What do GameStop, Reddit and Wall Street Bets have to do with your online marketing strategy? More than you might think. We think there are some huge takeaways for your business.
If you have been following any Economic News lately, you have most likely run across the story. Here’s what happened:
It all began with a group of investors who began to congregate on a Reddit group called WallStreetBets. (Reddit is an online platform with message boards where people post information or discuss specific topics. Users can also create communities based on specific interests, products or events.)
This particular Reddit group became quite large over the last year. The rapid growth was probably due to a combination of stimulus money, free time from the COVID-19 lockdown, market volatility, the disappearance of sports betting, and the emergence of free stock apps.
These were young people and rogue investors posting jokes and comments about what they perceive as a corrupt system. And these investors started trying some very non-conventional tactics. And one of these tactics caused people to earn and lose billions.
That was the short-squeeze of GameStop.
GameStop is a retail chain for video games and consoles. And it has been struggling, closing locations and dropping in market value. Large-scale investors began betting against GameStop, or shorting the stock. Basically, they would make money if GameStop fails. So, when WallStreetBets started buying the stock at astronomical rates, the stock soared and the people shorting GameStop lost billions.
So, what are the lessons your business can learn from this story?
Online communities can be very powerful.
Social media outlets give people with similar interests the chance to communicate with each other. And these groups can make a big difference for a business, depending on how that business is perceived.
So, your online reputation matters.
This story happened beneath the noses of some of the smartest people on Wall Street. So, we encourage you to be engaged with your customers online. Stay ahead of your company story and reputation. Be aware of what is being said about your business on the internet.
Octane can help you manage your online reputation. Contact us to get started!