Ethically gaining and maintaining users.
Mark Dimassimo: People reward companies, brands - and that, of course, includes social media platforms - that they feel are good for their behavior. And they punish brands, companies and social media platforms that they feel are, on the whole, bad for their lives by being bad for their behavior.
Dave Bittner: Hello, everyone, and welcome to "Caveat," the CyberWire's, privacy, surveillance, law and policy podcast. I'm Dave Bittner, and joining me is my co-host, Ben Yelin, from the University of Maryland Center for Health and Homeland Security. Hello, Ben.
Ben Yelin: Hello, Dave.
Dave Bittner: Today, Ben has the story of the Department of Homeland Security collecting substantial amounts of user location data. I've got the story of potential privacy legislation at the federal level that actually has a shot at passing. And later in the show, Mark DiMassimo - he's founder and creative chief of creative agency, DiGo. We're going to be discussing the challenges that social media platforms face when trying to reconcile their need for growth against their desire to behave in an ethical way for the benefit of their users. While this show covers legal topics and Ben is a lawyer, the views expressed do not constitute legal advice. For official legal advice on any of the topics we cover, please contact your attorney.
Dave Bittner: All right, Ben, we've got some good stories to share this week. Why don't you start things off for us?
Ben Yelin: So mine comes from Politico. It is by Alfred Ng, and it is about the Department of Homeland Security and Immigrations and Customs Enforcement collecting really a surprising amount of user location data. So this information comes from a records release from DHS as the result of a lawsuit from the American Civil Liberties Union back in 2020. These things take a long time. Finally, through the court proceedings, DHS was compelled to release some of these records. Some of them were released to Politico for this article, and then the ACLU released them publicly on their website.
Ben Yelin: What we've learned is that, starting in 2018, DHS harvested from a multitude of applications - over 300,000 location data points across North America. And this might only be a small portion of the location data points that are actually collected. I don't want to get too heavy into the details here, but there are a bunch of different contracts with providers, and this was information from one such contract. To lend further credence to the amount of data being collected, this one data company, Venntel - which I think we've referenced before on this podcast - when advertising to federal agencies, according to these records, marketed that they could potentially collect location data from more than 250 million mobile devices and could process more than 15 billion location data points per day, and that they could track users as they cross the border from Mexico into the United States.
Dave Bittner: Ah.
Ben Yelin: Yes - which is why this is of interest to Immigrations and Customs Enforcement and Customs and Border Patrol. And they are, again, just one company. There are several that are mentioned here that advertise similarly and that we know these types of services are being purchased by these agencies - by the Department of Homeland Security, Customs and Border Patrol and Immigrations and Customs Enforcement.
Dave Bittner: OK.
Ben Yelin: The reason this is allowed to work is that these companies, and thus these agencies, are taking advantage of the opt-in phenomena...
Dave Bittner: (Laughter) Right.
Ben Yelin: ...where we have an application on our phone. We want to use it. The application tells us they would like to use our location data. Sometimes it'll say - you know, it'll give us the option to only use it while the app is open. Sometimes it will give us the option to keep location data sharing on in perpetuity. And let's be honest, most of us accept these requests to use our location data as a matter of convenience.
Dave Bittner: Yeah. Or I would add ignorance - that we don't - it's buried in the EULA somewhere.
Ben Yelin: Exactly.
Dave Bittner: Yeah.
Ben Yelin: So nobody knows or anticipates that this is going to be shared with Customs and Border Patrol, Immigration, the Department of Homeland Security. Nobody thinks that their records are going to be caught up in this dragnet of the 330 million potential devices out there. So, yeah, I think ignorance is a part of it, but I don't want to minimize the importance of convenience. If I want to know where the nearest Panera is...
Dave Bittner: Right.
Ben Yelin: I'm going to accept location services 'cause it's just easier for me, and I'm just not in the frame of mind to think about what could potentially happen with this data.
Dave Bittner: Yeah.
Ben Yelin: What's important about stories like these is for people to realize that there is a cost to sharing your location data. And even though these companies insist that the data is anonymized, we know that in many cases it's not. You can reveal the identity of someone. We always use the example of - if somebody is going from this particular household to this business every single day, I think we'd have a pretty good idea, simply based on location services, about who this person is and where they're going.
Dave Bittner: Right.
Ben Yelin: There are some congressional efforts to put a stop to this type of purchase of location data collection...
Dave Bittner: Right.
Ben Yelin: ...At these various agencies. One is the American Data Privacy Protection Act - preview of coming attractions.
Dave Bittner: (Laughter).
Ben Yelin: And another, which was proposed last year by privacy advocate, Senator extraordinaire Ron Wyden, would have required federal agencies to obtain a warrant before purchasing Americans' data from data brokers.
Dave Bittner: Right.
Ben Yelin: So this is just another eye-opening story on the extent to which government agencies, without really releasing information publicly, is collecting vast amounts of data and the role that these companies, like Venntel, are providing as a service to these agencies.
Dave Bittner: Yeah.
Ben Yelin: And when they talk shop behind our backs, they might express some concern about the privacy implications. But really, they're interested in advertising how many pieces of data their technology allows them to collect.
Dave Bittner: Right (laughter). I'm just imagining, you know, an ad campaign that says, are you burdened by the pesky Fourth Amendment (laughter)?
Ben Yelin: Yeah, exactly. Who needs that pesky Fourth Amendment when we can go crazy and collect...
Dave Bittner: Well, let me ask you this, though, because we've talked about this before - about how the purchasing of this information is essentially an end-around of the Fourth Amendment - that it's an end-around where they do not need a warrant to gather this information because people have opted in to having this information tracked.
Ben Yelin: Right.
Dave Bittner: And that's problematic.
Ben Yelin: It is.
Dave Bittner: And I'm with you 100% that this - I would call it a loophole - should be closed. What I'm wondering about is, if my job - like the Border Protection folks - if my job is protecting the border, and I've got people coming over the border who I'm trying to keep from coming over the border, and they are not citizens, where does that put me in terms of Fourth Amendment protection and whether or not this data is in play or not?
Ben Yelin: So the Fourth Amendment applies to U.S. citizens and persons legally allowed in the United States.
Dave Bittner: Right.
Ben Yelin: So the legal term of art, which sounds kind of meaningless, is U.S. persons - basically, any legal resident or citizen of the United States.
Dave Bittner: OK.
Ben Yelin: The Fourth Amendment, according to precedent, does not apply to non-U.S. persons, and it does not apply extrajurisdictionally. So it does not apply in other countries unless it's searching a U.S. person while they are on foreign soil. And then there is Fourth Amendment protection, although it's somewhat diminished. So for somebody who is undocumented who comes into this country, they don't - because the Supreme Court has said that they're not part of the national community - which, obviously, we can have our own moral and ethical debates about that question...
Dave Bittner: Yeah.
Ben Yelin: ...At least as far as the Fourth Amendment is concerned, they're not necessarily protected. The problem is that there are many folks who are not undocumented who are going to get caught up in this dragnet. And even if, from a legal perspective - people who cross the border into the United States without documentation - even if they're not protected in a legal sense, I think there is a sort of moral - at least a moral quandary about whether we should be engaged in this type of precise location tracking. At the very least, we should have some transparency. So there should be some sort of public debate within Congress, or at least within these agencies, about whether it's worth it from a public policy perspective to engage in this type of tracking. That debate is really happening behind closed doors, out of the public view.
Ben Yelin: For example, in this article, they talk about a 2019 incident where the acting privacy officer for an office within DHS ordered that specific division to stop projects, including involving Ventell data, because of unanswered privacy and legal concerns, and Ventell had to submit information on their privacy practices to DHS. All of that happens out of the public view. We only find out about these things when they're released as part of some sort of records request, and that might be several years after the program has been discontinued or several years after the introduction of the program, when it's already been collecting information on all of us for five, 10 years, whatever.
Dave Bittner: Yeah.
Ben Yelin: So I think even if you support a policy of engaging in this kind of location data tracking, at least it should be something that's more transparent than - ACLU puts in a records request in 2020, and we get information on it in 2022.
Dave Bittner: How much does this sort of thing swing back and forth depending on who's in office? In other words, is this the kind of thing where, you know, during President Trump's administration, they said, hey, have at it - this is great - and then President Biden comes in and says, hey, knock it off - we're not a fan of this?
Ben Yelin: Not really.
Dave Bittner: No?
Ben Yelin: I mean, this started - this particular tracking started under the Trump administration.
Dave Bittner: OK.
Ben Yelin: So the way the article is framed is that the Trump administration - their immigration enforcers used mobile location data to track people's movements on a larger scale. I'm not sure I necessarily agree with that framing. To use a favorite term of the former president, this feels like kind of a deep-state operation...
Dave Bittner: (Laughter).
Ben Yelin: ...Where the president...
Dave Bittner: Oh, Ben (laughter).
Ben Yelin: I know. I'm becoming - this is for our more conservative users, to prove that I don't have a liberal bias.
Dave Bittner: OK.
Ben Yelin: This is something that happens kind of at the sub levels of government...
Dave Bittner: Right.
Ben Yelin: Where I don't think the president, him or herself, is intimately involved in the details of these contracts. And as I've explained, I think, a number of times, any president who's against these things theoretically during a campaign - once they realize how awesome these tools are when they get into office, and you have intelligence officials giving you a briefing, saying, here's the threat landscape and here's what we're doing about it...
Dave Bittner: Right.
Ben Yelin: ...All presidents are going to be hesitant to say, you know, let's give up this tracking tool.
Dave Bittner: Yeah.
Ben Yelin: It undermines people's personal privacy. It's just - that's just not really a thing that happens. And from the information we currently have, there's no indication that the Biden administration discontinued any of this type of collection.
Dave Bittner: I see.
Ben Yelin: So Biden and Trump do have very different policies as it relates to immigration enforcement. Certainly, as to what happens to migrants at the border, there are differences in policy, but I think this is something that's been consistent across the two administrations.
Dave Bittner: OK. All right. Well, interesting for sure. We will have a link to that in the show notes.
Dave Bittner: My story this week comes from WIRED. This is an article written by Gilad Edelman. It's titled, "Don't Look Now, but Congress Might Pass an Actually Good Privacy Bill." (Laughter) So this is...
Ben Yelin: I am not holding my breath.
Dave Bittner: Oh, well, Ben, come on. Let's try not...
Ben Yelin: We'll give it a chance. Let's give it a chance.
Dave Bittner: ...To be cynical. It's - this is the American Data Privacy and Protection Act, and there is a new version of this that was posted recently. I guess this is the House version of this bill, and this seems to have a lot of bipartisan support. And this article goes through some of the key elements of this bill. They say, in this article, perhaps the most distinctive feature of the new bill is that it focuses on what's known as data minimization. So companies would only be allowed to collect and make use of data if it's necessary for one of 17 permitted purposes spelled out in the bill.
Ben Yelin: Seems like a lot of purposes.
Dave Bittner: Well, it does. But the downside is, one of the purposes is - wait for it - targeted advertising (laughter). So - but it limits that. And you know what? I think this is an interesting effort and compromise, I guess - to see the compromise that's on display here, right? Would you agree with that?
Ben Yelin: Yes. So if this were the only train leaving the station as it relates to data privacy legislation - and I suspect it is - this would still be a major advancement in data privacy.
Dave Bittner: Right.
Ben Yelin: Because at least you're introducing a minimization regime where the Congress and the president, presumably, who would sign this bill - they are indicating that there should be limits on how much data is collected from individual users. Even if those limits are rather broad and contain significant exceptions, at least there is a focus on data minimization really for the first time. 'Cause, as we've seen, data privacy regulation at the federal level is virtually nonexistent, except as it's confined to specific industries - so something like a health care provider is going to be constrained by HIPAA.
Dave Bittner: Right.
Ben Yelin: But for everybody else, it's a little bit of the Wild West. So even if this legislation were not perfect, it would still be a step in the right direction.
Dave Bittner: Yeah.
Ben Yelin: That's really expressed here in the quotes in this article from people who are advocates of data privacy. They're saying this would be a major step in the right direction. It's a data minimization approach first, and then they list the potential exceptions where you are allowed to collect data. I think the tangible effects of this bill are substantially minimized by the fact that they would allow this type of targeted advertising...
Dave Bittner: Yeah.
Ben Yelin: 'Cause that's where so much of the data collection lies, that in practice, I don't think you'd be cutting down on that much in terms of violations of data privacy. But it would certainly be a start, and you always have to start somewhere - making some progress and establishing that there are limits to the type of data that can be collected, and that there's sort of a default that data can only be collected for a prescribed purpose. I think that's a major step in the right direction.
Dave Bittner: Yeah. You know, the example they use here I think is interesting. They say that you will be allowed to be targeted based on first-party data. So the example they use is - let's say you go and shop for a pair of shoes at target.com. So as you go around - and then let's say you go on Twitter, right? You'll see ads for shoes from Target on Twitter. That's first-party data.
Ben Yelin: Right.
Dave Bittner: You went and - you were looking on Target. Target, you know, put a - dropped some sort of, you know, cookie or something to know who you are, and now Target's going to remind you about those shoes you were interested in. What this gets rid of are the trackers that folks like Facebook and Google put on websites all over the world...
Ben Yelin: Right.
Dave Bittner: ...To build a specific profile of you. And I think those are very different things.
Ben Yelin: Right. That's why I think the bill is certainly worth it. Even if you are not going to cut down on that first layer of advertising...
Dave Bittner: Yeah.
Ben Yelin: ...As a means to collection, the general practice of aggregating somebody's data, creating a profile based on demographic characteristics, that sort of thing - that really is something that this bill would cut down on. And getting something as strong as that into a bill that passes the House Energy and Commerce Committee by a vote of 53-2 is very encouraging. You have a bipartisan consensus on really the heart of the problem, which is how organizations and sometimes government agencies can put together a dossier on each of us individually based on our internet habits. And I do think that this bill would put a end to that practice, even though it would leave open this pretty large loophole for that first layer of advertising.
Dave Bittner: Yeah. I'm curious - there was something that caught my eye in here that I wanted to ask you about. They say that, since 2019, a bipartisan agreement has supposedly been just around the corner. The effort kept stalling because Democrats and Republicans were divided on two key issues - whether a federal bill should preempt state privacy laws and whether it should create a private right of action, allowing individuals - not just the government - to sue companies for violations. Democrats are generally against preemption and in favor of a private right of action - Republicans the reverse. Now, I get the private right of action part. I don't - or, I guess, could you clarify for me - what did Democrats have against the preemption part of this?
Ben Yelin: So if there were preemption, then the federal law would preempt any state-level data privacy laws.
Dave Bittner: Right.
Ben Yelin: Congress would be occupying the field in this particular area.
Dave Bittner: OK.
Ben Yelin: And the reason Democrats don't like it is whatever Congress comes up with isn't going to be as strong or as robust for data privacy as CCPA, for example, or the data privacy law in Virginia, and it wouldn't allow states to outcompete each other in terms of protecting digital privacy. So we've seen this in other areas of the law, where there is a race to the bottom or a race to the top.
Dave Bittner: (Laughter) Right.
Ben Yelin: If Congress steps in and says, we're occupying the field of regulation in this area, it's within our domain - you know, it has to be something that Congress is authorized to do in the first place.
Dave Bittner: Yeah.
Ben Yelin: So it generally would have to relate to interstate commerce, for example.
Dave Bittner: OK.
Ben Yelin: Clearly, with data privacy, you can form that nexus. I mean, this is a national industry. It certainly crosses state lines.
Dave Bittner: Yeah.
Ben Yelin: This certainly would have a substantial effect on interstate commerce. But yeah, the reason that Democrats would be against preemption is they don't want to hamstring the blue states that try to come up with very robust privacy regulatory regimes. They don't want the federal data privacy law to be the ceiling. They want it to be the floor.
Dave Bittner: I see. Hmm. I mean, this really strikes me as not letting the perfect be the enemy of the good.
Ben Yelin: Yeah. So there are so many opportunities for this bill to fail.
Dave Bittner: (Laughter).
Ben Yelin: That's what's so difficult about...
Dave Bittner: Right.
Ben Yelin: ...Congressional procedures. So right...
Dave Bittner: It's where we are, Ben, right? That's where we are (laughter).
Ben Yelin: Yeah. And we've been at this point so many times - something seems so promising. It passes the House committee with near-unanimous bipartisan support, but it also has to go to the House floor. That sometimes can just be a matter of scheduling. There are only a few months left in this congressional term. There are a lot of different priorities. Just getting floor time can, in and of itself, be difficult in the House. The Senate is a different animal entirely 'cause getting floor time in the Senate is like getting a reservation at the French Laundry, you know, the night before Valentine's Day or something.
Dave Bittner: (Laughter).
Ben Yelin: I realize that's an extended metaphor. It's a fancy restaurant in California.
Dave Bittner: Ah, OK.
Ben Yelin: Gavin Newsom was...
Dave Bittner: Ooh la la.
Ben Yelin: Yeah, he was caught there.
Dave Bittner: (Laughter).
Ben Yelin: The governor of California was caught there with a mask off during the COVID shutdown.
Dave Bittner: I see. That's a deep cut, Ben (laughter).
Ben Yelin: It's a deep cut. Scheduling floor time in the Senate is very difficult. You can try and pass something by unanimous consent. That would be the easiest path. But any senator could object to that, and then you'd have to go through this very arduous process where, even if you don't have committee hearings, you have to file cloture to limit debate on the bill. Thirty hours have to pass, then you have to vote on cloture, then there are another 30 hours of debate. There are only so many times the Senate can go through this process before January.
Dave Bittner: Right.
Ben Yelin: And the Senate has a lot of priorities.
Dave Bittner: (Singing) I'm just a bill. I am only a bill (laughter).
Ben Yelin: I know. They made it seem so simple in "Schoolhouse Rock." And really, that's what it's like at most state legislatures.
Dave Bittner: Oh, OK.
Ben Yelin: It really is kind of like, this is only a bill.
Dave Bittner: Yeah.
Ben Yelin: I'm only a bill. Go through the committee process. Get a vote. Congress is just a different animal entirely. And that's why, even with such strong bipartisan support on the House committee, I'll believe it when it actually happens.
Dave Bittner: OK.
Ben Yelin: It just takes a lot to get a bill across the finish line, especially here, where you have some industry opposition and some opposition from privacy groups that this bill doesn't go far enough. Any of those people could get the ear of, say, Ron Wyden or Rand Paul. And if they decide to slow things down to a crawl in the Senate, that could be the death knell for this piece of legislation.
Dave Bittner: Yeah. It's why we can't have nice things.
Ben Yelin: It is.
Dave Bittner: (Laughter).
Ben Yelin: Now, you and I are going to follow this, and hopefully, maybe I'll have egg on my face at the end of the year when this bill passes, but...
Dave Bittner: You would love to be wrong, right?
Ben Yelin: Exactly.
Dave Bittner: (Laughter).
Ben Yelin: But until then, this is where we are.
Dave Bittner: All right, fair enough. All right. Well, we will have links to all of our stories in our show notes, of course, and we would love to hear from you. You can send us an email. It's caveat@thecyberwire.com.
Dave Bittner: Ben, I recently had the pleasure of speaking with Mark DiMassimo. He is founder and creative chief of creative agency, DiGo. And our discussion centers around the notion that social media platforms are facing some challenges of trying to balance their need for growth against their desire to behave in an ethical way. And I will just say as an aside here that different social media platforms seem to dial in that desire in different ways (laughter) - but we'll touch on that as well - all for the benefit of their users. Here's my conversation with Mark DiMassimo.
Mark Dimassimo: Look, people reward companies, brands - and that, of course, includes social media platforms - that they feel are good for their behavior - that they feel are good for their lives - whether that's mental health, physical health, social health, political health, cultural health, societal health. They reward brands that they feel are good for their lives, families, communities, by being good for their behavior. And they punish brands, companies and social media platforms that they feel are, on the whole, bad for their lives by being bad for their behavior. And that's what we've learned over the last two years of quantitative and qualitative research in building our positive behavior change score and index. And we find that the perception of whether a company, including a social platform, is good or bad for my behavior - my life through my behavior - translates into marketing spend efficiency or inefficiency. So, for example, if you have a low positive behavior change score, it's going to cost you much more to gain a point of market share. You're going to have to spend a lot more to grow than if you have a high positive behavior change score. In fact, brands with really high positive behavior change scores can grow while they don't spend on advertising, for example.
Mark Dimassimo: So what we're finding right now is privacy is a huge issue when it comes to how consumers are viewing, you know, positive versus negative effects of behavior. They don't like to be tempted into doing things that put their privacy at risk - not everybody, but more and more people. And they are - they reward companies and organizations that actually help them protect their privacy - make it easy for them to take actions that protect their policy. I don't know if you've seen - I'm sure you have - Apple's newest campaign, where they're - you know, they're promoting the iPhone as a privacy protector very directly and pointedly. That ought to work very well.
Dave Bittner: How much of that is building off of existing brand loyalty? I mean, if there's one thing we know about, you know, fans of Apple products - and I count myself among them - it's that the people who like them don't just like them. They tend to love them. And there's a long history behind that, right?
Mark Dimassimo: Well, yes, I - you know, I think this is - it's interesting. You know, brand loyalty, brand affinity, even brand love - these are things that have been measured for a long time. What we've done is we've gone in and said - and asked the question, what part of this is the effect on behavior? What part of it is your effect on me? Our hypothesis was - folks feel out of control, you know? A lot of folks feel out of control. They feel that their attention spans are shortening. They feel that their moods are being affected by the way they engage in what they do. They also feel a sense of - you know, is it paranoia if it's reasonable? A sort of reasonable paranoia may be over issues of privacy, protection of data, of information and all of that.
Mark Dimassimo: And so, you know, we wanted to go in and say, you know, predictably, what part of brand love and brand affinity is actually about behavior? And we found behavior - or the perception, I should say, of behavior, whether it's positive or negative - is highly predictive, even when you control for previous brand love. So, you know, our measure measures over time. So sure, Apple goes into it with having done a lot of things well, building a lot of brand love among the people who love them, but we are looking at change over time. Change over time really is about the perceptions now or over that period.
Dave Bittner: Well, can we unpack this a little bit? I mean, when you talk about, you know, positive behavior change scoring, what goes into that? What was the process by which you and your colleagues came up with this system?
Mark Dimassimo: So we partnered with Market Theory, which is an econometric and data analytics company. And I assembled a - you know, really, over the last 10 years, I've assembled an advisory board of behavioral scientists, behavioral economics, social psychologists and, you know, psychology professors, basically, in order to construct, you know, this study and also just to start to identify the questions around positive behavior change, you know? I just - I felt like I saw the huge amounts of energy and intelligence going into increasing engagement - right? - and for advertising purposes, mostly - right? - to increase the - you know, I saw - and it's not just me. We saw - you know, I think society in general has seen polarization, right? Because certain kinds of content engages people more. So, you know, we just hypothesized that there - that consumers - that people will choose new services based on whether they feel they're addressing this sense of out-of-controlness (ph) of constantly being provoked, of - you know, of being on edge, right? So, yes, the non-advertising model, which Apple benefits from - it's the reason they're able to do this - has really worked out.
Mark Dimassimo: But you asked a question - how did we construct this? Well, what we do is, based on publicly available information, we track the market share by category, and we keep on cutting it for different kinds of categories. I think, you know, I sent you a communications services map, which, you know, includes - so that you could see all of the social media platforms, but you could see them in context of other companies, like AT&T and The New York Times and Netflix, just because it gives you a broader view. We have - we take a tighter view where we look as well, too. So we look at their market share over time, and then we look at their spend over time. And it's really, at its core - at least quantitatively - that simple. And so when you see lower relative spend and higher market share gains over time, something is going on there.
Mark Dimassimo: We then have done extensive qualitative testing surveys against all of these categories, where we're asking people questions about the effect of, you know, Facebook, for example - Meta, Facebook - on their behavior. Is it positive or is it negative on the whole? Is it positive or negative on your family on the whole? - and many other questions. And what we found is a 0.8 - so almost 1-to-1 - correlation between positive behavior change ratings and our positive behavior change score, which is just more market share per dollar spent - very simple. If you could spend a dollar and get twice the market share, you've got a high score.
Dave Bittner: So is this something that is within the brand's ability to change - to influence? You know, I think back at, you know, a classic brand - you know, something - let's talk about something like big tobacco, you know? Like, it doesn't have the best view in people's minds, and I would imagine plenty of people who use their products wish they didn't. How does an organization like that - you know, admittedly an extreme example - if they wanted to turn that around for themselves, is that something that's possible?
Mark Dimassimo: You know what? Absolutely. And it's a great question. You know, if you, you know, look at this stuff and you ask the question - why do brands that most people view as bad for the users - why do they succeed, and how long do they succeed? So, you know, there are addictive products - you know, anywhere from, you know, tobacco to Vladimir Putin, you know?
Dave Bittner: Right. Well, but I think...
Mark Dimassimo: And they seem to do well for a while, right?
Dave Bittner: ...A lot of people would put something like Facebook in that category, where, you know, the algorithm drives that engagement, and people feel compelled to keep checking in.
Mark Dimassimo: It's exactly right. So, one, you've got to be - you've got to care about and become aware of your effect on people's behavior and their perception of that effect. Don't just do it for ESG reasons. Do it for financial reasons. It affects the efficiency of your marketing for growth. In other words, it predicts your future. In the long run, companies suffer when they're perceived to be bad for behavior. In fact, the tobacco companies are a sterling example because they finally realized that the perception of they were being bad for people's health through their behavior became such a stone for them to carry that they started to vigorously diversify. And, you know, in fact, when we first put out our positive behavior change shingle about a decade ago, the first prospective client we heard from was one of the two major tobacco companies, saying, look, we need somebody to work with us on shifting people from smoking our products to using less dangerous products. We said no. We said no because we just didn't think, as a positive behavior change company, that we wanted to start out shifting people from a unhealthy behavior to a slightly less unhealthy behavior.
Dave Bittner: (Laughter) Fair enough.
Mark Dimassimo: It just didn't seem like a good place to start. But they were on to it. They realized it was an existential question for them. We have to do it. And I think Facebook is on to it as well, too. You know, they're sort of in the have-our-cake-and-eat-it-too phase right now, where they want to - they feel they need to dominate. And so, you know, it's a little bit - how much poison can we tolerate? But they are also vigorously working on trying to make their business about something more than addicting people to fundamentally negative behaviors that are bad for them in order to gain advertising dollars. I think that's a big part of what this Meta thing is all about.
Dave Bittner: Hmm. Are there any examples that you can think of - of, you know, well-known brands from the past who've successfully pivoted on this - who, you know, maybe started out in a place where folks didn't think that highly of them, but they were able to, through their behavior, through their marketing, you know, turn it around?
Mark Dimassimo: Oh, yeah. Oh, yeah. Absolutely. I'll give a few examples. The great thing about having a positive effect on people's behavior and being perceived, you know, that way - having a high positive behavior change score - is it's so protective. So, you know, category No. 1, you know, would be brands like Nike and Apple, who perceived the themes in which they were positive very early - not from the beginning, but very early. So, you know, Nike - you know, Nike basically was just trying to make it. I don't know if you read "Shoe Dog" - great book - but, you know, they're just trying to make it, competing with much bigger, you know, basically sneaker - running shoe companies in an era when people didn't really run - right? - when it was a niche behavior.
Mark Dimassimo: And, you know, what finally opened up the world for them was that they realized that they were inspiring people to get in touch with and to activate their inner athlete. And when they realized that we're not fundamentally a shoe company - we're fundamentally a positive behavior company - they called it authentic athletic performance. That became their internal mantra. That's where "Just Do It" came from. When they started to make their strategic decisions based on realizing that we're all about this behavior, they not only built a massive business in, you know, in athletic wear - shoes and athletic wear - but they actually helped to drive this massive cultural change where, you know, we're now, you know, a running country and maybe a running world. We're an athletic country and an athletic world. That wasn't the case when they started. They really drove a lot of that and benefited from a nice chunk of it. So that's one story.
Mark Dimassimo: Apple - you know, Apple hasn't had a perfect record. They could be seen as monopolistic by some. Their sourcing and labor practices have been, you know, reasonably questioned. People generally don't like, you know, massive companies that tell them what to do. Apple's done two things - I mean, at least two things - really, really well. One, they realized that they were about inspiring more creative time and behavior in their target audiences. So again, they realized what these - Jobs said, it's a bicycle for the mind, you know? It's a bicycle for creativity. That was his analogy.
Mark Dimassimo: So they got that they were about behavior fundamentally. They knew what to say no to. So, you know, they're not sitting around saying, well, we need advertising revenue. Therefore, we have to compromise on privacy in order to maximize it. They know which side of that fence they're on, so they've been able to really make the most of the things they could do to help people with behavior problems they're having. I think, if you ask the average person, they just fear that they're going to get into trouble on the privacy issue. Apple makes it easier, simpler. It just empowers people to do something about it. So they've - you know, they've done really well.
Mark Dimassimo: I think that - like, take Altria, which used to be - I forget their name now - Philip Morris, right? I think, you know, they used to be a - just about selling tobacco. They realized, you know, some time ago that they need to diversify, and they have started to diversify. And I would say, you know, maybe they're half rehabilitated. It's - and, you know, I think they're on their way to a new lease on life.
Mark Dimassimo: We worked with CVS - it used to be CVS Caremark. And, you know, our client, Leslie Doty, was head of digital and strategy there when they were considering realizing that they're about helping people with behaviors that improve their health. And one thing that came up during that process was - how can we sell a billion dollars of cigarettes a year and say that we're a company all about health? What they did is they delayed that change for a year, and they used that year to commit to transitioning from - to give up that revenue and to live without it for - it took more than a year to recover that revenue through other things. But they made that decision, and it's been nothing but up since.
Dave Bittner: How much of this comes down to discipline? You know, you mentioned, in Apple's case, knowing when to say no to things. How much does that play into this?
Mark Dimassimo: I also think that's a great question. You know, it's funny - I think, when you think of discipline - you know, I've been thinking about this with, you know, the gun violence, you know, outrages and debate that's been going on. I think companies that have it wrong think that users should solve it with their own discipline. And I think that companies that get it right realize that they're the ones who are supposed to have the discipline so they can make it easier for human beings - for consumers, for users - to engage in the behaviors that make their lives better. The discipline has to be on the company's part, and often it isn't. So that's a massive opportunity.
Dave Bittner: Yeah. What an interesting insight. Where do you think we're headed with all of this? What does the future look like when it comes to these organizations, these brands and the public perception of them?
Mark Dimassimo: Pain leads to marketplace opportunities. And, you know, we've - sure, there are problems, but we've built an efficient world for capitalizing solutions - right? - for investing in solutions. So, you know, what's happened here is that the growth of this - particularly the growth of this, you know, electronic marketplace - social world in particular - has just accelerated the contagion of negative behaviors that are having massive effects on our society right now. And that's scary, you know? Bad things can happen. You know, we saw, you know, an attack on our, you know - at the least, a riot at our Capitol, where people were calling, you know, for hanging our vice president.
Dave Bittner: Right.
Mark Dimassimo: We see - you know, we see bad things happening, but this creates marketplace demand for solutions. And I just - I just view this positive behavior change world as a growth marketplace that I just want to - I want to see a movement around it. And I think it's going to happen whether I want it or not because when the need is there, the market responds.
Dave Bittner: So Ben, I mean, interesting stuff here, you know? I mean, there really is that tension there that these companies try to walk the line between.
Ben Yelin: Yeah. I mean, on the one side, there are the company's financial interests, and on the other side there are the company's ethical interests. Money is more fun. You can go out and buy nice things...
Dave Bittner: (Laughter).
Ben Yelin: ...Get the nicest offices in Silicon Valley...
Dave Bittner: Make your shareholders happy.
Ben Yelin: ...Make your shareholders happy, which is the most important thing...
Dave Bittner: Yeah.
Ben Yelin: ...And survive as a company and not get subsumed in the industry.
Dave Bittner: Right.
Ben Yelin: Some companies, like Apple, have tried to stake out their place in the market by being more conscientious about digital privacy. I think that's still a philosophy geared towards their bottom line, but I think that's a way for them to try to increase their market share.
Dave Bittner: Yeah - and easier for them because they're primarily a hardware provider.
Ben Yelin: Right, exactly. But when we're talking about social media sites, it's hard for me to imagine a situation where these ethical concerns would force one of these platforms to make significant changes that would cut against their advertising revenue or anything that keeps the lights on.
Dave Bittner: Right.
Ben Yelin: We've seen it happen in the past, particularly - I almost hesitate to bring this up, but in the X-rated realm, something like Tumblr making the decision to exclude pornography on its website...
Dave Bittner: Oh, right, right.
Ben Yelin: ...Which happened a couple of years ago - that ended up pretty much killing Tumblr. So it does happen from time to time. I think if you're really crossing a line, and senior leadership thinks you're doing something unethical, then there might be the chance for that to happen. But otherwise, you know, money talks, I think, louder than any of these ethical concerns - at least as a general rule.
Dave Bittner: Yeah. All right. Well, again, our thanks to Mark DiMassimo for joining us. We do appreciate him taking the time.
Dave Bittner: That is our show. We want to thank all of you for listening. The "Caveat" podcast is proudly produced in Maryland at the startup studios of DataTribe, where they're co-building the next generation of cybersecurity teams and technologies. Our senior producer is Jennifer Eiben. Our executive editor is Peter Kilpe. I'm Dave Bittner.
Ben Yelin: And I'm Ben Yelin.
Dave Bittner: Thanks for listening.
