Sentiment Analysis: A Comprehensive Guide

The innate ability of humans to understand emotion and sentiments sets them apart from every known species. Machines today are trying to mimic this quality. We, humans, display sentiments in everyday sentences that we speak. Currently, businesses adopting sentiment analysis tools in a bid to analyze the tone and sentiments expressed in the opinions of their consumers.

In a world where many gigabytes of data is produced every day, creating vast oceans of it, opinion mining is not easy unless guided by artificial intelligence. However, why should companies worry about consumer sentiments? How does sentiment analysis work? What are its limitations and advantages?

Let’s start with the concept of sentiment analysis and then try to understand its value proposition for business owners.

What is Sentiment Analysis?

Sentiment Analysis is a subset within the umbrella of Natural Language Processing (NLP). It is the process of understanding the opinions and perceptions of your consumers using the data mined from social media, review boards and others.

The famous personal care brand – Dove, had initiated a campaign to advocate the need for embracing a positive body image, for women. The campaign’s idea was to depict the shapes of ordinary women rather than professional models. In a bid to represent the various shapes and sizes of a woman, they had released bottles of varied shapes. Some of these were hourglass-shaped, some pear-shaped, some thin and slender and so on. However, what seemed like a novel thought turned out to be quite the opposite. The campaign was perceived as offensive by many women and eventually had to be taken down. If Dove wasn’t paying attention to the sentiments of its customers, the campaign could have caused real damage to its brand.

Consumer perceptions play a vital role in ensuring the success of your company’s campaigns or product launches; they actually decide your brand’s health.

Why is Sentiment Analysis Important?

“A satisfied customer is the best business strategy of all” – Michael LeBoeuf.

Your customers are the reason for your existence, so their voices, opinions, and needs should matter. Sentiment analysis helps you gain clear insights without having to seek direct feedback or validation. Consumers today express their views about their experience with a brand using the internet, social media, review boards et cetera, and these are accessible to the entire world. One bad review can cost a company its reputation, which may have been built painstakingly over years if not decades.

Using social listening to tap all the data around your brand and processing it further for opinion mining can provide you the following benefits:

Crisis Management

Detect an issue and take control before it becomes a pain point and hinders potential future customers from converting.

Brand Health

Sentiment analysis is a great tool which offers a quick way to judge your brand’s reputation, your weaknesses, strengths.

Key Strengths

Chatter with a positive connotation helps you identify and understand your key strengths and build on them.

Strategic Planning

Sentiment analysis is a window which drills down to identify and show you the specific problems. This helps you strategically plan your corrective measures.

Uses and Applications of Sentiment Analysis

User-generated content can become your best friend for sentiment analysis. Multiple corrective measures may suggest themselves while analyzing the data available via internet sources. Sentiment analysis helps with different aspects of brand reputation management including:

Brand Monitoring

Keeping an unwavering eye on every comment, every review, and analyzing it to understand the tone can be tedious and hinder fast-paced action, without adopting a tool. Continuous monitoring and opinion mining are necessary to maintain the reputation of your organization amongst the public and competitors.

Business Intelligence

Sentiment analysis does a lot more than tell you whether your customer is happy or disappointed. Data mining provides you a breakdown of the exact fault lines, tracks the overall perception of the brand amongst the masses, and tells you whether the growing chatter in the marketplace is in your favor or against. Decision making becomes a little more easy with such insights within your reach.

Customer Service

There’s no doubt that the better your service is, the better your chances are, of retaining customers. Gaining loyal customers results in spreading positive word-of-mouth which brings you more customers, and the cycle continues. However, as per a McKinsey report, about 25% of customers shift to a competitor brand after just one negative experience. Sentiment analysis helps you deliver on your customer service promises and to tailor your business to be more customer-centric.

Product/Service/Campaign Analysis

Customer opinion can make or break your product reception or even the success of your marketing campaigns – which in turn can ruin your brand’s image. Seeking frequent feedbacks and working to eliminate your current shortcomings serves to satisfy your customers and make them believe that your brand cares for their voices.

Market Research

Sentiment analysis also assists with prototyping for any market research, before a product or campaign launch. It is extremely essential that you become aware of how the audience receives the message before you let your brand get involved more.

Sentiment analysis grows more accurate each day, yet there are a few challenges which become evident and troublesome at times. The challenges include the inability of the tools to judge the true sentiment in cases of sarcasm and irony and polarity used by humans. For example a sentence like:

“Great service. 1 hour for a cup of coffee – Unbelievably fast delivery!”

has words like great and fast delivery which have a positive connotation to the tool, but not for us in this context. Sentiment analysis tools lack the capability to understand such sarcasm, unlike the human mind and could flag such comments as positive. But, as the model keeps getting trained, machine learning keeps helping the tool to evolve, and these challenges are bound to vanish over time.

All said and done, AI as a field is still young but growing very quickly, and so is sentiment analysis. Despite the few drawbacks, it can be applied to a multitude of business problems and prove to be a marketer’s true best friend.

Competitor Analysis using Social Listening

Enterprises, like people, try to be recognized for being the best at what they do. Are your competitors allowing your company to achieve this dream? Social listening for competitive intelligence can help you achieve your goals. Competitor analysis offers a sense of how well your company is faring when compared to others in the marketplace.

Competitor analysis holds the answer key to questions like:

Why is my company not the market leader?

What marketing strategies are my competitors using?

What are their weaknesses and strengths?

The idea, of course, is not to mimic your competitors. It is but a part of the game to learn and borrow from or improvise upon their winning strategies. Social listening enables you to do so.

What is Competitor Analysis and Why is it Important?

Planning a good marketing strategy starts with knowing your opportunities, strengths, and weaknesses. Identifying these gets easier when you closely monitor the significant players in your industry and analyze their actions.

By definition, competitor analysis helps you gather information about your competitors to analyze it and derive insights on where your business stands in comparison to them. The actionable insights derived from such competitive intelligence could help you to rise above your competition.

Let’s consider a good example of gaining competitive intelligence through competitor analysis – athletes. Sportspersons and teams must follow an opponent’s game, directly or from recordings to understand their strengths and weaknesses, style and strategy. This knowledge helps them decide their own defensive or offensive strategy easily. This search for an Achilles’ heel is mimicked by businesses. A company’s strategy is backed by competitor intelligence, sound logic, careful judgment.

There must be a reason why 55% of Fortune 500 companies engage extensively in competitor analysis and competitive intelligence for decision making.

How does Social Listening help Conduct Competitor Analysis?

Tech-savvy managers today can get ahead of their competition using social listening powered by artificial intelligence makes it very easy for tech-savvy managers. However, before we discuss that, let’s briefly look at how competitor analysis benefits you:

It helps you understand your competitors’ strengths and weaknesses

Finds gaps and opportunities within the marketplace

Helps you plan effective marketing and other functional strategies

Aids in planning and strategizing your company’s future course of action

In addition to the usual annual reports, newspaper articles, and press releases, social media is where one looks for data. By social media data, we do not mean skimming through the online content put out by your competitors. Social media listening helps you listen to the positive as well as negative sentiments of their customers and delve deeper into analyzing it.

Wondering what all you can learn through social listening?

Your primary competitors

Say you plan to open a pizzeria in your town, thinking you have no other competitor. Social media mentions can tell you a different story. Maybe people have been tweeting a lot about the recent arrival of Papa John’s or Pizza Hut in town, and you had no idea of their presence at all.

Share of Voice

Your brand’s exposure as well as a comparison of how much more everyone is talking about your competitors.

Sentiment Analysis

Having a good share of voice is not always a positive thing if many of the mentions denote negative sentiment. Such analysis helps you understand the weaknesses of your competitors and vice versa.

Public Interests

Say you are planning to revamp your pizzeria. You can tune into social media chats, to see which places are liked by your target audience for their ambience and interiors. Take inspiration from there, and turn your pizzeria into their favorite spot.

SWOT Analysis

Social listening analyzes the data collected to show the weaknesses of your competitors and the opportunities this holds for you.

How to Conduct Competitor Analysis?

Social media listening is a tool for competitor analysis, using which you can derive optimum results with minimal effort. Planning for useful competitive intelligence will include:

Choosing the Right Tool:

With the right tool, monitoring social media data across all channels and analyzing it becomes simple and quick.

Comprehensive Research Template:

You could gain greater clarity on the kind of social listening tool you want, by preparing a detailed template, mentioning the factors which need to be measured, like:

Target Market: This helps you understand the demographic and geographical details of your target market. The target market your competitors are focusing on can help you decide your target audience.
Differentiation factor: What is unique about your brand which sets you apart from your competitors? Learning about their social media activities, about their products, etc will help you analyze this.
Marketing Strategy: How well are your competitors planning their brand presence online and offline, what campaigns are resonating the most among your audience and why? The answers to these questions too lie in the analysis of the data available to help you decide your own marketing strategy.

There can be many attributes to your research. Modeling your research template according to your needs and analyzing the data for each of your competitors in detail will help you prepare a comprehensive business model for your brand.