One of the most exciting aspects of the internet is the ability to create global sensations in the blink of an eye. The acceleration of brand or product awareness can be the long-awaited jump you have dreamed of for years; however, the roller coaster ride may not be so fun if you are the one who takes a nose dive at someone else's expense.
With so much emphasis placed on influencers driving social media marketing, it's critical to understand how consumer analytics can give invaluable insight. For example, how do you differentiate between a trend and a fad? If you don't know how to recognize one from another, you run the serious risk of misreading the market and either dramatically overreacting or staying complacent when you need to act.
A fad is a short-lived phenomenon, fading in a relatively brief period. When the fad runs its course, you can expect to see a marked decrease in social conversations, a rise in negative conversations, and low user retention levels.
By comparison, a trend has a much longer lifespan and is far more sustainable as a market force than a fad. Trends indicate long-term market influence, an increase in positive social conversations, and a high user retention rate.
Fads are not necessarily a bad thing, especially if you happen to be in the right place at the right time. One of the most prolific examples of a fad came in 1975 when an advertising executive named Gary Dahl began selling the Pet Rock, which was literally a rock in a box with some straw and a 32-page instruction manual on how to care for the rock. As absurd as it sounds, public interest took off, and by the time the fad was over just six months later, Gary Dahl was a millionaire, selling 1.5 million Pet Rocks at $4 each.
But what if Gary Dahl had misread the fad of Pet Rocks as a long-term trend towards people purchasing "pets" made from non-living materials? What if he invested every penny he had into a $10 million state-of-the-art manufacturing plant to dominate the Pet Rock market for the next decade? Instead of making millions, Dahl would have likely ended up bankrupt, and he would have needed to find homes for all those poor little Pet Rock orphans.
So how do you identify the difference between a trend and a fad?
To put it simply - look at the consumer analytics. It's all in the data, but not necessarily in the way you might think.
Tracking social data can provide a reliable blueprint for market performance within a vertical, but an accurate analysis of consumer analytics requires looking beyond the volume of specific words used by social media users. Social data is a double-edged sword; it can be incredibly valuable, but also very dangerous if you fail to grasp what the information means in the proper context.
The key to seeing past this is having the ability to compare individual words people are using online against the rest of the market in that category, and then to determine if those words are gaining popularity in proportion with other similar words. If you see social metrics for a specific word rising quickly within a market vertical, it could be a trend, or it could be a fad. There is really no way to tell based solely on a sudden increase in social mentions over a short period.
Contouring is process of applying makeup to sculpt, define and enhance your natural facial features. The mentions of contouring in social conversations came in and rose incredibly fast in 2015, then continued to hold steady making it one of the biggest trends to ever hit the beauty industry.
In 2017, the CMO and CXO at one of our cosmetics clients had a hunch that this trend was on the way out, but social listening tools did not support their theory.
In the Social Standards Consumer Analytics Platform, we were able to look at Contouring specifically compared to the "Face Products" category, where we could see that its market share of conversations was actually on a steady decline. But what was replacing contouring? Our client was easily able to spot the next potential trend in our platform by looking at which Face Products had the highest growth in the last few months. The answer? Eyeshadow Palettes.
Here at Social Standards, we use two key components within social data analysis to determine a trend versus a fad: User Retention and Market Penetration.
Taking User Retention (UR) first: the Social Standards platform calculates UR as the number of people who are continuously mentioning a topic over a given period. A decline in user retention is typically a signal that the topic is a fad.
Market penetration, as we define it, is how deep a word extends within the context of the overall social media conversations about a product, in a specific market or vertical. It is a bit more involved, but is the basis for providing a clear and informed prediction. If people are talking about a product or brand using particular descriptive words; examining those words, in comparison with other words people are using, will demonstrate increased or decreased penetration. If the penetration of the word in question rises steadily as compared to other words in the social data over a set period, this is an indication of higher probability of a developing trend. It may sound complicated, but luckily, this is easily visible within the Social Standards platform.
By comparison, if the penetration of the word is a mile wide and an inch deep, you may be looking at a fad. If the word you are researching skyrockets in social mentions but does not go up in proportion to other established words, that is an indicator of short-term impact, which means you are looking at a fad. If you had only looked at the performance of the target word without seeing whether it was taking hold in the market data, there is virtually no way you would be able to know whether the bottom will likely drop out within a few months.
Identifying trends and distinguishing fads is an essential tool to any consumer product, but it begs the next question: where did the consumer go and what is driving the growth or decline?
This is where the Social Standards platform is unique. The advantage of the way we map conversations to their relative market vertical is that we are able to see market penetration. It can be likened to shopping cart analysis for social conversations.
If ignored or misused, consumer analytics data can be at best: ineffective, and worst: catastrophic. The ability to look past the surface and engage in objective comparative analysis is not only essential, but it could also be the determining factor as to whether you are a millionaire or just someone with a warehouse full of rocks.
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