The Effectiveness of Social Media as Marketing Tool for Business

Chapter 1

THE PROBLEM AND ITS BACKGROUND

Introduction

The study concentrates on social media and how entrepreneur can use it for their

advantage in a marketing point of view. It has already presence on Facebook, Instagram,

Twitter, Pinterest and more. In an era where technology prevails, entrepreneurs as well as

marketers see the need to keep up with the fast pace of change or risk being outdated. Gone

are the days when a pure-bricks business model will thrive well in current market scenario.

Social media had become important gradient in today’s marketing mix in general and in

promotion mix in particular. Adapting some form of marketing online through social media

is a key node for all businesses. As new technologies became available, businesses that

learn to use new technologies gain great benefits. Some of the best-known examples

include technology-driven companies such as Microsoft, eBay, Amazon and Google. In a

short span of time, social media has become one of the most loved of many users. Social

Media Marketing is the hottest new marketing tool and every business owner, entrepreneur

and a person planning to starts a business wants to know how social media can generate

value for their business. People are social by nature and collect or share information that is

important to them. Social Media Marketing is about understanding how technology is

making it easier for people to connect socially with their social networks and how your

business can profit from free

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that understanding. More and more of your customers, whether for personal use, business-

to-consumer or business-to-business reasons use social media in every aspect of their daily

life (Noora Aleksandra Honkaniemi Bachel).

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. 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 (Mangold and Faulds

2009).

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, advance mobile devices and interfaces, peer-to-peer

communication vehicles, and online social networks have extended family marketers’

ability to reach shoppers through new touch points”. (Shanker et al. 2011, 40).

The social media has witnessed an exponential growth in the new millennium and

the present information age the social media marketing has become a part of doing

business. Marketing with Facebook has been hot for quite a long time but recently more

and more companies have been using Twitter and other social media for marketing. Social

media marketing, or SMM, is a form of internet marketing that implements various social

media networks in order to achieve marketing communication and branding goals. Social

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media marketing primarily covers activities involving social sharing of content, videos,

and images for marketing purposes, as well as paid social media advertising. According to

Hubspot, 92% of marketers in 2014 claimed that social media marketing was important for

their business, with 80% indicating their efforts increased traffic to their websites. And

according to Social Media Examiner, 97% of marketers are currently participating in social

media—but 85% of participants aren’t sure what social media tools are the best to use.

With this into mind present research work focus on the Relevance of Social media in

marketing and advertising. The study conducted based upon the data collected from the

literatures and from other multiple secondary sources of evidence. After doing the

extensive literature survey and reading books and other support material it was found that

social media is increasing its horizon and motivation large number of consumers as well

as marketers and manufacturers to use it as an important source of important dissemination

and conformation (Dhani Shanker Chaubey, Sajjad Husain, Dr. Ali Ghufran, August 2016).

Background of the study

Entrepreneurs are finding that they can now not only take advantage of social media

as a marketing tool but use data to optimize their social media marketing campaigns. This

study conducted to examine trends in social media to entrepreneurs to jump start their

marketing strategy by incorporating social media. Entrepreneur sees social media as a

marketing tools as well as a way to connect with others and to evaluate success.

Although social media marketing is a well-researched topic, it has only been studied

through experimental and theoretical research; studies never precisely describe the benefits

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retailers gain from this marketing tactic. 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

(Mangold and Faulds 2099).

Statement of the Problem

This study identifies the outcomes of using social networking sites in promoting

businesses. In this research, we intended to further know how convenient and effective on

the part of entrepreneurs to use social networking sites as their tool for advertising and

marketing their business. This study aimed to answer the following questions:

1. What is the profile of the respondents in terms of:

1.1. Sex

1.2. Age

1.3. Income

1.4. Educational background

2. What is the connection of social media in business?

3. How efficient and effective is the social media as a marketing tool in business?

4. What difficulties they encounter in using social media?

5. What sites/applications they are used in advertising their products or business?

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Significance of the study

The research of this study may help certain group of people or just individuals, may

able to gain the following:

Entrepreneur- this research is applicable for entrepreneur where they were able to get

information about our research and to get strategies as well as the innovation of their

businesses. It will provide some knowledge on how social media can be effective tool for

their business.

Consumer- this study may be beneficial to the consumers in helping them find out the

advantages of using social media when buying products. Also on how reliable the social

media in purchasing their desired products.

Online user- they may be given a hint on how their time in using social media be

productive. They might be encouraged to try a business through the social media’s help.

Scope and Delimitation

This study is limited only within Moncada, Tarlac. Wherein the target respondents

will be the business owners who uses social networking sites in promoting their businesses.

This study is exclusively conducted for school year 2018- 2019, to determine if social

media networking sites has a significant impact as a marketing tools and its effectiveness

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and to successfully have the credibility of to be gathered data the questions listed to the

questionnaire will be prepared by the proponents.

Definition of Terms

To further more understand about the contents of this research paper, here are some

key words to help you out:

Social Media Marketing (SMM) is perceived as a more targeted type of advertising and

is therefore believed to be very effective in creating brand awareness.

LinkedIn is a social networking site designed specifically for the business community.

Social Media is the collective of online communications channels dedicated to

community-based input, interaction, content-sharing and collaboration. Websites and

applications dedicated to forums, microblogging, social networking, social bookmarking,

social curation, and wikis are among the different types of social media.

Marketing is the action or business of promoting and selling products or services,

including market research and advertising.

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 Chapter 2

REVIEW AND RELATED LITERATURE

This chapter includes the literature and studies of local and foreign which the

researchers have perused to shed light on the topic under study.

Related Literature

A. Foreign Literature

Chung and Austria (2010) postulate that Social media includes various methods of

online communication such as social networking, user-sponsored blogs, multimedia sites,

company sponsored websites, collaborative websites as well as podcasts. T..his definition

includes just about the entire scope of the activities that a majority of individuals who

participate in online communications would be involved with.

Dutta (2009) further reiterates this point by stating “it’s no secret that social

media—global, open, transparent, non-hierarchical, interactive, and real time—are

changing consumer behavior and workplace expectations.” It is becoming increasingly

difficult and in some cases, impossible to follow traditional communication structures of

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non-transparency and hierarchy when people communicate via social media platforms.

This is particularly true of business communication. Consumers now have more access to

information than they ever had before.

Over 50 per cent women who access the internet in India have said that internet

research influenced their decision before finalizing a product, Google India's 'Women &

Web' study reveals. In terms of the most researched category and influence on final

purchase decisions, internet influence was the highest for skin care products, with over 72

per cent of the surveyed women admitting the influence. Baby care (with 69 per cent) and

hair care (with 65 per cent) products were the other categories that scored high in terms of

influence of the internet. In an study titled “Digital & Social Media in the Purchase

Decision Process,” on 2000 shoppers of US conducted by ARF it was found that roughly

one-third of shoppers were either introduced to a brand or product, or changed their opinion

about a brand or product during the buying process, because of social media. What’s more,

22% of shoppers surveyed by the ARF said that social media was “important in my final

purchase decision.” "There have been doubts about the effectiveness of social media for

business because the link between a firm's efforts and the return on investment hasn't been

established," Bezawada in his study on title” Social media pays off for business “ states

that when customers engage with a business through social media they contribute about

5.6 percent more to the firm's bottom line than customers who do not.

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 also influenced consumer behavior from information acquisition

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to post purchase behavior such as dissatisfaction statements or behaviors about a product

or a company. (Mangold and Faulds, 2009)

Electronic media have transformed consumers, societies, and corporations with

wide spread access to information, better social networking and enhanced communication

abilities (Kucuk and Krishnamurthy, 2007). The social media network link millions of

users from all over the world with same interests, views and hobbies. Blogs, YouTube,

MySpace, Facebook are examples of social media that are popular among all level of

consumers. (Sin, et al., 2012) Users are using several online formats to communicate, (e.g.,

blogs, podcasts, social networks, bulletin boards, and wikis) to share ideas about a given

product, service, or brand and contact other consumers.

Many marketers believe that the organizations should aggressively promote only

one advantage in the market concerned (Moise, 2011) and social networks in the online

environment allows them to appear more attractive to consumers. The much higher level

of efficiency of social media compared to other traditional communication channels

prompted industry leaders to state that companies must participate in Facebook, Twitter,

Myspace, and others, in order to succeed in online environments (Kaplan and Haenlein,

2010).

B. Local Literature

In a recent study conducted by Effective Measure, a research supplier for web

audience measurement, 83 percent of Filipino respondents say that engaging in the

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Facebook corporate page influenced them to buy from those businesses while 72 percent

claimed they are urged to buy upon seeing Facebook Ads.

Indeed, Filipinos are proving that they are one of the social media savviest countries

in the world. They are also found to spend 41.5 percent of their computer time in social

media versus 19.5 on news websites and 17.3 percent on service websites.

In a separate report from Social Media Today, Filipino internet users spend an

average of four hours a day in social media, 97 percent of them on Facebook.

Facebook knew this that’s why its new algorithm that was started in 2013 has

limited the organic reach of Facebook business pages to 6 percent. What does this mean?

If a Facebook business page with 1,000 fans posts a status update, roughly 60 people will

get to see it on their news feed.

Mediabistro had foreseen this happening since last year and made a prediction that

this year companies will face more pressure to pay sponsor ads.

“It’s pretty easy formula,” mediabistro writes. “Social networks are vital medium

for consumers. More brands are using social media and sponsored ads will help them

connect with their target client base.”

True enough, Facebook delivers the goods. When it introduced Custom Audiences

last year, it allows advertisers to tap into Facebook users who previously used their website

or mobile apps.

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 Using this feature, for instance Zaggora, a woman’s active wear company,

increased its return on ad spend (ROAS) by as high as 600 percent. (https://-

www.google.com/url?sa=i&source=undefined&cd&ved=0ahUKEwj-3pyeo-

DfAhUKvo8KHYiNCqsQzPwBCAM&url=https%3A%2F%2Ffanyv88.com%3A443%2Fhttps%2Ftechnolog-

y.inquirer.net%2F37475%2Fthe-power-of-social-media-marketing-

&psig=AOvVaw3QGrlaW0QOZ2oj1ecqDp53&ust=1547108719109186)

Related Studies

A. Foreign studies

Since the inception of Social networks 1997, with the launching features of

blogging and posting through web 2.0 named as six degress. com. The basic purpose of

this site was to facilitate people in terms of social connectivity via , My Space as well as

advance mode of face book and other software’s like Orkut, Google talk, Skype, Hangout

and what-up etc. Cheung and Lee stated that, “the decision to use online social networking

technologies represents a social phenomenon that largely depends on the interactions” and

concludes observing that “the driving forces behind online social networks are connections

and community, and the usage is largely depended on subjective norm and social identity”.

Mangold and Faulds defined that “Social media is a hybrid element of promotion mix

because in traditional sense it enables companies to talk their customers while in a non-

traditional sense it enables customers to talk directly to one another. The key factor behind

the performance of Management is based as team work, while the progress of employee’s

depending upon leadership of the management. However, the term management is not only

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consisting on firm level but also for Institutions, Economy and State levels respectively

Shahzad and Rehman. With the help of social media people enjoying their lives smoothly

and remain connect with their love-ones, as well as it provides salient pieces of information

for different purposes, social media can be named as consumer generated media, new

media and citizen media.

All most all business takes into consideration of usage of social media in order to

market / branding some product. Small businesses use social media application as a

marketing tool for the branding and marketing of their products. A practical approach has

been followed by Karkkainen investigating general companies to actually see how much

of the social media application has actually penetrated the nontechnology and traditional

organizations. Based on survey results he finds application of social media by businesses

is inclined more towards communication to the customer in the traditional sense like

branding, public relations and lead generation rather than communication with the

customer, understanding the customer and internal communications. The strategies of

small business are to adopt micro blogging to make direct connect with individual who has

some interest in their business Shabbir. Gunther et al. says that social media helps small

business entrepreneurs to build their small community over that media for smooth

interaction with their partners.

The motivation for adopting micro blogging by small business entrepreneurs has

been to make connections more appropriately directed connection with people who have

same or common business interest and hence the businesses especially small and medium

enterprises are trying to adopt micro blogging as evident from the studies of Gunther et

al.,Meyer and Dibbern ,Fischer and Reuber , Riemer and Richter.There is a new trend of

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using face book by small business users due to cost saving as well time saving in order to

promote their products as well as use face book for connecting themselves with weak ties

and career advancement. Fischer and Reuber say that “in the relatively few scholarly

studies that consider how such social media may benefit firms, the majority has focused on

social media as marketing tools and also suggest that entrepreneurs who have used Twitter

that “entrepreneur learned that he could connect to his customers even more effectively

than he had been doing”.

Now a days, small businesses use assortment of applications in social media to

enhance their business growth as well as for publicity. As, large number of related field

join their pages that’s why they earn more and share knowledge with each other’s, results

in expansion of their businesses. With the passage of time, no doubt in it that technology

is becoming faster and faster as well as making lives of individuals easier, on the other

hand the opportunists taking advantage of this facility and brining new ideas on the facets.

Entrepreneur will use the face book to connect to its weak ties or try to increase contact

with existing strong ties. Small business use social media more because it is all about

socializing and sharing opinions. These opinions can be expressed as written entries in the

form of blog posts or comments, video presentations and votes on social media sites. These

opinions are direct and unfiltered Shabbir. The openness of these opinions is one of the

main changes social media introduced to the relationship between business and customers.

Entrepreneur use social media as a marketing tool because through this tool they

can build quickly a network of supporters which is vital for business growth. Because these

supporters keep bring a customer’s/ business for small business entrepreneurs by referring

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it to others. Social media helps to create a long term relationship between businesses and

customers. But there are some issues related to social media in first is that worries

businesses concerning the implementation of social media is the lack of consensuses on

how two implement different activities as the platforms and the technologies are so

dynamic and there has not been a clear guideline for businesses as to how to utilize them.

Mostly business use their own experimental approach to achieve a better result and this has

somehow made the task more challenging. Second is implementing social media is the task

of setting a clear objective and large number of businesses join the social media every year

but those who maintain their online presence effectively are relatively low, this is because

many of those businesses launch the social media campaign without clear strategic goal.

Gillin explains probably most businesses want to experiment the technology or maybe they

are attracted by the low cost of entry and he suggests experimenting is better than inaction,

but better to have a plan. Tuten suggests if a business is to benefit from social media

marketing, the first step in the process should be to set objectives for the campaign, as

setting objective is a critical step in any communication and marketing planning process.

According to him, any marketing campaign without an objective cannot be measured and

evaluated and unless we are able to measure the performance it can be considered a waste

of an effort. (https://www.omicsonline.org/open-access/impact-of-social-media-

applications-on-small-business-entrepreneurs-2223-5833-1000203.php?aid=71295)

B. Local Studies

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 Brands in the Philippines are placing social media at the heart of their strategy as

they strive towards 360-degree customer engagement, according to a study released

recently by consultancy firm TNS (Taylor Nelson Sofres).

The results from TNS’s annual Marketing Monitor study across Asia Pacific

highlighted the centrality of social media for marketers — it ranked as the top element

guiding the planning process, as well as the top metric used to measure the performance of

campaigns.

According to the study, which surveyed a total of 2,250 marketers in Asia Pacific,

including 200 from the Philippines, businesses are using a variety of sources to inform their

marketing strategy.

Insights gathered through social media monitoring have finally overtaken more

traditional metrics such as market share data and brand tracking to become the most

popular component used by marketers.

The findings echo the changes happening in consumer behavior across the region.

As people become more connected via digital channels, brands are focusing on how they

can communicate with their customers in the online spaces where they are already spending

time – social.

What’s more, for many mobile-first internet users across the country, social is the

primary reason for going online, and so it is a valuable environment for marketers to both

connect with their audiences and build a better understanding of them.

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 Zoë Lawrence, digital director for Asia Pacific for TNS, said: “It’s no secret that

social has become an intrinsic part of our daily lives – 97% of connected consumers in the

Philippines use social networks, switching between Facebook and Google+ and Instagram

as the top three channels.

“This mass adoption of social provides marketers with an array of sources when it

comes to developing strategies and evaluating the effectiveness of their marketing activity.

As the digital ecosystem evolves, we will continue to identify new ways to build insights.

However, whatever the metric used, it’s important to ensure marketers are monitoring the

indicators that contribute to sales.”

The study also highlighted the top priority for marketing departments this year –

customer relationship management. The findings revealed that marketers’ sphere of

activity has now broadened, as they concentrate on how to deliver the best overall customer

experience, ahead of the traditional aim of increasing brand awareness.

To achieve this, businesses are using social media across a range of disciplines. For

example, 43% of marketers are using social media for brand communications, but in

addition, even more (44%) are using it to provide customer service.

Social media appeared to be a big part of ecommerce strategy, with 54% using

social media advertising and one in three (32%) using social media buy buttons.

Despite this approach to using social to support a variety of marketing goals, the

results showed that businesses are not working as collaboratively as they could be, with

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 less than half (49%) of marketers partnering with customer service teams, one in four

(27%) working with the digital team and a mere 10% working with the insights department.

Lawrence said: “With marketers using social for a range of marketing objectives,

it is important that they are offering a consistent, coherent experience to the customer.

Brands need to strive to break down the silos in their organizations to ensure that they are

realizing the potential positive impact that an aligned, well-executed social strategy can

deliver.” (http://newsbytes.ph/2016/09/01/study-social-media-taking-over-in-ph-

marketing-customer-service/).

Conceptual framework

Effectiveness of Social
Media in Business as a
Marketing Tool

Respondents:  Data
Gathering
 Sex (Survey
 Income Questionnaire)
 Graduated,  Data
Under Processing
graduated, or  Data
Professional Interpretation

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 CHAPTER 3

RESEARCH METHODOLOGY

This chapter contains the research design, research locale, the respondents,

sampling procedure, data gathering tools, the scoring procedure and the treatment data in

the stated study.

Research Design

The research used qualitative approach because it focused in the present condition.

According to Creswell (2002), the descriptive survey design is cheap, effective, and easy

to conduct and it also ensures ease in accessing information. The descriptive survey design

was also used as it allows the researcher to gather information, summarize and interpret

them for the purposes of clarification (Orodho, 2004).

Research Locale

This study is exclusively conducted within the municipality of Moncada, Tarlac

only.

Respondents of the Study

The respondents of this study, are the business owners around Moncada. At least

the target 25 respondents will be selectively chosen by the proponents. That in the

perspective of the researchers are best help to answer their prepared questionnaires.

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Data Gathering Procedure

Gathering of data are through survey questionnaire prepared by the proponents.

Then it will be tabulated according to the corresponding weights of each answers. To come

up for interpretation and conclusion.

Research Instrument

Main instrument to be used in this study is the survey questionnaire prepared by the

proponents. To secure the validity of to be gathered data.

Statistical Treatment of Data

The gathered data will be arranged, tabulated and interpreted according to its

corresponding weights, to arrive to the answers of the problems of this study.

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