Does Social Media Marketing Improve Business Performance?

Does Social Media Marketing Improve Business Performance?

Tanses Yasemin Gülsoy (Beykent University, Turkey)
DOI: 10.4018/978-1-4666-8125-5.ch023
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The recent growth of social media, or consumer-generated media, has given rise to bidirectional communication between consumers and marketers. There is some evidence that the dialogue appears to help the business performance of companies by influencing, for example, product sales, consumer attitudes, and consumer decision-making. This chapter examines the evidence, with a particular focus on on-line consumer product reviews. Also investigated is the role trust plays in how marketing works in the social media. Managerial implications and research directions are indicated.
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What Is Social Media?

In this chapter we follow Kotler and Keller’s (2012) definition of social media as “a means for consumers to share text, images, audio and video information with each other and with companies and vice versa” through the three main platforms of on-line communities and forums, bloggers, and social networks (such as Facebook, Twitter, and YouTube) (p. 568). Social media is the “umbrella term” for Web-based software and services that allow users to join one another on-line and “exchange, discuss, communicate, and participate in any form of social interaction” (Ryan & Jones, 2009, p. 152). A more technical definition is “a group of Internet-based applications that build on Web 2.0 technologies, employ web- and mobile-based technologies to support the creation and exchange of user-generated content” (Duan, 2013, p. 861). Kaplan and Haenlein (2010) suggest that the World Wide Web’s growth increasingly into a social media platform can be seen as “an evolution back to the Internet’s roots, since it re-transforms the World Wide Web to what it was initially created for; a platform to facilitate information exchange between users” (p. 60). Mobile devices such as certain types of cellular phones can also enable social networking through mobile components of Web sites and programs. Thus, mobile marketing which involves the delivery of direct marketing messages to mobile devices using wireless technologies (Fill, 2009, p. 739), may sometimes take on the features of social media marketing.

Many different types of social media exist, and these include forums and discussion sites, media sharing sites, reviews and ratings sites, social networking sites, social media submission sites, blogs, podcasts, micro-blogging, and “wikis” among others (Ryan & Jones, 2009, pp. 157-169). Some of these media such as “wikis”, defined as Web sites that allow users to “add, remove, or otherwise edit and change content collectively” (Organisation for Economic Co-operation and Development, 2007, p. 33), are user-generated, but they do not allow for social interaction among different users.

Key Terms in this Chapter

Marketing Effectiveness: The extent to which a marketing activity or program reaches its predefined objectives.

On-Line Customer Review: Customer reviews of products posted on digital media such as marketers’ Web sites or social media platforms.

Business Performance Indicator: Indicators such as market share and return on investment that give an indication of business performance.

Digital Marketing Strategy: Marketing strategy as it pertains to digital channels of communication.

Social Media Marketing: Marketing activities performed through the use of social media.

Word-of-Mouth Communication: Communication shared by consumers about a product or promotion and the act of sharing such communication (based on the definition of the American Marketing Association, 2014 ).

Social media: The on-line electronic media such as on-line communities and forums, blogs, and social networks through which consumers share information with each other and with companies. The companies also may use these platforms to share information with consumers. This definition is based on Kotler and Keller (2012 : 568).

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