Volume 125: Designing For Culture; Gaming The Algorithms.

1. Designing For Culture; Gaming The Algorithms.

tl;dr: You might not be doing what you think you are.

Last year, I talked at the Brand New Conference in Austin. As I nervously waited my turn, I watched the other speakers, which I thoroughly enjoyed.

As I did, I noticed something interesting: the use by different people of the term “designing for culture.” Now, this is a statement that could be taken in a few different ways. For example, my first reaction was to groan. It’s hard to see this as new in a world where design has always had a part to play culturally, meaning I was initially skeptical that it was nothing more than a statement of the obvious masquerading as profundity.

But, as I sat through more speakers using the term, it was clear that something else was going on. When people said “designing for culture,” they showed work that had been successfully amplified socially. In other words, “designing for culture” seemed to actually mean designing things to be noticed and amplified by the algorithms driving social media engagement. So, while the designers might think of what they’re doing as being culturally of the moment, it’s actually about meeting the amplification requirements of the machines that act as our cultural gatekeepers.

This is interesting because if you understand what’s going on and how they work, then algorithms can be gamed. This is the reason so many people find themselves writing two resumes. One to get through the automated screening when they apply for a job, and the second to put in front of an actual human being when they get an interview. It’s also why online recipes have so much exposition before you get to the recipe itself - this time because the Google search algorithm weights pages more highly based on “engagement,” and people figured out that you can game this engagement by placing a load of exposition copy above the recipe itself. And, finally, it’s why “pods” of people work together to like, comment on, and reshare each other’s LinkedIn posts because they know how the LinkedIn algorithm works and have figured out how to game it.

It’s highly likely that as we move into recessionary times, there will be greater demand from clients for work that cuts through our algorithmically gated environment to achieve the myth of viral reach at low or no cost. And while virality is far from a sound strategy, and all the data suggests it isn’t something you should rely on, that doesn’t prevent there from being an almost infinite appetite on the part of clients seeking it. So, far from being a unique skill set that can only be delivered by the few most talented designers out there, I deeply suspect that “designing for culture,” AKA “gaming the algorithms,” will increasingly represent a learned skill amidst the design community.

And while I don’t know what this might mean for the work overall, what I did realize as I sat through people presenting their work, was that those things achieving the most social traction also seemed to be the work that was the most novel, different, and unexpected. So, yeah. Maybe designing for culture (or, more accurately, gaming the algorithms that gate culture) will be a further nail in the coffin of the boring ass Helvetica in Pastels movement.

Or, at least, one can hope.

2. Falling on The Sword of D̶a̶m̶o̶c̶l̶e̶s̶ Efficiency.

tl;dr: A few thoughts inspired by the Southwest Airlines debacle.

Unless you’ve been living under a rock recently, you’d be aware of the complete meltdown of Southwest Airlines over the festive period. Facing a perfect storm of weather-driven delays and fully booked flights, its back-end technology infrastructure failed spectacularly, requiring it to cancel a vast majority of its flights for a period of days to ‘reset’ the system. At one point, Southwest represented something like 75% of all canceled flights in the country.

As a result, I figured it was a good opportunity to talk about efficiency. Over the pandemic period, we heard much about efficiency relative to supply chains, mainly through a lens that views efficiency and resilience as mutually exclusive. Here, the view is that for a system to be resilient, it will naturally be less efficient. And that for a system to be efficient, it will naturally be less resilient.

But, this is a fairly narrow view of efficiency and resilience. Looking at Southwest, we see two kinds of efficiency; financial and operational.

For years, employees warned Southwest about the clunky, 1990s-era technology it uses to organize, manage, and track people and aircraft. And that having groundcrew do manual entry changes when flights are delayed or re-routed was inefficient and would almost inevitably lead to collapse.

Which, of course, is exactly what happened.

Southwest was optimizing for financial efficiency rather than operational. It didn’t want to spend the money updating its back-end systems and was willing to embrace a certain degree of operational inefficiency to save this cost. Were Southwest optimizing for operational efficiency, this wouldn’t have happened. It would’ve invested the necessary time, money, and resources into developing a modern scheduling and tracking system. Instead, it ran the old system until it broke.

As a result, whenever we discuss resilience and efficiency, it’s essential that we also consider whether we’re talking about operational efficiency or financial.

The rise of financial efficiency is highly correlated with the financialization of American corporations over the past few decades. Where corporations went from being businesses that made things, invested in innovation, and delivered value to their customers to…something else. Creating a world where the corporation became a financial vehicle engineered for maximum payout to shareholders, management, and little else.

Jack Welch-era GE was ground zero for corporate financialization, driving up the stock price of what had been a sleepy industrial conglomerate to new heights, even as his leadership cut hard into the muscle of the business, replacing hard-to-deliver industrial innovation with easy profits from lending. An edifice, of course, that ultimately crashed in 2008, when the financial crisis highlighted just how exposed GE was to incredibly risky sub-prime lending. A humiliating period of its history that it never recovered from and which led directly to its forthcoming breakup.

Or, look at Boeing. Another storied American brand that’s been brought to its knees by financialization. In this case, engaging in a game of regulatory capture to avoid having to deal with difficult questions about the safety of the 737 Max, which had disastrous consequences. To see what happened there, look no further than its board, where financial engineers vastly outweigh actual engineers, even though Boeing is meant to be an engineering company.

And this is the thing. When we look at corporations that are buying back stock, borrowing money to pay special dividends, and engaging in creative accounting practices to increase payouts to shareholders, we’re almost always dealing with firms that place a huge primacy on financial efficiency, even if it has a materially adverse impact on operational efficiency, resilience, and usually, the customer experience. Because when you think of the company as a financial vehicle rather than an ongoing operation, you’re more inclined to starve those operations of investment in order to return capital to shareholders.

And, more often than not, when major issues created by the idolatry of financialization occur, these firms find it hard - often impossible - to recover. GE never did, and it’s unclear whether Boeing ever will.

This brings me neatly back to Southwest Airlines. It’s hard to say right now how big this issue will be for the long-term health of the brand and business. It’s clearly had a significant impact in the immediate term relative to flight cancellations and refunds. Still, the bigger question is whether there has been a longer-term hit to its goodwill and brand equity that only greater operational consistency could solve. I suspect people will likely be warier about flying Southwest, in a similar way that I’m wary of flying JetBlue after the awful experience I had with them earlier in 2022.

Beyond a hit to a single company’s reputation and brand preference, however, it also raises a bigger economy-wide question. Over the past fourteen years, when interest rates were zero, corporations rewarded C-Suites that could financially engineer their way to success. In particular, using debt to enhance stock market performance, which airlines were particularly aggressive proponents of. By contrast, the upcoming period, where interest rates are no longer zero, means artificial debt-driven stimulation is largely off the table. This, in turn, might create a new reality of the C-Suite being rewarded for delivering profits via operations. Something that gets lost in our conversation about efficiency versus resilience.

As a result, there’s a good chance we might be entering a golden age for operationally-minded, customer-focused leaders as a reaction to higher interest rates. People who understand the nuts and bolts of running their businesses, not just the financial levers of how to artificially stimulate stock prices.

3. The Enshittification of The Customer Experience.

tl;dr: When Google And Amazon Went Bad.

One of the less remarked upon consequences of Amazon quietly building a $30bn+ advertising empire is that it’s had a direct and negative impact on the Amazon shopping experience.

While retailers have operated under variations of pay-to-play merchandising for years, Amazon has taken it to a new level. Today, pretty much everything you see when shopping at Amazon is paid for by a vendor. I don’t know about you, but I find myself scrolling way down the page to try and find products that better match what I’m looking for and aren’t obviously paid-for placement. So much for being “the most customer-centric company on earth,” unless you class your advertisers as your primary customers.

As an aside, this also shows the limits of first-party data and personalization. Amazon has more data on me and my shopping habits than any other company, bar none. Yet, it still can’t tailor the product assortment to my personalized needs and still sends emails promoting products I’ve already bought. From Amazon.

Cory Doctorow has written about this, describing it as the “enshittification” of the Amazon experience, and he’s not wrong. And Amazon is far from alone. The mobile web has become almost unusable due to the sheer volume of ad windows, video auto-players, and newsletter pop-ups you find yourself constantly clicking to avoid, assuming you stay on the page long enough for all the various ad servers to do their thing, bogging down load times as a result.

Even digital advertising leader, Google, has turned its homepage from one of the simplest ways to find information online into one of the most annoying. Not only are the ads everywhere, but people have become so adept at gaming the Google algorithm that you might need to go as far as ten pages deep to find the kind of result that you’re looking for, and even then, it’s a crapshoot.

It’s only going to get worse from here. As capital becomes ever more expensive, profit-challenged companies with significant traffic will be led like moths to a flame toward the experience-enshittifying business model that is advertising. Uber, Doordash, and Lyft being three recent examples that have begun doing just this.

Now, what’s interesting here, are two distinctly different observations.

First, it’s unlikely that an enshittified experience will have any material impact on Amazon, at least not in the short term. There just isn’t a competitor out there that can match the scope and scale of the Amazon retail offering. We’re all just going to have to eat it. Google, however, could be a different story. Much of Google’s monopoly position in search is driven by consumer habits. With the advent of ChatGPT, it’s clear that AI could offer real and meaningful competition in information search, to the point that Microsoft is already planning an AI-powered version of Bing, which has the potential to change the category. With the Google experience being so compromised from a consumer value standpoint, it’s not without question that it could find itself in a world of hurt at some point in the not-too-distant future, were a competitor to make relevant search information available in a quicker, simpler, more convenient, and less enshittified fashion. And as much as people may say they love Google, the switching costs of typing Bing.com instead of Google.com are trivially small.

Second, it amazes me that after all these years, and all the money and effort expended on customer experience, UX, UI, and all of its ancillary activities, combined with all the money and talent invested in ad tech, and all of its ancillary activities, that nobody, not one single corporation seems to have connected the dots between the two in such a way that advertising can be presented in a compelling, yet unobtrusive fashion.

If there’s one arena of the online advertising landscape just begging to be innovated, it’s this. Not more ad-tech, buy-side, sell-side, data-platform, first-party, third-party, measurement, attribution, blah blah. But innovating the ad formats themselves, so they work within experiences without enshittifying them, and that allow advertisers to showcase their creativity and craft. And, as more eyeballs go digital, this is precisely the kind of mature category innovation we’re crying out for. Because, like it or loathe it, TV advertising is still the most effective at driving incremental sales. And it shouldn’t be. The only reason it still is is that nobody has figured out how to make the digital ads better. At least not yet.