Predicting Express's Bankruptcy: The Warning Signs in Their Social Media

Social media is more powerful a tool than ever for brands to captivate potential customers, engage current ones, and spread positive word of mouth. But it’s even more than that.

A lot of brands fail to understand that social media engagement doesn’t only rely on the quality of the content you’re posting. It more importantly relies on how customers feel about your brand in general.

Express recently filed for Chapter 11 bankruptcy. But if you had just quickly scrolled through any of their social media pages, this announcement wouldn’t actually be too surprising.

Social Media Engagement as a Predictor of Success

In previous articles, we talked about whether or not we could predict the success or future valuation of a brand using customer sentiment data. We decided to change up this experiment ever so slightly with Express.

Instead of measuring how Express’ volume of customer complaints and praises changed over time, we looked at how their engagement numbers on Instagram changed over time.

We began by noting down the number of likes on every single Instagram post that displayed Express’ clothing without a model in the image, starting in January 2021 and ending in May 2024. We then graphed the data out, with 480 entries in total.

We saw that while Express’s Instagram engagement remained relatively stable in 2021 with a slight decline, these numbers plummeted during 2022 and have been tumbling downward ever since.

What’s even more interesting is that Express’ stock price graphed over the years shares a very similar pattern to their Instagram engagement numbers over the same time frame.

And though we only ran this experiment for one brand, the results show just how important it really is to pay attention to your customers. At one point, you have to stop asking yourself how you can improve your content and start asking yourself how you can use the feedback you gain from your social media accounts to improve your brand.

So What?

But most of the time, customers who churn or unfollow won’t give you a reason why — they’ll simply leave. So when you see your churn rate increasing or your number of likes decreasing, it’s your job to find out why — whether that’s through reaching out to customers directly, observing their browsing and purchasing behavior from afar, or of course, simply listening to what they have to say when they do give you a reason.

This experiment we just did is actually a great example of this. The number of likes per post had been dropping for Express throughout the past few years, but there was no way to understand why simply from looking at things surface-level, especially since most Instagram comments have remained positive.

But when we picked out the few comments that were negative or even searched anonymous social media communities like Reddit, the reason why seemed much clearer.

Express’ product quality, overall assortment of apparel, and customer service seemed to be common complaints. There appeared to be a consensus that Express’s clothing items themselves simply didn’t align with and evolve with trends as well as other brands had — and this was most definitely a core issue of theirs that led to their bankruptcy.

Had they listened to this feedback more closely in the beginning or explored why their engagement numbers had been dropping earlier on, things might have turned out differently.

Takeaway

Social media is such a useful tool for brands for both obvious and non-obvious reasons.

The obvious reasons being that it can be used to captivate customers with engaging content and spread brand awareness.

But the more non-obvious reasons being that it can be used to garner customer feedback and to tell a brand when they’re in danger and how they can turn their situation around.

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