This is an article about addiction. It’s a new kind of addiction. One that isn’t as taboo as substance abuse. It’s not one that you would go to a treatment center for. It’s not one that you’d see on Intervention, but make no mistake, advertisers want to make you addicted and keep you addicted. It’s also an article about economics. The currency is your time and attention. This is an article about something I am calling mind share, which is the amount of attention and time that you pay to something.
From an economic standpoint, the same principle applies to your attention that applies to your dollars. Economics is based on scarcity. Value is simply the equilibrium of the supply available and the quantity demanded. However, whereas you could always make more money, you will never be able to take back your time. Unfortunately, we already live in the Black Mirror future where advertisers know how much you are worth to them based on how much you engage with their brand and this attention can be quantified with a dollar amount.
The old-school way of quantifying attention is called CPM, which basically means cost per 1,000 impressions (using the Latin reference of M=1,000). While an advertiser is much better served with a CPC or cost-per-click type of model, a lot of advertising platforms still use the CPM metric as it takes less of the burden off of the advertising medium. However, there are so many other ways of measuring your attention. It’s not just impressions, those are cheap. Engagement is worth so much more than impressions. As an advertiser, I really don’t care too much about how many people see my ad, although that’s nice. I care if someone is actually doing something with what they see. While impressions are a passive medium, engagement is active and engagement=mind share. So why is engagement so valuable? Well, your engagement, your…addiction, is worth a ton of money.
They Call Your Addiction “Average Revenue Per User” (ARPU)
Facebook and other social media companies make money from your engagement. They do this by advertising to you. They make money off of your clicks and you only click if you are engaged. So they created the cute term “average revenue per user”, or ARPU. I’m guessing they made an acronym so they didn’t have to think about it as much. They didn’t have to think of the things that you’d have to do to increase that number. They didn’t think of how manipulating the platform would impact someone’s mental health, but I digress…
The more ways you can become engaged, the more likely you are to click. Interested in a robot vacuum? Maybe you join a social media group dedicated to different types of robot vacuums. This keeps you on the site. It keeps you engaged with the community. From an advertising perspective, it puts you into a potential target bucket of people likely to purchase a robot vacuum soon, and increases your likelihood to click on an ad that is targeted to you. The more you do this inside the platform, the more valuable you are to them. The more you do this outside of the platform, the less valuable you are.
In November, Facebook reported a $7.26 quarterly ARPU. To put this into perspective, Snapchat’s ARPU was $2.12, Pinterest was at $0.90, and Twitter was estimated at $5.68.[1] So Facebook makes about $30 per year off of you. Although it doesn’t seem like much, take that $30 multiplied by 2.7 billion monthly active users and you get one of the largest brands in the world built off of getting and keeping your attention. If this quarterly ARPU drops just by a dollar, that’s an annual loss of 10 billion dollars, which is far more than most companies make annually. That’s more than the GDP of 49 distinct countries.
In addition to the actual revenue produced per user, you also have to consider the opportunity cost. If you’re not familiar with the concept of opportunity cost, it’s basically the loss of potential gain from doing something else. One economist found that adult Americans engaged with ad-laden content 58% more than they worked in 2019. He also found the amount we consumed this content equaled $7 trillion in opportunity cost[2], or over $33,000 per American adult. So if you were making money instead of scrolling social media, you could be up $30K, but I get it. Part of being on social media is like bubble gum for your brain. For some people, it fulfills something missing like seeing photos of their grandkids or keeping up with their friends. For others, this race for mind share can lead to addiction.
Facebook and Social Media Addiction
Is Facebook addictive? Good question. Many social media sites use certain tactics that can keep users on the platform and keep them coming back. The most obvious and possibly the most infamous tactic is infinite scroll. The creator, Aza Raskin, now advocates for social media to change their practices has been cited as saying:
“It’s as if they’re taking behavioral cocaine and just sprinkling it all over your interface. And that’s the thing that keeps you like coming back and back and back.”[3]
Many social media websites also use a “pull to refresh” feature, which has the ability to give reinforcements intermittently, much like a slot machine.[4] There are also opportunities for dopamine hits such as other users liking your content and continually engaging in a (probably angry political) ongoing conversation. Our brains crave dopamine. If your brain starts to think that you will get all the dopamine it needs from Facebook, maybe you’ll spend more time on Facebook. There are also push notifications and constant emails giving you updates to keep you from fear of missing out (FOMO). All of these items, again, are to increase your mind share. They’re there to keep you there and keep you coming back.
I can also point out that is there has been a psychological scale since April of 2012, called the Bergen Facebook Addiction Scale. This helped to link psychological problems with the use of Facebook.[5] I can also point out a 2018 study of Portuguese emerging adults (adolescents) that found their most addicted participants used Facebook an average of over three hours per day. These participants showed an increase in depression, anxiety, and interpersonal sensitivity.[6]
Time Distortion
Social media distorts our perception of time. One study found that both low and at-risk social media addiction groups actually had an upward trend of perceived time after abstaining from Facebook for a week[7]. This basically means that they thought time was taking longer than it actually was.
Netflix Addiction
Remember when Netflix made you actually click on something before it would play? That was nice. Well, there was a long period of time where autoplay was the only way that the platform worked. You couldn’t even browse the selection without everything that you pass by starting to autoplay. When you were done with a show, you didn’t have to do anything. The next show would come up and play, skipping the intro before you can even get a chance to decide if you want to continue watching. Why did they do this? Mind share, that’s why.
I personally think this feature sucks, and apparently, a ton of other people did too which is why you can now turn that feature off. Honestly, I stopped logging into Netflix because autoplay was really annoying and I didn’t even know you could turn off the feature until I started researching the Netflix section of this article, about…10 sentences ago. But yeah, they now made it an option[8] which is pretty amazing. However, you have to do this through a browser. Who watches Netflix on a browser? Weirdos, that’s who. Netflix knows you don’t watch on a browser (unless you’re a serial killer), so they allow you to turn off the feature, but they don’t make it easy.
But let’s get into the mind share for Netflix. Should they really care about mind share? Absolutely, but the reason they care about mind share is much different than the reasons social media sites care about mind share. Netflix needs you to keep coming back so you don’t drop their service. Once you are a customer, the purpose of Netflix’s mind share strategy is to keep you a customer. As customers evaluate their monthly expenses, Netflix has a goal of moving toward a need, rather than a want. How can they get customers to feel an urge so strong that they don’t even consider dropping their service? Creating a greater market share of the customer’s mind, that’s how. They do a great job of creating content that customers cannot live without. Shows like “Orange Is the New Black”, “Stranger Things”, and “Mindhunter” are shows that you cannot get ANYWHERE else so customers feel the need to keep their subscription active.
In addition to current customers, Netflix has had an amazing ability to attract new customers with this same strategy. With the publicity they receive from their regular shows, they’ve been able to continually pique curiosity to attract new subscribers. With their limited run documentaries, however, they’ve found a way to dominate the mind share of both traditional and social media. Shows like “Tiger King” and “Making a Murderer” have been limited-run smash hits. If they can get someone to try to log on to see one of those shows, their goal should be how they could create mind share with a subscriber while they are there. That’s why their algorithms are targeted to feed you content they think you will like. They even show different preview images for the same show to different audiences, based on your customer profile. You’ve got to admit, this is slightly creepy.
One term that is commonly associated with Netflix and other streaming services is binge-watching. Binge-watching could impact your mental health. Seriously, have you ever heard the word “binge” referred to as anything that would have a positive impact on your mental health? One study from the University of Toledo showed that binge-watching increased anxiety, depression, and stress.[9] So what does your brain get out of binge-watching? Well, it’s back to good old dopamine. When you get sucked into a story for a show you are watching, your brain gets a dopamine hit. Since your brain likes dopamine, it will typically crave any source that is known and available.
You’ve Been Targeted
Your data, everything electronic that can be scraped and known about you, every website you visit, every button you click in an email, every time you swipe on an app that is “swipe tracing”, all of this is being collected and categorized. You probably have a Gmail account. You probably use Google Chrome. Guess why Google is so powerful. Data. You willingly tell them what websites you visit. You trust them with your email. That’s fine, I do too. What do you think they do with that data? Well, create more mind share, that’s what. They try to sell your data to advertisers and keep you on the platform so they can keep selling even more of your mind share back to advertisers. It’s really an endless loop.
You are being targeted not only by your demographics but from your psychographics as well. This includes your attitudes, opinions, values, and your interests. Why? Well, combined with your past behavior, psychographics can be great predictors of future purchasing behavior. They can also give some insight to an advertiser where you might be in the buyer’s journey so they can target you effectively. Ironically, the retail store Target is great at this. You may recall the story from the New York Times in 2012 of a father complaining to a manager at a Target store that his high-school-aged daughter was receiving coupons for maternity clothes from Target. Well, turns out she was pregnant, and Target was able to predict this before her father knew. This was done with a combination of buyer behaviors including unscented lotions, cotton balls, and other supplements which constructed Target’s “pregnancy prediction score”.[10] While I question the validity of the anecdote given in the story, the data analysis is likely pretty accurate.
So why is this important? What should Target try to do with this data? Well, it is obviously great information in trying to make an immediate sale, but from a long-term perspective, it’s better to create mind share. Being relevant to a customer helps increase build a relationship with that customer for the future. In this instance, a woman who is shopping at Target throughout her pregnancy is likely to continue that customer journey well into the early years of the child’s life and beyond. In this case, mind share=wallet share.
I can tell you from first-hand experience, the mind share Target creates around maternity and the early childhood years is strong. Their store brand of essentials for babies like wipes and diapers are much cheaper and in my opinion, much higher quality than national brands. Their baby section is easy to navigate. They have just enough choices to give you options, but few enough that you don’t feel too overwhelmed, especially as a new parent. The prices on their higher-end items like baby furniture and strollers are right in line with what you would find if you shopped for competitive products online. I’m not sure if Target has their baby items priced as loss-leaders, but their strategy of focusing on maternity and baby items certainly has led to a greater mind share for me, which has translated into a sickeningly high level of wallet share.
The thing that is interesting to me is I know they are doing this. I know that they are trying to create a relationship with me (and my family) as a customer. I know they are trying to establish long-term brand loyalty by creating mind share. I know they’re probably manipulating me and walking me through a buyer’s journey that they have defined, but I still fall into the trap. Why? Well, probably because it’s easier. Like just about everyone on the planet, my brain is a cognitive miser, which essentially means it likes to take the path of least resistance. In a situation where I have a lot of baby stuff to buy, or even just grab something and go, am I looking for a perfect solution? Probably not. I’m looking for a solution that is good enough. If it means that the pricing is similar to what I can find somewhere else and I don’t have to go to Walmart, I’m in.
Micro-Influencers
A micro-influencer is someone that has a niche following. They don’t have a mass following like Taylor Swift, but they have a very dedicated and loyal following for some particular type of follower. For instance, I listen to a podcast called “The Ultra Runner Podcast”. It has a really niche following for crazy people that like to run distances longer than a marathon. This could be 50K, 50 miles, 100 miles, all sorts of insane distances. There aren’t many people that are interested in this type of behavior, let alone, people that like to do this and listen to the show. I would guess they have somewhere around 10,000 active listeners.
The show has been around for around a decade and has had the best athletes in the niche appear to tell their stories. The loyal following of this podcast would be an excellent opportunity to try and advertise something that people that run that much would need, namely shoes. Who is going to go through shoes faster than someone that puts 100+ miles every week on a pair of shoes? Micro-influencers have already created the mind share. They already have an audience. Their fans are loyal. A brand will pay more per potential customer for that level of loyalty than for a much less engaged and targeted audience. Someone with a wider appeal doesn’t have nearly the mind share as a micro influencer’s audience. The reason you’ve heard the term micro-influencer gaining so much popularity in the past few years? They know how to create mind share, and advertisers want to harvest that connection.
Account-Based Marketing ABM
Possibly the biggest trend in marketing right now is called Account-Based Marketing (ABM). ABM is essentially a diversion from mass-marketing techniques to a more strategic, segmented approach. The basic idea is that your company identifies key accounts within your organization to try to enhance your relationship. This is done with a behavioral-based approach. Generally speaking, it is a fancy lead nurturing system that is based on content. This content could be articles or white papers, videos, or even an audio podcast. Once a potential customer enters the marketing ecosystem (generally your website), AI and some other fancy tools track the person’s engagement with different content on your website. Based on their behavior, they receive the next piece of content, which is a little more relevant, and possibly a little more value for the customer. Based on their behavior, the AI tries to predict someone’s next action. This funnel continues to narrow until there is some type of action, whether it be a lead form filled out, a call to a sales rep, or some other deemed action by the sales team. Some of these software packages are around $25,000 per year or more. What are all of these software platforms trying to do? You guessed it, create mind share. The longer and more items you interact with, the more likely you will be to become a customer.
Wrapping Up
I opened this by saying that mind share is the currency of the future, but the more I wrote, the more I realized that the future is now. And it’s not even the future. This has been happening for hundreds, if not thousands of years. If your customers are not thinking about you, regardless of how fancy your marketing tech stack might be, or how smart your analytics team members are, if you don’t occupy a space in your customer’s brain, you’re sunk. Amazing brands know this and are continually evolving their brand for the ever-changing needs of their customers. Customer needs are not static. There are likely many brands in your niche vying for your customers. They’re trying to figure out how to convert your customer into being their customer. Many companies will stop here. They’ll try to get a customer in the door and make the sale. When you design your strategy, however, realize that the secret to keeping and maintaining your customer relationships is a longer-term approach. The secret that the world’s greatest brands truly understand comes down to two words: mind share.
[1] https://www.cnbc.com/2019/11/01/facebook-towers-over-rivals-in-the-critical-metric-of-revenue-per-user.html
[2] Evans, David S., The Economics of Attention Markets (April 15, 2020). Available at SSRN: https://ssrn.com/abstract=3044858 or http://dx.doi.org/10.2139/ssrn.3044858
[3] https://www.businessinsider.com/silicon-valley-insiders-tell-bbc-how-tech-firms-turn-users-into-addicts-2018-7
[4] https://www.sciencefocus.com/future-technology/trapped-the-secret-ways-social-media-is-built-to-be-addictive-and-what-you-can-do-to-fight-back/
[5]https://www.medicalnewstoday.com/articles/245251#:~:text=Researchers%20in%20Norway%20have%20published,of%20the%20journal%20Psychological%20Reports.
[6] da Veiga, G.F., Sotero, L., Pontes, H.M. et al. Emerging Adults and Facebook Use: the Validation of the Bergen Facebook Addiction Scale (BFAS). Int J Ment Health Addiction 17, 279–294 (2019). https://doi-org.prox.lib.ncsu.edu/10.1007/s11469-018-0018-2
[7] Turel, O., R. Cavagnaro, D. Effect of Abstinence from Social Media on Time Perception: Differences between Low- and At-Risk for Social Media “Addiction” Groups. Psychiatr Q 90, 217–227 (2019). https://doi-org.prox.lib.ncsu.edu/10.1007/s11126-018-9614-3
[8] Mishra, M. (2020). Netflix finally turns off autoplay. B & T Weekly, Retrieved from
[9] https://www.researchgate.net/publication/313236736_Viewing_Patterns_and_Addiction_to_Television_among_Adults_Who_Self-Identify_as_Binge-Watchers
[10] https://www.forbes.com/sites/kashmirhill/2012/02/16/how-target-figured-out-a-teen-girl-was-pregnant-before-her-father-did/#51f13a946668