Flevy Blog is an online business magazine covering Business Strategies, Business Theories, & Business Stories.

An in-depth Q&A on Social Media

Editor's Note: Take a look at our featured best practice, Organization Design Toolkit (103-slide PowerPoint presentation). Recent McKinsey research surveyed a large set of global executives and suggests that many companies, these days, are in a nearly permanent state of organizational flux. A rise in efforts in Organizational Design is attributed to the accelerating pace of structural change generated by market [read more]

* * * *

socialmediaSocial media–it’s a hot topic. Much has been written about how important social media is, how to measure it, the pitfalls of doing it, and how it will transform marketing as we know it.

What has been missing from these social media discussions is how companies can leverage social media to better understand consumers and use this insight to improve innovation, commercialisation, and performance. Never before have marketers been able to eavesdrop on what consumers actually say to their friends; however, with Twitter, Facebook, etc., it is now possible to glean information from authentic, real-time conversations that consumers have with one another.

To better understand how Marketers can leverage social media to drive insight and develop more effective marketing programs, I talked to three senior marketing experts:

I also talked to two research and consulting experts who are regularly using non-traditional methods to generate customer insight:

Question: Why is social media a good place to mine for customer insight?

Consumers are discussing brands, companies, and experiences on social media, according to Serendio’s Condamoor. “While some consumers will still pick up a phone to call a help line, the vast majority are now turning to blogs, Facebook, Twitter, etc., to provide real-time experience feedback,” he said.

Optimal Strategix Group’s Sukumar added that consumers engaging in social media often do so in a more detailed and authentic manner. “As a result, the source of information is often faster and more accurate than traditional methods of generating consumer insight,” he said.

Question: How does social media differ from traditional methods as a consumer insight tool?

According to Grant Stanley, the similarities are few. “The velocity, speed, cost, number of respondents, honesty . . . the differences are tremendous,” he explained. “We can generate feedback almost immediately, with a sample size of thousands. Because consumers are networking with their friends in their natural environment, we experience little to no bias that might be found if they were answering a survey done by a manufacturer.”

One way to think about it, he explained, is as if social media were a constant focus group whose feedback can be fed into more quantitative research.

Mondelez’ Bindra suggested that social media is an effective and efficient way to “generate an authentic, 360-degree perspective about your product or brand with an enormous sample size in real time.” While social media is currently an effective way to augment traditional methods given that it is in its infancy, Bindra foresees the potential for social media to become a richer source of consumer insight given its speed, low cost, and wide reach.

However, while using social media as a means to generate customer insight is valuable, it is best when used in conjunction with traditional methods, such as surveys and more formal, methodologically accurate tools. “In aggregate, social media can provide the quick, cost-effective, scalable insight that feeds into the accurate and predictive output that more traditional methods provide,” Stanley noted.

Question: How can Marketers use social media to get a better understanding of consumers?

The first goal is to identify what the company wants to learn about. Then, once the “insight need” is determined, specialists can develop programs to search targeted sites to extract thousands of related data points. Once this is collected, an analytics specialist can use sophisticated methodologies to analyse the content and derive significant consumer insight. Today, most of this work is outsourced to specialists because it requires very specific training that usually doesn’t exist within firms.

“This analysis can then be used by the company in a myriad of ways, such as determining how customers feel about a new product launch, ranking of customer service issues, measuring likes/dislikes of a current product, and their reaction to a new marketing campaign,” Stanley said. “Theoretically, this technology could also be used to better understand other key stakeholders, such as shareholders, labour unions, etc.”

Question: How are you leveraging social media data to create a better customer experience?

Wendy’s is designing marketing programs around insights pulled directly from social listening. For example, Wendy’s launched a social media-based initiative called #Tweatfor1k in support of its new Flatbread Grilled Chicken product. The program was based on “food-spotting” that Wendy’s observed across key social sites, such as Instagram and Twitter.

“The trend we saw was people wanting to take a photo of their food and share it across their social networks,” Bahner said. “We turned this into a traffic-driving promotion that engages and rewards consumers for visiting our restaurants and trying our new product. In addition, we use information regarding patterns [when people tweet to their networks] to better understand our loyalists.”

This initiative started by recognising heavily engaged customer behaviour and then using this insight to create a program to not only rewards the behaviour, but to create an enhanced experience for Wendy’s most engaged customers.

As another example, Grant Stanley talked about new tools that have been developed to help manufacturers capture, assess, and analyse conversations that consumers are having about specific ads and products. Rather than going through the traditional advertising testing, which is somewhat resource-intensive, it’s possible to air a commercial and then get instantaneous insight on what is and isn’t working. Likewise, social media is especially valuable in identifying the most salient new flavours, products, or white space opportunities.

From an idea generation standpoint, “The days of managers sitting in a room and white boarding new product ideas has given way to our ability to harness millions of consumer needs, desires, and wishes via social media,” Stanley said.

Question: Are there any examples of how social listening can help drive innovation and how to facilitate conversion of listening into action?

NRG Energy’s Jones provided an interesting example of how one of NRG’s retail companies, Reliant, used social listening skills to address an opportunity. Reliant ran a TV spot, called Smart Dog, with Matthew McConaughey’s voiceover.  Quickly, it became apparent via social media that people loved the music and wanted to download it as a ringtone.

“Never would it have occurred to us that the music would have been popular enough to want to download. We could have ignored the insight, but chose to obtain the rights for the music so that consumers could download it,” Jones said. “To date, we have had thousands of downloads of the ringtone and converted frustration into satisfaction.”

While this ability to glean insight and then transform it into actual programs may seem simple, it’s not. Many firms have customer service organisations that leverage social media to solve problems. However, these organisations may be isolated from the rest of the organisation. Jones indicated that her company has a very effective method for converting customer knowledge into firm action.

“Marketing manages all social media listening efforts. However, we are simply ambassadors who daily summarise key customer learning and then disseminate this to an individual within each department who serves as that department’s social media ambassador,” Jones said. “That individual is then empowered to address the problem or opportunity. This process of quickly feeding information to the right person is what it is enabling us to act upon learning.”

Question: Are there any examples of the power that social media can have in driving consumer understanding?

CSM Consultants are working on a project with the NHS to better understand patient issues in the healthcare arena.

“We are delving into targeted Web sites where patients are engaging in direct conversations with doctors and fellow patients regarding a specific disease,” Stanley said. “In these instances, there is significant information about the patient that the doctor/scientist can tap into while complying with all the healthcare privacy laws. For example, say that we are talking about rosacea, a skin condition. There are specific Web sites designed to talk about this condition, the treatment efficacy, side effects, medication, dosage, pros and cons of competing brands, and more. There are also community boards where patients help one another and some where doctors weigh in as well. This information is powerful as a starting point to try and ascertain where products are successful and where they are failing.”

Rather than doing an expensive focus group, which tends to be unrepresentative, or using a more traditional research instrument, which takes time, this approach can gather data almost immediately. “This data can either be used as fodder for quantitative, predictive research or can be directly fed into R&D efforts, marketing communication, and product design. It simply depends on the degree of rigor and predictive validation that the client wants,” Stanley added.

Question: Is there any downside to using social media to generate consumer insight?

Social media can provide insight on past experiences, but it cannot replace such things as concept testing and product testing. “It’s not as good of a source to test future concepts,” Stanley said. “There are ways around this, but dropping into today’s conversations between consumers is rarely a great venue to think up the next iPad.”

Another challenge social media provides as a source of consumer insight is that analysis usually cannot link consumer information with a comment. “There is technology in development that will make this easier, but right now, if Consumer X posts a comment on Twitter, we can’t really tell if they like action movies, live in Boston, Lincolnshire, have a Ford, or have three dogs at home,” Stanley explained. “The ability to connect demographic/geographic/psychographic usage data to their opinions is limited right now. However, as an immediate, cost-effective, large sample-size response vehicle, social media is unparalleled in its application.”

While marketers are focused on leveraging social media to build the business, perhaps there is another way to extract value out of social media–by using it to generate insight that can lead to better innovation, better marketing, and an enhanced customer experience. As Stanley suggested, marketers are just beginning to explore the power of social media in augmenting more traditional research methods.

Excel workbook
Accountants, accounting firms, and real estate property owners can all benefit from this cost segregation study (CSS) template. It makes the estimated benefit easy to figure out and has flexible assumptions for high level or detailed segregation analysis. You get a summary of cost [read more]

Do You Want to Implement Business Best Practices?

You can download in-depth presentations on 100s of management topics from the FlevyPro Library. FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives.

For even more best practices available on Flevy, have a look at our top 100 lists:

These best practices are of the same as those leveraged by top-tier management consulting firms, like McKinsey, BCG, Bain, and Accenture. Improve the growth and efficiency of your organization by utilizing these best practice frameworks, templates, and tools. Most were developed by seasoned executives and consultants with over 20+ years of experience.

Readers of This Article Are Interested in These Resources

70-slide PowerPoint presentation
Organizational Design (OD) is a structured approach to aligning the structure, processes, and systems of an organization to achieve its strategic objectives and enhance performance. It encompasses various components, including defining the purpose of reorganization, determining supportive [read more]

145-slide PowerPoint presentation
Excel workbook

About Grant Stanley

Grant Stanley is an experienced Sales & Marketing Leader with over 20+ years coaching, training, and developing New and Existing Business. With experience in IT, Telecom, Capital Equipment, and FMCG, Grant shares his business experiences and expertise on his blog, CSM Consultants (Inspiring & Enabling Change). Grant is also an author on Flevy, where he has published materials from Business Fundamentals to Management and Leadership Excellence. Take a look at all of Grant's Flevy best practice documents here. You can also connect with Grant Stanley on LinkedIn here.

, ,

Complimentary Business Training Guides

Many companies develop robust strategies, but struggle with operationalizing their strategies into implementable steps. This presentation from flevy introduces 12 powerful business frameworks spanning both Strategy Development and Strategy Execution. [Learn more]

  This 48-page whitepaper, authored by consultancy Envisioning, provides the frameworks, tools, and insights needed to manage serious Change—under the backdrop of the business lifecycle. These lifecycle stages are each marked by distinct attributes, challenges, and behaviors. [Learn more]

We've developed a very comprehensive collection of Strategy & Transformation PowerPoint templates for you to use in your own business presentations, spanning topics from Growth Strategy to Brand Development to Innovation to Customer Experience to Strategic Management. [Learn more]

  We have compiled a collection of 10 Lean Six Sigma templates (Excel) and Operational Excellence guides (PowerPoint) by a multitude of LSS experts. These tools cover topics including 8 Disciplines (8D), 5 Why's, 7 Wastes, Value Stream Mapping (VSM), and DMAIC. [Learn more]
Recent Articles by Corporate Function






The Flevy Business Blog (https://flevy.com/blog) is a leading source of information on business strategies, business theories, and business stories. Most of our articles are authored by management consultants and industry executives with over 20 years of experience.

Flevy (https://flevy.com) is the marketplace for business best practices, such as management frameworks, presentation templates, and financial models. Our best practice documents are of the same caliber as those produced by top-tier consulting firms (like McKinsey, Bain, Accenture, BCG, and Deloitte) and used by Fortune 100 organizations. Learn more about Flevy here.

Connect with Flevy:


About Flevy.com   /   Terms   /   Privacy Policy
© . Flevy LLC. All Rights Reserved.