Media Releases

Voting with their Tweets: social media complaints can be alternative to market discipline, Rotman study shows

March 1, 2017

Toron­to, ON – Noth­ing inspires con­sumer frus­tra­tion quite like an air­line flight delay. Researchers from the Uni­ver­si­ty of Toron­to’s Rot­man School of Man­age­ment have used those melt­down moments — and the com­plaints they pro­duce via the social media plat­form Twit­ter — to study how con­sumer “voice” may influ­ence busi­ness behav­iour.

“We thought com­plaints were an impor­tant part of the econ­o­my but, until now, we haven’t had a sys­tem­at­ic way to mea­sure them,” says study co-author Mara Led­er­man, an asso­ciate pro­fes­sor of strate­gic man­age­ment at Rot­man.

The accept­ed idea among econ­o­mists is that mar­kets act to dis­ci­pline com­pa­nies for poor per­for­mance as con­sumers will with­draw their busi­ness if they are not hap­py. Com­plain­ing – as opposed to switch­ing — has been sug­gest­ed as an alter­nate mech­a­nism but, to date, has received much less atten­tion.

The pub­lic nature of social media, how­ev­er, now makes it pos­si­ble to track con­sumer com­plaints, the mar­ket cir­cum­stances under which they’re made and how com­pa­nies respond. This opens the door for stud­ies that exam­ine the pur­pose and impact of cus­tomer voice.

Not sur­pris­ing­ly, the researchers found that pas­sen­ger com­plaints via Twit­ter increase when an air­line’s “on-time” per­for­mance wors­ened.  This was based on an analy­sis of approx­i­mate­ly four mil­lion Tweets made to or about the top sev­en Amer­i­can air­lines over a two-year peri­od.

What was more inter­est­ing is that the same dete­ri­o­ra­tion in on-time per­for­mance gen­er­at­ed about 50 per­cent more com­plaints when the air­line was the dom­i­nant car­ri­er in the passenger’s local mar­ket. Air­lines also respond­ed more often when com­pe­ti­tion was lim­it­ed and when the pas­sen­ger men­tioned the air­line’s loy­al­ty pro­gram in their tweet.

These find­ing sug­gest that com­pa­nies in low com­pe­ti­tion mar­kets may have the most to lose from ticked-off cus­tomers because these cus­tomers gen­er­ate high mar­gins yet have the abil­i­ty to go else­where if they are not hap­py, says Prof. Led­er­man. The same goes for cus­tomers who are invest­ed in a company’s loy­al­ty pro­gram– these are the very cus­tomers that are cost­ly for the com­pa­ny to lose.

“In mar­kets where you don’t have a lot of com­pe­ti­tion, but you have some, voice might be effec­tive because this pre­cise­ly when com­pa­nies will care to retain cus­tomers who have been made unhap­py,” she says.

Prof. Led­er­man car­ried out the study with fel­low Rot­man researchers Joshua Gans, a pro­fes­sor of strate­gic man­age­ment and Avi Gold­farb, a pro­fes­sor of mar­ket­ing.

Their results sug­gest using social media to com­plain can be worth­while, so long as a com­pa­ny val­ues the cus­tomer enough to respond and offer some incen­tive for them to stay (whether mon­e­tary or sim­ply a promise to do bet­ter in the future). Com­pa­nies, mean­while, may want to con­sid­er set­ting up ded­i­cat­ed com­plaint chan­nels as a way of retain­ing valu­able cus­tomers who might be at risk of leav­ing, says Prof. Led­er­man.

The com­plete study is avail­able at:

For the lat­est think­ing on busi­ness, man­age­ment and eco­nom­ics from the Rot­man School of Man­age­ment, vis­it

The Rot­man School of Man­age­ment is locat­ed in the heart of Canada’s com­mer­cial and cul­tur­al cap­i­tal and is part of the Uni­ver­si­ty of Toron­to, one of the world’s top 20 research uni­ver­si­ties. The Rot­man School fos­ters a new way to think that enables our grad­u­ates to tack­le today’s glob­al busi­ness chal­lenges.  For more infor­ma­tion, vis­it


Ken McGuf­fin
Man­ag­er, Media Rela­tions
Rot­man School of Man­age­ment
Uni­ver­si­ty of Toron­to
Tel: 416–946-3818