Social Media As A Marketing Tool A Lit - Essay Example

This Article is brought to you for free and open access by the Textiles, Fashion Merchandising and Design at [email protected] It has been accepted for inclusion in Major Papers by Master of Science Students by an authorized administrator of [email protected] For more information, please contact [email protected] URL. Due. Major Paper Literature Review Social Media as a Marketing Tool: A Literature Review Introduction In today’s technology driven world, social networking sites have become an avenue where retailers can extend their marketing campaigns to a wider range of consumers.

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Chi (2011, 46) defines social media marketing as a “connection between brands and consumers, [while] offering a personal channel and currency for user centered networking and social interaction. ” The tools and approaches for communicating with customers have changed greatly with the emergence of social media; therefore, businesses must learn how to use social media In a way that Is consistent with their business plan (Mango and Faults 2099). This is especially true literature that focuses on a retailer’s development and use of social media as an extension of their marketing strategy.

This phenomenon has only developed within he last decade, thus social media research has largely focused on (1) defining what it is through the explanation of new terminology and concepts that makeup its foundations, and (2) exploring the impact of a company’s integration of social media on consumer behavior. This paper begins with an explanation of terminology that defines social media marketing, followed by a discussion of the four main themes found within current research studies: Virtual Brand Communities, Consumers Attitudes and Motives, User Generated Content, and Viral Advertising.

Although social media marketing is a well-researched topic, it has only been studied wrought experimental and theoretical research; studies never precisely describe the benefits retailers gain from this marketing tactic. In reviewing the rich plethora of multi-disciplinary literature, it is has become clear that studies are focusing on describing what social media marketing is as well as examining what factors affect consumer behavior relative to social networking. Despite the initial progress made by researchers, development in this area of study has been limited.

Research needs to expand by providing a deeper understanding of the longtime promotional gains retailers obtain from social media marketing. More formalized studies are also needed to progress beyond theorized or predicted outcomes in order to gain knowledge of real life applications. This review of literature touches upon the gaps that currently exist within social media marketing research and points out the need for future studies to explore the benefits gained by marketing on social networking sites, especially for small retailers.

Defining Social Media To consider social media as a marketing tool a retailer must understand every aspect of it. Social media cannot be understood without first defining Web 2. 0: a term that ascribes a new way in which end users use the World Wide Web, a place where content is continuously altered by all operators in a sharing and collaborative way (Kaplan and Heinlein 2010). “It is much more to do with what people are doing with the technology than the technology itself, for rather than merely retrieving information, users are now creating and consuming it, and hence adding value to the websites that permit them to do so” (Campbell et al. 011, 87). Web 2. 0 has evolved from simple information retrieval to interactivity, interoperability, and collaboration (Campbell et al. 2011). 2 Kaplan and Heinlein (2010, 61) define social media as “a group of Internet based applications that build on the ideological and technological foundations of Web 2. 0, and allow the creation and exchange of user generated content. ” Sinclair and Bogus describes software tools that create user generated content that can be shared. However, there are some basic features necessary for a website to meet the requirements as a social network website: the site must contain user profiles, content, a method that permits users to connect with each other and post comments on each other’s pages, and Join virtual groups based on common interests such as cushion or politics. (Gross & Acquits, 2005; Ellison, Steindler & Lamps, 2007; Alienate & Madden, 2007; Winder, 2007; Boyd & Ellison, 2007 as cited in Cox 2010). The phrase social networking sites’ is often used interchangeably with social media.

However, social media is different because it allows participants to unite by generating personal information profiles and inviting friends and colleagues to have access to those profiles (Kaplan and Heinlein 2010, 63). Thus, social media is the environment in which social networking takes place and has altered the way in which consumers gather information and make buying decisions. Consumers’ Sentiment toward Marketing (SCM) is a factor consider by researchers to measure how well consumers will perceive social media marketing.

SCM is defined as a concept which refers to the general feelings that consumers have for marketing and the marketplace (Lawson et al. 2001 as cited by Made 2011). An individual’s perception of the overall marketplace plays a major role in whether or not they are motivated to partake in consumption activities (Made 2011). In order to create a successful marketing campaign via social media, a consumer must be open to the technology. Consumer technology readiness is defined as 3 people’s propensity to embrace and use new technologies for accomplishing goals in home and work” (Paranormal, 2000 as cited by Made 2011, 195).

Consumer technology readiness is important for retailers to remember when marketing on social networks because if their intended target market does not use social media, is not familiar with it, or perceives it negatively, then their social media marketing will be unrewarding. Analysis of technology readiness can determine if marketing via interactive advertising would be a good fit for a retailer’s target market. The Innovation Adoption Process (PAP) is another instrument that provides information on a consumer’s acceptance of new technology.

The PAP is the progression through which an individual goes through the innovation-decision process (Rogers as cited in Made 2011). Five steps make up the process: knowledge of the innovation, forming an attitude toward the innovation, deciding to adopt or reject the innovation, implementation of the innovation, and confirmation of the decision (Made 2011). Knowledge of PAP can help marketers obtain a social media marketing campaign that is fulfilling. Social media has advanced from simply providing a platform for individuals to stay in ouch with their family and friends.

Now it is a place where consumers can learn more about their favorite companies and the products they sell. Marketers and retailers are utilizing these sites as another way to reach consumers and provide a new way to shop. “Technology related developments such as the rise of powerful search engines, advanced mobile devices and interfaces, peer-to-peer to reach shoppers through new touch points” (Shank et al. 2011, 30). 4 Shopper marketing is a new concept that has emerged, creating a new touch point for the interactions between businesses and consumers.

Shopper marketing is “the landing and execution of all marketing activities that influence a shopper along, and beyond, the entire path of purchase, from the point at which the motivation to shop first emerges through purchase, consumption, repurchase, and recommendation” (Shank et al. 2011, 29). Perceived fit is an important factor for retailers to consider for shopper marketing; perceived fit is the amount of similarity between an extension product category and existing products affiliated with the brand (Delicious and Smith as cited in Chaw 2009).

The more people perceive shopping services on social networking sites as useful and easy to use, the more keel they are willing to shop for items on social networks (Chaw 2009). Providing shopping services on social networks can provide business growth for retailers due to the diversity of consumers who use social media sites. The wide range of consumers utilizing social networks means that most target markets can be reached (Chaw 2009). This provides an effective platform for retailers to promote their brand and products to potential consumers.

According to Shank et al. (201 1), shopper marketing can Join forces with shoppers to improve products, create clear messages, identify promoters, and serve as a connection to in-store activities, thus mistreating the importance of social media within a retailer’s marketing plan. Advancements within social media sites have created consumer communities that are defining new ways in which companies and customers can interact with one another to share information on brand products.

For example, virtual brand communities are creating a computer-generated space for consumers and retailers to connect with one another via marketing. 5 Virtual Brand Community A main topic being studied involving social media as a marketing tool is Virtual Brand Communities (BBC). NBC can be described as aggregations of consumers that occur n the internet because of their interest in some brand or product” (Muezzin and Gauguin as cited in George and Mink 2012, 3). Specifically, a brand community is a group of people who share the same interest in a particular brand or product (CasualГ¶, VivaГn and Signaling 2008).

Overall, Vic’s are “the site[s] of complex brand meaning creation and consumption efforts” (Muezzin and Jensen Schwa, 2007). CasualГ¶, VivaГn and Signaling (2008) found when a member is trusting of the BBC that they are part of, it increases their amount of participation, and consumers who have a positive participation experience are more loyal to the brand. Trust is a central aspect to affecting a consumer’s opinions toward social networking sites and can ultimately impact trust.

Since Bcc depend on individual users’ participation, both group unity and awareness can strengthen users’ satisfaction with a BBC (CasualГ¶, VivaГn and Signaling 2008). The study done by CasualГ¶, VivaГn and Signaling (2008) demonstrates the powerful sway BBC and an online interaction between consumers can have on their buying behavior. Studies also found that within these Bcc many new forms of social interactions are taking place such as Electronic Consumer to Consumer Interaction (cycle), which are interactions between consumers of e-services (George and Mink 2012).

The chance to mingle with other people is a fundamental part of the consumer experience and social networking sites have become a way in which consumers can interact with one another and retailers (George and Mink 2012). Because of cycle, consumers are playing a more dominant role in influencing each other with their consumption decisions. George and Mink (2012) came up with the concept of 6 electronic consumer to consumer interaction quality (cycle). They found that seven factors contribute to the success of cycle.

These include content, security, hedonistic meaning the emotional aspects of consumers’ interactions with products), quality, atmosphere, convenience, and social. An example of cycle (which is any interaction between consumers of e-services) is when a consumer posts a question about the fit or color of a product displayed online and another consumer answers the question. This cycle event would presumably be of high quality if the question is answered by another consumer quickly, correctly, and in a friendly manner.

This example of an interaction between consumers involves some of the factors associated with cycle such as social and convenience, thus making it an cycle occurrence. Consumers feel more engaged with products and companies when they have the option to submit feedback (Mango and Faults 2009). Accordingly, it is important for retailers to be aware of the quality of their social media presence even when consumers are the creators of their marketing because it is increasingly influencing how consumers shop.

Companies need to be aware of the variety of factors that affect their social media presence such as a consumer’s social identity online. Some BBC research focused on the concept of social identity and group norms as an aspect that strongly influences online groups’ buying behavior. The nature and culture of social media groups affect the ways members of such groups interpret and attach meaning to brands and products (Muezzin and Jensen Schwa, 2007). Group norms represent the set of shared goals, beliefs, and values that the group members follow.

Social identity refers to the values and beliefs that influence group related behavior (Zen, Hung, and Duo 2009). Community members within a strong social group were more likely to have group intentions to accept advertising in online communities (Zen, Hung, and Duo 2009). For instance, if a Faceable group is centered on luxury brands, then ads pertaining to high-end products are more relevant to members of the 7 they contain, while others interpret the ads by attaching meaning to the brand represented based on their own experiences (Muezzin and Gauguin as cited in Muezzin and Jensen Schwa, 2007).

Moreover, BBC members value ads that are relevant to the theme of their community. Muezzin and Jensen Schwa (2007) found advertising and branding produce discouragement of the intended meaning of the ad in order to serve the meaning of the distinct group, in this circumstance the brand community. A BBC can alter or manipulate the true meaning of an ad by the way it displays or uses an ad for branding. Many times Vic’s change the meaning of an ad by the way it is presented on the community forum.

A BBC can alter an ad to conform to the theme of its community, therefore the ads true meaning gets lost. An individual’s identity within social media combined with the social community’s customs affects the way in which people perceive ads presented on social media. Community customs can be affected by users’ cultural backgrounds as well. Postulating and Kessler (2011) used the Technology Acceptance Modems (TAMA) to kook at the impact of culture on social media.

TAMA highlights the role and procedures connected to perceived usefulness and perceived ease of technology. TAMA suggests that the factors that determine perceived usefulness will not influence perceived ease of use and the factors that influence perceived ease of use will not influence perceived usefulness (Postulating and Kessler 2011). The researchers used TAMA to find out if an individual’s cultural background affects perceived ease and perceived usefulness in order to discern users’ behavioral intention towards social media.

More specifically, the researchers used TAMA to determine if an individual’s cultural background influences how they will interpret a message, 8 event, or idea presented to them through a social networking site. This was done through a conceptual framework in which the researchers created a research model using TAMA. Based on the research model, Postulating and Kessler (2011) conclude that culture does in fact influence how individuals act and perceive an event on technology based applications, such as social media.

This means that an individual’s cultural or ethnic background will influence how they will interpret social media and its content. Social networking has allowed the evolution of new culture where it is no longer shaped by Just individual values and ideologies, but also by new rituals and communication tools in the social space of Web 2. 0″ (Postulating and Kessler 2011, 352). Retailers need to be conscious of the importance of culture when utilizing social media, since social networks are a merging of different cultures and the creation of new online cultures (Postulating and Kessler 2011).

In addition, cultural backgrounds and traditions may factor into the formulation of a consumer’s opinion and attitude towards a brand or product. Consumer Attitudes/Motives It is vital for retailers and marketers to be aware of the factors that affect consumer brands, something previously controlled solely by companies (Heinous 2011). As a result, current research has examined what aspects of social media sites affect consumer attitudes and motives.

Chug (2011) examined the link between Faceable brand related group participation, advertising responses, and the psychological factors of self-disclosure and attitudes among members and nonmembers of Faceable groups. The study determined that users who are members of groups on Faceable are more likely to disclose their personal data than nonmembers are. Chug (2011) 9 explains group participation and engagement with online ads requires a higher level of personal information because users openly reveal their connections with Faceable groups and promote brands or products when they pass on ads to their friends. Faceable groups provide channels that consumers deem useful when seeking self- status in a product category, as does passing on viral content about brands to their social contacts” (Chug 2011, 40). Chug (2011) also found that users who are Faceable group members maintain a more favorable attitude toward social media and advertising. Users who have more positive attitudes toward advertising are more likely to Join a brand or a retailer’s Faceable group to receive promotional messages. Based on this result, Chug (2011) suggests that a link exists between consumers’ use of and engagement in group applications on a social media sites.

The relationship between consumers’ use of and engagement with group applications influences the rate and effectiveness of advertising on social media, particularly Faceable. Generally, as Chug (2011) notes, Passbooks college-aged users have the most favorable attitudes toward social media advertising and are the largest growing demographic, which suggests that social media sites are a potentially rich platform for online advertising campaigns, especially for companies with a younger target market.

Cox (2010) also investigated the correlation between age and attitude and found that social network user attitude toward online advertising formats (I. E. Blobs, video, and brand channel or page) differed to some extent across age groups. She explains that users who fall in the 18-28 age brackets had strong positive attitudes towards Blobs, video, and brand channel ad formats. This was because users’ found these ad formats to be eye catching, informative, and amusing.

The 35-54 age groups preferred ad formats on video and brand channels because they found them to be more eye catching, informative, and had better placement within the online 10 page layout. Overall, online advertising formats with positive attributes are welcomed by users; however, ads that are intrusive or interfere with online social networking activities, such as pop up, expandable, or floating formatted ads were disliked by network users (Cox 2010).

According to Chi (2011) users perceive advertising differently depending on the social network, which suggests user responses to social media marketing. As mentioned previously in the explanation of Postulating and Sleeker’s (2011) study, the technology acceptance model (TAM) was also used by Harris and Dennis (2011). Harris and Dennis (201 1), however, used TAM as a loose framework that combined trust and the factors associated with TAM (I. E. Perceived enjoyment, ease of use, and usefulness).

The TAM determined that consumers, specifically students, hold a hierarchy of trust when using social media such as Faceable. Student’s trust ‘real’ friends, then Faceable friends, followed by expert Blobs and independent review sites and lastly celebrities and e-retailer sites Harris and Dennis 2011). Did Pitter and Pantaloon (2012) conducted further research using the TAM to discern that enjoyment is the major factor that influences consumers to use social networks as a platform for assisting in their buying decisions.

They found that the fun provided by Faceable, as well as the opportunity it provides users to ask for suggestions in an easy and entertaining way, motivates individuals to pay more attention to the products promoted on Faceable. “Faceable promotes a consumer to consumer approach, exploited by consumers to share experiences and create a common knowledge on products and services; on the other, t provides managers a direct channel for communicating with clients through a business to consumer approach” ( Did Pitter and Pantaloon 2012, 20).

Retailers can improve their Faceable page appeal by adding games, contests, and interactive applications, which can attract more users (Did Pitter and Pantaloon 2012). 11 However, retailers also need to be educated on consumer’s attitudes when it comes to social media marketing. A deeper understanding of how consumers perceive social marketing will help ensure marketing strategies are effective. Consumer activities of consumption, participation, and production are not related to just one motivation according to Heinous (201 1), who concluded that consumer activities are a combination of a variety of motivations.

The classic notion of individuals as mere consumers is outdated; consumers can now be seen as active producers of business value because user generated content is reducing the influence of traditional marketing tactics (Heinous 2011). Awareness of consumer’s motives is important because it provides a deeper understanding of what influences users to create content about a brand or store. User Generated Content “While social media provides never ending avenues for communicating, it is the individuals who serve as the influences not the technology’ (Gonzalez 2010, 23).

User generated content produces social currency for marketers because it helps define a brand. User generated content describes “the sum of all ways in which people make use of social media, usually applied to describe the various forms of media content that are publicly available and created by end users” (Kaplan and Heinlein 2010, 61). Therefore, social currency is when individuals share a brand or information about a brand (Cannibalize and Honed 2011). Social currency greatly affects brand reference and is a concept that can be linked to Boride’s (1977) and Colleen’s (1988) idea of social capital.

Social capital is shaped on a personal level and occurs in the relationships among individuals (Cannibalize and Honed 2011). Furthermore, the amount of an individual’s social capital depends on the size of the network of connections that the user can successfully mobile (Broodier as cited in Cannibalize and Honed 2011). An individual’s connections can potentially aid in developing brands into an essential part of customers’ social interactions via social networking. Translating [Boride’s] theory into today’s world of exponentially increasingly social interactions on the internet, social currency can also be understood as the entirety of actual and potential resources available to a brand from its presence in social networks and communities” (Cannibalize and Honed 2011, 51). There are six components of social currency: affiliation, conversation, utility, advocacy, information, and indemnity (Cannibalize and Honed 2011). Social currencies come from interactions between consumers and are usually beyond the direct control of a firm (Cannibalize and Honed 2011).

Through their empirical study, Cannibalize and Honed (2011) establish that although social currency consists of six efferent components, brands do not rely on all of them to facilitate brand loyalty among users. It was discovered however, that what made a brand successful was being an essential part of people’s daily lives. When a brand becomes integrated into a consumer’s daily life, it enables consumers to connect, interact, and benefit from likened brand users, and thus, the likelihood of consumer generated advertising for a brand increases (Cannibalize and Honed 2011).

Consumer Generated Advertising (GA) is a form of user-generated content, which refers to specific instances where consumers create the brand, focused messages tit the purpose of informing, persuading, or reminding others (Campbell et al. 2011). Muezzin and Jensen Schwa (2007) and Pelican, Corsican, and Berthed (2011) use the term vigilante marketing to describe GA. Vigilante marketing is defined as “unpaid advertising and marketing efforts, including one to one, one to many, and many to many commercially oriented communications, undertaken by 13 brand loyalists on behalf of the brand” (Muezzin and Jensen Schwa 2007, 35).

Campbell et al. (2011) state that today, traditional marketing is coexisting with GA. Retailers need to be aware of this because GA can positively support traditional marketing or t can negatively impact and undermine it. Chosen and Morrison (2010) research supports the previous statement by explaining how the lack of research on the credibility of both positive and negative user generated content (UGH) highlights the need for retailers to be conscious and study ICC to completely understand its influence.

Consumers are taking part in a diverse array of activities such as consuming content, participating in discussions, and sharing knowledge with other consumers, to contributing to other consumers’ activities (Heinous 2011). Pelican, Corsican, and Berthed (2011) chose a grounded theory approach to compare GA with Firm Generated Advertising (VGA), specifically for the large well-known Apple Corporation. They found that GA differs from VGA because each type of ad (GA or appreciation for VGA, but found GA to be more entertaining causing consumers to talk about the ad more (Pelican, Corsican, and Berthed 2011).

Chosen and Morrison 2008 study was similar; they examined the difference between ICC and producer generated content (PIG), which refers to content created by marketers of products, by interviewing college students. Overall, the study found that consumers hold more rust in product information created by other consumers than information generated from manufactures. Consumers’ read other consumers’ opinions to decrease their risks and obtain pre-purchase information; therefore, other consumers’ information emerges as more important than advertising, thus, individuals who post ICC become opinion leaders (Chosen and Morrison 2008).

Another study that centered on GA was conducted by Taylor, Stratton, and Thompson (2012); like the fore mention studies, their research indicates that consumers trust 14 GA over ads produced by companies and the more entertaining the ad the more it will be passed on. Taylor, Stratton, and Thompson (2012), found however, that social media users’ message sharing behaviors are also attributed to the need for self-enhancement. When consumers perceive an online advertisement to be consistent with their identity, they are more likely to share the message with others because it is representative of who they are and what they like.

Thus, “advertisers should consider the symbolic and self-expression properties of their online ads and match them to targeted consumers’ self-concepts” (Taylor, Stratton, and Thompson 2012, 13). In other words, the marketing of a company needs to share similar characteristics with TTS target market’s interest. All of the findings from these studies show the significance of GA and its impact on online marketing. Muezzin and Jensen Schwa (2007) note that a lot of GA is created quickly and spreads via e-mail without revealing who made it or if it is official corporate content.

Therefore, brand managers now have to consider how to react when their brand is talked about by consumers (Campbell et al. 2011). Muezzin and Jensen Schwa (2007) argue GA is relevant to companies because it provides proof of consumer perceptions of brands and their feelings towards the brand. They also argue that GA is important because they are prime examples of persuasive marketing messages from brand loyalists. Moreover, GA is only going to increase in frequency.