Influence of Social Media in Changing and Influencing Consumer Behaviours - Research Proposal Example

Marketing Customer Inserts Name Customer Inserts Tutor’s Name 30th October, 2014 Executive Summary The growth of the internet and social media has changed the way people shop and analyze goods sold. This is because more and more young people are using the internet and social media to make decisions concerning different aspects of life. The increased use of social media has changed the global business environment since more and more companies are utilizing this tool in marketing and selling goods or services to different consumers globally. However, companies are still lagging behind in terms of utilizing social media as a tool for designing marketing strategies. Social media trends have shown that more and more consumers are utilizing these channels in making consumer decisions. Therefore, a research on social media users was undertaken with an aim of understanding its effect on consumer behaviour. The result of the research shows that young people spend considerable time and money in online shopping and socialization. The importance of social media in influencing consumer behaviour is outlined by the fact that 84% of social media users rely upon reviews on these channels to make purchase decisions. In terms of popularity, Facebook and Twitter take the bulk of users who utilize these channels in socializing and making consumer based decisions. Female social media users are very attached to social media comments and changes and thus could be easily influenced by reviews and other factors that influence social media activity. Companies should engage young people through active social media campaigns and communication to understand the behaviour and working of these young people. This is because consumer behaviour is shaped by opinions, comments and other factors which contribute towards coming up with a proper marketing strategy for companies. Table of Contents Executive Summary 2 Table of Contents 3 Introduction 4 Problem Definition 4 Background to the problem 5 Methodology 6 Data Analysis 7 Limitations and Future Research 12 Conclusions and Recommendations 14 References 17 Appendix 19 Questionnaire 19 Introduction Social media is a phenomenal that has caught the world by storm and this has transformed a lot of industries. As a result, consumer behaviour has morphed and organizations and companies have tapped into this new information from different sources in the process of selling and marketing its goods and services. Societal influences come to play in the process of searching and reviewing products or goods sold by different companies. The role and influence that social media plays in influencing consumer behaviour have changed the way companies market and sell to other individuals. This analysis will look into a study that outlines the influence of social media in changing and influencing consumer behaviours. Problem Definition Measuring consumer behaviour is a challenging task that requires the possession of different skills sets. Understanding consumer behaviour depends a lot on issues concerning age, market demographic, income and other factors. Understanding the trends that inform consumer spending is a tedious process that requires the researching, analysing and making recommendations on various factors that affect the implementation of a marketing campaign. Organization and companies need to understand the trends within social media that affect the consumer behaviour and make appropriate recommendations in the implementation of marketing strategies. Social media sites have been utilized for different purpose among online users such as communication and group discussions. Consumers have an emotional bond with products which they purchase and therefore, it is imperative to ensure strong brand communication and information is available for the consumer. Research has shown that negative perception or information on certain brands can have significant impact on consumer attitudes. This phenomenon has driven companies into social media websites as opportunity on tapping information from existing and potential customers of their products and services. However, mining information from social media websites can be cumbersome since the right type of information is difficult to obtain. Companies have to therefore rely on information from different social media groups and from feedback received from their own social media pages (Pookulangaran 2011, pp. 352). Shopping and purchase of products is a social experience that is easily shared among consumers who are strangers to one another. Therefore, communication and interaction are important aspects that control and enable social media sites to interact with consumers. Therefore, research on consumer trends and behaviour through the use of social media as an effective marketing tool has been considered greatly by several companies and organizations (Sin 2012, pp. 329). Companies currently utilized social media sites such as Facebook, Twitter and MySpace to get users and consumers to communicate about their products and brands. As a result, it is imperative to undertake an analysis on the effect of social media in influencing consumer behaviours. Background to the problem The growth of the internet has created a lot of opportunities for consumers and companies to sell and market through the use of different online platforms. As a result, a lot of people have had the opportunity to get more information concerning products and services provided by different companies. However, competition for consumer numbers and increased competition in the sector has created a big gap for companies needing to fill the gap of information needed to ensure successful marketing of goods and services. Consequently, it is imperative to ensure that proper research is undertaken in gathering information to be used in marketing and selling goods and services to the general population. In the process of brand development, communication is utilized by companies and organizations to understand the attitudes and feeling towards certain products and services (Pookulangaran 2011, pp. 350). For that reason, it is imperative that companies get information from the majority of the consumers and look at the factors which influence their buying decisions. The growth of the internet and social media has contributed largely to growth of information which is readily accessible from different platforms. Thus the unique offering and work undertaken by social media sites in the field of marketing has transformed the way companies undertakes their policies especially in the field of marketing, advertising and promotions (Sin 2012, pp. 328). Companies have to be aware of the information needed to ensure successful marketing and selling campaigns right from the acquisition of marketing information, selling and post sales behaviour of the market. This information may include dissatisfaction or poor reviews from consumers or people from different segments of the population. Social media sites have been effective in giving information, reviews and ensuring companies maintain interpersonal relationships with its customers on a regular basis (Vegheș 2009, p. 942). The use of social media by companies and organizations is expected to grow due to the increased need to be aware of consumer trends in the fast changing consumer environment. Methodology The process of understanding social media influences on buyer preferences will be undertaken through the use of research and a market survey undertaken to understand consumer trends. Several factors influence the trends and changes in the consumer market and therefore, it is imperative to make use of qualitative data sampling methodology for this study. An online research survey will be conducted on selected social media users based in different regions globally. Their insight and feedback from the data collected will be used in making decisions concerning social media and consumers’ behaviour insights. Undertaking a qualitative research is well suited for this research study due to the scope of the work being undertaken. The qualitative research methodology used in this study will rely upon sampling and questionnaires to come up with research questions and other forms of data from consumers (Kardes 2014). The questionnaires will be sent to online users from different regions globally as outlined; North America (100 online users), Africa (50 online users), Asia (100 online users), Australia and Oceania (100 online users) and South America (50 online users). These online users will be sampled from different selected countries due to language barriers which effectively makes the research difficult. The use of the online data was limited to specific countries such as the United Kingdom, Australia, United States of America, Brazil, Chile, México, Canada, South Korea, France, Germany, Switzerland, South Africa, Nigeria and Kenya. This is because these countries have a strong presence within online media circles and the fact that most of the countries are Anglophone regions. The questionnaires were prepared and mailed out to different sampled people from these regions. Most of the sampled online users were obtained from Facebook and Twitter which are the most popular social media sites globally. Moreover, the sampled people were from the ages of between 15 and 30 years old segment who represent a huge demographic as users of social media sites. The research study relied upon the use of questionnaires which were mailed to these willing respondents and the feedback to these questions and their opinion contributed towards obtaining concrete feedback for the research study (Kirsh 2010). Data Analysis Data Analysis The data collected from the research group focused on certain aspects and therefore, there was need for analysis on the data collected to ensure proper results and recommendations are deduced. The research on social media impacts on consumer behaviour gathered information from 400 selected social media users located in different regions globally. Out of the selected 400 individuals, only 356 individuals decided to participate in the study representing 89% of the sampled individuals as shown in figure 1 below. Figure 1: showing pie chart of the respondents in the research Moreover, most of the respondents were between the age of 20 and 23 years while respondents between the ages of 15 and 19 years represented the least age group in the sample as shown by figure 2 below. Figure 2: showing respondents’ age distribution The analysis of the data gathered from these online users was compared to studies done on consumer behaviour based on data from different social media sites. Participants who decided to be included in this research study were mailed a set of questions in a questionnaire to understand their disposition on the use of social media and the consumer behaviour in terms of spending and purchase of goods. The research study focussed on certain factors that such as; age, social media use, platform and time spent on social media sites (Shin 2008, pp. 436). These factors were based on the sampling the best reasons or factors that could influence consumer behaviour within social media sites. Most respondents being young people had in the past undertaken online shopping. From the data analysis, we learn that most of the young people spend over $ 100 undertaking online shopping and some even spend more than $ 400 monthly in online shopping. The amount of money spent online by the respondents is distributed as shown below; Figure 3: money spent in online shopping by the respondents Since the information obtained from the research study was qualitative in nature, we had to make use of SPSS and Microsoft Excel as the tools utilized in analysing the data collected from the different social media platforms. Data analysis’ focus was on grouping similar research data and information to come up with a clear picture of the research study. In the process of collecting data and information using qualitative sampling and research study technique, we have to utilize univariate and multivariate analysis methods. Univariate sampling and analysis focused on certain aspects of social media such as frequency of use; gender and importance of social media. Multivariate sampling looked into the combination of these factors in the process of understanding the effect of social media in affecting consumer behaviour (Ahuja 2007, p. 165). For instance, we could combine the gender, frequency of use to understand the behaviour of social media users such as importance of social media. In the process of undertaking data analysis on social media influence on consumer behaviour, we have to make use of information and data from other researches and third party sites. For instance, a study on online shopping was conducted within social media users and the research came back with results giving insights into the workings of the average online shopper. These insights show that the frequency of use of social media networks, the amount of money spent on online shopping and the age of shoppers active in online based shopping (Vegheș 2009, pp. 941-943). Data collection is important due to the fact that it links the researcher and respondents in the process of undertaking research. This research study made use of sampling and questionnaires to collect information from selected social media user from different regions globally. The questions were structured in a simple manner that allowed people to easily answer and analyse the responses of these questions. Moreover, structuring the questions to have more open ended questions would allow the responses of respondents to be more qualitative (Hanna 2011, p. 268). The use of tools such as MS Excel and SPSS makes the grouping of data for analysis easier and faster. Results and Discussion The results obtained from the research study gave insights into the behaviour of social media users within the online circles. This research study was useful in getting the insights on the social media information and how this information affects consumer behaviour. Consequently, we had to understand why the research is important based on the objectives outlined as follows; a) The research is meant to understand the reasons why people visit or utilize social media sites such as Facebook, Twitter, MySpace or YouTube. b) The factors that make companies to operate social media sites and pages c) Determine the factors or reasons that affect consumer behaviour within social media sites d) Determine the time spent by young people in social media sites e) Sample data from different locations on the behaviour of young social media users Data and information gathered from the research study looked into these categories of consumer behaviour. For instance, the research study was conducted on 356 participants comprising of 199 female and 157 male participants. In terms of the platform being utilized the respondents polled as follows; Facebook (67%), Youtube (34%), Twitter (48%) and 27% used LinkedIn. Other social media sites were rarely utilized by the respondents in this research study. In terms of importance of social media in their social activities; the respondents polled 76% for female respondents compared to male counterparts who polled 42%. The frequency of use of social media was another factor that was analysed with 63% of the respondents visit very often, 22% access often, while 9% said frequently but not rare, 6% rare. Feedback and communication was another question that was researched with 56% of the respondents rating feedback as important while 44% were not concerned with feedback from companies. The research study also looked into the presence of companies in social media sites and online presence. Respondents in this research were questioned on companies and brands which had presence in social media with respondents polling 34% being aware while 66% were not aware of the presence of companies having active social media presence. The research also looked into the shopping behaviours of social media users by questioning information used in shopping (Lantos 2010). The research analyzed on brand and product review pages used by social media users. The research focussed on the visit of product or company pages and online based product review sites with keen interest on the use of these sites. 82% of the respondents polled that they do visit social media product review pages and other reference sites before they make a purchase. While, a further 18% did not think that visiting social media review pages and other reference sites was important before making a purchase decision. Based on the results of the research we understand that social media does indeed have an influence on consumer behaviour. Most of the young people spend a lot of time within social media spheres and this influences their tastes and behaviours towards certain products and companies. For instance, from the results we notice that people rely upon reviews to make decisions and thus positive social media reviews assist in generating positive sales for certain goods and services. Moreover, some of the respondents alluded to the fact that influencers and celebrities do contribute to influencing their consumer decisions. This was more profound on fashion related products and services. Limitations and Future Research In the process of undertaking research on social media and its effect on consumer behaviour, we faced several challenges which limited our research as outlined; a) Time Constraints: the study on social media influence on consumer behaviour was supposed to take a period of 2 weeks. However, the information and data gathered from the research was voluminous and thus, it required careful analysis which took a lot of time. Moreover, some of the research participants took time in responding to queries raised in the questionnaires and giving valuable information for the research. Samples obtained from past researches and studies on social media were summarised and focussed on other aspects of social media. b) Inclusivity: Since the study was conducted based on a random sample obtained from selecting individuals from different social media sites and thus, there was a worry that these selected individuals would not be representative of the whole population. c) Language Barrier: The study on consumer behaviour in relation to social media focussed on various countries which communicate using different languages. As a result, the languages used in these regions limited us in conducting effective research. Moreover, some of the participants did not understand the questions posed properly due to their limited understanding of English (Sokolowski 2013). d) Scope: Since the research focussed on the social media influence on consumer behaviour, the research study was huge and therefore, getting the appropriate information and data from these respondents is quite difficult. Some respondents give information which might not be accurate since individual perceptions cannot be grouped with collective responsibility. Moreover, different regions of the world have different set of cultures which have to be analyzed independently. Thus, this research study did not take this into consideration leading to an unbalanced study on the social media effect on consumer behaviour (Hoyer 2012). e) Data collection: In the process of collecting data, we were faced with several challenges that bordered on accuracy and clarifications. In order to understand the data collected, it is imperative for the respondent to provide clear answers to the queries raised. This would ensure proper and accurate information is used in conducting a research. These limitations and challenges could be overcome through the utilization of other techniques and sampling techniques. For instance, reducing the scope of the research study would ensure accurate information is obtained from a research study. Future research on the users of social media should focus on specific companies or products which we should do a research on specific companies or organizations. This would enable the researcher to obtain information and data easily on these products and companies since information would be limited to the specified range. Moreover, accurate results could also be obtained from social media groups and monitoring firms which mine social media data for specific purposes. Social media pages and sites for companies promoting or selling their goods have specified users who have follow the launch and promotion of these products. As a result, the reviews and comments generated by other social media users contribute towards the formation of an opinion that might influence the decisions and consumer behaviour within different sections of the society (Hoyer 2012). In future, the same research study will make use of a survey to undertake the research and this will ensure proper responses are obtained through an online portal such as Survey Monkey. Conclusions and Recommendations The data analysis and information collected in this research study point to a growing need for information collection from social media sites for companies to market and sale their goods and services. Based on the study, we came to realization that the information collected paint a picture and profile of online social media users. For instance, most of the respondents were people who frequented and made use of social media sites for social purposes. Consequently, these respondents also made use of social media in getting reviews and information concerning certain goods and services sold by different companies. The research outlined the importance of social media sites in obtaining information and shaping decisions undertaken by consumers in the process of socializing and online shopping (Close 2012). From the research study results, we witnessed a gap in information collection, utilization and implementation within shaping consumer marketing strategies deployed by different companies. Consequently, the following recommendations would assist marketers and companies address these gaps in their pursuit of understanding consumer behaviours; a) Increase Social media presence: Companies and organizations have not yet fully embraced social media presence. Many companies have social media pages which are inactive or lack communication with its key customers (Sin 2012, p. 328). Having an active social media presence will allow these companies to get close to its customers and receive feedback on their products easily as opposed to conducting a market research. Consequently, having active social media presence allows companies to understand the changing needs of the young consumers who utilize social media (Samli 2012). b) Undertake Surveys: Companies should utilize the social media to ensure that they do understand the factors that shape the behaviours of consumers. These companies should make use of online surveys within the social media sites to ensure that comments, reviews and other suggestions on their products and services are well understood (Holtzclaw 2013). c) Advertise and Promote: Social media has a global reach that could be well exploited by companies in their adverting and marketing campaigns. The use of social media is cost friendly and consumers can express their views and comments based on the campaigns started by companies within these social media channels. Reaction and feedback can be obtained easily through social media and thus companies can gauge the consumer reaction and attitudes towards certain goods and services marketed through social media channels (Anderson 2010). This feedback can be utilized in understanding the behaviour of the consumers and thus tailor goods and services which suit their needs. d) Utilize social media influencers: Social media is dominated by celebrities and influencers who have huge following and fan base and thus they can influence the behaviours of social media users. The endorsement of these celebrities for certain goods and service receive positive reviews which could influence a positive increase in sales of selected goods and services (Holtzclaw 2013). Companies and organizations should therefore make use of these influencers and celebrities in endorsing their goods or services or in some instances to try out their goods and write reviews. This would assist in generating positive reviews and understanding consumer behaviour in relation to the activity of these influencers and celebrities. References Ahuja, M and Galvin, J 2007, “Socialization in Virtual Groups”, Journal of Management, Vol. 29(2), p. 161–185. Anderson, E 2010, Social Media Marketing: Game Theory and the Emergence of Collaboration, Springer Science & Business Media, New York. Close, A 2012, Online Consumer Behavior: Theory and Research in Social Media, Advertising, and E-tail, Routledge, Austin. Hanna, R, Rohm, A and Crittenden, V 2011, “We’re all connected: The power of the social media ecosystem”, Business Horizons, Vol. 54(1), p. 265-273. Holtzclaw, E 2013, Laddering: Unlocking the Potential of Consumer Behaviour, John Wiley & Sons, Lowell. Hoyer, W, MacInnis, D and ‎ Pieters R 2012, Consumer Behaviour, John Wiley and Sons, Boston. Kardes, F, Cronley, M and Cline, T 2014, Consumer Behavior, Lippincott Williams & Wilkins, New York. Kirsh, S 2010, Media and Youth: A Developmental Perspective, Greenwood Publishing Group, Sydney. Lantos, G 2010, Consumer Behaviour in Action, New Age International, New Jersey. Pookulangaran, S and Koesler, K 2011, “Cultural influence on consumers' usage of social networks and its' impact on online purchase intentions”, Journal of Retailing and Consumer Services, Vol. 18(1), p. 348–354. Samli, C 2012, International Consumer Behavior in the 21st Century: Impact on Marketing Strategy Development, Springer Science & Business Media, Chicago. Shin, S 2008, “Understanding purchasing behaviours in a virtual economy: Consumer behavior involving virtual currency in Web 2.0 communities”, Interacting with Computers, Vol. 20(1), p. 433–446. Sin, H, Nor, K and Al-Agaga, A 2012, “Factors Affecting Malaysian young consumers’ online purchase intention in social media websites”, Procedia - Social and Behavioral Sciences, Vol. 40(1), p. 326-333. Sokolowski, O 2013, Influences and Attitudes Within Consumer Behaviour Process, Allen & Unwin, Boston. Vegheș, C 2009, “The Consumer Private Space: What is and How it can be Approached without Affecting the Consumer’s Privacy”, World Academy of Science, Engineering and Technology, Vol. 29(1), p. 939-942. Appendix Questionnaire This questionnaire has been prepared with the purpose of gathering information concerning the effect of social media effects on consumer behaviour. The questionnaire was designed to test certain aspects of social media in respect to consumer behaviour. The questionnaire will be mailed out to different people in different regions globally. I am pleading with you to assist me in answering this questionnaire, as I aim understand the effect of social media on consumer behaviour. This questionnaire will only take you around 15 minutes to finish. 1) What is your gender? a) Male b) Female 2) Which social media site do you have an account with? (Highlight more than one if true) a) Facebook b) Twitter c) YouTube d) LinkedIn e) MySpace f) Other 3) What is the significance of maintaining social media sites? a) Very Important b) Quite Important c) Not Important 4) How often do you make use of social media? a) Very Often b) Often c) Often but not rare d) Rarely 5) How many hours in a day do you spend on social media sites? a) 1-3 hours b) 3-5 hours c) 5-8 hours d) More than 8 hours 6) How often do you read product reviews and comments on social media? a) Very Often b) Often c) Often but not rare d) Rarely 7) Do you give products reviews and comments? a) Yes b) No 8) Are you aware of social media pages for different companies? a) Yes b) No 9) Can you mention these companies? ................................................................................... 10) Do celebrities and Influencers affect your purchase behaviour? a) Yes b) No 11) Which trends do you think will influence your consumer purchase behaviour? ...................................................................................... 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