This 2009 article outlines research conducted my doctoral students, and a professor at the University of Texas, Austin. It attempts to correlate Twitter activity with product demand. The researchers contend that companies and executives could utilize this information to maintain appropriate inventory levels and predict sales activity.
I'll admit, when this notion was presented toward the beginning of the article I almost started laughing. As they outlined their premise I did not stop. Lastly, the example they used in no way supported their contention that executives could use this activity to effectively predict inventory levels in given store locations. For the example they tracked box office sales for 3 different movies (nationally) and gauged them on the Twitter activity they found. In order to do this effectively they had to categorize the Tweets as either favorable, neutral, or negative.
First and foremost, this seems like an exhausting task for any company to undertake, not only that, but it’s very subjective in many cases. In addition, Twitter's approach to determining whether a Tweet is positive or negative seems flawed to me. In part, they track emoticons. A ":-)" means it’s a positive Tweet, a ":-(" means it’s a negative one. But, using the movie example, what if I Tweeted "Tried to see 'The Hangover, but it's sold out :-(", what if 50 people Tweeted that, 100! Does that mean people hate "The Hangover", I don't think so. Second, how does tracking box office sales nationally correlate to inventory levels? Let’s say retailers for instance, their product demands vary dramatically based on location? And "Land of the Lost", "My Life in Ruins", and "The Hangover"??? Really??? That's like trying to gauge whether people like steak over canned tuna, in oil. I mean lets shoot for something a little more challenging. What about a product release (say the IPAD) and gauging Tweets in Boston, NYC, Miami, and Chicago with sales levels for those cities? Prove that works and you got me.
Ok, enough negatives, on the up-side I did like their take-aways for company executives. Twitter can be a powerful additional resource for gauging customer satisfaction and even soliciting ideas for enhancements. Executives should not overlook this medium. Its real-time, it’s easy, and hello, its FREE! This should in no way be limited to Twitter though. An effective marketing/PR department would be well-served in developing a social-media research team that tracks and engages customer feedback on all social media sites. Quantitative and qualitative information can be compiled in quarterly reports and presented to senior management. I believe this process will soon replace, at least in part, more expensive methods utilized today.
What do you think?! Will Twitter evolve into a powerful market research tool in the future? Is there an opportunity for tech-savvy grad/undergrad students to create a Twitter Digest (Trademark Pending!!) for executives to use in product development, updating, marketing in designated industries?
6/10
Article: "Business Insight (A Special Report): Technology- Following the Tweets: By Monitoring Comments on Twitter, Companies Can Predict Where Next Week's Sales Are Heading", WSJ: 11/30/2009
I completely agree with your take on the article. It was lacking a lot of the punch that it promised to deliver and you made a good point that those weren't even good movies to choose to conduct data on. It would have been much better if they looked at a few highly anticipated movies and collected data about which ones had staying power and which ended up being busts after the first weekend. Certainly no one expected the other two movies (not the Hangover) to really have any sort of success. I'm a huge movie fan and I have barely even heard of "My Life in Ruins" and on top of that I think most people assumed Land of the Lost was going to be pretty crappy even from its first trailer. I basically came to the same conclusion in my blog post: the authors need to try harder.
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