Social Media and Its Impact on Consumers Behavior

Assignment of Business Research Methods

Submitted to

Sir.Sarfaraz

Research paper conducted by Majid khan

9206

Sharoon Gulfam

9232

Zain Farooq

9230

M.Adeel

9263

Mujtaba

9216

Mehran Iqbal

9211

Social Media and its Impact on Consumers Behavior Abstract: Technology gives consumer the power to investigate products to label them and criticize them in equal measure, and more. Therefore many companies today have pages on social networks to complement the information held about products, held by the feedback of consumers about products and tend to relate more to a company after reading various reviews. The paper is related to impact of social media on consumer’s behavior. How the decision power is effected by the social media is discussed in this paper. The questionnaire is provided to the people and the result is calculated after the answers are provided to every question.

Introduction: In recent years the online environment is viewed by users from a new perspective, in a commercial way. Its development and the emergence of online stores have turned users into consumers. Also the most important role of social media has changed the way of how consumers and marketers communicate. (Hennig-Thurau et al., 2004) Informational society influences affects the consumer decision processes and product evaluations. Social media provides a new channel to acquire product information through peer communication, (Kozinets, 1999) Moreover, by using social media, consumers have the power to influence other buyers through reviews of products or services used. Consumers are also influenced by other psychosocial characteristics like: income, purchase motivation, company presentation, company or brand's presence on social networks, demographic variable (age, sex, disposable income etc.), workplace method of payment, type of stores (online or physical), etc. In this paper we study the influence of social networks on the decision to purchase in the online users. The first section presents a brief introduction to the chosen theme, followed by relevant information on literature review, where are presented previous specialized studies. The second part describes the research methodology and data analysis. Finally, we present conclusions.

Literature review: Internet and virtual communities have transformed consumers, societies, and corporations with wide spread access to information, better social networking and enhanced communication abilities (Kucuk and Krishnamurthy, 2007). Social media network are defined as sites which connect unlimited users from all the world with same interests, hobbies and views. Facebook, twitter, Instagram, Myspace, LinkedIn and many others are examples of social media networks that are popular among all levels of consumers. Users use several online formats to communicate with each other to share ideas about a given product, service and brand. Now a day’s social media plays an important role on the products sales. The unique aspects of social media and its immense popularity have revolutionized marketing practices such as advertising and promotion (Hanna, Rohn and Crittenden, 2011) Social media has influenced consumer behavior about the information of products and the company. In the last few years can be noticed a great influence of the companies on online networks. Social media websites provide an opportunity for businesses to engage and interact with potential consumers, encourage an increased sense of intimacy with consumers, and build all important relationships with potential consumers. (Mersey, et al., 2010) Previous research has indicated that even a small amount of negative information from a few postings can have substantial impacts on consumer attitudes (Schlosser, 2005). Palmer (1996) stated that individuals have an underlying need for an emotional bond with high-involvement products that they buy. Brand development and relationship development are complementary and substitutable strategies toward this bonding. The relationship between the brand and the consumer is very important for the company and strengthening it leads to loyalty. Due to the advantages of social media in connecting businesses directly to end consumers, in a timely manner and at a low cost (Kaplan and Haenlein, 2010), has been seen that a great influence on customer perceptions and behaviors (Williams and Cothrell, 2000), and has been brought in the center of attention in different industries in the last few years.

Research Objectives: The present research aims 3 objectives: 1. Measuring the degree of consumer confidence in purchasing products online 2. Consumer attitudes toward other consumer feedback from online

3. Determine the age group of the consumers that buy the products online

Conceptual frame of work: In our research we have two variables  

Social Media(Independent variable) Consumer behavior(Dependent variable) Social media is going to have an impact on the consumer behavior. If the impact is positive consumers will buy the products online or see the stuff information online before purchasing the product. If the impact is negative by any means of the social media the perception of the customer is changed due to the social media the customer will not buy the product online.

Social Media Consumer Confidence Attitude towards online feedback

Consum er Behavio ur

Consumers Group

Research design: This is a pure/basic type of research done for information/knowledge-gathering purposes.

Research methodology: A questionnaire based method is used for the research based on the public opinions.

Data Collection:

Data is collected in the form of questionnaire, conducted upon a sample of 30 social media users that buy products online.

Conclusion: After the analysis of the collected information from the 30 subjects, we can conclude the fact that most consumers who buy online are indeed young, between 25-29 years. As a result, 47% of the subjects who buy online products are between 25-29 years. Before purchasing a product on online they usually inform themselves from forums, company’s websites, Facebook accounts or peer reviews. Even more, among the reasons which most consumers prefer online transactions are convenience (42%) and the fact that the product is readily delivered home (39%). Now a day’s social media has a great impact on people life as well as the companies’ products that advertise their products on the social media. From the questionnaire it is concluded that people have full confidence in the company’s name. They fully trust company policies and buy the products.

Questionnaire of the research:

Which category includes your age? * 17 or younger 18-24 25-34 35-44 45-54 55-64 65+ What is your gender?* Male Female What is your educational background?* High School Undergraduate Postgraduate Other Do you use social media? Yes No Which of the following Social Media do you use on a daily basis? (you can provide more than one answer) Social Networking Sites (Facebook) Microblogging (e.g. Twitter) Blogs/Forums Social Bookmarking Sites/ Social News (Reddit, Digg) Photo & Video Sharing sites (e.g. Flickr, Youtube) On average, how many hours per week do you spend on social media?

0 hour 1 to 3 hours 4 to 6 hours 7 to 9 hours 10 hours or more Do you have positive thought towards a particular product/service before use? Always Most of the Time Sometimes Rarely Never Do you have negative thoughts towards a particular product/service before use? Never Rarely Sometimes Most of the Time Always Which of the following can influence your decision to purchase a product/service? (you can provide more than one answer) Knowledge or awareness of the brand Previous experience Information from the internet (e.g. user reviews, blogs, forums) Brand reputation Information from mass media (e.g. TV, radio, magazine) Information from peers, friends or family members. Do you tend to seek out information that support your initial preference/opinion for a purchase?

Always Often Sometimes Rarely Never Have you ever bought a product/service after seeing it on social media Yes Not sure No Do you still find advertisements on mass media (Tv, radio, newspaper) attractive? Yes No If yes, Which of the following mass media channels do you prefer? TV Radio Newspaper Magazine Other (Please Specify) Do you agree that searching for information on a product or services is easier on social media compared to Mass Media?

Strongly Agree

Agree

Neither Agree nor Disagree

Disagree

Before you buy a product/service do you use social media to checkout more information about it? No Yes If yes, how often do you use social media to find out information about a product/service?

Strongly Disagree

Never Less than Once a Month Once a Month 2-3 Times a Month Once a Week 2-3 Times a Week Daily Rank on a scale of 1 to 5, for the source of information on Social Media you use before a purchase? (1 being least, 5 being most)

1 Twitter

Facebook

Online Forums/ Communities/ Blogs

YouTube

Social Bookmarking Sites (e.g. Digg)

2

4

5

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

Agree


Strongly Agree a) Do you think that advertisements via Social Media is an effective way to influence you to try new

3

a) Do you

b) Do you

think that advertisement s via Social

think that Social Media has provided

c) Do you think that marketing

Disagree

Strongly Disagree

Strongly Agree

products/services?

Agree

more Media is an effective effective way platforms to to influence new you to try new products/servi products/servic ces than es? mass media channels?


Disagree

Strongly Disagree

via Social Media is more acceptable than Mass Media?

b) Do you a) Do you b) Do you think that Social Media has provided more effective platforms to new products/services than mass media channels?

c) Do

think that think that Social Media advertisement has provided s via Social more Media is an effective effective way platforms to to influence new you to try new products/servi products/servic ces than es? mass media channels?

you think that marketing via Social Media is more acceptable than Mass Media?

b) Do you a) Do you

c) Do you think that marketing via Social Media is more acceptable than Mass Media?

think that think that Social Media advertisement has provided s via Social more Media is an effective effective way platforms to to influence new you to try new products/servi products/servic ces than es? mass media channels?

c) Do you think that marketing via Social Media is more acceptable than Mass Media?

From question 17c, why do you agree to this?

Do you rely on information provided on Social Media if you have uncertainties regarding the purchase of a product/service?

Always Often Sometimes Rarely Never Do you change your initial purchase preference after searching relevant information via Social Media sites? Never Rarely Sometimes Most of the Time Always

Are you likely yo share comments/reviews/blogs posts/related articles to peers or friends via Social Media after you purchase a product/service? Never Rarely Sometimes Most of the Time Always Are you likely to change your attitude towards a certain product/service after you have read positive comments/reviews/online articles? Yes Maybe No Do you agree that reviews, comments, post etc on Social Media affect your purchasing decision behaviour? Strongly Disagree Disagree Neither Agree nor Disagree

Agree Strongly Agree

Do you agree that Social Media provides an effective and powerful platform for consumers to communicate with each other and the companies Strongly Disagree Disagree Neither Agree nor Disagree Agree Strongly Agree

Are information on Social Media regarding products and services of higher credibility than on mass media channels because th information is beyond the company's control? Yes No

Which of the following stage of your buying decision process has been affected mostly because of Social Media? Rank on a sc to 5. (1 being least, 5 being most)

1

2

3

4

5

Exposure Exposure to product/service information

Problem to product/servi ce information

Recognition

Search for the alternatives

Evaluatio n of Information

Purchase review

Exposure Problem Problem Recognition


to product/servi ce information

Recognition

Exposure

Problem

to product/servi ce

Recognition





Purchase review

Purchase review

1

2

3

4

5

information Exposure Evaluation of Information

Search

Problem to product/servi ce information

Recognition

for the alternatives


Purchase review

Exposure Search

Problem Purchase review

to product/servi ce information

Recognition

for the alternatives


Purchase review

Do you think that Social Media complicate your decision making behaviour? Strongly Disagree Disagree Neither Agree nor Disagree Agree Strongly Agree The following factors affect the length of your decision making process. Rank on a scale of 1 to 5 (1 being least, 5 being most)

Strongly Disagree Resource Resource (time, finance)

(time, finance) Resource

Amount of available information

(time, finance)

Disagree Amount

Neither Agree nor Disagree Personal

of available information

factors (e.g. pressure)

Amount

Personal



Agree Uncertain

Strongly Agree

Risk

ity

Uncertain ity

Risk

Strongly Disagree Resource Personal factors (e.g. pressure)


Uncertainity


Risk

(time, finance)

Disagree Amount

Neither Agree nor Disagree Personal



Amount

Personal



Amount

Personal



Agree Uncertain

Strongly Agree

Risk

ity

Uncertain

Risk

ity

Uncertain

Risk

ity

In your opinion, what is the biggest difference in making a purchase decision between using information from the Social Media information from the mass media

References: Ahuja M. and Galvin J., (2003), Socialization in Virtual Groups, Journal of Management, 29 (2), 161–85. Cătoiu, I., (2009). Tratat de Cercetări de Marketing. Uranus Publishing, Bucharest. Chelcea, S., Mărginean, I. & Cauc, I. (1998). Cercetarea sociologică: Metode şi tehnici, Destin Publishing, Deva. Chelcea, S., (2005). Tehnici de cercetare sociologică, Comunicare.ro Publishing, Bucharest. Hanna, R., Rohm, A. & Crittenden, V., (2011). We’re all connected: The power of the social media ecosystem, Business Horizons, 54, 265-273. Kartajaya, H., Setiawan, I., & Kotler, Philip, (2010), Marketing 3.0, Publica Publishing. Kozinets, R. V., (1999). E-tribalized Marketing? The

Strategic Implications of Virtual Communities of Consumption, European Management Journal, 17(3), 252–64. Kozinets, R.V., (2002). The field behind the screen: using netnography for marketing research in online communities. Journal of Marketing Research 39 (1), 61– 72. Kozinets, R.V., Valck K., Wojnicki A.C., & Wilner S. J.S., (2010). Networked Narratives: Understanding Wordof-Mouth Marketing in Online Communities, Journal of Marketing, 74(2), 71–89. Kuruk K., (2007). An analysis of consumer power on the Internet, Technovation, 27(1–2), 47–56. Mangold G. and Faulds D., (2009). Social media: The new hybrid element of the promotion mix, Business Horizons, 52, 357-365. Mersey R., Davis, Malthouse E. & Calder B., (2010). Engagement with Media, Journal of Media Business Studies, 7(2), 39 -56. Moise D., (2011). Marketing strategies – strategic context specific to communication in events marketing, Romanian Journal of Marketing, Ed. Rosetti Educational, 1, 26. Palmer A.,(1996). Integrating Brand Development and Relationship Marketing, Journal of Retailing and Consumer Services, 3, 251–257.

Social Media and Its Impact on Consumers Behavior

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