Traditionally, marketing professionals used demographics compiled by market research firms as one of their primary tools to identify and target potential customers.

Obtaining this information was time-consuming and costly, because marketing professionals had to ask potential customers to provide it.

Today, however, members of social networks provide this information voluntarily on their pages! (Think about all the information that you provide on your favorite social networking Web sites.) Because of the open nature of social networking, merchants can easily find their customers, see what they do online, and see who their friends are.

This information provides a new opportunity to assess markets in near real time. Word of mouth has always been one of the most powerful marketing methods-more often than not, people use products that their friends like and recommend.

Social media sites can provide this type of data for numerous products and services.

Companies are utilizing social computing tools to obtain feedback from customers. This trend is referred to as conversational marketing. These tools enable customers to supply feedback via blogs, wikis, online forums, and social networking sites.

Again, customers are providing much of this feedback to companies voluntarily and for free. Social computing not only generates faster and cheaper results than traditional focus groups, but also fosters closer customer relationships.

Conducting Market Research Using Social Networks

1) Using Facebook for Market Research

There are several ways to use Facebook for market research. Consider the following examples:

• Obtain feedback from your Facebook fans (and their friends if possible) on advertising campaigns, market research, etc. It is like having a free focus group.
• Test-market your messages. Provide two or three options, and ask fans which one they prefer and why.
• Use Facebook for survey invitations (i.e., to recruit participants). Essentially, turn Facebook into a giant panel, and ask users to participate in a survey. Facebook offers a self-service model for displaying ads, and these ads can be invitations to take a survey. Facebook also allows you to target your audience very specifically based on traditional demographic criteria (age, gender, etc.).

2) Using Twitter for Market Research.

Your customers, your prospects, and industry thought leaders all use Twitter, making it a rich source of instantly updated information. Consider the following examples:

• Visit Twitter Search (www.twitter.com/search). Enter a company’s Twitter name. Not only can you follow what companies are saying, you can also follow what everyone is saying to them. Monitoring replies to your competitors and their employees will help you develop your own Twitter strategy by enabling you to observe (a) what your competitors are doing and, more importantly, (b) what people think about it. You can also follow the company’s response to this feedback.
• Take advantage of the tools that enable you to find people in the industries they operate in. Use search.twitter.com to monitor industry-specific keywords. Check out Twellow (www .twellow.com). This site automatically categorizes a Twitter user into one to three industries based on that person’s bio and tweets.
• Do you want to know what topic is on most people’s minds today? If so, then review the chart on TweetStats (www.tweetstats.com). It will show you the most frequently used words in all of Tweetdom, so you can be a part of those conversations.
• An increasing number of companies are utilizing Twitter to solicit information from customers and to interact with them. Examples are Dell (connecting with customers), JetBlue (learning about customers), Teusner Wines (gathering feedback, sharing information), and Pepsi (fast response time in dealing with complaints).

3) Using LinkedIn for Market Research

Post a question (e.g., solicit advice) regarding the topic or issue you are interested in. You may get a better result if you go to a specific LinkedIn group.

For example, let’s take a look at how Mountain Dew uses social computing to conduct market research. The company has always appealed to consumers who were looking for high caffeine beverages. However, the brand wanted to unite all of its customers into one community with its Dewmocracy contests, which let consumers pick the newest flavor.

Several brands have used social networks to help them choose new flavors, but Mountain Dew is expanding its scale from the most dedicated fans to the public at large.

The first step of its market research involved sending seven flavors of soda to 50 Dew fanatics, who were also given cameras and told to debate and show their like or dislike for the brand on a video.

The cameras were a great idea because it made the social media effort more personable. Rather than just looking at static images or tweets, Dew fans could see like-minded Dew fanatics in action. After narrowing the seven flavors to three, based in part on the videos, Mountain Dew turned to its Dew Labs Community, a 4,000-person group comprised of passionate soda fans.

Those fans then created nearly every element of the three sodas, including color, name, packaging, and marketing campaigns. After that process was complete,

Mountain Dew made the three flavors available in stores for a limited time, with the general public electing a winner (a drink named Voltage) via online voting.