You can read all of my last post on the misappropriated use of the term “social regulation” here, but if you’re late to the fray then here’s the end of it (the most relevant bit really, given I’m using it to justify another blog post):

Social regulation, in the hands of individual consumers, changes the game. Literally. No longer can corporations amuse themselves by opening the playbook of regulatory requirements and then chart a course to navigate through official regulatory complexity to an end goal that meets the company’s objectives, preferably exploiting a loophole or two along the way. Now, consumers and the marketing commentariat expect to be consulted informally, continuously, with actual impact on the company’s ability to make decisions.

There are two questions for business leaders to answer, and sooner rather than later:

Is this a good thing?

What can we do about it?

Let’s start with the first of those questions: Is this a good thing?

For an answer, let’s jump in the way-back-when machine and apply the Henry Ford test: “If I had asked people what they wanted, they would have said faster horses.” – Henry Ford

So he didn’t ask. In today’s socialised marketing world, the process of collaboration is seen as integral to innovation. But most of the population isn’t particularly visionary. If they were, we wouldn’t be inspired by the likes of Steve Jobs, or Seth Godin, or either of the Gary Abletts. The fact is…most of us actually are the great unwashed. I know I am. So why would we want the future of transportation decided by the masses? Me, I want a jet pack, and I’m quite happy to be told by someone else what it’ll look like and how much I’ll have to pay for it.

Limited offerings

“People can have the Model T in any color – so long as it’s black.” – Henry Ford

The first Model T Ford was built on 1 October, 1908. And it was black. There comes a point in the development, manufacture and sale of any product where a commercial decision has to be made. Was there a market for a blue Model T? Probably. Was it financially viable to make blue ones as well as black? Probably not. Or maybe it was, but the perceived luxury of a black car meant Henry could charge more for it. Or maybe Henry didn’t like blue. Or maybe Henry was a closet emo and this was his chance to make everyone wear black, and like it.

Regardless, the case study is illustrative of one of the great truths of consumerism. We don’t know we want one until we’re told we do. And if you don’t believe that, turn off your smartphone, throw away your tablet and pull your horse over to the side of the road while you give yourself a good talking to.

Innovation

Yes, the internet provides unprecedented opportunity for real-time market research. Yes, it’s possible to tailor not just your marketing but also your product development specifically to get the juices of your target audience flowing in a way hitherto unimagined by Henry Ford and his ilk.

But at the same time, the rule of the masses is frequently detrimental to innovation and experimentation, unless the innovation and experimentation already aligns with the market’s expectations.

Yes Henry, you can build me a car. What kind of horse is that?

Prisoner’s dilemma

Social regulation in its current state is the ultimate Prisoner’s Dilemma. If everyone were able to rationalise a common good out of the circumstances facing them, it would be possible to argue that increasing social regulation is only a good thing.

But humans aren’t big-picture rationalists.

Despite the hallelujah-inducing fodder that floods the information superhighway, there is a massive downside risk here. In simple terms, there are 23 million Australians who want faster horses. They don’t just want everyone to have faster horses though. We want everyone to have a faster horse…but we want ours to be the fastest of all.

Like it or not, the kid still wants a Model T pony.