Social media is giving companies a new way to research and predict future sales. Using popular social networking websites like Twitter, individuals can give their reviews on restaurants, movies and just about anything in the time it takes to write a text message. For any company, positive word of mouth marketing through Twitter is the best type of advertising because it doesn’t cost money, it creates major buzz and people generally trust it. According to research, the popular social media website is now a leading box office predictor for the film industry.

Before Twitter, a popular website that was used to predict box office hits was The Hollywood Stock Exchange (HSX). On this site, audiences use virtual currency to predict which movies will do well in the box office. Since its beginning, HSX has been fairly accurate in its predictions.

Although HSX is one of the industry’s favorite forecasting sites, Twitter has advantages that are now making it a major competitor. Researchers are finding that Twitter has been more accurate than HSX in determining box-office revenue by 1-2 percent. In addition to accuracy, the social networking website also provides a stream of data that is easy for others to understand. On Twitter, anyone with access to internet can read a never-ending stream of user-generated content and reviews about the movies they are thinking about watching in the theater. Researchers are finding that these real world reviews can forecast trends in sales and revenue for each movie. For example, the Oscar award winning movie, The Blind Side, had mediocre numbers during its opening weekend. Then, after its release, the movie had a major increase in positive sentiment, which was largely seen through the social networking website Twitter. By the next weekend, the movie made $10 million more than it did during its opening weekend. As seen through this study, movie forecasters are now using social media to their advantage and it’s taking their research to next level.

Now that researchers know that Twitter is an accurate predictor for films, they think that the website can be used to predict sales for other products and services. The film industry is only the beginning.


Source.

By Jackie M.

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