Social Media Marketing On Consumer Loyalty-Samples for Students

Question: Critically Analyse the Impact of Social Media Marketing On Consumer Loyalty. Answer: Introduction Social media marketing is more than a trend these days as it is a necessity for organizations to survive in global market. If the social media marketing is done in proper way, it can garner enough attention to scale up sales within a few amount of time. Social media platforms help different companies to channelize their path towards the customers and act as an impeccable way to create brand as well as product awareness. Brand awareness in turn is central to the process of creating customer loyalty. Apparently it seems that social media marketing is advantageous for any organization to gain instant popularity, but there are certain threats too which trends to be omnipresent simultaneously with advantages. Word of mouth can be both an advantage and disadvantage as it plays an influential role to motivate or demotivate buying behavior of people. This study would focus on the impact of social media on customer loyalty. A popular retail organization namely, Walmart would be considered for this study to determine its social media marketing strategies and their underlying flaws. Research problem Social media marketing strategies need proper use of keywords, acronyms and jargons to attract enough customers. Companies which are good at creating such practices find social media utterly advantageous but this platform is extremely sensitive as one small word can alter the thoughts of people. Walmart also faced some troubles regarding its contents in social media. From 2014 to 2016, this company made series of mistakes by promoting its brand name in a controversial way. For example, this company promoted its plus size products on social media websites by a caption fat girl costumes, which got immediate negative reaction from customers and this idea of Walmart fell flat on the grounds of effective social media advertising (bloomberg.com, 2017). As a result of these attempts, company lost most of its followers on social media sites and also saw shortage of sales from 2014 to 2016 (forbes.com, 2017). Figure 1: Drop in sales rate of Walmart (Source: forbes.com, 2017) Main hypothesis of this study is to analyse issues that are made by business firms while marketing their products in social media platforms and make effective recommendations to avoid consequences in future. H1- This study would be able to provide effective recommendations with the help of social media marketing theories as well as strategies H0- This study may not be able to determine effective strategies for business firms due to insufficient information about existing theories. Research objectives To analyse the importance of social media marketing done by Walmart for gaining the loyalty of customers To demonstrate the ways by which such marketing is done for inclining huge customer base towards Walmart To portray the consciousness of Walmart in doing attractive social media marketing so that purchasers decisions can be manipulated To recommend useful strategies in order to enhance social media marketing by this venture Research questions What is the importance of social media platforms in marketing practices? What are the techniques used by Walmart regarding social media marketing practices for gaining huge customer base? What are the underlying issues in the system regarding consciousness in social media marketing practices? What are the useful strategies that Walmart can adopt for making successful attempts in future? Background of the problem Social media marketing problems are not new and these problems tend to exist in current scenario too parallely with number of digital opportunities (Agnihotri et al. 2016, p.178). These issues if not identified with time can lead to massive disasters and create financial problems in upcoming future. The study of the connection between social media marketing and customer loyalty is significantly important as this marketing practice is a necessity these days and thus might be helpful for organizations to build up effective management practices in future. Historical Social media marketing problems dates back to early 20s and almost every marketing disaster came with serious threats to companies associated with those problems. For example Walmart was blocked out of Germany in 2002 for exploiting information in social media platforms (nytimes.com, 2017). Theoretical Walmart has been following social media integration theory for marketing its products. Social media integration framework has been criticised for its costly nature and disability to enforce confidentiality of information. If companies tend to use this theoretical framework they may face problems in future (Trainor et al. 2014, p.1207). Business procedures and social engagement Walmart mainly follow a strategy of acquiring business firms for penetrating a new market and also engages a number of elements in its marketing procedures (Cropanzano et al. 2014, p.121). Marketing techniques are mostly cost consuming and thus cost effective methods needs to be engaged. Figure 2: Walmart business model (Source: Cropanzano et al. 2016, p.120) Intellectual background Walmart mainly uses acquisitions to penetrate a new market and also endorse those in social media. Though this strategy has been profitable most of the time yet there have been massive failures too. For example, acquisition of jet.com by walmart did not go well with social media and have impacted the business of Walmart for cultural issues (Banjo, 2017). Introduction Literature review is the section of a research study which provides knowledge about the substantial findings that are based on data collected from journals, text books, and articles and so on (Laroche et al. 2013, p.80). This section particularly focuses on investigating the research problem and make critical analysis of the same. Conceptual framework Figure 3: Conceptual Framework (Source: Created by learner) Concept of social media marketing Social media marketing refers to advertising of products with the help of social media platforms and digital communication methods. A number of aspects are associated with marketing techniques such as involving engaging contents, keeping patience, building a loyal base of customers who actually respond to the contents posted on digital sites, creating a link between advertisements and accessibility of those in main website and influential taglines. These related aspects act as catalysts for scaling up a business by leveraging customer attention towards particular advertisements. On another hand Rapp et al. (2013, p.560) stated that these related aspects like engaging contents, influential taglines can also bring about a negative impact in the marketing process as these are the aspects that a company needs to extra cautious about while marketing. Eye catchy contents, taglines, engaging product descriptions can also hurt emotional sentiments if improper contents are used. Link between social media marketing and brand loyalty Consumer behavior these days are highly based on word of mouth and most of the manipulative actions take place in social media. For an instance, review about any product can change perceptions of people about a certain product. Buying decision of a consumer goes through a series of invisible filters, which act as manipulative elements for consumer decision making. In the first step a customer create a plan for buying a product, which gets diverted by negative or positive thoughts of people presented on social media communities and finally end up buying something else completely different from the initial plan (Rodriguez et al. 2015, p.638). Figure 4: Consumer decision journey (Source: Rodriguez et al. 2015, p.637) On the contrary, Turban et al. (2016, p.45) commented that decision of customers remain undiverted if there is a proper loyalty base or loyalty loop. It has been mentioned that most of the manipulations or decision changes occur after a purchase when a customer get over excited about a product by comments of users and does not get an expected outcome. Current issues in the system regarding the use of social media platforms Figure 5: Issues in social media marketing techniques (Source: Wang and Kim, 2017, p.20) Inadequate contact with customers on social media platforms Majority of company pages on social media websites tends to be non-existent and obsolete when it comes to effective engagement with customers. Customers do not show interest on those companies which do not interact with them, in fact they get carried away by the attention they get from other companies. Incapability to gather organic followers This is a hard thing to maintain on public pages to gather new supporters on a regular basis. Most of the time, due to obsoleteness of public pages on social network sites, organic or new follower engagement seems to be less as compared to others (Barger and Labrecque, 2013, p.34). Content management problems Content makes contact with people and their thoughts as it is the key element for gathering attention of people. Most of the companies fail to create eye catchy contents and sometimes even fail to keep the value of customer sentiments which provoke customers to look out for another brand (Corstjens and Lal, 2014, p.80). Encouragement of sharing in social media platforms Sharing on social media helps to gather attention from people and also help to gather organic customers (Corstjens and Lal, 2014, p.41). Companies need to come up with such contents which are worth sharing and for that companies need to look beyond mere product advertising which most of the companies fail to do. Theories based on social media marketing There are various theoretical concepts based on social media marketing that popular business organizations adopt for their own advantages. AIDA model has been typically used by many dynamic business firms for creating brand and product awareness among people (Cohen et al. 2013, p.32). This model is associated with data analysis techniques as it helps an organization to create awareness of their products and create a sense of interest as well as desire among the customers Figure 6: AIDA model of social media marketing (Source: Cohen et al. 2013, p.32) Capability to influence the desire of customers can help to create a positive action of consumers towards a product. This model helps to rectify the needs of people and create product strategies as per those needs if associated with proper consumer behavior analysis. On another hand, Leonardi (2014, p.800) mentioned the use of Social Media sales funnel can bring about better results as compared to AIDA as it addresses the use of social media profiles, customer service and branding as a part of acquisition strategies, social conversations, participants and customer engagement as a part of activation and signups as well as repeated activities as a part of absorption. Figure 7: Buffers social media sales funnel (Source: Ashley and Tuten, 2015, p.20) Funnel shaped nature of this model suggests that buying activities of customers goes through various activities that influence their day to day buying decision and promote customer loyalty. Social facebook profile of different companies gain supporters or followers by effective branding strategies and these companies attain a stage of immense popularity by active support of followers which is depicted with the help of conversations on public pages. Finally, a customer loyalty base is formed with the help of signups as well as constant use of website platforms of companies (Laroche et al. 2013, p.80). Tajvidi and Karami (2015, p.70) suggested that if companies gets effectively engaged in the first two steps of the funnel, then the final step of customer absorption occurs at an ease. In this context the use of social exchange theory has also been mentioned which can be used simultaneously with Buffers sales funnel for focusing on the perceptions of people about a particular brand on a social media page. Figure 8: Social exchange theory (Source: Tajvidi and Karami, 2015, p.71) Buying decision of people can be based on the positive or negative aspects stated by consumers socially. For example, positive review of customers about any product can create positive impact on sales rate and negative reviews create negative impact on the sales rate. As recommended by Novikov and Novikov (2013, p.56), a company can use this theory to measure or analyse comments about a certain product on community pages to make improvements in a certain idea in future. Literature gap This study would not be able to cover all the aspects of social media marketing theories as well as concepts due to inadequate time period. Statistical data that would be collected about Walmart may not be authentic as it based on company reports and reports sometimes contain manipulated data. The research would not be able to provide insights on the innovate strategies followed these days due to unavailability of data. Ethical considerations Researcher would abide by the rules stated in Data Protection Act 1988 and would not disclose confidential information to anyone before the completion of research. The researcher would also not influence anyone for providing information and would also not present manipulative data. In order to get effective participation from managers, researcher would inform about the purpose of research to managers prior to the collection of data. Summary This chapter focuses on different theoretical frameworks as well as models to discuss about the impact of social media on the buying decision of customers. This section also stresses on the viewpoint of different people regarding the use and effectiveness of social media marketing theories on company business, which in turn has been helpful to derive the need of proper implication of these theories for gaining a loyal customer base Reference list Agnihotri, R., Dingus, R., Hu, M.Y. and Krush, M.T., (2016). Social media: Influencing customer satisfaction in B2B sales.Industrial Marketing Management,53 (1), pp.172-180. Ashley, C. and Tuten, T., (2015). Creative strategies in social media marketing: An exploratory study of branded social content and consumer engagement.Psychology Marketing,32(1), pp.15-27. 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