On Bauer Business Focus — A conversation on trendspotting with Andrew Schneider, business reporter for KUHF 88.7 FM.
As social media becomes more commonplace for everyone from tweens to grandparents, companies are looking for ways to quantify consumer activity on websites like Twitter, Facebook, blogs and search engines.
A host of online consumer interest tracking measures already exist, but a marketing professor from the University of Houston C. T. Bauer College of Business says there’s a better way.
Rex Du, an associate professor of marketing at UH Bauer, recently visited Bauer Business Focus to discuss how businesses are using what he calls “quantitative trendspotting” to track consumer interest in certain items.
“Traditionally, businesses looked at all kinds of information indicators, from all kinds of sources, and then they rely on experts, or trendspotters, who use their judgment, their intuition, to sift through all the information data and come up with some predictions of what’s going to happen in the future,” Du said.
New research from Du shows that if common trends can be distilled from a large set of tracking measures, their collective explanatory power and insights can increase dramatically.
For example, he and his co-authors found that on average, 73 percent of fluctuations in new car sales in the U.S. market can be explained by seven common trends behind the ups and downs of consumer online searches for 38 major car brands.
“The biggest change that social media provides is a real-time documentation of people’s online behavior. What they search for, what they talk about, what they visit, leave a footprint on the internet, and there are services that are capable of recording all of these activities that provides a large amount of data for analysts to crunch the numbers and see the underlying trend, instead of relying simply on intuition or judgment.”
Click here to hear the full interview.