CARMA Study Finds Costco and Other Wholesalers are Clear Winners in Blogosphere: Walmart, Sears, and Macy's Fared Worst Among Bloggers

Share Article

CARMA International released a new study analyzing blog coverage of 17 leading national retailers in the U.S. during the first two months of 2009. CARMA's research suggests that Costco and other wholesale and club stores performed the best in the blogosphere, while Walmart, Macy's, and Sears performed the poorest, with bloggers providing the most favorable attention to those retailers that are able to provide high quality products and services at low prices.

Winners and Losers in Blogosphere

Costco really is well positioned to excel in the blogosphere in today's economic climate, as our results suggest it can compete on price at a time when cost is foremost in consumers' minds without having to worry that people are going to think they are buying lesser quality goods.

According to a new study from media analysis company CARMA International (http://www.carma.com), wholesale and club stores receive the most favorable coverage among retailers in the blogosphere, while traditional department stores and mass merchandisers trail far behind due to substantial criticism from consumers. This is based on the findings of CARMA's analysis of consumer-written blog posts about 17 leading wholesale and club stores, traditional department stores, and mass merchandisers that appeared during the first two months of 2009.

The CARMA study also identified wholesale giant Costco as the individual retailer receiving the best coverage from bloggers, while mass merchandisers Walmart and Sears and traditional department store Macy's emerged as the retail industry's laggards for the medium. Costco stood out in the blogosphere after it received the most praise for its low prices and quality product offerings.

With media monitoring assistance from CyberAlert, Inc. (http://www.cyberalert.com), a leading web and social media monitoring company, CARMA International searched more than 50 million blogs each day for any mention of the selected retailers, finding and examining more than 3,700 blog posts containing relevant discussions about the 17 retailers.

CARMA analyzed a sample of these posts using its industry-leading research methodology to determine the focus of this blog coverage; the reasons that bloggers praised and criticized the retailers; the frequency that bloggers discussed the current economic environment; and the favorability with which bloggers depicted the retailers.

Only the wholesale and club store sector received favorable blog coverage overall, with few aspects about wholesalers coming under criticism. Nearly 60 percent of all blog posts on wholesale and club stores were favorable, while only 9 percent of posts were unfavorable.

In contrast, the blogosphere published unfavorable reporting overall on mass merchandisers and neutral reporting overall on traditional department stores. Both faced significant negative attention from bloggers about their financial struggles in today's economic climate.

Despite widespread favorable coverage in the mainstream media that Walmart is the only retailer excelling in the current economic turmoil, the world's largest retail chain was one of the industry's worst performers in the blogosphere, receiving negative attention overall. CARMA found that Walmart was the subject of the largest number of negative blog posts across the industry, with many of these posts being highly critical of the retailer, calling Walmart "evil" or other similar invectives. CARMA's analysis showed that only Kmart witnessed a larger share of intensely negative coverage than Walmart among retailers that appeared frequently in blog coverage, with 12 percent of blog posts on Walmart depicting the retailer with intense negativity.

"We were surprised at our findings. We thought Walmart's financial coverage in the mainstream media would foster positive attention overall from the blogosphere, but that wasn't the case," said study author and CARMA International Vice President Christopher Scully. "Some bloggers criticized the company severely for being anti-worker, driving mom-and-pop stores out of business, and contributing to sprawl and to the decline of the American manufacturing base, and this hurt its overall depiction in blogs."

"Likewise, we didn't anticipate that wholesalers like Costco would fare so well and how much their ability to offer quality products at low prices would factor into their strong performance," he added. "Costco really is well positioned to excel in the blogosphere in today's economic climate, as our results suggest it can compete on price at a time when cost is foremost in consumers' minds without having to worry that people are going to think they are buying lesser quality goods."

Citing Walmart's poor performance, Scully said that it may be common for retailers and other companies to see a divergence between how they are covered by consumer generated media and by mainstream media. "That is why CARMA recommends that companies employ a comprehensive and systematic approach to monitor and measure their consumer generated media coverage, particularly since blogs and other social media increasingly are affecting public opinion and purchasing decisions," he stated.

However, he cautioned against using automated media analysis tools to identify messages being conveyed in blogs or judge the favorability of consumer generated content. Instead, Scully suggested a human-based research approach can better assess consumer generated media.

He said, "Bloggers often discuss their experiences in unique and interesting ways that make it virtually impossible for computer algorithms or other automated approaches to determine accurately whether a company is being depicted favorably or unfavorably. Not to mention that many blogs and online discussions can be rife with sarcasm, snark, slang, and references to current events and pop culture. All these factors make it far easier for human analysts to assess consumer generated media content accurately."

CARMA included in the study the largest chains from the selected retail sectors as determined by number of stores nationwide, along with several high-end traditional department stores, such as Saks Fifth Avenue and Neiman-Marcus. Other retailers examined for the study included BJ's Wholesale Club, Bloomingdale's, Bon-Ton, Dillard's, JCPenney, Kohl's, Lord and Taylor, Nordstrom, Sam's Club, and Target.

A detailed analysis of CARMA's research, entitled "U.S. Retailers: Winners and Losers in the Blogosphere," can be found in CARMA's Research Library at:

http://www.carma.com/research/Retail_Sector_CGM_Study.pdf

About CARMA International, Inc.
CARMA International (http://www.carma.com), celebrating its 25th anniversary in 2009, stands apart as a world leader in media research with an emphasis on human analysis. Using state of the art, proprietary software, and specialized research methodologies, CARMA analysts translate traditional and non-traditional media metrics into strategic insights that inform communications programming and planning. CARMA is a privately held company headquartered in Washington, D.C. with offices in Hong Kong, London, New Delhi, Paris, Sao Paulo, Singapore, Sydney, Tokyo, and Toronto. For more information about CARMA, visit http://www.carma.com.

About CyberAlert
Founded in 1999, CyberAlert (http://www.cyberalert.com) is a worldwide press clipping, media monitoring, broadcast monitoring, and online word-of-mouth monitoring service. Its CyberAlert 4.0 worldwide news monitoring service monitors over 35,000 online news sources each day in 25+ languages in 169 countries. The company's TV broadcast news monitoring service monitors the closed caption text of over 2,100 news programs on over 600 TV stations in the Top 100 markets in the United States. To monitor consumer discussion (online word-of-mouth), its NetPinions™ service monitors over 100,000 Web message boards and UseNet news groups for consumer insight about companies, products, key issues and trends. Its BlogSquirrel™ service monitors over 5 million blog postings each day from a total of 50+ million blogs worldwide and its CyberAlert VDO service monitors 200+ video sharing sites.

###

Share article on social media or email:

View article via:

Pdf Print

Contact Author

Sonia LaFountain-Ginyard

Christopher Scully