The worldwide popularity of social media has changed how consumers think about, and shop for, products, creating new opportunities for consumer goods brands. This includes the ability to “microtarget” different consumer groups through tailored marketing efforts. Companies that embrace e-commerce functionality directly into their social media platforms will outperform their peers. Brands that are too slow to adapt to the digital age will see a drop in customers and a missed opportunity for further profits.
Listed below are the key macroeconomic trends impacting the social media theme, as identified by GlobalData.
The splinternet is the compartmentalisation of the internet. Regulators with growing concerns about fake news and online safety are beginning to target leading social networks to block access to specific parts of the internet. This process also relates to censorship of cyberspace, with governments in China, Iran, and Russia serving as prime examples of countries that have increased their internet oversight.
Social media platforms can be tools for democratic engagement and participation. This engagement involves the online exchange of political ideas and direct and active engagement with political leaders and organisations. These platforms also enable a greater public consciousness of civil society and have a key impact on spreading messages. This was particularly noticeable in the “Arab Spring” uprisings of 2011.
On the other hand, it can be argued that social media has made democracies more vulnerable to foreign interference. During the 2016 US election, Facebook claimed the Russian state promoted fake pages to influence public sentiment.
Filter bubbles are created when algorithms that personalise individuals’ online experiences cause the user to be exposed only to content that conforms to and reinforces their own opinions. Filter bubbles can convince individuals that their view is the dominant one, enforcing cultural tribalism rather than a forum for fair discussion.
The term “echo chamber” has come to describe this unconscious exercise of confirmation bias that creates a homogenising effect within social communities such as Facebook, Twitter, and Reddit.
The use of artificial intelligence (AI) to alter video and audio clips of real people without their permission produces deepfakes. Unfortunately, this creates content that seems real but is fundamentally corrupt. Deepfakes are primarily used to imitate, parody, or slander politicians. AI and machine learning can also clone voices, with some companies already demonstrating that only a small data set is required to recreate the prosody of speech.
Digitalisation has allowed a handful of social media companies and individuals to play a greater role in the dissemination of news. As a result, the boundaries of traditional media that once prevented fake news from spreading have broken down. Anyone can create and disseminate information, particularly those adept at manipulating how social networks operate.
The outbreak of the Covid-19 pandemic has led to drastic changes in consumer behaviour, attitudes, and lifestyles. Social media has been a hugely successful way to galvanise community spirit during these unprecedented times as people continue to shield at home and work remotely.
According to GlobalData’s 2020 Coronavirus (Covid-19) Recovery Week 3 Consumer Survey, 37% of global consumers would like to hear news about initiatives adopted by brands after the Coronavirus (Covid-19) pandemic period.
For all the benefits that social media brings, disinformation is a threat that has become more pervasive as improved access to technology has made people more susceptible to manipulation with false rumours. The United Nations (UN) has labelled fake news on Covid-19 as an infodemic.
The social impacts of this infodemic have effects that transpire beyond the virtual world. A lack of context mixed with people’s desires to rapidly learn about unfolding events creates mixed messaging and confusion.
This is an edited extract from the Social Media in Consumer Goods – Thematic Research report produced by GlobalData Thematic Research.