Market Overview

The Story Of Lockheed Martin And The $4 Billion Tweet

The Story Of Lockheed Martin And The $4 Billion Tweet

For today’s companies, Facebook Inc (NASDAQ: FB) pages and Twitter Inc (NYSE: TWTR) feeds are no longer simply about having a token social media presence or having another place to announce promotions and events. Investors pay close attention to social media these days. What a company says on social media, or what others say about the company, can have a major impact on share price and market valuation.

The Strength Of Social Takes Wing

One of the most well-known recent examples of the power of Twitter involves Lockheed Martin Corporation (NYSE: LMT) and prolific tweeter and leader of the free world, President Donald Trump. Prior to even taking office back in December, Trump tweeted that he would save the country “billions of dollars” by cutting wasteful military spending, specifically mentioning the “out of control” cost of F-35 Lockheed Martin’s F-35 fighter jets.

Within minutes of the tweet, Lockheed Martin shares plummeted more than 4 percent, cutting a staggering $4 billion from the company’s market cap.

Trump’s tweet had such a wide-reaching impact that shares of rival aerospace and defense company General Dynamics Corporation (NYSE: GD) also initially fell 2.8 percent.

Related Link: Even Trump Can't Save Twitter From Monetization Failure  

While company executives can’t control what the president or the media tweets about their companies, they can use the platform to help influence the tone of the social media conversation. Tesla Inc (NASDAQ: TSLA) CEO Elon Musk is a master of social media. When Tesla was receiving bad press related to its merger with SolarCity last year, Musk reassured investors with a tweet:

Charismatic T-Mobile US Inc (NASDAQ: TMUS) CEO John Legere is both entertaining and informative on Twitter and has amassed 4.1 million followers. Legere doesn’t pull any punches when criticizing competitors such as Verizon Communications Inc. (NYSE: VZ):

A Tweet Worth 4 Billion Bucks

In his new book, “The 4 Billion Dollar Tweet,” Hootsuite founder and CEO Ryan Holmes explains why business leaders that do not optimize their use of social media are missing a huge opportunity. Holmes told Benzinga that millennials will surpass baby boomers in terms of spending by 2018, and younger customers have a much different approach to spending.

“The expectations of digital natives around engagement with brands is much different than any other generation,” Holmes added. “The expectations are social-based. This is how they develop awareness, make purchase decisions, ask for support and become brand advocates.”

Social media can be a major weapon for business leaders if used properly. Business leaders should certainly think twice about simply dumping social media outreach on junior staff and consider social media a critical part of the company’s marketing and brand-building efforts.
Image Credit: Screenshot from Twitter, @realdonaldtrump


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