Topic: Why are retail companies so interested in using social media for marketing purposes, and why are they finding it so difficult? Explain your answer.
Lecturer’s Name: David Johnstone
Date: 18th September, 2016
Word Count: 1600
Abstract
Social media changed human social life over past years, the way of communication has evolved into a revolutionary age, through paper to voice and to Internet. This essay intends to discuss the reason of why modern retail companies start consider using social media as one of marketing tool, and address some issues when company try to implement it with three different aspects - advanced targeting options, improved conversion, and increased engagement.
Introduction
Nowadays, the term of social media to become a rapid growth popular word in our daily life, and it probably dominate the most our time. But, what exactly the social media means? Kaplan & Haenlein (2010) indicated that social media contains a collection of “internet-based applications”, which allow online users to publish and exchange what they created or shared content within the online community [2]. Because of social media became a popular tool which allows retail company to deploy their business market, however, they find that it is difficult to implement and deployment properly based on the market demand. This essay will address this problem based on following three aspects to analysis why retail company interested in using social media as a tool to extend their market, and the reason of why they find difficult to implement it: social media could provide advanced targeting options for retail company to extend market, improved conversion tracking based on the performance of social media, and increased engagement with valuable consumer through social media exposure.
Discussion
Social media marketing is considered as the next big thing by companies to exploit the market and build the brand across the market. The first reason of why retail companies want to use social media as one of the marketing tool is that social media could expand virtual world potential consumers caused by social media provide more targeting options. Johnstone (2016) mentioned that there have six different types of social media, which consist of social networks, bookmarking sites, social news, media sharing, microblogging, and blogs & forums [1]. Each type of social media is targeting different group of users, for example, Facebook is an online community platform to provide connection services based on real world user profiles. Kaplan & Haenlein (2010) shows that a group of end-user could achieve a better outcome than individual end-user [2]. Kietzmann, Silvestre, McCarthy & Pitt (2012) also shows that the difference between group and individual is that behavior is different, which means that individual may contain a number of identities, but the group only has one identity [3]. In other words, the impact of group people has more power than individual people. For example, if one person liked a public page on Facebook, his/her friends will get notified the post, because the post is either open to the public or friends. Furthermore, social media platform provides an opportunity that allows the firm gets into virtual marketing with low cost or even free. Tate, Gao, Zhang, & Johnstone (2016) indicated that social media platform seen as “promising marketing channel” with minimal cost for small business [4].
In addition, social media could also help the company to improve version tracking based on social media performance. Kaplan & Haenlein (2010) indicated that social networking sites is an online application that allow user to create their profiles, which contains their personal information, like photos, videos, audios, and notes, and also they can invite their friends or families to join with them. They also show that some companies already using social networking as a tool to do some marketing research, so they could find out what consumer would like company to show on the virtual community. However, they also show that because social media is allowing the user to create an anonymous account, so it could destroy company’s reputation within the online community [2]. On the one hand, online user might do not want to share content from strange user or advertisements on their timeline post due to concern about their privacy. Tate, Gao, Zhang, & Johnstone (2016) indicated that why user do not share other people’s content (like click “like” button or repost the original content) is because they do not want to disclose their personal information [4]. On the other hand, people want to share some advertisement information because they want to get a discount price or coupon code from the company that they want to purchase. Tate, Gao, Zhang, & Johnstone (2016) also shows that the motivations of users want to interact with the company on social media is because buying products, receive discount information, present their opinions and get services from company [4].
According to Kietzmann, Silvestre, McCarthy & Pitt (2012) recent research, they use honeycomb model to analyze social media with seven constructs, which included identity, presence, relationships, conversations, groups, reputations, and sharing. From identity of social media perspective, three problems has been found within social media, which is there might have multiple identifies for one single person on single social media platform, and also the information provide on non-anonymous or anonymous social media platform might not accuracy and real. The importance of user provides accurate information is that the company could focus on the group that they want to sell their product or service, but the inaccurate information might provide misleading market strategy. From a relationship perspective, each individual has their own social networks, which may contain hundreds or thousands connections. The importance of people maintains such relationship is the key to distribute their idea or thoughts, so once company’s advertisement influence he/she, his/her network members might also influence by the same content. From reputation perspective, how good or bad of a company or a product/service is based on the user’s experience, which means that a good reputation can influence potential consumer future action, like make a decision about purchase goods or services. From presence perspective, the company should be aware of user’s availability and engage with them in real time, which means that the company might need to put more effort on social media to keep consumer “online”. From conversation perspective, the company should understand consumer conversation on social media because the sense of their conversation might help make a decision when try a new product or service. From sharing perspective, the motivation of consumer share their ideas or thoughts on social media could help the company to analyze the consumer behavior [3].
Finally, social media could be as a tool to increase engagement rate with valued consumer. According to Kaplan & Haenlein (2010), social media provide a platform with low cost but high efficiency that allow the company directly deal with end-consumer compared with traditional media, and it both good for large firms and middle or small firms, even good for nonprofit organizations and government departments [2]. On the other hand, Tate, Gao, Zhang, & Johnstone (2016) also shows that the problem of across cultural issue within social media might also be a problem when the company decides to get into virtual community [4]. However, Tate, Gao, Zhang, & Johnstone (2016) shows that the content shared on social media might reused by other online users, the benefit is that they can help company to spread their words, but the bad news is that there is no copyright obtained by the content, and user might change the content to provide misleading information [4]. Tate, Gao, Zhang, & Johnstone (2016) argued that consumer use image and symbol to identify the brand in their identity construction [4].
According to Kaplan & Haenlein (2010) recent study, ten advices have been suggested to companies who want to use social media as a marketing tool, there are: (1) choose the right social media platform to play with, but “being active” is the key to success; (2) make own social media platform or buy existing plan or do both is next decision that the company need to decide, make own social media could provide the best practices to consumer, but there is lack of user base, or buy existing plan on existing social media, but the cost might be very high and not suitable for current company; (3) company need to make sure their content is up to date and activated communicate with users across the different platform of social media; (4) integration between social media and traditional media, because consumer consider both media is the same; (5) enable all people can access the social media, because normally company will block corporate computer to access social media; (6) the company need to make sure they actually engage with user on social media to develop a relationship with valuable consumers; (7) the company need to carefully listen what consumer want to hear in order to tell them interesting stories; (8) treat everyone equal and be humble to everyone user, because they are the main user on social media; (9) the company need to avoid use professional content on social media; and (10) be honest to everyone because the company might lose their market if consumer find out they are provide misleading information [2].
Conclusion
The use of social media is to spend less money to gain the better result, and also to provide better service to valued consumer. However, social media might not be the main market that the company should focus on. Tate, Gao, Zhang, & Johnstone (2016) shows that social media is a place for marketing, but not the primary place, because social media is only part of consumer life, and their real life relationship could influence their behaviors on social media [4]. The benefit of using social media as one of social marketing tool is to provide advanced targeting options compared to traditional media. And also, it can improve conversion and increase engagement with consumer based on the function of social media. However, whilst social media is important for the company to expand their market and establish a better relationship with the consumer, evidence suggests that the company should carefully consider social media as their primary marketing place. In this way, social media can be seen as having an important combined role in company’s marketing strategy.
References
[1] Johnstone, D. (2016, August). INFO 402 – Week 6 – Social Media. Unpublished lecture notes, Victoria University of Wellington, New Zealand.
[2] Kaplan, A. & Haenlein, M. (2010). Users of the world, unite! The challenges and opportunities of Social Media. Business Horizons, 53(1), 59-68. doi: 10.1016/j.bushor.2009.09.003
[3] Kietzmann, J., Silvestre, B., McCarthy, I., & Pitt, L. (2012). Unpacking the social media phenomenon: Towards a research agenda. Journal of Public Affairs, 12(2), 109-119. doi: 10.1002/pa.1412
[4] Tate, M., Gao, H., Zhang, H., & Johnstone, D. (2016). How to be a Good Frand in China: An Exploratory Study of Effective Social Media Behaviours for Foreign Brands. Proceeding of Australasian Conference on Information Systems 2015.
