You can tell a lot about a company from the conversations that take place about it on social media. Apparently, that also includes future share price movements. According to a new data mining study, the more separate conversations that take place on Twitter about a company in the S&P 500, the better that company is likely to perform on the stock market. When conversations focus on just a single topic, the company is likely to perform poorly.
The reason is not entirely clear although researcher Vagelis Hristidis speculated that the cause might have something to with people focusing on bad news and growing bored quickly with good news.
When Apple produces a phone whose antenna does not work, for example, social media chat will focus on the problem. That is a preoccupation that is very difficult to shift especially when it takes hold among millions of people, even with the help of expensive public relations firms. Apple might have tried to dismiss the antennagate problems of the iPhone 4 and move the conversation on, but it ended up handing out free bumpers and dismissing the engineer instead. As long as the company does not repeat antennagate though, conversations about that company will continue to range from the iPad to what it is going to do with its giant pile of cash.
That is interesting news as far is it goes, but only 500 companies are on the S&P 500 and most small firms would be happy just to be the subject of conversation. The problem though is that when spontaneous conversations about small companies do occur, they often focus on criticism. Jorno Keyboard, a manufacturer of a foldable Bluetooth keyboard, seems to spend its entire time on social media dealing with complaints about the product’s delayed launch rather than discussing its unique folding structure and small size.
Small firms though have an advantage: when conversations about them are not happening by themselves, their social media staff get to decide the conversation starters. When they tweet a link to a blog post that touches on their industry, they start to push the conversation in the direction of that post. When they ask followers what they think of the product’s new color or shape, they keep chat focused on appearance, spreading word about the brand without opening it to any substantive criticism. Even some large firms can do this. Coca Cola is rarely in the news (although it is always on billboards) so its Facebook page constantly asks simple questions that prompt the drink’s fans to mention the product’s name without engaging in any real discussion about it.
When your followers and fans have one reason to talk about your business that reason is likely to be a problem. That is a time to listen, respond and make sure you fix the issue. But when the conversation is not happening, you get to start it. That conversation might not put you on the S&P 500, it might just keep the business rising.
[I should mention that there are some fine products to control any possible criticism. I should also mention that you need it sorely. Contact me and I will suggest a few.]


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