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Digital & Social⟩Social Media

What Can Social Media Be Used For?

Disclaimer Please note that we are not authorised to provide any investment advice. The information on this page should be construed for information purposes only. We may earn commissions from the products mentioned on this site.
author imageConnor Brooke Last updated: August 31, 2011
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Social media is not only a whole new way for consumers to communicate and express themselves, it’s also a whole new way for corporations to conduct business. Sure, a corporation can have a Twitter account and a Facebook fan page, but that’s the obvious application. Every day I see new applications for social media in market research, marketing communications, brand management, innovation, and even supply chain management.

Here are some ways I’m seeing social media applied in business.

For Brand Managers

Brand audit—You expend a lot of effort to create a specific image for your brand, but how successful are you? Is the image you want consumers to have the one they do, in fact, have? Social media gives you a quick and accurate way to find out. You can perform a brand audit by analyzing posts (also referred to as “sound bites” or “verbatim”) from consumers about a brand. The posts can be sorted into positive or negative classifications and then grouped into themes. Do this, and you’ll know if the brand positioning you want is the positioning you’ve got.

Tracking new product launches—You can analyze how sentiment and buzz in social media change over time (daily, weekly, monthly) following the launch of a new product.

Brand equity tracking—Brand managers and customer service managers can track a metric such as sentiment (positive or negative), which can be thought of as a measure of brand equity. What’s more, brand equity metrics obtained through social media analysis are available without waiting for survey data.

Ad campaign tracking—You can conduct a social media search for sound bites that refer only to commercials, print ads, YouTube videos and other media to judge reaction to a campaign.

For Customer Service

Consumer satisfaction measurement —This is really the same technique as brand equity tracking (i.e., tracking sentiment), but it’s used for customer service evaluation instead. Net Promoter Score (NPS), which is survey based, is sometimes used; sentiment is simply another way to measure the same parameter with social media.

For Marketing

Demographic segmentation—You can segment your audience by gender and other factors to analyze opinions, behaviors and emotions of specific slices of your audience.

For Business Intelligence

Marketing spend ROI—Measure sentiment over time and then correlate it with marketing spend to show return on dollars invested in marketing programs.

For Market Researchers

Category analysis—What brands in a category get talked about the most? Which one do consumers like the most? The least? What is it about each brand that they like or dislike? You can use social media to find out all this and more. You can compare brands in a category on various attributes, including share of buzz, overall sentiment, and key positive and negative themes. This blog post shows the technique applied to the casual dining segment. You can also trend these metrics over time, something that’s easy to do with social media but has proven difficult to do on a frequent basis with traditional research.

Competitive intelligence—Using traditional methods, in-depth analysis of consumer sentiment about your competitors is prohibitively expensive (not to mention time-consuming), but not so when using social media. This is probably the most common use I’ve seen for social media in business.

Product innovation—An innovation technique that social media supports is incremental innovation, where you improve your existing product by fixing the complaints or by finding out what people like about your competitor and adding those benefits to your product. In addition, consumer feedback can directly or indirectly lead to ideas for new products or new product features or applications.

Lead User Scouting—You can search social media for “lead users,” who are users of a product or service that currently experience needs still unknown to the public and who would benefit greatly if they could find a solution to these needs. If they do, their solution can be commercialized, and the Lead User Method suggests it will be more successful than most. Best examples of such consumer-generated product ideas are the sports drink Gatorade, developed with input from athletes, and the “liquid paper” invented by a secretary for correcting typos.

For Public Relations

Hot-issue identification—This is a basic “listening” function that reports on what’s being said in social media, but many PR managers are starting to use social media to get an in-depth analysis of what is being said, allowing them to move beyond what to why.

Crisis management—PR managers can use social media listening to detect a steep drop in sentiment, and can analyze sound bites to understand the issue and help them devise a plan to address it.

For R&D

New product development—Companies can analyze social media to help develop a new product for an existing category by identifying everything people like and dislike about existing products in the category, then introducing a great product that has all the benefits and none of the problems. Here’s an example of that kind of analysis applied to the search for an ideal supermarket.

For Sales

Lead generation—Sales staff can find sound bites where consumers have made negative remarks about a product. If your company makes a similar product that doesn’t have the flaws mentioned, you can respond directly to consumers, recommending they try your product.

For Social Media Managers

Community participation—Sure, you should be on twitter and facebook. But where else should you be looking? Is there a topic-centric forum that happens to discuss your brand a lot? Is there a popular group of bloggers who discuss your products? You can analyze where the social media conversation about your brand is taking place so you can engage consumers in those communities to counteract negative opinions and/or inaccurate information.

Brand snapshot report—You can create a report you send on a regular basis to decision-makers, giving an up-to-the-minute read on consumer perception of your brand as compared to other brands.

For Category Managers

Brand rationalization—A retailer may need to decide which brands and how many brands a store should offer in a particular product category. One way to do this with social media is to do a brand audit on each brand in the category, then look at the top three positives for each of them. If any brands have exactly the same top three positives, then one of them can probably go. The retailer might ditch the brand with the lowest sentiment score, for instance, and keep the others because they have distinct benefits for consumers.

For Mergers & Acquisitions

Due diligence—Business managers can use netnography to get up to speed on what consumers think of a company they’re about to buy. It’s like being able to do focus groups on the acquisition target’s consumers—but much, much faster and more cost-effectively.

For Stockbrokers

Stock picking—Stock traders have an ongoing online conversation about stocks. Stockbrokers can search social media posts for ticker symbols to learn what traders are saying about specific stocks.

Compliance—In the heyday of the dot com bubble, brokers would send a mass email to bash a stock, then send another mass email to pimp the stock. Now they may be using twitter and the like to do the same thing. Regulators could analyze social media to find out who is both denigrating and promoting the same stock.

For Supply Chain Managers

Stock-out identification—You can use social media to identify points in time when consumers complain they couldn’t find your product so you can pinpoint and fix the supply chain problem.

How NetBase Fits In

For these applications of social media, it’s possible to manually find posts from consumers and determine if they’re positive or negative and display the results graphically—but analyzing posts accurately on a massive scale using a tool designed for these tasks is much faster and more cost-effective. NetBase technology is uniquely suited for this—it can measure sentiment at 80-plus percent accuracy (see Accurately Understand Social Consumers) with 70-plus percent correlation to customer satisfaction measures (see Can Social Media Measure Customer Satisfaction?).

What Else?

What do you use social media for in your role?

Are there any applications for social media in finance or accounting? How is Wall Street using social media?

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  This article was written for Business 2 Community by Connor Brooke.
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Author: Connor Brooke

Connor is a Scottish financial expert, specialising in wealth management and equity investing. Based in Glasgow, Connor writes full-time for a wide selection of financial websites, whilst also providing startup consulting to small businesses. Holding a Bachelor’s degree in Finance, and a Master’s degree in Investment Fund Management, Connor has …

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 Discuss This Article

Show Comments (2)
  • Daniel Muguko says:
    September 7, 2011 at 4:42 pm

    This is very timely info for me as i embark on my social media research proposal.
    Thanks

  • Fafi says:
    May 16, 2012 at 6:53 am

    Thanks for the great info. I like the way you mentioned each category separately for social media.

  Comments on this article are closed.

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