Can Success on Social Media be a Problem?

Most people will not hesitate to put an equation sign between Social media success and business success. After all, a big social media footprint seems to be a key requirement for the success of the business as a whole. In what follows, we challenge this notion on the basis of data sourced by Stockpulse. Informed by Granger analyses of sentiment and stock development of Olaplex we argue that a strong social media presence means that the sentiment expressed in social media and stock development are closely associated. In the case of Olaplex, the former does even influence the latter as evidenced by significant Granger analyses conducted in this paper. However, a strong follower base in social media does not prevent from stocks taking a big dive as seen in Olaplex between January and March 2022.

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