SOURCE: Engagement Labs Inc.

Engagement Labs Inc.

June 27, 2017 08:30 ET

Costco Enjoys Positive Consumer Conversations in Real Life, but Underperforms on Social Media

Engagement Labs' TotalSocial® Rankings Reveal Which Big Box Retailers Reign Supreme at Social Influence, Both Offline and on Social Media

NEW YORK, NY--(Marketwired - June 27, 2017) - While most big box retailers are struggling, Costco is bucking the trend. Not only are sales up, but it tops Engagement Labs' newly released TotalSocial® rankings on the best-performing U.S. big box retailers with respect to consumer conversations over the last 12 months.

This first-of-its-kind analysis of combined offline and online consumer conversations is based on Engagement Labs' proprietary TotalSocial data, which continuously measures the most important drivers of brand performance in terms of social media and word of mouth conversations.

Overall, the analysis finds most big box retailers perform better in offline word-of-mouth conversations than on social media. However, Costco's offline performance is particularly strong, which is what propels them into the number one spot in the TotalSocial ranking. Their low online scores, in contrast, don't even place them in the top 10 among their competitive set.

Notably, Costco also ranks first for offline sentiment, demonstrating that despite criticisms about the company's slowness to adopt an e-commerce strategy, its positive in-store experience, consistent focus on wholesale prices and quality merchandise is a strategy that resonates with its members in their offline conversations. In fact, low prices and deals seem to be real drivers of positive word of mouth conversation -- trailing closely behind Costco are T.J. Maxx and Dollar Tree, which rank at number two and number three for offline sentiment.

"Consumers like to share, or even brag, about the great deals they find. Costco clearly benefits from this," said Ed Keller, CEO of Engagement Labs. "However, while it has particularly strong offline scores -- especially offline volume, sentiment and influence -- its weak performance online means the retailer is not fully capitalizing on the power of social influence. It has an opportunity to increase sales by developing strategies to improve its online performance."

"With Amazon's bid for Whole Foods, Costco has a strong incentive," Keller continued. "The company will face greater competition from the online retailer, who we consider a 'Conversation Commander' -- a designation we use to describe brands that have above average scores both offline and online."

There are some big box retail brands, according to the analysis, that are Conversation Commanders, where offline and online scores are both above average. Included in this group are IKEA, Kohl's, and Best Buy. However, none come close to matching Costco's strong offline score. To compete more effectively against the warehouse club, these brands can benchmark their own performance to identify areas that need improvement and take action on those with the highest potential to engage more of Costco's shoppers.

Meanwhile, at number nine, retail giant Walmart leads the category for both online and offline volume. However, its sentiment scores leave substantial room for improvement, offline and especially online. So, while the retailer is generating a lot of conversations, they aren't positive enough. The low online sentiment score is a particular challenge for Walmart as it seeks to compete more effectively in e-commerce, as reflected in its recent acquisition of Bonobos.

To learn more about Engagement Labs or TotalSocial insights and how to increase your brand's word of mouth in real life and online, reach out at: totalsocial@engagementlabs.com.

Learn more about Conversation Commander brands, like IKEA, that go against the grain, read Engagement Labs' latest e-book, Lessons from the Leaders of Social Influence, here.

About Engagement Labs
Engagement Labs (TSX VENTURE: EL) is the world's first TotalSocial® company, offering intelligent data, analytics and insights for marketers. We are leaders in tracking, measuring and benchmarking the impact of conversations happening around a brand and industry -- both online and offline. Consumer conversations are a proven driver of critical business outcomes, including sales. The patent pending TotalSocial data solution provides brands with unique insights and powerful analytics to understand online and offline social impact and drive business results. TotalSocial demonstrates to marketers how their online and offline conversation compare and contrast and helps identify areas of competitive opportunity or significant emerging threats. TotalSocial is an "always-on" proprietary scoring system, based on the most important drivers of brand performance: Volume, Sentiment, Brand Sharing and Influence. TotalSocial was built on the pillars of Engagement Labs' patented social media measurement tool and the world's only offline word of mouth tracking system for brands and tracks 500 brands across 16 major industry categories within the U.S., and 350 brands across 18 industry categories in the UK.

To learn more visit www.engagementlabs.com / www.totalsocial.com.

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