Tag Archives: wisdom of the crowd

QLIQZ – Human Web Against Data Giants

March 5, 2017 jillbue Leave a comment

Sick of giving away your data for free to data giants like Google, Facebook, and so on? You want to have control over your browser history, search terms, and advertisement when surfing the internet? You are annoyed by scrolling through a list of ads first when entering a term in Google Search? Then CLIQZ might be a very interesting alternative for you.

CLIQZ combines search engine and browser. A quick search is performed directly in the browser, without having to go to another search engine. Search terms or names of a website are directly entered into the browser line. As done by other browsers, a selection of suggestions for websites appears, without you having to leave the current website.

The Human Web

Heart of the search engine is its algorithm, called Human Web, which ranks search results according to their relevancy, and not related to the content, structuring, and linking of websites as done under Search Engine Optimization. With the Human Web, CLIQZ makes use of the wisdom of the crowd – the community of users. The search algorithm of CLIQZ weighs data about people’s behavior on the web more than the technical analysis of websites. And the more data collected, the better is the search algorithm. But now you might think: “How is that different from Chrome or Firefox? They also collect my data.” In contrast to other search engines that build complete and detailed profiles on their users, CLIQZ only works with anonymous statistical data (CLIQZ Human Web, 2017).

Recent Development

CLIQZ recently hit the headlines with the acquisition of Ghostery, a browser plug-in and mobile app that enables its users to easily detect and control JavaScript “tags” and “trackers”, which allow the collection of the user’s browsing habits via cookies, as well as participating in more sophisticated forms of tracking such as canvas fingerprinting. By this acquisition, CLIQZ wants to increase its user base (AdAge, 2017).

Business Model Evaluation

Although the concept of CLIQZ is widely described as very promising due to a global shift towards privacy awareness (EY Privacy Trends Report, 2016), this does not automatically lead to business success. Currently, CLIQZ is a start-up backed by renown investors, namely Hubert Burda Media and Mozilla. As stated on their website, CLIQZ did not decide on how they will generate revenue (CLIQZ Support, 2017), but it should be compatible with the respect they have for our users’ privacy and with the core benefits of their product (direct, fast, clearly structured). Thus, making money like other conventional browsers (mainly through advertisements and search royalties) does not fit their strategy.

The single functions of CLIQZ and Ghostery are not new for consumers. If you do not want to be tracked, other options are already available on the market. Add-ons such as the Privacy Badger block scripts and cookies. The Tor browser offers even more anonymity. To avoid search engines such as Google, Startpage, for example, is also a privacy-friendly alternative.

However, CLIQZ provides a seamless integration of those single features into an encompassing solution. Next to this, the most useful differentiator of CLIQZ is its relevancy-based Quick Search. This combined functionality is currently the main reason for consumers to consider using CLIQZ as a default browser.

References

AdAge. Cliqz, a Mozilla-Backed Search Engine, Buys Privacy Extension Ghostery. Retrieved March 5, 2017 from http://adage.com/article/digital/cliqz-a-mozilla-backed-search-engine-buys-ghostery/307980/

CLIQZ. Human Web. Retrieved March 5, 2017 from https://cliqz.com/en/whycliqz/human-web

CLIQZ. Support. Retrieved March 5, 2017 from https://cliqz.com/en/support

EY Privacy Trends Report (2016). Can privacy really be protected anymore? Retrieved March 5, 2017 from http://www.ey.com/Publication/vwLUAssets/ey-can-privacy-really-be-protected-anymore/$FILE/ey-can-privacy-really-be-protected-anymore.pdf

Business Case

Social Trading: A new way to invest

February 17, 2017 379184SV 1 Comment

Have you ever wanted to get into trading but don’t know where to get started? Trading and investing in stocks, currencies, indices and commodities offer a high potential payoff, however can be hard to get in to. Often people don’t know how and where to get started, and end up making poor choices due to the steep learning curve. In the past, people have looked to their brokers or third parties for advice and guidance in trading, however with the rise of social and crowd platforms, a new style of trading has emerged.

What is Etoro and how does social trading work?

Etoro is a social trading platform where people can trade using ‘the wisdom of the crowds’ principle. The platform offers free trading advice, tutorials, a trading simulator, and an integrated social trading platform. On the social trading platform experienced investors can make market predictions, share information, and show their current and past trades through their public profile. The aggregate of the current trade actions is made visible for each stock, currency pair, and commodity, so users know what the crowd is doing. Users can also select individual investors based on their past trading success, subscribe to their profile (via which they can receive advice or information), and even select to automatically copy their trades. This adds a new element to investing as users can track all trades made by their favorite investors, and automatically execute those exact same trades.

Investors can moreover benefit from being a ‘popular investor’, through which they can earn payments and other benefits relating to their popularity within the platform. Etoro charges users with a transaction fee for each trade as well as a general fee when withdrawing funds (relating to the size of the amount withdrawn).

Efficiency Criteria

In essence, the platform is split into two distinct sides that interact to create value together. Experienced investors join the platform with the intention of sharing their knowledge and trades in order to build up a reputation, and benefit from the rewards and payments that come with being a ‘popular’ investor. Meanwhile, new investors join the platform with the intention of benefiting from the crowd’s collective knowledge and copying experienced investors. Through this, new investors can start building a portfolio while learning from the advice and behaviors of experienced traders. As such, the value derived on both sides of the platform is maximized by the combined knowledge and interaction of the crowd.

Etoro itself also greatly benefits from this network effect. The more experienced traders join the platform, the more useful content will be available to new users, thereby making the platform more attractive to join. Additionally, the more trades are executed by users, the higher the profit generated by the company. Etoro further encourages sign ups using a referral program in which users can gain rewards for each new person that signs up through their referral link. This serves to further enhance the network effect by bringing more users to both sides of the platform.

The business model itself is not specifically adapted to the political, social or legal regulations of each individual country in which it operates, but rather is static across all regions. As such, a country’s legal environment poses the greatest threat to the survival of the company. Due to the strict regulations that come with operating in the financial sector, Etoro’s business model has not yet been approved in all countries. Currently, the USA, Iran and Cuba are among a few countries that have not yet allowed Etoro to operate under its current business model. This is understandable since social trading and the concept of copying trades can bring about many negative consequences. For example, a user could instantly lose all their equity by forgetting they are ‘copying’ an investor who might have executed a (failed) high-leverage trade.

References:
Etoro. (2017). Retrieved from https://www.etoro.com/

Business Case, News

“We are quite curious, really, to the tune of one million dollars”

February 14, 2016 liselottekeizer Leave a comment

When the number of movies and series on Netflix increased exponentially, the CEO of Netflix, Reed Hastings, realized they needed to improve their recommendation system to retain customers. After Netflix made several unsuccessful attempts to develop a new algorithm to improve their movie predictions accuracy, they decided to start a three–year open contest. When they launched the challenge, they invited their lead users to come up with a better recommendation system than the one Netflix had at that time, named Cinematch. Many mathematicians, statisticians, software engineers and cyber geeks, symmetrically skilled, from all over the world participated. The variety of participants is often beneficial since somebody outside the field of the problem can often come up with a good solution (Harvard Magazine, 2013). To win the contest, the proposed system had to improve recommendation accuracy with at least 10%, compared to Cinematch. The ones who would achieve this goal, received a price of one million dollars.

Continue reading “We are quite curious, really, to the tune of one million dollars” →

Business Case

Scavenger Hunt 2.0 – Crowdsourcing at its best with Streetspotr

April 25, 2015 birgitfriemann 1 Comment

Imagine yourself having a list of to-dos for the day, including a doctor appointment, grocery shopping, meeting a friend for lunch and your mother for an afternoon tea. Even though these are a number of things to be done, there will always be slack time in between where you cannot be as productive as you would like to be – and as we all know and as it was eloquently put into words by Benjamin Franklin: Time is Money.
Wouldn’t it be great if you could use your waiting time more efficiently and earn some money on the go?

Now, in a second scenario, imagine yourself to be part of a big company, selling products worldwide in thousands of retail shops, creating a massive amount of points of sale. Since you cannot be everywhere at the same time yourself to check how your products are presented in a store, whether enough items are on stock, which types of consumers buy your product etc. you would usually have to send out field workers to collect these valuable information. Unfortunately, this takes time, is very costly and to evaluate the effectiveness of a specific campaign, for example, it is vital to get timely information from various different locations to be able to adapt and improve your strategy while the campaign is still running (1).
Wouldn’t it be great to either clone yourself or have another option to have scalable workforce at the right place at the right time?

Just during the time when crowdsourcing was entering the peak of Gartner’s hype cycle, representing the market’s inflated expectations as well as the start of a mass media hype (2), Streetspotr was founded in Germany in 2011, with the beta phase ending in 2012 – a company exploiting two trends that affect almost all (IT-related) companies at the moment: crowdsourcing with the help of mobile.

Streetspotr is a platform that constitutes a two-sided market (3): On the one side, there are private users who face, for example, the first scenario described above. These individuals can download an app for their smartphone and learn about so-called microjobs (or “spots”) just in proximity of where they’re currently located. When they decide to take the job, they have a limited time frame in which they can answer questions, take photos etc. As soon as the result is accepted by the “employer”, the spotter earns a small amount of money, typically around 2-3€, which is accredited to the spotter’s PayPal account (4).
This way, otherwise wasted time can be turned into money while there is also a social and fun aspect as by now there is a real spotter community, where points and badges can be earned that show your credibility, enhance your reputation and unlock higher paid jobs over time (5).

The other side of the two-sided market is represented by businesses of any size that want to have access to near real-time information collected by a scalable workforce in an extremely cost-effective way. Via the website of Streetspotr, they can enter all different kinds of microjobs, determine a price that the spotter is paid and a time frame (4). As soon as the job is taken and executed by a spotter, Streetspotr controls the result’s quality and the “employer” gets to either accept or decline the result. This way, businesses can utilize the wisdom of the crowd without having to employ masses of field workers; instead making use of a temporal mobile workforce (6).

That this concept works has been shown in several ways by now. First, a number of 300.000 spotters (1) has ensured a critical mass, attracting more and more (and larger) businesses to use Streetspotr for the location-based microjobs they have, causing positive network effects for both sides of the market (3). Second, gamification and the community aspect, as well as the money to be earned ensure an excellent consumer engagement, where hardcore users purposefully plan routes to execute 20- 30 microjobs per day, earning a 4-digit sum of money in one year (6, 7).
Third, after winning two awards for their timely, well executed business model and the way they make use of the trend mobile, having created an “ideal mobile app” (8), Streetspotr now thinks about expanding beyond German-speaking countries to Great Britain and even the United States of America, after having received their first injection of capital in 2014 (7).
Talking about expansion, there is the idea that in addition to the co-creation model of C2B, Streetspotr is thinking about opening the platform to private consumers to occupy both sides of the two-sided market as well (C2C); in this respect, users shall be able to have others collect information on a used car they want to buy or any other information that can be found on the street (6, 9).

All in all, I think Streetspotr has managed to develop a business model that is really interesting and has a high potential – it is timely, makes use of current trends and serves the individual as well as the business side of the market, having managed to create a critical mass on both sides. Personally, I have just downloaded the app and look forward to earning some money on the go from now on.

References: