The New Crystal Ball: It's the Internet
The New Crystal Ball: It's the Internet
Aug 8, 2005.Vol.146, Iss. 6; pg. 14
"IF YOU WERE SELLING A product to Generation Ythe age group between 10 and 27, which has yet to come up with a melodious monikerwho would be your ideal spokesperson? At one point in marketing history, answering that question would have been a pricey process involving phone surveys, focus groups and hanging around schoolyards and student unions. Today there's a perfect shortcut: the Internet. Specifically, blogs and chat rooms, where the opinions, whims and heartthrobs of today's youth are freely aired. "We have the ability to listen to unsolicited opinions and comments," says Howard Kaushansky, CEO of Umbria Communications. "Listening to the stream of consciousness, we get an unbiased view of what people think." As a result, Umbria's team of Web surfers and analysts didn't have to make any phone calls or interrupt a single soccer game to come up with the guy you want selling your product to young males: Kobe Bryant.
That's only one of a million juicy fruits that are now hanging lower, courtesy of the Web. The instant availability of even the most intimate consumer preferences and turnoffs has initiated a new boom in market research, which can be done more cheaply and accurately than ever before.
Some of these pears and plums are so low-hanging that anyone with a laptop can pluck them. The giants of Internet commerce all offer, right on the surface, gobs of up-to-thesecond market information. Amazon.com gives sales ratings of even the most obscure products; eBay determines the market value of Picasso prints and baseball cards; Google search results tell you the Web popularity of anything. You can also do quick probes of the blogosphere with services like Technorati or Daypop. Sometimes the results aren't terribly surprising. For instance, a few weeks ago Shopping.com's Consumer Demand Index informed us of great interest in the new "Harry Potter" book. Really!
To make full use of the bounty of information, there are highly sophisticated services with sophisticated digital divining rods. Umbria, for instance, claims to have developed algorithms that can detect the age and gender of bloggers and chatters by analyzing speech patterns and subject matter. And IBM's WebFountain, a product of its West Coast research arm, does text analysis on billions of documents, from blogs to trade journals. "If you know where to look, it's easy to find things," says IBM's Dan Gruhl. "But we can look everywhere."
Drinking from its data fountain, IBM can anticipate the popularity of rock stars and monitor the way people are reacting to prescription drugs. Recently, the Web Fountain crew has been tracking blogs to predict which books would hit the online best-seller lists (it correctly predicted the U.S. success of the selfhelp book "What Not to Wear").
Will these techniques lead to better products, better customer service and fewer marketing faux pas? That's not so certain. One potential mistake might lie in assuming that blog popularity translates directly to sales. Umbria's research for Burger King unearthed plenty of self-appointed food critics who made vicious fun of Burger King's new product, the obesity-courting Angus. But despite a flurry of disparaging blog posts that spelled the name without a "g," the product was a success. While well-calibrated data mining will certainly tell you what people think about a given product, and even what they say they want to buy in the future, it still takes instinct, vision and the courage to ignore conventional wisdom to produce the category-busting innovations that become breakout products-and the obsessive subject of millions of blog items and chat comments that have yet to be written."
Aug 8, 2005.Vol.146, Iss. 6; pg. 14
"IF YOU WERE SELLING A product to Generation Ythe age group between 10 and 27, which has yet to come up with a melodious monikerwho would be your ideal spokesperson? At one point in marketing history, answering that question would have been a pricey process involving phone surveys, focus groups and hanging around schoolyards and student unions. Today there's a perfect shortcut: the Internet. Specifically, blogs and chat rooms, where the opinions, whims and heartthrobs of today's youth are freely aired. "We have the ability to listen to unsolicited opinions and comments," says Howard Kaushansky, CEO of Umbria Communications. "Listening to the stream of consciousness, we get an unbiased view of what people think." As a result, Umbria's team of Web surfers and analysts didn't have to make any phone calls or interrupt a single soccer game to come up with the guy you want selling your product to young males: Kobe Bryant.
That's only one of a million juicy fruits that are now hanging lower, courtesy of the Web. The instant availability of even the most intimate consumer preferences and turnoffs has initiated a new boom in market research, which can be done more cheaply and accurately than ever before.
Some of these pears and plums are so low-hanging that anyone with a laptop can pluck them. The giants of Internet commerce all offer, right on the surface, gobs of up-to-thesecond market information. Amazon.com gives sales ratings of even the most obscure products; eBay determines the market value of Picasso prints and baseball cards; Google search results tell you the Web popularity of anything. You can also do quick probes of the blogosphere with services like Technorati or Daypop. Sometimes the results aren't terribly surprising. For instance, a few weeks ago Shopping.com's Consumer Demand Index informed us of great interest in the new "Harry Potter" book. Really!
To make full use of the bounty of information, there are highly sophisticated services with sophisticated digital divining rods. Umbria, for instance, claims to have developed algorithms that can detect the age and gender of bloggers and chatters by analyzing speech patterns and subject matter. And IBM's WebFountain, a product of its West Coast research arm, does text analysis on billions of documents, from blogs to trade journals. "If you know where to look, it's easy to find things," says IBM's Dan Gruhl. "But we can look everywhere."
Drinking from its data fountain, IBM can anticipate the popularity of rock stars and monitor the way people are reacting to prescription drugs. Recently, the Web Fountain crew has been tracking blogs to predict which books would hit the online best-seller lists (it correctly predicted the U.S. success of the selfhelp book "What Not to Wear").
Will these techniques lead to better products, better customer service and fewer marketing faux pas? That's not so certain. One potential mistake might lie in assuming that blog popularity translates directly to sales. Umbria's research for Burger King unearthed plenty of self-appointed food critics who made vicious fun of Burger King's new product, the obesity-courting Angus. But despite a flurry of disparaging blog posts that spelled the name without a "g," the product was a success. While well-calibrated data mining will certainly tell you what people think about a given product, and even what they say they want to buy in the future, it still takes instinct, vision and the courage to ignore conventional wisdom to produce the category-busting innovations that become breakout products-and the obsessive subject of millions of blog items and chat comments that have yet to be written."
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