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To cite this article: Wu He, Xin Tian, Yong Chen & Dazhi Chong (2016) Actionable Social
Media Competitive Analytics For Understanding Customer Experiences, Journal of Computer
Information Systems, 56:2, 145-155
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ACTIONABLE SOCIAL MEDIA COMPETITIVE
ANALYTICS FOR UNDERSTANDING CUSTOMER
EXPERIENCES
WU HE XIN TIAN
Old Dominion University, Norfolk, VA 23529, Old Dominion University, Norfolk, VA 23529,
USA USA
ABSTRACT
Downloaded by [Penn State University] at 11:58 21 January 2016
A large amount of user-generated content is now freely available amount of customer-generated content on social media sites has
on social media sites. To increase their competitive advantage, become a new source of mining competitive intelligence [59]. In
companies need to monitor and analyze not only the customer- addition to extracting data from social media sites, businesses need
generated content on their own social media sites, but also the to be able to quickly make sense of the data to provide information
content on their competitors’ social media sites. In this article, that is relevant, and actionable. By understanding what people
we describe a framework to integrate several techniques think about their company, products, and services, companies can
including quantitative analysis, text mining, and sentiment act quickly and compete more effectively. Furthermore, corporate
analysis for analyzing and comparing social media content employees can transform what they have learned from social media
from business competitors. Specifically, we conducted an in- data analytics into action to deliver real business results or to guide
depth case study which applies our developed framework to the development of better products and services [26]. Thus, busi-
the analysis and comparison of social media content on the nesses are increasingly expected to harness this user-generated
Facebook sites of the three largest drugstore chains in the social media content to create a competitive advantage in order to
United States: Walgreens, CVS, and Rite Aid. We found excel in the business environment [14]. In this article, we devel-
similarities and differences in the social media use among the oped a framework to integrate several techniques including quan-
three drugstore chains. We discuss the implications of our titative analysis, text mining, and sentiment analysis to analyze and
findings and provide recommendations to help companies compare social media content from business competitors. In an
develop their social media competitive analysis strategies. effort to help businesses understand how to perform actionable
Keywords: Social media, text mining, sentiment analysis, social media analytics and how to transform social media content
business intelligence, competitive intelligence, competitive into strategically actionable knowledge, we conducted an in-depth
analytics case study which applies our developed framework to analyze and
compare unstructured text content on the Facebook sites of the
INTRODUCTION three largest drugstore chains in the United States: Walgreens,
CVS, and Rite Aid. We focused on comparing their Facebook
More and more customers use social media sites to express posts to understand the issues and problems with customers’ shop-
opinions, feelings, and concerns about the services and products ping experiences.
they have purchased. Customers’ conversations on social media The remainder of the article is organized as follows: Section
sites can help us learn about their purchasing behaviors and shop- 2 provides a review of social media and social media competi-
ping experiences and can provide valuable knowledge to help tive analytics. Section 3 proposes a framework for using social
businesses improve their marketing and customer service. He, media competitive analytics to analyze and compare social
Zha, and Li [23] suggest that businesses leverage and analyze a media content from competing organizations. Section 4 presents
wealth of textual data on social media to reveal hidden knowledge an in-depth case study of the three largest drugstore chains in the
and insights to gain a competitive edge. However, analyzing social United States. Section 5 discusses the findings. Section 6 pro-
media content can be challenging and very time-consuming [47]. vides managerial implications and insights. Section 7 notes
The rapid growth of social media content demands the use of conclusions and suggestions for future research.
automatic social media analytic techniques. Furthermore, since
competitive intelligence is an important factor for businesses to LITERATURE REVIEW
use in managing risks and making decisions [52], there is a need for
businesses to monitor not only their own social media sites but also Social Media
their competitors’ social media sites. Successful businesses need to
develop the capability to process all available information (e.g., Social media generally refers to online communication plat-
customers’ opinions, product prices from competitors, reviews of forms including websites and web applications used for social
services and products), identify what has happened, and predict networking, photo and video sharing, blogging, etc. [17, 51].
what may happen later. Studies indicate that businesses that can Compared to traditional media, social media allows businesses
harness data analytics significantly outperform their peers on the to easily create online communities and utilize a two-way parti-
key business metrics of growth, earnings, and performance [65]. cipatory media model, rather than the traditional one-way broad-
With the wide adoption of social media by businesses, the large cast media model, to communicate with customers [62].
influence customers’ evaluations and actions [40], and cultivate meaningful information from unstructured textual data [23,
loyal customers [38]. 36]. The main purpose of text mining is to automatically extract
knowledge, insights, and useful patterns or trends from a given
set of text documents [64]. Text mining techniques have been
Social Media Competitive Analytics
used to analyze large amounts of social media data. Chen,
Vorvoreanu, and Madhavan [8] mined students’ informal con-
In order to achieve competitive advantage, it is important for
versations on social media (e.g., Twitter, Facebook) to under-
businesses to constantly collect and analyze information about
stand students’ educational experiences, including their
their competitors’ products, services, and plans [23, 59].
opinions, feelings, and concerns about the learning process.
Traditionally, companies mainly collect information about com-
Corley et al. [10] used text mining to identify trends in posts
petitors from marketing reports, trade journals, newspaper arti-
about the flu that correlate to real-world influenza-like illness
cles, and competitors’ websites. However, most of the
patient report data. Key text mining techniques include cluster
information is secondary information whose objectivity can be
analysis, categorization, information extraction (text summariza-
questionable and the amount of such information is typically
tion), and link analysis [64]. In particular, cluster analysis is a
limited [59]. Since social media has been used by many busi-
key application of text mining and includes four main building
nesses to interact with customers, it is necessary for companies
blocks: feature selection, the clustering algorithm, validation of
to monitor their own and their competitors’ social media sites.
the results, and interpretation of the results [18]. By dividing a
As the market competition among big brands is becoming
population into clusters which are different from one another
increasingly fierce, it is of great importance for large companies
(maximal distance between clusters) but whose members are
to identify critical situations or moves by their competitors at an
similar (minimal distance within each cluster), cluster analysis
early stage so that they are in a position to initiate counteractive
can enhance the understandability of datasets and can support
marketing measures [28]. This is especially critical for a com-
effective decision-making [30]. Currently, there are a wide range
pany when its competitors use a new promotional technique and
of tools that can be used for text mining and analytics, such as
customers express negative opinions about their products or
the IBM SPSS Modeler (formerly Clementine), Leximancer,
services through social media. For example, Coombs [9] found
Clarabridge, and the SAS Enterprise Miner.
that the diffusion of negative opinions poses a reputational and
Sentiment analysis is the computational detection and study of
financial threat and can harm the company’s image and future
opinions, sentiments, emotions, and subjectivities in text [34, 35,
sales volume. On the other hand, Dey, Haque, Khurdiya, and
42]. As a special application of text mining, sentiment analysis is
Shroff [14] found that social media not only provide competitors
concerned with the automatic extraction of positive or negative
information but also provide direct comparison of customer
opinions from text [42]. Since texts often contain a mix of positive
behaviors with respect to different verticals among competing
and negative sentiment, sentiment analysis is often useful to
organizations. Customers often compare several competitive
identify the polarity of sentiment in text (positive, negative, or
products with similar functions and share their opinions and
neutral) and even the strength of sentiment expressed [42, 54].
sentiments on social media. These comparison opinions have
Sentiment analysis relies mainly on machine learning techniques
large impact on other customers’ purchasing behaviors and thus
such as support vector machine (SVM) and naive Bayes to clas-
need to be constantly collected and analyzed by businesses to
sify texts into positive or negative categories [34, 43]. In the
identify the relative strengths and weaknesses of their products
business field, sentiment analysis makes it easier for companies
or services, to analyze the potential business risk and threats
to mine customer opinions on products or companies through their
from competitors, and to further develop corresponding business
reviews or online posts, so it has been widely used in marketing
strategies or tactics [59]. In summary, it is crucial for companies
and customer relationship management. Bollen et al. [3] used
to develop social media competitive analytics skills so that they
sentiment analysis to mine a large corpus of Twitter messages to
can get prompt feedback and can generate daily/weekly/monthly
determine the mood of the Twitter population on a given day.
analytic reports for quicker strategy changes that allow them to
They found that the mood of the Twitter population was able to
work more effectively to attract and retain customers [19, 22].
predict the movement of the Dow Jones Industrial Average (DJIA)
However, a recent literature review reveals that there are only a
on the following day with a claimed 87.6% accuracy. Duan, Cao,
few studies that use social media competitive analytics in busi-
Yu, and Levy [15] used sentiment analysis to mine 70,103 online
ness although a lot of research has been devoted to analyzing the
variety of algorithms and methods such as text classification, monitoring and analysis of all known social media sites from
n-gram, topic modeling, and sentiment analysis [7, 64] can be target business competitors. Competitive intelligence reports
used to support and implement these approaches. Additional for each competitor can be generated on a daily, weekly, or
analytics methods and mining algorithms can be added to this monthly basis to provide actionable insights into critical busi-
framework as technology evolves. ness functions such as supply chain, customer service, and
Data from social media sites can be gathered in a number marketing. For example, by comparing customer comments
of ways. The most straightforward way is to use web-crawl- and sentiments about a particular competing product, a com-
ing software to access the web interface of the site. Currently, pany could make its marketing strategies more precise, agile,
many social media sites such as Twitter, Facebook, and and responsive to consumer demands and thereby increase its
YouTube offer application programming interfaces (APIs) sales potential. Based on an understanding of the patterns,
for data tracking. These APIs allow organizations to create trends, issues, and problems reflected in social media content,
custom applications for more convenient data collection. In companies can make more informed recommendations and
contrast, blogs and online forums typically do not provide decisions on proper interventions and services that can improve
APIs for data tracking. However, most blogs and online for- the customer experience and can help achieve better business
ums do offer RSS feeds which can be easily tracked. For outcomes for the immediate future [52].
In addition to selling prescription and over-the-counter (OTC) the findings, and to come up with recommendations and
medications, many pharmacies and drug stores in the United insights. We had several rounds of evaluation and discussion
States also provide other services and sell products including of the generated results to develop and refine our findings.
cosmetics, tobacco, consumables, stationery, household items,
and the like. Currently, there are approximately 67,000 pharma-
Findings
cies in the United States. Many of these pharmacies and drug
stores aggressively market on the Internet to capture market
Results of Quantitative Analysis on Facebook Content. We
share. Popular social media applications used by drugstores
collected quantitative data, such as number of fans/followers,
include Facebook, Twitter, and YouTube. Among them,
number of postings, comments and likes, frequency of posting,
Facebook is the most popular social media application used by
posting, and response time, manually from each chain’s indi-
the drugstore chains. Since pharmacies and drugstores have a
vidual Facebook site. In our analysis of the Facebook data
large social media user base, and so far there is little research
gathered for the month of June 2013, we focused on compar-
that investigates how large drugstore chains are using social
ing the level of engagement on their Facebook sites. Figures
media to support their business, we conducted our social
2–4 show the customer engagement levels for Walgreens,
media competitive analysis with the three largest drugstore
CVS, and Rite Aid in June 2013. As Dey, Haque, Khurdiya,
chains in the United States: Walgreens, CVS, and Rite Aid.
and Shroff [14] indicate, social media data can be an indicator
Currently, by pharmacy count, Walgreens is the largest, CVS
of brand popularity. In the three Figures and in Table 1, we
is the second largest, and Rite Aid is the third largest drug
note that Walgreens, the largest drugstore chain, typically had
retailing chain in the United States.
a higher level of engagement than its two competitors, in
terms of likes, comments, and shares from customers. This
Procedures result correlates well with the number of likes it had, since
Walgreens had many more likes than its competitors. We also
To answer the research questions, we followed the proposed identified spikes from Figures 2–4 and examined the posts
framework listed in Figure 1 to conduct our social media com- from the dates of the spikes to see what might have caused
petitive analysis. First, we collected quantitative data manually them. We found that these spikes were mainly caused by
from the chains’ individual Facebook sites, such as the number holidays or by promotional sales as well as by special events.
of fans/followers, the number of postings, comments, shares, For example, since June 16 was Father’s Day in 2013, we
and likes, and the frequency of posting. Our data analysis mainly found a relatively higher level of engagement during that
focuses on the information posted on their Facebook sites during weekend, which led to a spike in the number of likes and
June 2013. Next, we applied several analytics methods including comments.
statistical analysis, text mining, and sentiment analysis to ana- Table 1 lists the total number of likes, shares, comments, and
lyze the gathered text messages in order to discover business posts for each drugstore chain received in June 2013.
insights, new knowledge, and patterns and to acquire a deeper Figure 5 compares the number of daily posts among the three
understanding of how the three drug chains are using social drugstore chains in June 2013.
media in practice. Our study used the posts collected between We found that Walgreens posted approximately two mes-
June 1 and June 30, 2013, as the sample for analytics. All of the sages on average per day, Rite Aid posted 1.5 messages on
posts and comments were saved into Excel Spreadsheets for average, and CVS posted about one message per day.
competitive analysis. Compared to CVS and Rite Aid, Walgreens seemed more active
Case study relies on multiple sources of evidence with data in engaging and interacting with customers. Based on the data
needing to converge in a triangulating fashion [63]. The data shown in Table 1, we conducted a correlation analysis. A finding
analysis in this case study was done by using both qualitative observed is that the frequency of post activity was positively
and quantitative data. We first used statistical analysis including correlated to number of likes (r = 0.755), shares (r = 0.838), and
descriptive analysis and correlation analysis to examine the comments (r = 0.576). This indicates that active posting on
relationships among the numerical data we collected from the Facebook is likely to engage more customers or to attract the
drugstore chains’ social media sites. We then used a text mining attention of more customers.
tool and a sentiment analysis tool to mine and analyze the
6000
Drugstore Like Share Comments Post
Walgreens 60,976 10,895 3642 64
5000 CVS 12,039 994 1732 28
4000 Like Rite Aid 9270 1807 879 50
Comments
3000
Share
2000 7
1000 6
0
2013/6/1
2013/6/3
2013/6/5
2013/6/7
2013/6/9
2013/6/11
2013/6/13
2013/6/15
2013/6/17
2013/6/19
2013/6/21
2013/6/23
2013/6/25
2013/6/27
2013/6/29
5
4
CVS
FIGURE 2. Walgreens’ Customer Engagement Trend in 3 Walgreens
June 2013 Rite Aid
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1800 1
1600
0
1400
2013/6/1
2013/6/3
2013/6/5
2013/6/7
2013/6/9
2013/6/11
2013/6/13
2013/6/15
2013/6/17
2013/6/19
2013/6/21
2013/6/23
2013/6/25
2013/6/27
2013/6/29
1200
1000
Like
800 FIGURE 5. A Comparison of Daily Posts Among the Three
Comments
600 Drugstore Chains in June 2013
Share
400
200
The results show that the number of people who liked the
0
pages showed a strong correlation with the number of people
2013/6/1
2013/6/3
2013/6/5
2013/6/7
2013/6/9
2013/6/11
2013/6/13
2013/6/15
2013/6/17
2013/6/19
2013/6/21
2013/6/23
2013/6/25
2013/6/27
2013/6/29
600 Like
TABLE 2. Total Number of Likes, Number of People Talking
400 Comments about it, Number of People Who Were there, and the Facebook
Share Starting Date for These Drugstore Chains as of April 13, 2014
200
Number of
0
Number of people
2013/6/2
2013/6/4
2013/6/6
2013/6/8
2013/6/10
2013/6/12
2013/6/14
2013/6/16
2013/6/18
2013/6/20
2013/6/22
2013/6/24
2013/6/26
2013/6/28
2013/6/30
likes (rs = 0.639) and the number of people commenting on services, or information about free items, are relatively less pop-
Facebook pages in the past seven days (rs = 0.276). In other ular and do not attract many comments or likes (in most cases).
words, a drugstore with an earlier Facebook setup tends to
attract more Facebook users who “like” the drugstore and who Results of Text Mining. After applying the Leximancer soft-
comment on its Facebook pages than those with a later ware to conduct an automatic analysis of the Facebook comments
Facebook setup. This indicates that those drugstores that joined
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Concept map generated from Concept map generated from Concept map generated from
also crucial. By monitoring and analyzing the words posted by sentiment including positive sentiment and negative sentiment.
their competitors’ customers, businesses can develop better Fisher and Miller [19] recommend that companies “obtain real
business intelligence and can use the knowledge they gain to time snapshots of sentiment related to service, reaction to mes-
identify relative strengths and problems when comparing their saging at different locations, for different demographics, from
products and services with those of their competitors. However, different media outlets, and in a meaningful format.”
the social media monitoring and analyzing process can be very Third, companies need to provide managers, executives, and
challenging because of the huge amount of data created daily other decision-makers with easy access to the data and the
on social media. results of the analytics. To gain a competitive advantage, it is
In summary, the case study shows how the social media imperative for companies to use the data and analytics results to
analytics results from three drug store chains can be used to quickly respond to changes. Query-and-reporting tools can be
benefit their business relationship with their customers. In parti- provided to decision-makers who can then explore the data on
cular, social media analytics help a business to know more about their own. Online analytical processing (OLAP) tools can be
both its customers and its competitors’ customers. Therefore, use provided to decision-makers to support them in their use of
of social media analytics can help a business develop a more common operations including slice and dice, drill down, roll
effective competitive benchmarking strategy in terms of compar- up, and pivot. Daily, weekly, or monthly reports can be sent to
ing customers’ sentiments about the services and products of a decision-makers who can then turn the information into knowl-
particular company with sentiments about the same or similar edge for decision-making and other actions.
services and products offered by competitors. For example, the Finally, we need to point out that businesses need to pay
comparison may identify some additional benefits or values that specific attention to the quality of the data when they use social
were previously overlooked. The comparison may also identify media data for decision-making. There are some concerns about
some consumer needs that have not been met by competitors [57] the quality and reliability of the data posted on social media. To
or may help to identify potential risks as early as possible. Based mediate such concerns, businesses need to integrate social media
on the results of such a comparison, businesses can better under- data with other data such as their internal business data in order
stand their strengths and weaknesses, can plan appropriate strate- to make well-informed decisions. Teo and Choo [52] found that
gies, and can create action plans to compete more effectively in the quality of competitive intelligence information is positively
the marketplace [61]. related to organizational impact. By integrating longitudinal
social media data with other data sources, companies can more
reliably determine trends in a way that provides more accurate
IMPLICATIONS
predictions that can be incorporated into decision-making and
policy development.
The results of this study indicate that using and mining social
There are several limitations to this study. First, the
media data has value and can help businesses produce useful
Facebook data were collected for only one month and thus the
intelligence. With the growing importance of social media in our
conclusions should not be overgeneralized. Ideally, a longitudi-
society, companies and customers are increasingly using social
nal study is needed to examine the Facebook data for an exten-
media as a medium for communication. To help businesses more
sive period of time to identify long-term trends of how
effectively manage social media data, we recommend that interested
businesses like drugstores use social media for their business
businesses adopt or adapt our proposed framework for conducting
development. Second, we did not interview drugstore managers,
social media competitive analytics. Below are some suggestions.
employees, and customers directly to understand their social
First, companies need to consider implementing a corporate
media experience. For future research, it would be interesting
database system to capture, store, and manage the messages
to interview them and to get their direct input on their social
posted on their social media sites and their main competitors’
media experience.
social media sites, because implementation of competitive intel-
ligence requires the collection of information from both the
internal environment and the external environment. In practice, CONCLUSION AND FUTURE RESEARCH
many companies often fail to “scan the external environment to
which the companies are exposed, and fail to yield meaningful Business cannot afford to ignore social media data as the
intelligence” [60]. Since scanning the whole environment is competition in the marketplace intensifies. Businesses often
proposed framework and the methods applied in the case study competitive intelligence from social media. Proceedings of
are effective ways to perform social media competitive analyses. the 2011 Joint Workshop on Multilingual OCR and
Businesses should take necessary steps to leverage social media Analytics for Noisy Unstructured Text Data; p. 3.
data to complement their competitive intelligence strategies for Beijing, China.
achieving better competitive advantage. [15] Duan W, Cao Q, Yu Y, Levy S. 2013. Mining online user-
Our future research plan is to build a social media competitive generated content: using sentiment analysis technique to
intelligence monitoring and analytics system, which can be custo- study hotel service quality. Proceedings of the 46th Hawaii
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