Companies and buyers interact through various channels, which include news, advertising, social media and consumer sentiment. Most brands tend to develop a separate strategy for each, but scientists vote for integrated approach. “You can't just be in your silo,” says Roland T. Rust, Distinguished Professor at University of Maryland. “You have to manage all of your brand communications as a big system.”
Welcome to “Echoverse”
According to Professor Rust and his fellow authors, messages about brands circulate in a complex system of feedback loops. The research team of the University of Tennessee, Massey University and University of Maryland calls it the “echoverse”, which stands for the universe of brand communications where everything echoes everything.
The authors shared this finding in the May 2016 Journal of Marketing lead article “Brand Buzz in the Echoverse”. It covers the results of one the most comprehensive studies in the brand communication literature.
Professor Harald van Heerde, Dr Kelly Hewett, Professor Roland T. Rust and Dr William Rand have analyzed a huge amount of information about the “big four” banks in the United States. The dataset included 18 million tweets, 5000 press releases and 65,000 articles. Each of those messages, the study found, was able to influence consumer deposits in its own way. However, the efficiency of brand communication was defined by the general “valence”, or tone.
Tips for managers
In addition to unravelling the interdependence of media, corporate messages and consumer feedback, the paper offers an empirical look at how an “echo chamber” actually works. Below is a list of findings that can be useful for firms aiming to build better business communication.
Negativity breeds negativity. Negatively toned news increase the number of negative tweets – and the other way around. Plus, any message with negative valence generates more of the same kind: negative articles prompt more negative articles; negative tweets induce more negative tweets. It is a downward spiral, which leads to fewer sales.
While newspaper articles and tweets affect each other equally, influence between Twitter and consumer sentiment goes one way. The Twittersphere affects how people feel about brands, but consumer sentiment has little impact on tweets.
No actor of the echoverse should overlook press releases. Positive corporate statements can improve the tone of third-party tweets about the brand, and even increase sales (in this case, customer deposits).
Traditional advertising doesn’t affect any other channel of communication in a statistically significant way. In other words, traditional ads cannot change the volume of tweets, news or consumer sentiment. However, advertising does lead to better sales, which means it has a slow, long-term payoff.
To be effective, companies have to move from a one-to-many model of communication to a one-to-one approach. For example, Bank of America chose to send direct tweets to consumers, whilst their competitors used Twitter for broadcast advertising. Another key to success is “high volume, consistent, moderate” tone, which seems more authentic to consumers.
So, the theory of echoverse is enough of a reason to rethink your brand-consumer interactions. For detailed guidance on balancing between social media, newspaper articles and customer sentiment, by all means, contact The Loupe.