The strength of ‘weak signals’ Martin Harrysson, Estelle Métayer, and Hugo Sarrazin
Snippets of information, often hidden in social-media streams, offer companies a
valuable new tool for staying ahead.
As information thunders through the rise to weak signals. Executives who
digital economy, it’s easy to miss valuable are curious and attuned to the themes “weak signals” often hidden amid the emerging from social media are more noise. Arising primarily from social media, likely to spot such insights.1 For example, they represent snippets—not streams— a global manufacturer whose high of information and can help companies quality and low prices were the topic of to figure out what customers want one customer’s recent social-media and to spot looming industry and market post almost certainly would not have disruptions before competitors do. examined it but for a senior executive Sometimes, companies notice them who was a sensitive social “listener” and during data-analytics number-crunching found its implications intriguing. Did exercises. Or employees who apply the company have an opportunity, the methods more akin to art than to science executive wondered, to increase prices might spot them and then do some or perhaps to seek market share more further number crunching to test anom- aggressively at the current prices? alies they’re seeing or hypotheses the signals suggest. In any case, companies To find out, the executive commissioned are just beginning to recognize and research to quantify what had started capture their value. Here are a few prin- out as a qualitative hunch. Ultimately, the ciples that companies can follow to grasp low-price perception turned out to be and harness the power of weak signals. an anomaly, but the outsize perception of the product’s quality was widely held. In response, the company has started Engaging at the top funneling marketing resources to the prod- uct in hopes of building its market For starters, given the fluid nature of share by capitalizing on its quality and the insights that surface, it’s often useful differentiating it further from the to get senior leaders actively involved offerings of competitors. with the social-media sources that give 2
Listening and mapping sites. The exercise produced a wealth
of relevant information about the types of As the manufacturer’s example implies, services available in individual markets, spotting weak signals is more likely when the specific levels of service that parents companies can marshal dispersed net- sought, the prices they were willing works of people who have a deep under- to pay, the child-care options companies standing of the business and act as already sponsored, the strength of listening posts. One global beverage com- local providers (potential competitors), and pany is considering including social- the people in various communities media awareness in its hiring criteria for who might become ambassadors for a some managers, to build its network new service. This wasn’t a number- and free its management team from “well- crunching exercise; instead, it took an rehearsed habits.” anthropological view of local child care—a mosaic formed from shards of Weak signals are everywhere, of course, information found only on social media. so deciding when and where to keep In the end, the weak signals helped the antennae out is critical. One such sit- the company to define the parameters of uation involves a product, market, or a not-yet-existing service. service that doesn’t yet exist—but could. Consider the case of a global adver- tising company that was investigating Spotting visual clues (for one of its clients) a US growth opportunity related to child care. Because It’s also useful to search for weak signals no one was offering the proposed when customers start engaging with service, keyword searches on social media products or services in new, tech-enabled (and on the web more broadly) wouldn’t ways, often simply by sharing per- work. Instead, the company looked ceptions about a company’s offerings to social-media platforms where it might and how they are using them. This find weak signals—finally discovering can be hard for companies to relate to an online content service that allows at first, as it’s quite removed from the users to create and share individu- usual practice of finding data patterns, alized newspapers. clustering, and eliminating statistical noise. Spotting weak signals in such cir- In the child-care arena, digital-content cumstances requires managers and channels are often curated by mothers employees to have the time and space to and fathers, who invite conversations surf blogs or seek inspiration through about their experiences and concerns, as services such as Tumblr or Instagram. well as assemble relevant articles by experts or government sources. Analysts As intangible as these techniques may used semantic clues to follow hundreds sound, they can deliver tangible results. of fine-grained conversations on these US retailer Nordstrom, for example, took 3
an early interest in the possibilities other operational activities. Interestingly,
of Pinterest, the digital-scrapbooking TomTom, a company that offers products site where users “pin” images they and services for navigation and traffic, like on virtual boards and share them found that the mechanism for spotting with a larger community. Displayed weak signals proved useful in enhancing on Pinterest, the retailer’s products gener- its product-development process. ate significant interest: the company currently has more than four million As part of normal operations, TomTom followers on the site. monitored social media closely, mining conversations to feed into performance Spotting an opportunity to share this metrics for marketing and customer- online engagement with in-store shoppers, service executives. The normal process the company recently started dis- changed after an attentive company playing popular Pinterest items in two analyst noted that users posting on a UK of its Seattle-area stores. When early forum were focused on connectivity results were encouraging, Nordstrom problems. Rather than let the tenuous began rolling out the test more broadly comments get lost in the company’s to capitalize on the site’s appeal to performance statistics, he channeled customers as the “world’s largest ‘wish them to product-development teams. list,’” in the words of one executive.2 To resolve the issue, the teams worked The retailer continues to look for more directly—and in real time—with ways to match other customer inter- customers. That helped short-circuit an actions on Pinterest with its products. otherwise costly process, which would Local salespeople already use an have required drivers using TomTom’s in-store app to match items popular on offerings to check out connectivity Pinterest with items in the retailer’s issues in a number of locales. The broader inventory. As the “spotting” ability of com- payoff came in the form of new R&D panies in other industries matures, and product-development processes: we expect visual tools such as Pinterest TomTom now taps directly into its to be increasingly useful in detecting driving community for ideas on design and capitalizing on weak signals. and product features, as well as to troubleshoot new offerings quickly.
Crossing functions
As the Nordstrom example demonstrates, At most companies, weak signals will be
listening for weak signals isn’t enough— unfamiliar territory for senior manage- companies must channel what’s ment, so an up-front investment in leader- been learned to the appropriate part of ship time will be needed to clarify the the organization so the findings strategic, organizational, and resource can influence product development and implications of new initiatives. The new 4
1 See Martin Harrysson, Estelle Métayer, and
roles will require people who are Hugo Sarrazin, “How ‘social intelligence’ can guide comfortable navigating diverse, less decisions,” McKinsey Quarterly, November 2012, corporate sources of information. mckinsey.com. 2 See Rachel Brown, “Nordstrom touts merchandise Regardless of where companies observe with Pinterest,” Women’s Wear Daily, July 2, 2013, wwd.com. weak signals, the authority to act on them should reside as close to the front Martin Harrysson is an associate lines as possible. Weak signals principal in McKinsey’s Silicon Valley office, are strategic enough to demand top- where Hugo Sarrazin is a director; management attention. They are Estelle Métayer, an alumnus of the Montréal sufficiently important to the day-to-day office, is an adjunct professor at McGill work of customer-service, technical- University, in Montréal.