We All Live in an Interaction Field

If we really want to understand the way consumers live, play, and work, we need to stop looking at the world of consumers and brands from the dated view of classical economists in terms of segments, categories, sectors, and industries. We need to stop thinking about competition and disruption, and adopt a new model of business built on collaboration, engagement, and participation.

We all live in an interaction field. When waking up in the morning, most of us check the mobile phone first (about 80 percent of us).[1] Whether you only look up the weather or you go over to LinkedIn or flip through Flipboard to read the morning news, or if you move over to Google and search or check the Dow Futures for the day’s expected swings in the stock market, you generate data about your every move. Your weather app connects to the Nest network that regulates the temperature of every room in your house and sends an alert to the electrical company and other providers who advise you to improve utilization or conserve energy.

As you go through the day, you leave a trail – a digital trail – that consists of data. If you drive a Tesla, 8 video cameras, 12 ultrasonic sensors, and a front radar will track your driving. The toll booth records your time, and when you stop by the grocery store, a geofence captures your arrival. The Starbucks nearby readies your favorite latte as you approach within a few hundred feet based on your mobile phone location – no need to wait in a queue or even pay, just drive up and get your daily fix.

I call this digital trail “interactions.” I see an entire field of interactions, a world of hyper-connectivity where everything connects anywhere and anytime. I don’t mean that we are being tracked and we all should be worried about our privacy now. No, I mean we quickly approach a world where everything connects – companies, brands, consumers, and things. As Douglas Rushkoff says, “We don’t ‘go online’ by turning on a computer and dialing up through a modem; we live online 24/7.” [2]

And it is already happening because of technology. An example is the Internet of Things (IoT). IoT is the technology that connects everything from thermostats, cars, your toaster or refrigerator, lights in your home, the alarm clock, or your Bose stereo system. Social media technologies connect people, and APIs connect different computer systems from different companies.

In the future, the physical world will seamlessly merge with a fully flushed-out digital world. It is called the “Mirrorworld” by Kevin Kelly.[3] Kelly describes a future where converging technologies create a mirror world that sits on top of the physical world, the mirror world being a complete digital replica of the real world. I think this world already has arrived in parts.

In China, 1.1 billion people live and work on the WeChat app. Oh, it would be ridiculous to call this an app. It is more like an operating system. Users rarely, if ever, leave it throughout the course of the day. You can do everything on WeChat including messaging your friends, buying groceries, hailing a ride and even booking a doctor’s appointment or getting married, if you wish. Its stated purpose is “to embed itself in every moment of the user’s daily life, from morning till night, anytime, anywhere.” Already today, WeChat is so interwoven in people’s daily life – you practically can’t do anything without WeChat.

If you are a company or a brand, and you want to grow your business, drive new innovation or build a brand, you need to understand the interaction field of consumers and you need to define the field that is relevant for you. It does not matter whether you are in the grocery business, the fishing business, if you sell laptop computers or accounting software, or if you provide tax services in Deadwood, South Dakota. Yes, there are people living in Deadwood. Here are a few things that I would consider:

Framing the Interaction Field

The first question to ask yourself is, “what am I solving for? What challenges am I solving, and what frictions am I removing in the lives of consumers? What jobs are to be done? What pain points really matter today and over time to consumers and society at large?”

It isn’t helpful here to start thinking about your products, services, or assets and capabilities. You won’t see the opportunities if you think from the inside-out.[4] Luckily, a lot of good sources exist that can help you define the right problem to solve for.[5] There is more than enough written on framing and writing a purpose. A good recent source can be found here: [6]

Define the Participants who Create Value

The next step is to define the full set of companies, brands, institutions and people who create value and solve the challenges, pain points, jobs to be done – or, shall I say, the needs and wants of consumers. I look at interactions in three ways, those in the nucleus. In a platform business model, this would be the two sides of a marketplace like riders and drivers in the case of Uber. In a traditional pipeline business, it would be the company or brand and existing customers. The next level are the ecosystem participants, and finally there are market-makers.

I also define the core interactions that create value between ALL the participants. This helps to define the relevant interaction field. If you are a company like John Deere, your nucleus consists of farmers riding John Deere tractors. They are the core participants. In the ecosystem are participants like crop manufacturers or fertilizer companies that all contribute to the job to be done – to increase the profit per acre of farmland or to reduce water usage. But there are also market-makers who influence value creation in the field – both the actual land and the interaction field. The Department of Agriculture strongly influences it, as do other participants in the food chain including consumers like you and I with our nuanced food preferences, the retail trade and food companies.

Make it easy to participate and share

In this step, I look at technologies and other ways that enable interactions and in particular the frequency and quality of interactions. It is very important to understand how interactions create value, which participants create value and how value is not just captured but shared out to the larger interaction field. GoPro is a camera company that helps amateur surfers make videos of their exploits on the water much like pro surfers do (hence the name GoPro). It invested significantly in technologies that makes it incredibly easy to capture, edit and share videos on the GoPro channel and all major social media networks. Today, the GoPro channel has one of the highest levels of engagement, participation, and interaction among social networks. The higher the frequency and quality of interactions, which I call velocity, the more the participants in the interaction field benefit – everyone shares, and everyone benefits.

Define the value that can be created and how it can be shared

To maximize the interaction field, it is necessary to determine how the interactions in the field create value and how everyone benefits. This requires understanding the role of network effects, viral effects, and learning effects. It is a difficult challenge. This also requires defining proper governance mechanisms between the participants. MoviePass is an example that failed because its service benefited moviegoers but not movie theaters. At $10 a month for a relatively large number of movies, it was a deal too good to be true for frequent visitors, and for participants who ran concessionary stands, but theater owners had lower admission revenues. This is called “negative externalities” and is a good example of a flawed governance mechanism.

Ultimately, the entire system – the interaction field that you choose to build, manage or orchestrate, needs to benefit everyone including companies or businesses, customers and society. It’s about shared value, not just shareholder value.

Conclusion

If we understand the relevant interaction field where a company or brand seeks to create value, we have a much better foundation to solve some of the challenges, problems, and jobs to be done that matter today. There can be goodness in digital, in data, analytics and technology. Interaction fields don’t pigeonhole consumers into segments. They don’t create artificial boundaries or barriers between categories or industries to build monopolies and protect or preserve them. Interaction fields transcend these groupings or clusters of same products or services and set the sights on the interactions that create shared value for everyone.

If you are interested in more information about this approach, please feel free to contact us.