Archive for March, 2010
The Source is designed to help the expanding population of bloggers, as well as traditional media, keep abreast of financial security trends and the growing pressure on individuals to generate retirement income beyond Social Security and employer-sponsored plans. Content already posted on the site includes:
- Highlights of a recent AXA Equitable retirement thought leadership forum that featured former Federal Reserve Board Chairman Paul Volcker.
- A look at the trends in inflation, interest rates and taxes that are changing the landscape of retirement in America.
- A video that reports on the unique financial needs of women.
It’s possible that this could be the beginning of a shift in the industry toward greater acceptance of newer forms of media like blogging. Given current angst among US consumers and the negative perception many have of the insurance industry as a whole, this could prove very beneficial.
The popularity of blogs has surged for much of the past decade, and consumers are turning to blogs more and more for information. For better or worse, people have a tendency to trust information and advice from blogs, which are often perceived as more genuine and “human” than conventional forms of print media.
Given the mass acceptance of blogs by the public, it makes sense that bloggers can play a key role in lubricating the flow of information between consumers and insurance companies seeking to develop closer relationships with their clients.
One of the hottest topics on the web this week was Facebook’s recent dethroning of Google as “most visited” site (albeit it only for one week). This was a historic, attention-grabbing moment for Facebook and also accentuates the meteoric rise in popularity of social media.
As I thought about Facebook’s visitation statistics, it struck me that there is something fundamentally different about a visit to a social media site like Facebook compared to a drop-in on Google. Ten years ago, all visits were more or less equal. A visit was simply a page view. If someone was viewing a page, presumably it was because the page had something of interest. In other words, the page had something to offer the visitor.
However, a visitor’s motivation for navigating to a site like Facebook is different, as is the subsequent experience while visiting. People go to social media sites not only to view and retrieve information, they’re also going there to add information. I know, I know, Google is collecting information every time you do a search, but it’s not readily available to other web users. A web search is a one-way street.
A status update on Facebook is so much more. Even if someone is asking a question on Facebook, the question itself contains information because it says something about the person, including their interests, needs, and wants. A seemingly insignificant bit of information about someone can trigger an entire exchange of additional status updates, each of which paints an additional hue on a social canvas that was very blank only a few years ago.
And while social media sites–a group growing three times faster than the overall Internet in terms of “time spent” according to Neilsen in 2009–continue their rocket-like ascent, the data contributed by users of these sites that can actually be used by other people grow at an astronomical rate.
Consider the following statistics on just a few of the most popular social media sites:
- Six-year-old Facebook now has over 400 million users users (exceeding the population of the US). Half of them log into Facebook every day, and 35 million of them update their statuses every day.
- As of March 2010, users of YouTube upload 20 hours of video every minute, a rate that equals 12 centuries of video per year!
- The number of tweets blasted by Twitter users grew 1400% from 2009 to 2010. The loquacious group now generates 50 million tweets a day, or 600 per second.
Great, so what can we do with all of it?
Obviously, there is a lot of non-information in all that clamor, especially if you’re looking at it microscopically, which as individual users, we are. But the possibilities for finding patterns and trends are thought-provoking to say the least. For example, it may be possible to create “social graphs” of the various connections that people have with others at a global, state, and city level as this visualization suggests. Such a bird’s eye view of real-time human interaction is remarkable.
A recent article in the Economist notes that
… the world contains an unimaginably vast amount of digital information which is getting ever vaster ever more rapidly. This makes it possible to do many things that previously could not be done: spot business trends, prevent diseases, combat crime and so on. Managed well, the data can be used to unlock new sources of economic value, provide fresh insights into science and hold governments to account.
The article distinguishes information and knowledge in the following way: “information is made up of a collection of data and knowledge is made up of different strands of information.”
Considering that digital information increases tenfold every five years and that Cisco predicts that the torrent of data traversing cyberspace will approach 667 exabytes by 2013 (that’s 667 billion gigabytes), finding those strands of information will be quite a challenge.
But the reward is likely great too.
The Economist also provides a hint as to how the insurance industry might be affected:
As the world is becoming increasingly digital, aggregating and analysing data is likely to bring huge benefits in other fields as well. For example, Mr Mundie of Microsoft and Eric Schmidt, the boss of Google, sit on a presidential task force to reform American health care. Early on in this process Eric and I both said: Look, if you really want to transform health care, you basically build a sort of health-care economy around the data that relate to people Mr Mundie explains. You would not just think of data as the ‘exhaust’ of providing health services, but rather they become a central asset in trying to figure out how you would improve every aspect of health care. It’s a bit of an inversion.
To be sure, digital records should make life easier for doctors, bring down costs for providers and patients and improve the quality of care. But in aggregate the data can also be mined to spot unwanted drug interactions, identify the most effective treatments and predict the onset of disease before symptoms emerge. Computers already attempt to do these things, but need to be explicitly programmed for them. In a world of big data the correlations surface almost by themselves.
Social media can play a big role in health care reform too, as I suggested in a previous post.
If you’re an actuary like me, work in some other quantitative field, or are just interested in finding those information trends, the future is bright. It will be fascinating to see what patterns emerge as we learn more about ourselves than we ever knew before.
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[Photo by joiseyshowaa via Flicker]