Monday, November 07, 2005
Nothing Is Free
Perhaps I should have taken an economics course in college -- it's one of my few educational regrets, actually.
I realized that in a typical going-out-to-the-movies experience, you'll possibily encounter multiple different sorts of transactions.
There's the obvious direct translation of cash into a product, service, a set of information, or a combination of all of the above. So in a movie, there's some that goes for the various services involved with keeping the theater clean, functioning, and providing the entertainment that you want. There's also the price to produce the information (ie, the movie) that you are watching.
And that leads to advertising. When something carries adverising, instead of you buying the product, another organization is paying the advertising vehicle's ability to deliver a set of eyeballs.
Also, the movie theater may have a loyality program. With this, you'll occasionally get free movie tickets, or discounts at the concessions stand. Really, what you're doing here is "selling" information, and also perhaps doing something similar to "buying in bulk". I've no doubt that the movie theater can make lots of interesting conclusions by tracking when, what, and where people see any particular film. We get this same thing at supermarkets or other retailers as well -- patterns of what people buy, when they buy them, and how many things they buy. Even if they don't use that for targetting advertising later -- which in many cases they do -- there's still a lot of things that they can do with that data. For example, there's usually some obvious logic when they package two apparently unrelated items together for a sale. You see it with something like Amazon.com all the time.
That's all obviously key to what a company like Google is doing. They're collecting data -- all sorts of information. Most of us don't write checks to Google -- but they can collect information, based on what we link to, what we search on (and then follow), and so on.
I suppose this is all obvious. But also all quite relevant, especially as it becomes easier to use more and more information. Maybe.
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