Why Trump Won: Fairness and Change

Donald Trump won the 2016 US presidential election because of two issues: Deep concerns about the fairness of American government, and an intense desire for change. That's a different story that we've heard from many commentators (link), but I'm confident in my opinion because I heard it directly from Trump voters. Below I'll share their voices with you, and tell you how I found them.

This post grew out of an experiment I ran at UserTesting (my employer). I wanted to see if our technology could be used to gather public opinion info. I was pleased with the results, and wanted to share them. At a time when most people are focused on talking, think of this post as an opportunity to listen, and maybe get a better idea of what the whole election meant.

Background. Like many people in Silicon Valley, I was surprised and worried by the recent election of Donald Trump. I didn't understand why so many of my fellow citizens would vote for someone who had such obvious personal flaws. There were plenty of explanations in print and online, but most of them came from the same people who predicted the election wrong. I didn't trust their analysis; I wanted to hear from Trump voters directly.

Fortunately, I had a way to do that. UserTesting runs a system to give companies fast user feedback on websites and apps. You come to us, describe the demographic you want and the tasks you want them to perform, and we recruit normal people to record themselves doing the task. The whole process is automated and extremely fast – you start getting videos back in as little as one to two hours.

I figured I could probably use the same system to run interviews with voters. Instead of testing a website or app, the participants would just answer written questions about the election.

What I learned. I reached out to Trump voters the day after the election, and within a few hours I had all the responses. As you'd expect, there were many different motivations, but I think two threads connected the Trump voters:

--They feel the system in the US is unfair, and is being exploited by people who cheat on the rules.

--They felt that Donald Trump, as an outsider, was the best bet to change the system. Hillary Clinton's long history in government worked against her with many of these voters, because it meant she was seen as a product of the system rather than a change agent.

Trump stood for change. Clinton stood for continuity. Change won.

Don't take my word for it. Below are recordings of the Trump voters, explaining the decision in their own words. First there's a sampler with highlights chosen by me, followed by the full recordings of each interview, so you can judge for yourself. A few notes:

--To protect the privacy of the participants, I did not record their faces, and I have removed any references to their location. All you'll get is a black screen and their voices.

--The participants came from all over the country, and range in age from their 20s to their 60s.

--There are nine recordings. Before anyone objects, I know that's not enough for a statistically significant sample. But statistically significant surveys failed us during the election; do you really want another one? These recordings are more like a focus group, except it was completed in hours instead of weeks, each interview was separate, and the questions were written. So there's no groupthink and no moderator bias. This sort of research won't tell you the exact percentage of people who hold a particular view, but it's excellent for understanding why they think as they do, which is what I wanted.

Here's my highlight reel of Trump voters talking about their choice:

Other issues: What's the mandate?  The full interviews are much richer than my summary, and I encourage you to listen to them. Here are some of the issues that stood out to me:

--The vote was a very difficult decision for some of them. I was humbled by the amount of thought they put into it.

--Some were motivated by intense distrust or hostility toward Hillary Clinton.

--Some were motivated by opposition to abortion.

--There was not a huge amount of hostility to immigration in and of itself. Some of the participants went out of their way to acknowledge the contribution of immigrants. What bothered many of them was illegal immigration, because that was viewed as cheating. Sometimes that was paired with concerns about citizens who cheat on government services. It's the fairness aspect that bothers them: "I'm working hard to make ends meet; it's unfair when others don't follow the rules."

--Although I didn't ask about it, several people mentioned health care costs. They said health insurance prices have gone up dramatically in the last few years, despite President Obama's reforms. In fact, some blamed him for the rise in premiums.

--There was a lot of desire for reconciliation with the part of the country that voted for Clinton. Some of the Trump voters went out of their way to say that they want more cooperation in the country, more equality, and less racial tension.

Overall, I think it's fair to say that the election was a mandate for dramatic change in the system and for increased fairness. That's especially vivid when you think how close Bernie Sanders, another advocate of change, came to the nomination on the Democratic side.

I don't think the election was necessarily a mandate for every other proposal that was floated during the election. In the recordings you'll even hear some Trump voters scoffing about the border wall, and saying they don't want Roe vs. Wade overturned.

I think the election result was a cry for help from people who thought Trump was worth the risk. As one woman put it: "I decided to go with Trump...because I thought maybe he could make a change and he could make a difference, and I am praying that I am right."

You're not the only one, sister.

Here are the full interviews:

What do you think? I'm going to take a chance and leave comments open. I'd love to hear your thoughts on the interviews and what they say to you. But please don't vent, and don't criticize the interview participants. They had the courage to share their thoughts candidly, and deserve to be treated with respect.

PS: Although UserTesting allowed me to do this research, I did it on my own time, because I wanted to understand the election, and I was curious to see if our tool could be used this way. I used personal time to edit the videos, which is why you're seeing this several weeks after the election.

PPS: If you're wondering why I put a political post on a technology blog, stay tuned. There is a connection, which I'll explain in future posts.

The Real Meaning of the Fire Phone

People have been asking my opinion of the new Amazon Fire Phone, but I’ve had a lot of trouble answering. My first reaction was overwhelmingly blah. I’ll be curious to try it, and maybe then I’ll feel better about it. But right now it seems to me like a bag of interesting features rather than a coherent product. (Quick, what do faux 3D imaging and a year of free mail order shipping have in common? Absolutely nothing.) Plus it’s available from only one mobile operator, and the pricing isn’t low enough to get anyone excited. I’m delighted anytime a major company tries to innovate, but I can’t imagine this phone having a huge impact on the market.

Many others are neutral to downright hostile. BGR wrote, “Amazon innovated in all the wrong places.” (link). And CNN said, “if you're happy with your iPhone 5s or Galaxy S5, there's no compelling reason to change” (link).

So why did Amazon build this product?  Ben Thompson made a good case that the phone is designed to strengthen Amazon’s relationship with its lucrative Prime customers (link). I’m sure that’s part of the motivation. But if that’s the only goal, wouldn’t you price the phone very low to grab more customers, the way you did Kindle? And as Ben himself noted, there are many other things you could do to more directly recruit Prime customers. For example, many of the Fire Phone apps could have been released separately for Android and iOS. Wouldn’t that be a better way to serve Prime customers? Rather than trying to rip people away from their iPhones and Galaxies, why not just co-opt them through some apps that run on their current phones? What Amazon’s doing is like selling your own line of sofas as a way to distribute slipcovers.

And so I go back to wondering why Amazon did it. Imagine you’re Jeff Bezos. You have a fairly stable relationship with Apple and many other phone companies at the moment; why turn yourself into their blood enemy for a product that that won’t move the needle in sales?

To me, the Fire Phone reeks of experiment. I think Amazon’s testing something, and the experiment is important enough to spend a ton of money and create a lot of competitive hostility. After thinking about it a lot and trying to look at the world through Amazon’s eyes, I think I can guess why the Fire Phone would be strategically important to Amazon. I believe it’s not about the phone market; it’s about the evolution of mobile commerce and the future of Amazon itself.

To explain why, I have to give a bit of background on mobile commerce. For online retailers, the single most frustrating thing about mobile technology, especially smartphones, is that it people using it don’t buy a lot of stuff. They’ll browse in your web store and use your shopping app, but when it comes time to buy they often don’t purchase. The industry rule of thumb is that a good commerce site on a personal computer will convert about 3% of shoppers to buyers (in other words, for every 100 online shoppers you make three sales). The conversion rate for smartphones is a third of that, about 1%.

In an industry that would kill to improve conversion by a tenth of a point, that drop from 3% to 1% is horrifying. Many commerce companies have spent years trying to fix it, and through incredible effort and careful experimentation it is indeed possible to increase the mobile conversion rate. In my day job at UserTesting that’s one of the things I help companies do. But it’s a slow process of incremental fixes, and in the meantime mobile web use is growing explosively. Here’s the nightmare scenario for an online retailer:

—What if the next generation of internet users moves to smartphones and wearables faster than we can figure out how to fix mobile shopping?

—What if, as people move to mobile, the conversion rate for our whole business drops from 3% to 1%?

—And most disturbing for a category leader like Amazon, what if the low conversion rate on mobile is a sign that the online store itself is not a good fit for smartphones? What if some new mobile technology or app makes online shopping obsolete, just as online stores have been making traditional retail stores obsolete? What if Amazon itself is the next big tech dinosaur?

Don’t laugh. Platform transitions in tech usually make the old category leaders obsolete. Read about Lotus Development or Digital Equipment Corporation if you don’t believe it.

That existential threat is the kind of thing I’d expect Jeff Bezos to worry about. It’s a huge change that comes from an unexpected direction and could cut the heart out of his business. What’s worse, by the time the threat becomes obvious it’ll probably be too late to respond to it.

So the time to act is now. Amazon needs to dive into mobile and figure out what the shopping experience would look like if you built it into a phone from the ground up.

If that’s Amazon’s motivation, then the Fire Phone is really all about Firefly, Amazon’s instant-buying technology. I think the question being tested is whether you can completely replace a web store with a properly configured phone. What if, instead of going to an online store to buy something, your phone itself became the store? What if, instead of searching for the thing you want to buy, you could just take a picture of it, or scan its barcode, or say its name? 

Amazon everywhere. Futurist Paul Saffo put it this way: “Firefly allows Amazon to invade every store in every mall on the planet and turn it into a de facto showroom for Amazon” (link). I’d go even further. I’d say Firefly is an effort to turn the entire world into an Amazon store.

If Amazon makes that phone first, it takes another big chunk out of Walmart and Target and eBay and every other retailer out there, physical or virtual. If someone else makes it first, Amazon itself is in mortal danger.

I think that’s why Amazon had to make a phone. It needs to test and tune the integration of mobile hardware and software in the purchasing process, and that would not be possible on someone else’s phone. It also doesn’t want to share the data it’ll collect with any other phone vendor (especially not one allied with Google), since that could be the key to the future of the whole company. 

From this perspective, the rest of the Fire Phone announcement makes more sense. You need to toss in a few sexy features, like the semi-3D screen, to attract some users. The price doesn’t have to be low because Amazon doesn’t want to sell a gazillion phones. One carrier in one country is enough because Amazon’s not pushing for world domination yet. It needs just enough users to give it a robust experimental base. Then it’ll observe, and it’ll learn, and it’ll tweak the experiment, and it’ll learn some more.

And then, when it gets the formula right, we’ll see the real Amazon phone. I’d expect it to be more aggressively priced and much more broadly available. I wouldn’t be surprised to see Amazon also release Firefly apps for other phones at the same time. By that point Amazon’s priority won’t be secrecy, it’ll be rapid domination.

Or maybe the experiment will fail. Maybe Amazon will learn that there is no magic way to turn a smartphone into a store. In that case it’ll quietly make the phone disappear, write off the losses, and move on to other priorities. Hey, it’s just money, and we all know how Jeff Bezos feels about that.

What it means for the rest of us

Do you remember back when Google was just getting started in smartphones, and there was widespread speculation that Google would give away a phone with free wireless service? The idea was that the things Google would learn from the user were worth more than the cost of a phone service plan. That idea faded away as Google focused on co-opting rather than destroying the mobile industry, and as it realized that it couldn’t make enough money from phone users to pay for the service.

It might be time to revisit that scenario. If anyone can figure out how to make a free phone pay for itself, it would probably be Amazon. Even if it can’t give away a phone for free, it might be able to offer steep discounts, putting the rest of the phone industry at a huge disadvantage. If you’re Google or Apple, you don’t have the sort of retail back end that Amazon does, so you can’t directly match that strategy (although Google might try). A better option is to team up with the other companies threatened by Firefly. Perhaps you create a Firefly-equivalent app and open it to connectivity with anyone else’s online store in exchange for some sort of revenue sharing.

That approach requires heavy skills in alliance building. Apple might be able to pull it off, but they tend to work exclusively with a small number of subservient partners. Google could try for a broad alliance -- it likes to do everything big -- but I doubt it has the focus and consistency to create a lasting partnership of equals with large numbers of companies. (In that vein, it’s meaningful that Google started on a path similar to Firefly back in 2010 with Google Goggles, but killed the product a few weeks before the Fire Phone announcement because it was “a fun feature, but also a feature of no clear use to too many people” link).

So Amazon’s potential strategy plays to the weaknesses of its biggest competitors.

I wonder if Apple might be willing to build a long-term partnership with Amazon, instead of competing against it. In addition to cooperating on mobile commerce, Amazon could help Apple with its portfolio of online services, a constant weakness of the company. Steve Jobs would not have done it; I think Tim Cook might.

If you’re an e-commerce company, you should investigate the Firefly APIs. It looks like you can plug into the Firefly system to make your own offers when a user scans an object. You’ll still need to convince users to install your plugin, but at least this will give you options. Besides, you need to learn how this new shopping paradigm works.

If you’re a bricks-and-mortar retailer, I think you shouldn’t waste time worrying about people using your store as a showroom for Amazon. You can’t stop that anyway. Instead, look at how you can enhance the shopping experience by embracing smartphones. To give one example, what if every product in your store had a QR code that took a smartphone user to your page for that product, with additional information, FAQs, and special offers? I’d love to have that in one of the box box retail stores where you can never find a sales rep. You’d enhance the shopping experience and maybe intercept shoppers before they turn to Amazon. Plus you’d get data on what people actually do inside your store.

I’m kind of surprised that Apple and Google haven’t already built a QR scanning app into their mobile platforms. It’d be a logical way to partner with retailers and get leverage against Amazon.

If you’re another mobile phone vendor, such as Samsung, you should talk with Amazon about integrating Firefly into your phones in exchange for a cut of the revenue. Better to embrace the company now than to risk competing against a heavily-subsidized Amazon phone in the future.

And for anybody who deals with mobile, the Fire Phone is a reminder that we’re just getting started. Although we talk of smartphones as a maturing market, we’re barely beginning to learn how mobile devices will change our lives. We stand in the foothills of the Himalayas. The biggest mobile opportunities, and the biggest disruptions to today’s businesses, are still ahead of us.


What Happened to the Surface Mini?

Well, that was disappointing.

Microsoft’s heavily-rumored mini-tablet (link) was a no-show at the Surface event this week. If this had been an Apple announcement, I’d just say the Internet got carried away with itself. But the source of the rumors was the very reliable Mary Jo Foley at ZDNet (link), who’s almost a house organ for Microsoft official leaks. So what happened?

It’s possible that Microsoft leaked the rumors deliberately in order to smoke out Foley’s sources, but I don’t think Microsoft would have put Qualcomm in the story if that were the case. Most likely the product was real, and the announcement was canceled just recently.

Bloomberg says Microsoft execs Stephen Elop and Satya Nadella lost confidence in the product and decided to pull it at the last minute (link). That would be a typical move for a new management team – you always look to kill a few of your predecessor’s projects to put your own stamp on the organization. The reasoning that Bloomberg gave didn’t make sense, though. The report says the mini-tablet was canceled because it didn’t have enough differentiation. A tablet optimized for note-taking and equipped with a stylus would have been heavily differentiated, so that doesn’t wash.

More believable would be if the company is leery of launching any new product that depends on Windows RT, the ARM-based version of Windows that can’t run normal Windows apps. RT has failed to achieve significant momentum in the market, and I could see Elop and Nadella being very cautious about risking another RT-based product flop. More prudent to pull it now, ship the Intel-based jumbo Surface tablet, and do a minitablet later, if at all, based on Windows Phone. The jumbo product won’t change the world, but at least it won’t embarrass Microsoft.

If that was the call, it’s a prudent decision that totally misreads the market for mobile devices. RT was a bad choice for full-sized Surface tablets because they are too close in price and size to notebooks. No Windows user wants a notebook that won’t run Windows apps. But a minitablet could have been sold as an information appliance, for which full Windows app compatibility is much less important.

This situation illustrates why the tech industry has so much trouble creating truly new device categories. Small startups have trouble scraping together the money necessary to do a really different product. Doing it right often takes on the order of $20 million, more than you can easily raise from VCs or Kickstarter. Big companies have that sort of money, but they’re usually risk averse and would rather stick to established categories of product. Which is what Microsoft just did.

Ah well, the net impact is that Microsoft has now whiffed twice on the minitablet market, once with the twin-screen Courier product and now Surface mini. I wonder if they’ll get a third chance.

I’ll also be interested to see what the last-minute cancellation costs Microsoft. If they were close to launching, there will be parts and manufacturing contracts with big cancellation fees. Presumably Nadella will be doing some sort of restructuring of the company in the near future – new CEOs always do – and the writedown, if any, can be buried in that.

Meanwhile, someone at Microsoft is probably sitting on a roomful of Surface Mini prototypes that are headed to a shredder. I have one humble request: Could you please slip one of them to me?

Is Microsoft About to Announce an Info Pad?

The reports leaking out of Redmond are intriguing. Tomorrow (May 20, 2014) Microsoft will reportedly announce a “Surface Mini” tablet, a touchscreen device in the same size class as an iPad Mini but equipped with a stylus and note-taking software (link).

Most of the press reports have focused on the chip vendor (link) and comparisons to the iPad Mini, but what most of them seem to miss is that this may be a new category of mobile device. The Surface Mini as described in the reports sounds very much like an info pad, a tablet optimized for managing business information and taking notes in meetings.

That product opportunity has been evident for at least ten years. It has a very distinct customer base that is more interested in business productivity than in playing games or listening to music. When I was at Palm, we studied the market closely, and later I tried to pull together a startup to build one (that evolved into Zekira, the software startup I’m working on now).

Although you can use an iPad for business functions, a device optimized for notes and business productivity could be far more compelling than an iPad for that particular usage and for those particular customers. But the price has to be right and a ton of little features have to be done correctly. And you have to market it properly, so it looks like the ultimate replacement for the paper notepad rather than a debased iPad. The right product is an appliance for business info, not an iPad that happens to have a stylus.

I’ve written about the info pad opportunity in the past. You can read about it here.

Is this the vision Microsoft’s shooting for? Will it get the details right? I’m more intrigued by this announcement than by anything else Microsoft’s done in years. Stay tuned.

The Uncomfortable Truth at the Heart of Mobile Gaming

I was at a developer conference earlier this year, and the discussion came around to a certain very popular pattern-matching game. I was surprised by how much hostility I heard.  “That thing,” one developer fumed, “is just a slot machine.”

At the time I chalked it up as jealousy. Sure, many mobile games have random elements, but the best ones also require a lot of thought. That’s nothing like a slot machine.

But as I learn more about mobile gaming, I start to see the developer’s point. Most people outside the game industry don’t realize that free-to-play games, by far the most successful mobile game category, are often supported financially by a very small number of users who pay extravagantly for power-ups, extra lives, and in-game currency. The whole point of many successful free-to-play games is to identify these “whales” and extract as much money as possible from them.

The discussion of this process at mobile conferences is sometimes uncomfortable. Non-paying players (the great majority of a game’s users) are often dismissed as meat to be fed to the whales. An intense amount of thought goes into not just identifying the whales, but determining their individual psychology and the best techniques to pull more money from that particular type of person. Players are tracked in as much detail as possible, including exactly which promotion they responded to, what their purchasing pattern is, and any other details the developer can glean from them. Every aspect of the game is crafted to maximize revenue extraction, including minute changes in graphics, button designs, and subtle changes in game play. Anything that creates even a small fraction of one percent change in a conversion rate can mean the difference between a successful and unsuccessful game, so the pressure to constantly refine everything is immense.

At its recent F8 developer conference, Facebook gave a great overview of this process. You can view it here.

At several recent conferences, I’ve heard developers say they’re starting to realize that there seems to be no upper limit on the amount of money you can extract from some users. Do you think offering a bundle of power-ups for $50 is outrageous? Create a bigger offer at $100 and you’ll make even more total revenue.

This process of systematically designing games to extract revenue, and targeting offers at the biggest whales, makes many game developers uncomfortable. In an excellent essay on Gamasutra, Mike Rose wrote, “Free-to-play games aren't after everyone for a few dollars -- they're after weak people in vulnerable states for hundreds, if not thousands.” (link)

Many game developers take issue with that statement. They point out that there’s nothing wrong with accepting money from people as long as they’re in control of their actions. Some people just plain like playing mobile games and are happy to spend money for a better gaming experience. What’s wrong with letting them pay? Besides, if a console gamer buys an Xbox for $300 and a bunch of games worth $700, we wouldn’t call the console industry exploitative. Why should mobile games be any different?

But the discussion at the conferences sometimes sounds a lot like gambling executives trying to talk their way around the problem of compulsive gambling. And sure enough, there are efforts to create an ethical code of conduct for free-to-play game developers, defining how far they can and cannot go to pull money out of a customer (link). You don’t usually get a code of ethics for an industry unless it has a potential ethics problem.

Meanwhile, what’s very clear is that successful free-to-play game development is much more about science than art. I think many game developers were drawn to the field for the art -- they want to create the most engrossing, glorious game experience they can; the game equivalent of a blockbuster movie. I think about the awesomeness that was Marathon and Myst on the Macintosh, or the surreal weirdness of Badland on iOS (link), and that’s the sort of pure mind-bending joy that I want from a mobile game. The idea of systematically altering that experience to extract another purchase from 0.5% of the users feels fundamentally wrong, and probably explains some of the developers’ complaints.

But rather than dismissing their complaints as frustrated idealism, I think it’s a good idea to listen and think about where the industry is going. I think the code of conduct is a very good idea; without it, we could easily end up with government regulation of free-to-play gaming, and I can’t imagine how that could be effective without destroying the category altogether. It would also be a very good idea to develop other new revenue streams to support mobile gaming. That’s why I’m always interested when someone like Facebook claims they can fix mobile advertising. You may not love the idea of mobile games becoming like commercial television, but I think we’d all be a lot more comfortable pushing an occasional ad at every user rather than trying to extract $1,000 from 0.5% of them.