Social media analysis to transform business competition
The impacts of social media are increasing as it is not confined to sales promotion only, but also allowing the entrepreneurs to analyse and improve based on the comments and feedback on products and competitors.
The world is now flooded with much better mobile devices and strong social applications which has eased the process of sharing experience about products, services, and sales.
It has been observed that the influence of social media on buying decisions varies significantly across product categories. It has also been found that a fraction of social influencers are creating the buzz. For instance, very few would use social media in choosing utility services; but there are large numbers of people on social media, who are influenced by the opinion of their peers on travel, investment services, and over the counter drugs. Almost half of these consumers search for online recommendations on services and products.
Buzz analytics is a new phenomenon which relates to analysing the data retrieved from social media about a product, its price, defects or advantages. It helps companies to read growing signals from social media to identify and prioritise actions across broad product lines. It captures consumer insights by mining the abundant and free information from online conversations in which comments are posted about product features on company websites and external platforms like Facebook and Twitter.
The companies are then in a position to analyse positive and negative sentiments retrieved through data mining. It could then be converted into meaningful metrics at the product-feature level. Moreover, since product information is also easily accessible on the websites of competitors, an analysis to benchmark strengths and weaknesses is also possible and a cost effective way of gathering creditable data.
Though this is not happening in Pakistan, in developed economies, many companies use it for insights on product features; and after analysing the data they add value and increase their market share. The data analysis helps in better pricing, marketing or merchandising options.
This data mining also helps determine which features are less important to consumers and thus suitable for elimination or modification to optimise costs. Companies that take this analysis seriously and adopt appropriate measures, succeed in nudging out competitors. The digital footprint is rapidly expanding, but analogue technology is still in vogue in many countries, including Pakistan.
The smartphones account for 30 percent of mobile users in Pakistan; the rest 70 percent are still using analogue technology. Analogue therefore is still an important medium in our culture.
Recommendations about brands are also made through SMS and the companies also contact almost half of their consumers through this medium. Offline recommendations have substantial influence on consumers while buying a product.
Creditable research reveals that online articles written by journalists prompt consumers to seek out social media to further gather information on purchases. Consumers that use search engines to gain initial knowledge on a product, often go to the social media before they buy.
For the companies, it is important to recognise the real influencers on social media as. These powerful influencers are more active in product categories such as shoes, clothing, and cosmetics. Analysis of the social media data shows that only five percent of the recommenders or influencers account for 45 percent of the social influence generated. Some companies request for endorsements on their web pages.
It has been found that response to requests for endorsement is always lukewarm. Consumers respond enthusiastically if they are asked to comment on the company’s page. An interesting point in this regard is that the positive comments are also three times higher than the negative ones. Companies with the right strategy can take advantage of even negative vibes by responding promptly and prudently to the comments.