ctac475w connor kooyers final paper

Running head: SOCIAL MEDIA AND RELATIONSHIPS 1

Post It to the Market:The Study of How Social Media

Improves a Business and Their RelationshipsConnor Kooyers

CTAC 475W

SOCIAL MEDIA AND RELATIONSHIPS 2

Abstract

Social media has completely changed the way communication works in a professional

business setting. Social media allows businesses to connect with their consumers in a more

interactive way than ever before. Within seconds, consumers can connect with different

businesses and can post their opinions about their products. This study identifies how businesses

use social media to improve their organization. The study also demonstrates the effects social

media has on a business and their employees. At the end of the study, the results of the research

will conclude that social media improves a business most by enhancing the ability for an

organization to communicate their brand to their consumer market. One of the greatest effects

social media has on a business is that it motivates employees to work at a harder rate as it

increased employee morale. “Our (Leftheriotis and Giannakos 2012) results not only indicate

that social media are not simply a waste of time for employees, but they also significantly and

positively impact the employees’ performance” (140). In conclusion, businesses positively

benefit from the use of social media as it can greatly enhance the operation of a business.


Introduction

Commitment. Responsibility. Morals. Customer service. These are the fundamental

attributes that help make a business successful; however, these attributes alone cannot drive the

market of consumers. A business relies on the most current technology in order to generate the

most profit. The technology in a business starts at resources, equipment, and task performances;

however, one aspect of technology that is often ignored is communication. Communication

significantly changes as new technology is discovered. As a result of the latest development in

technology, an aspect of communication that has taken center stage in the business world is

social media.

Social media now plays a crucial role in day-to-day business operations. Businesses use

social media to interact with their consumers and as a way to compete with other businesses.

Social media has changed the entire landscape of business communication by enabling

businesses and consumers to interact without using the traditional methods of verbal and

nonverbal communication. Social media improves a business’ relationship with customers and

other businesses better than traditional communication methods because businesses are changing

and adapting the idea of social media. For example, LinkedIn allows users to post their

professional resume and job experience for businesses to look through. Businesses can now

interact with their interviewees even before they step into the company’s front doors. According

to Aral, Dellarocas, and Godes (2013), “[f]irms and industries use social media features to

promote themselves, to communicate with consumers and society, and to cocreate new features

and add-ons that can contribute to the evolution of social media itself” (Aral, Dellarocas, and

Godes, 6). With social media changing how a business communicates in today’s environment

illustrates how understanding the hypothesis (social media improves a business’ relationship


with consumers and other businesses because social media is more personable with consumers,

allows businesses to compete at different levels, and leads to a more successful business) is

crucial when comparing the traditional forms of communication to the new form of social media.

Kesavan, Bernacchi, and Mascarenhas (2013) examined how social media is taking the place of

traditional communication:

[I]t should be clear that the media that can best help communicate CSR are the newly

evolving “social” media, since self-promotion (through traditional media) does not work

that well. For purposes of CSR conveyances, significantly different communication

media styles must be considered and applied (Schmeltz, 2012). The social media are the

“people’s media” and as such they are the final arbiter of messaging. It has the ability, if

used properly, to turn “window dressing” CSR into being the “window to a firm’s soul”.

In getting CSR right, it can be transformative for a firm and can be used as one of its

most important brand pillars (61).

Social media has become a stepping stool for businesses to expand their reach to a variety of

consumer bases. media will continue to change the landscape of a business and how they

communicate with their consumers and surrounding businesses.

Therefore, due to the fact that social media has changed the way a business operates,

social media enhances the business communication experience, and businesses are more

successful when social media is implemented, the following research question and hypothesis

will be posed:

RQ1: Does social media improve a business’ relationship with customers and other

businesses better than traditional communication methods?

H1: Social media improves a business’ relationship with consumers and other

businesses better than traditional communication.


Review of Literature

Business Communication

How individuals communicate has changed greatly over the course of the last century.

For the longest time newspapers were the ideal source of information, but then came radios,

TV’s, the World Wide Web, and eventually cell phones. It now only takes a few numbers to

communicate with someone millions of miles away. This allows word-of-mouth communication

to spread news like a wild fire as observed by Castronovo and Huang (2012), “word-of-mouth

has been shown to be even more effective in influencing purchase decisions than traditional

advertising channels (Godes & Mayzlin, 2004; Herr et al., 1991) and retaining customers over

time (Trusov et al., 2009)” (Castronovo and Huang, 118). Castronovo and Huang (2012)

continue to state that word-of-mouth communication allows consumers to spread positive or

negative thoughts about a business and the services they provide. Businesses rely on this

pertinent information in order to develop better products and customer service. As a result, a

business is always looking for new ways and ideas to reach their consumer market.

In the last decade, many businesses have started using a new type of media to

communicate and connect with their target audience. This new style of communication is

referred to as social media. Aral, Dellarocas, and Godes (2013) detail how many businesses use

social media. “Firms and industries use social media features to promote themselves, to

communicate with consumers and society, and to cocreate new features and add-ons that can

contribute to the evolution of social media itself” (Aral, Dellarocas, and Godes, 6). Various

types and sizes of businesses are transferring over to this new media. Jussila, Kärkkäinen and

Aramo-Immonen (2014) researched business-to-business interactions using chi-squared tests and

discovered “[n]o differences were found in the external utilization of social media based on sales

turnover and between small and medium and large sized businesses” (Jussila, Kärkkäinen and


Aramo-Immonen, 608-609). Businesses, large and small, are realizing the importance of social

media and how it can impact the consumer market. This new media is transcending the business

world into a new age of marketing, one where word-of-mouth cannot spread fast enough.

Social Media in Business

Thanks to social media, business can now reach out and communicate to their consumers

on a new level. Social media can be applied to Castronovo and Huang’s (2012) theory of word-

of-mouth communication as seen in research conducted by Bruhn, Schoenmueller, and Schäfer

(2012). These researchers concluded “that companies can create word of mouth. They also

prove that this so‐called firm‐created word of mouth eventually drives sales. Companies can

actively initiate consumer word of mouth about their brand by leaving indelible impressions on

consumers' minds (Mangold and Faulds, 2009)” (Bruhn, Schoenmueller, and Schäfer, 782).

Castronovo and Huang’s (2012) theory agrees with Bruhn, Schoenmueller, and Schäfer (2012) as

it continues to state:

Social networking sites allow for viral marketing and word-of-mouth promotion to be just

as effective – if not more effective – than traditional media outlets because of the high

levels of consumer engagement associated with these alternate forms of web-based media

(118).

Social media has taken over control of traditional communication methods. This is evident in the

research conducted by Kesavan, Bernacchi, and Mascarenhas (2013). They studied how social

media is replacing traditional communication:

[I]t should be clear that the media that can best help communicate CSR are the newly

evolving “social” media, since self-promotion (through traditional media) does not work

that well. For purposes of CSR conveyances, significantly different communication


media styles must be considered and applied (Schmeltz, 2012). The social media are the

“people’s media” and as such they are the final arbiter of messaging. It has the ability, if

used properly, to turn “window dressing” CSR into being the “window to a firm’s soul”.

In getting CSR right, it can be transformative for a firm and can be used as one of its

most important brand pillars (61).

Businesses are using social media to reach their consumers on a deeper level allowing a business

to publicize its products in a whole new way. Social media changed the way a business markets

their products as seen in the research by Richard Hanna, Andrew Rohm, and Victoria L.

Crittenden (2011). They analyzed the effect of social media on marketing and discovered:

These social media have transformed the Internet from a platform for information, to a

platform for influence. Because of the dramatic and global growth of social media such

as Facebook (550 million users) and Twitter (100+ million users), companies of all sizes

from different industries now view social media marketing as a mandatory element of

their marketing strategy” (272-273).

New advertisements must be combined with some sort of social media; otherwise they will not

be as successful in reaching a vast majority of their target audience. Now businesses have

started to understand how social media can influence their company, as organizations are starting

to see its effects in their daily business operations.

Effects of Social Media in Business

Businesses have started to gain a stronger grip on the importance of social media and

how to effectively use it in their daily marketing technics. Social media is especially useful for

small business owners trying to establish themselves on the market. In a study performed by

Rohayah Kahar, Faizal Yamimi, Ghazali Bunari, and Hadina Habil (2012), they researched how


small business entrepreneurs in Malaysia used social media as a form of marketing. These

researchers discovered for small businesses “the two most important usages of social media is

visibility among prospective and present customers, positioning oneself to a distinguished up to

date business setup and progressively build up the networking” (Kahar, Yamimi, Bunari, and

Habil, 568). Social media also benefits larger businesses as well. A solid brand name is the key

to a successful business, and social media plays a huge role on how the general public identifies

a brand. Edosomwan, Prakasan, Kouame, Watson, and Seymour (2011) studied how social

media affects a brands image:

Engaging in media will help strengthen the brand experience which will support brand

building. A company becomes more attractive to the customers, and to current and

potential employees, if it has a well-built brand name. As a result, social media will help

in building a good reputation for a business operation… Through social media, the

company can repeatedly reinforce the brand name (85).

Veronika Svatosová a professor at the University of Pardubice also studied social media and its

effect on a business. Svatosová’s (2012) research corresponded with the study performed by

Edosomwan, Prakasan, Kouame, Watson, and Seymour (2011). Svatosová says “[a]ccording to

a survey by Wildfire Interactive with 700 world markers, the greatest advantage of social media

is increased brand awareness (88%), engage to dialogue (85%), increased sales and partnerships

(58%) and cost reduction (41%) (eMarketer.com, 2012)” (Svatosová, 8). Social media’s greatest

effect on a business is its ability to increase brand awareness; however, this media has other

effects as well. Svatosová explained how social media increases the amount of dialogue between

a company and its customers which leads to stronger longer lasting relationships. Social media

also helps build employee’s morals while working. Ioannis Leftheriotis and Michail N.


Giannakos (2014) conducted an experiment testing the effects of social media on company

employees:

Our (Leftheriotis and Giannakos) results not only indicate that social media are not

simply a waste of time for employees, but they also significantly and positively impact

the employees’ performance. These results build on the potential of social media as a

medium for improving collaboration and knowledge thereby increasing productivity

among employees (140).

Social Media positively affects employee’s attitudes towards their work environment allowing

them to feel more motivated when completing tasks and accomplishing their goals. Social media

permits businesses to save money on fancy bill boards or television commercials by using

interactive social networking sites which are often times free. Social media serves as an

effective hub for businesses to communicate and persuade their consumers to buy their products.

Castronovo and Huang (2012) point out:

“A social media platform serves as the vehicle through which all marketing

communication efforts are connected into one easily accessible, integrated consumer

venue. Social media is pervasive by nature and is characterized by its ability to

instantaneously connect an infinite number of people… In order for social media to be

an effective platform, its presence must funnel through from the firm’s main Website”

(126).

Social media is one of the most effective tools a business can use to gain success in their market.

Without social media businesses would not reach the number of target market consumers they

desired and their sales and profits would decrease tremendously limiting businesses to only

interact with the number of consumers they meet face-to-face.


Conclusion

A business performs better when they use social media to enhance their products and the

relationships with their customers. This study will examine that claim by compiling different

social media research and comparing them to one another. A constant theme discovered

throughout the research and data collected is social media has the greatest effect on the brand and

the image the consumers have of a business’ brand. The social media a business uses can

persuade consumers to identify their brand or if the persuasion is not relatable to the consumer

then the ideal of the brand will be lost in the eyes of the consumer. In the method section, a

study was proposed comparing how different styles and sizes of businesses use social media with

their customers and competing businesses.

Method

Social media is being used by businesses to interact with their customers on a deeper

level. To further the research in the field of social media, I will explore how businesses use

social media to interact with their consumers and with other businesses. This study will answer

my proposed research question: does social media improve a business’ relationship with

customers and other businesses better than traditional communication methods?

The first step I will take to begin my research is by asking the Crystal Sears Foundation

for a grant. Part of the money from this grant will be used as an incentive for businesses to take

part in my qualitative study. The rest of the grant money will be used by my qualitative study

which will consist of individual interviews with various types of businesses: large, small, for

profit, and nonprofit. By comparing several different and similar businesses to one another it

will allow my team of researchers to discover any patterns and unique trends that occur when

these businesses use social media. Businesses will be motivated to participate in my interview


because after they participate in the interview they will be given a raffle ticket and entered for a

chance to win a donation which will be used to enhance their social media (or an equivalent

communications) department of their business.

The next part of the research would be to email and/or visit each of the different

businesses to explain the purpose of my study and to request an interview with one of their

officials. My team and I intend to interview several local and chain businesses to gain a variety

of data on how social media affects different businesses. To gain a variety of businesses, I will

contact (email or official visit) various stores and restaurants in the surrounding area of Ann

Arbor, Michigan. With each business and restaurant I will request an interview with the director

of their communication department (or a comparable position of authority). The information

gained from each interview will be kept private and used only for the purpose of research in this

study.

The third component of the study would be to conduct the interviews with the businesses.

For this typed study, the researchers would have a typed interview guide for them to use during

each interview. This guide would ensure that the researchers ask every business the same

questions so the results would not be skewed in either direction. The interview guide will act as

the independent variable (since it will not change), while the different businesses interviewed

will act as the dependent variable (since the businesses continuously change). Some of the

questions on the guide would include:

- What types of social media does your business use daily?

- What types of social media sites are your competitors using?

- How does your business use social media with its employees?

I intend to interview large retail chain corporations such as Walmart and Best Buy and

comparing their responses to the interviews of smaller chain stores, Meijer and Kroger.


Interviewing these two types of commercial stores would allow me to compare how businesses

use mass (general) media as opposed to localized (personalized) social media. Restaurants also

use various styles of social media. I would interview Pizza Hut and Papa John’s because they

are two of the corporate giants in the pizza community. I would then compare their interviews to

the local Ann Arbor favorites of Mr. Pizza and Hungry Howie’s. Other corporate chain

restaurants, Taco Bell and McDonalds, would be interviewed in order to compare their responses

to the local favorite STUFD (a small burrito restaurant) and Sidetrack’s Bar and Grill (a famous

burger restaurant). The last category of businesses interviewed would be public schools. I will

reach out to the three major public schools in the surrounding area: the University of Michigan,

Eastern Michigan University, and Washtenaw Community College, and request an interview

with the president of their respectful school.

The final step in this study is to compare all of the research gathered from the different

businesses and organizations interviewed. This information will be compiled into a final

portfolio detailing the similarities and differences between the various sizes and types of

businesses interviewed. The final portfolio will describe how each business uses social media to

interact with their consumers and other businesses. At the end of this research, the following

hypothesis will either be heightened or dismissed: social media improves a business’ relationship

with consumers and other businesses better than traditional communication.


References

Aral, S., Dellarocas, C., & Godes, D. (2013). Introduction to the special issue: Social media and

business transformation: A framework for research. Information Systems Research, 24(1),

3-III. Retrieved from

http://ezproxy.emich.edu/login?url=http://search.proquest.com/docview/1323170747?

accountid=10650

Bruhn, M., Schoenmueller, V., & Schäfer, D.,B. (2012). Are social media replacing traditional

media in terms of brand equity creation? Management Research Review, 35(9), 770-790.

doi:http://dx.doi.org/10.1108/01409171211255948

Castronovo, C., & Huang, L. (2012). Social media in an alternative marketing communication

model. Journal of Marketing Development and Competitiveness, 6(1), 117-134. Retrieved

from http://ezproxy.emich.edu/login?url=http://search.proquest.com/docview/1019047580?

accountid=10650

Edosomwan, S., Prakasan, S. K., Kouame, D., Watson, J., & Seymour, T. (2011). The history of

social media and its impact on business. Journal of Applied Management and

Entrepreneurship, 16(3), 79-91. Retrieved from


accountid=10650

Ioannis Leftheriotis, Michail N. Giannakos, Using social media for work: Losing your time or

improving your work?, Computers in Human Behavior, Volume 31, February 2014, Pages

134-142, ISSN 0747-5632, http://dx.doi.org/10.1016/j.chb.2013.10.016.

(http://www.sciencedirect.com/science/article/pii/S074756321300366X)

Jari J. Jussila, Hannu Kärkkäinen, Heli Aramo-Immonen, Social media utilization in business-to-

business relationships of technology industry firms, Computers in Human Behavior,


Volume 30, January 2014, Pages 606-613, ISSN 0747-5632,

http://dx.doi.org/10.1016/j.chb.2013.07.047.

(http://www.sciencedirect.com/science/article/pii/S0747563213002860)

Kesavan, R., Bernacchi, M. D., & Mascarenhas, O. A. J. (2013). Word of mouse: CSR

communication and the social media. International Management Review, 9(1), 58-66.

Retrieved from http://ezproxy.emich.edu/login?url=http://search.proquest.com/docview/

1348267976?accountid=10650

Richard Hanna, Andrew Rohm, Victoria L. Crittenden, We’re all connected: The power of the

social media ecosystem, Business Horizons, Volume 54, Issue 3, May–June 2011, Pages

265-273, ISSN 0007-6813, http://dx.doi.org/10.1016/j.bushor.2011.01.007.

(http://www.sciencedirect.com/science/article/pii/S0007681311000243)

Rohayah Kahar, Faizal Yamimi, Ghazali Bunari, Hadina Habil, Trusting the Social Media in

Small Business, Procedia - Social and Behavioral Sciences, Volume 66, 7 December 2012,

Pages 564-570, ISSN 1877-0428, http://dx.doi.org/10.1016/j.sbspro.2012.11.301.

(http://www.sciencedirect.com/science/article/pii/S187704281205286X)

Svatosová, V. (2012). Social media such as the phenomenon of modern business. Journal of

Marketing Development and Competitiveness, 6(4), 1-23. Retrieved from


accountid=10650

ctac475w connor kooyers final paper

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