"The New Visible Hand: Can Social Data Illuminate Market Forces?"

 

Just a short post this Sunday evening to reflect on a topic that’s been at the center of so many conversations this week:  how the social web is making everything visible,  and how making everything visible is not entirely good.

It’s a conversation, of course, that has several threads.  On the personal level, it’s easy to understand the complaint — on consumer social networks, people are making everything visible to marketers –  what they are thinking, what they are doing, what they are planning to do — every moment of the day.  Whether people understand that they are doing this is besides the point.  As many folks in the social media world have argued — especially those who earn a paycheck dispensing technology or advice — traditional notions of privacy are coming to an end.  Their message to unhappy consumers:  get over it.   But the debate is only just beginning to heat up, so if you are in fact in the social media biz, I advise you get over this as well:  the

privacy debate is not over.

Also on the personal level is a happier conversation:  how the emergence of personal visibility — and the disappearance of anonymity — is making the web a more habitable place.  Here the transparency of what we think-do-and-plan has a more salutary effect.  While trolls on the Web have not disappeared — and while discourse is increasingly fractured and segregated according to personal tastes and political preferences –  the Web does seem like a more civil place than, say, just a few years ago.  And that, I believe is mostly a good thing.  It’s not such a big topic of debate today.  We may in fact have moved on from this conversation.

But there’s a third talk about visibility that I believe is really just beginning, and it’s the value of social data in understanding how markets work.   A few things worth noting here:

–In conversation with people in industry (mostly at conferences, but sometimes in private) social data looks like something that interests almost all enlightened business people.   It began as a modest market segment for social  media back in 2005-2006, and now it’s looking like a juggernaut.

–The value of social data is manifold. Anything from understanding what moms in Cleveland are planning for dinner at 3:30 PM to how social movements are formed in the Middle East.

–In both the business and political worlds, leaders are looking to understand how social data can be parsed to understand market forces. What’s interesting here is how social data may in fact be providing else with a wider lens to make more things about our world visible.

Some perspective:  in 1977, Alfred Chandler’s The Visible Hand tweaked the Adam Smith notion that an “invisible hand” manipulated market forces.  With the rise of the new managerial class, the motions of the principal actor in our modern economy — the firm — in fact are visible.  And as a result, manageable. You see, we never did like the idea of an invisible hand, because there’s not much you can do with it.  It offends our sense of autonomy.  Unless, of course, you have blind faith in market forces, and we know not everyone belongs that particular church.  For as many believers we have in free markets, there are at least as many who do not.  Reminds me of the Jean Shepard title:  “In God We Trust:  All Others Pay Cash.”

But here’s the thing:  with social data, we may actually have the opportunity to act on the bigger picture that interested Mr. Smith — the market — by empowering the people that interested Mr. Chandler — the managerial class.   With the new wave of analytic and predictive tools that sit on top of it, social data indeed might tell us where markets are going and perhaps enable us to act before things happen. And that’s a part of the general conversation about visibility that’s quite happy, if a tad giddy and overly optimistic.  For one thing, we’re just at the very beginning of this thing that Andreas Weigand (former chief scientist at Amazon) calls the Social Data Revolution.  For another, the data is available to everyone, including our enemies, our business peers, and the larger population that the economy serves — call them the 99%.  Truth is, in the postdigital world, there’s more than just one hand.  There are many hands pulling — with various degrees of strength — the long tail of influence.

Depending on how you look at things, that’s a happy situation or it’s not.  But like the end of privacy that we’re still lamenting, it may be time to get over it.   Data wants to be free, and it will almost certainly create value for anyone who can get their mitts on it.  At least we’ll be able to see them.