Impact of Social Media on Consumer Buying Behaviour

Abstract

This research focuses on the research of the buying process for consumers' complex purchases and puts a special attention to how the purchasing process is affected by the influence and influence of the social networks. In this case, the complicated buying behaviour refers to frequent purchases made by consumers with a high level of involvement that creates a substantial distinction in the brand. Social media is now an emerging trend. In the last 10 years since social media and the World Wide Web has seen an increase in the number of user-generated internet technologies, such as blog posts, social networking sites, and social media sites. Overall, it is called social media and technology is the main factor behind the growth in the amount of user-generated content, which is a world-wide community. Social media has led to platforms on the internet like Facebook, Instagram, YouTube, Twitter, where people can interact with one another to share their thoughts and content. Social media's revolution has provided new methods of getting information on the products and on services. The opinions of a consumer and their reviews of products and services may be influenced by people on social media, which influences the opinions of others on the offline side as well. Yet, Social media has provided ability to consumers, where content is created solely through online conversations, and consumers have a significant role to play in creating or breaking the brand. Marketers try to comprehend the use of social media by consumers as well as their decisions based on the content they find in the social media platforms that may alter their buying habits. The study also examines the sheer quantity of information and user-generated information could alter the purchasing behaviour of consumers. In the six stages of the customer decision-making process, also referred to as EBM model, has been utilised. The study has also been carried out to understand the value of the model within the context of Social Media use. A survey of quantitative nature was conducted to study the elements of the customer choice process.

Keywords: Social Media, Consumer Behaviour, World Wide Web, online platforms.

INTRODUCTION

Social media is the online communication medium on which we can interact with each other, share content and get the information from. The various sorts of Social media can be social networking, forums and social book marking etc. Facebook, Instagram, LinkedIn, Wikipedia, Pinterest, Google plus and twitter are included in Social media and no doubt that it has become an integral part of our life. In businesses, Social media is generally used to spread the awareness about the products and services, promoting brands, to retain the existing customers and to find new prospects.

In this way Social media marketing definitely takes the benefit of Social networking, increasing the brand awareness, brand value and to increase the customer reach. The goal of the research is to find out the impact of Social media on consumer buying behaviour in urban areas. No doubt, now the consumers and the businesses are more connected than ever with each other for the very first time due to more internet connects than ever and After China, India has become the largest internet connection user.

OBJECTIVES OF THE STUDY 

• To study the impact of social media on consumer buying decision process. 
• To measure the change in perception of the consumers through the content and engagement on Social media.
• To understand how businesses can engage more customers to increase the brand value.

LITERATURE REVIEW 

1. This article says that Social media doesn’t always need some language or the words to spread the message to the consumer. When a product and the services is marketed then the context can be interpreted by the potential buyer. On the basis of that, the buyer gives the response. It can be in the way of purchasing a product, repurchasing a product or it can be in the form of not purchasing a product. So, this process is based on the customer need, his knowledge and liking towards the product, brand loyalty & brand value, word of mouth and its demand. 

2. Founds that the best and the successful way of advertising is Social Media Marketing. The study focuses on knowing the factors how the buying pattern of those consumers change who are on Social media through Social Network Marketing. This study also finds the relationship between the selling activities of the companies and the customer engagement and their purchase behaviour. In this, a survey was conducted among the 50 students in Malaysian National University. The result of the study shows the positive relation in between consumer buying behaviour and Social media engagement. 

3. The article talks about the past and the future impact of Social media because the fifth Social media week held in September 2011. Toby Daniels, the founder of Social media week found the increase in role of Social media in the lives of people. SMW is there in 21 cities in the world, because of increase in use of Social media in Middle east and how it is completely changing the business models too.

Sampling Plan & Research Instrument

The Research paper is based on the empirical data from the respondents who are actively involved in online shopping platforms. The primary data is collected from 200 respondents who were selected through convenient sampling technique. The data collection was conducted using a structured questionnaire.

ANALYSIS

Out of the 200 responses the least that is 24.5% people are having an account on Pinterest otherwise most of the respondents are having their account on Instagram and Facebook that is 91.5% & 91% respectively, 83% people are having the account on LinkedIn and the rest 18% have their account on other social media websites.

Out 0f 200 respondents, 64.5% accepts that social media provides more information with easier access, 52.5% says that they can trust more on social media advertisements and reviews, for 44.5% it saves their time and 21.5% accepts that they can be informed without being interrupted while doing other activities. In other words, they find social media more beneficial than the traditional media.

In the age group of 18-25, 7% people that is the least percentage, strongly recommend the products that they like and the 35% of the population agree with this fact that they do. But in the age group of 25-30, only 9% of the population strongly agree with this fact while only 22% say that they agree with this.

Student community can be engaged more via Frequency of Advertisements on their feed and also through Visual elements of products & advertisements. 

However, salaried class isn’t much affected by Frequency of Advertisement and can be engaged via attractive Visual display (elements) of advertisements and products.

Moreover, it is evident people who prefer discounts and promotions on social media end up doing unplanned purchase. And, people who don’t end up doing unplanned purchase on social media don’t prefer discounts & promotions on social media.

FINDINGS 

• It is suggested for the organizations to understand the crucial role of Social media to sell and promote its merchandise as Social media is the best way to entice the customers towards products and services.
• The marketing methods should be designed in such a way that could attract the various age and class of the customers.
• Social media influencers make a positive impact on the buying decision process of the customers.
• Social media is effective and cheap.
• Social media can make a direct interaction with customers.
• Social media is an effective way to generate more leads and sales.

RECOMMENDATIONS 

• Companies should give more importance to Social media marketing. Their presence on Social media can give them more visibility and it can also increase the brand value that will lead to more customer loyalty and customer lifetime value.
• Companies can be more connected with customers through Social media because the brands can communicate with them regularly and help or guide them to make a better purchase decision.
• Companies can use Social media more frequently to draw the consumer attention and brand awareness.
• Brands can be more interactive with the customers and it can get more customers insights and their reviews and feedbacks to make them feel that they are a part of the brand.
• Brands can share more positive experience of the customers who have already used that product so that the prospects and the ones who are already planning to buy can relate themselves more.

CONCLUSION

The research has shown a powerful impact of Social media on consumer buying behaviour in digital age. No doubt that Social media had brought major changes to both, consumer as well as businesses. The research has shown that consumers are highly selective while making a purchase. Though there is a plenty of data and sources of information on Social media, still personal attitude of the consumers makes a lot of difference in selecting and making a purchase.

The quality of content on Social media makes a big impact so it should be consumer relevant. When the marketing is done through Social media, it is not all about consumer awareness or selling the product itself. It is more than that which includes retaining a built-up relationship and building it between the potential buyers and corporations. Now the consumer is the king who can get all the information regarding a product or services by simply speaking with each other. So, the companies and marketers should highly careful about the bad mouth on Social media because it can lead to destroy the company’s reputation.

Even many individuals have agreed on the fact that through Social media, they can share their opinion and talk to other consumers and the corporations more effectively. Social media has definitely bridged up the gap between the brands and the consumers. Considering this fact, companies are now making each possible effort in making the buyer feel connected with the brand and allowed them to put their views, opinions, feedbacks and reviews.

The company that are adapting an integrated strategic approach with the aim of Social network platforms that is becoming the most successful in getting, engaging, influencing and retaining the customers. Factors, that can change the customer’s brand perception and a will to buy includes the strategies that led to consumers perspective, and the opinion of the people who create content on Social media. So, these strategies definitely need a high degree of maintenance and those companies that are using the method should be ready to fix all the marketing services to retain the existing customers and to increase the customer lifetime value.

Best Regards,
Mian Mukarram

Influence of Electronic Word of Mouth

Influence of Electronic Word of Mouth (eWOM) and Relationship Marketing on Brand Resonance:

A Mediation Analysis

Abstract: This study investigates how electronic work of mouth (eWOM) mediates the relationship between marketing relations and brand resonance. Based on the information obtained from 473 customers using an online questionnaire, this study analyses the relationship between eWOM, relationship marketing practices and the brand resonance of lifestyle products in an Indian context. The results from the multiple regression analysis indicate that the proposed hypotheses are valid, that relationship marketing significantly affects brand resonance, and that eWOM significantly mediates the relationship between the relationship marketing and brand resonance of branded apparel. The findings suggest that personalised attention and tangible rewards are effective relationship marketing strategies, and that these relationship-marketing practices—in association with eWOM—build up the strong brand resonance of branded apparel. The present study recommends that marketers should place emphasis on effective online and offline relationship marketing strategies, and should design appropriate eWOM strategies to enhance brand loyalty, brand attachment, brand community and brand engagement. Some of the managerial implications and the future scope of study based on the empirical findings are also highlighted in the present research work.

Keywords: brand resonance; relationship marketing; electronic word of mouth (eWOM); lifestyle products; regression analysis.

Introduction

Business organisations operate in a highly competitive environment as a consequence of a number of factors, such as the emergence of new markets, the rise in market demand, the increasing expectations of modern customers, the quality of services and products, value conscious customers, the rise in operational costs and declining profitability in addition to the inflation. Organizations can only survive by employing strategic and competitive measures towards attaining good positioning, a sustainable competitive advantage, differentiation and value creation. Several researchers, including, have advocated that two important strategic factors—relationship marketing and branding—are critical for competing effectively and fostering differentiation, as well as creating firm value and customer value. Relationship marketing and brand resonance have become part of the necessary requirement for modern organizations to Posit that relationship marketing enables marketers to build long-term relationship with customers, help brands understand their customers beyond a single interaction, and explain strategic variables associated with marketing efforts. In addition to relationship marketing, effective eWOM is another strategic measure that enhances customer awareness, builds purchase intention and influences final purchase. 

Effective relationship marketing and eWOM help business organizations to reduce the risks associated with a competitive business landscape. A strong brand mitigates risk, aids in the decision-making process and differentiates the brand from other offerings. The customer-based brand equity (CBBE) pyramid or brand resonance model proposed by Keller provides a sequential structure for building a strong brand. As a top element of the CBBE pyramid, brand resonance is the extent to which a consumer develops strong behavioural, psychological and social bonds with the brands. Brand resonance plays a crucial role in managing the customer relationship, developing sustainable brand equity, creating loyalty and building an emotional association with the brand. Brand Resonance is a dominant state of the psychological relationship that every organisation would like to establish with its customers. It is the way a by which a customer relates to a brand. This study is concerned with examining the association between relationship marketing, eWOM and brand resonance for lifestyle products. 

In recent years, marketing professionals have focused on managing customer relationships

and their marketing as a theoretical lens for understanding consumer–brand interactions. Many studies have introduced the use of the relationship metaphor to enhance the understanding of the various dimensions of brand resonance. According to a review of the branding literature, the construct of brand resonance defines the stepwise development of the brand relationship. Even though previous studies have investigated brand resonance in consumer research, the role of eWOM communication in strengthening relationship marketing for better brand resonance remains unknown. The research question is whether relationship marketing has an effect on the brand resonance of clothing products. Moreover, does effective eWOM communication mediate the relationship between relationship marketing components and apparel brand respondents? The study of this is more contemporary and justifiable in an Indian context, as India is considered to be the second largest emerging market for consumer goods due to its favorable demographical and socio economical advantage, rising disposable income, effective brand promotions, high demand for lifestyle products, increasing consumption, and spending on lifestyle products and luxury items. The Indian apparel market has witnessed a huge influx of international brands in the last few years. The findings of the present work will be beneficial for marketers in designing suitable relationship and eWOM strategies to influence brand resonance among consumers in this emerging economy.

Literature Review and Hypothesis Development

Relationship Marketing and Brand Resonance

Relationship marketing is a value creation process intended to retain existing customers, develop powerful relationships to affect their repurchase decisions, and generate brand advocacy. It requires generating, maintaining and improving the strong relationship with customers and other stakeholders within and outside an enterprise. According to, an improved capability to target profitable consumers, a unified assistance across channels, improved marketing force efficiency and effectiveness, improved pricing, customised products and services, enhanced consumer service efficiency and effectiveness, and individualised marketing messages are the seven core benefits of relationship marketing. With the regular usage of the marketing methods at the disposal of business owners, relationship marketing is playing a greater role as they look for ways to differentiate themselves and create long lasting, meaningful brand and customer experiences. 

Keller defined brand resonance as the strength or extent of the psychological connection that customers have with the brand and the degree of operation generated by this loyalty. According to Keller, brand resonance has four dimensions, which comprise brand loyalty, brand attachment, brand community and brand engagement. Tracking out the linkage between relationship marketing dimensions and brand resonance, brand attachment is directly influenced by the core factors of relationship marketing, which include trust and satisfaction. The research of validated the significant and positive relationship between conflict handling and brand loyalty through trust and relationship quality. When the service providers deal with the conflicts of customers effectively and efficiently, they develop a loyalty towards 

the enterprise or the brand. Beyond conflict handling, empathy also generates the loyalty of the customers, as per the research conducted. With such great advantages, brand resonance can be used by the organisation to gain a competitive advantage. Many organizations seek to enhance brand resonance dimensions by using relationship marketing. Relationship marketing has more significance to service enterprises compared to product enterprises. The above arguments lead to the following hypothesis:

Hypothesis (H1). Relationship marketing has a positive effect on brand resonance towards

branded apparels.

Relationship Marketing and eWOM

Relationship marketing involves the creation of easy two-way communication between customers and the business, tracking customer activities and providing tailored information to customers based on those activities. EWOM has made it easy for marketers to enhance their relationship with customers, establish strong communication, and convince customers in favour of their products. EWOM is any favourable or unfavourable communication made by prospective, existing or previous customers about a brand or organisation, which is capable of reaching to millions of individuals and organizations through the internet. EWOM communication—usually attributed to written words, indirect interactions, anonymity and a wide scope—offers higher reliability and better understanding and significance to shoppers than commercial information sources on the internet created by marketers. EWOM brings a significant change in the knowledge, attitude and behaviour of the audience. EWOM messages effectively minimize the chances of risk and ambiguity while making the purchase decision, and thus influences consumers’ subsequent intention to purchase. Spending on marketing and advertising campaigns to acquire new customers and retain existing customers can be expensive. Relationship marketing influences customers to become brand ambassadors and effectively spread word of mouth digitally for the brand, which consequently drives sales. 

These arguments lead to the following hypothesis:

Hypothesis 2 (H2). Relationship marketing has a positive effect on eWOM for branded apparels.

Electronic Word of Mouth (eWOM) and Brand Resonance 

EWOM plays an important role in improving brand recognition and creating positive brand relationships. EWOM is recognised as an effective tool for building brand awareness, creating hype in the marketplace, influencing purchase decisions and developing brand loyalty. Examining the effect of eWOM on brand image and purchase intention, found the strong influence of eWOM on brand image and purchase intention. Several studies have examined the relationship between the individual elements of brand resonance (i.e., brand loyalty, brand attachment, brand community and brand engagement) and eWOM. In the social media environment, loyal consumers usually tend to be ambassadors of the brand for other consumers. Several researchers have attested that positive eWOM creates and strengthens customers’ loyalty towards brands. Regarding brand attachment, the studies of found that brand attachment develops emotional bonds with customers and motivates them to generate positive WOM. 

Research Methodology

Branded apparels were chosen for this study as lifestyle products. The data for this

study were collected through responses received from Indian consumers using an online

questionnaire generated through Google document for three months, from June to August

2020. The customers were requested to reply by email. The survey questionnaire consisted

of three sections. The first part consisted of questions related to the demographic profile

of the respondents and the motivation of purchasing branded apparels. The second part

of questionnaire contained attributes related to relationship marketing practices, EWOM effectiveness and brand resonance. Relationship marketing was measured by interpersonal communication, direct mail, tangible rewards, preferential treatment, customisation methods and the individualisation attention, as adopted from the previous study. EWOM was measured according to seven attributes taken from the previous works. Brand resonance was measured by developing four constructs namely Behavioural Loyalty, Affective Attachment, Sense of Continuity and Affective Engagement, which were taken from previous studies. Participants were instructed to indicate their preferences according to their level of agreement with the given attributes in a five-point Likert-scale (where 5 designated strongly agree and 1 designated strongly disagree).

A panel of experts and academicians of the marketing domain vetted the initial questionnaire by judging the content’s validity, the clarity of its items’ meanings and the linkages of the identified variables with the research objectives. For reliability, the questionnaire was pilot tested using 55 respondents, representing 13% of the total proposed sample, who were considered the representatives of the study population. The value of Cronbach’s alpha was found to be 0.983, which suggested the acceptable level of reliability of the questionnaire. The consumers were invited to participate in the study via email and by posting invitations to well-known sites using snowball sampling, in which potential respondents were asked to complete the questionnaire and forward it to someone known to them. Initially, the questionnaire was mailed to 1500 respondents. The researchers received 498 responses and, after editing, 473 respondents were found fit to be used in this study, excluding 25 responses that were incomplete or insincerely answered. The sample size was calculated for an infinite population keeping a level of confidence of 95% and a margin of error of 0.05 to calculate that the sample size. The data thus received was systematically arranged, tabulated and analysed through SPSS software. Some of the statistical techniques like descriptive statistics, regression analysis and the Sobel test for mediation analysis were used to draw the inferences.

Results

The demographic profiles of the respondents presented in Table 1 indicate that 52.6% of respondents were in the age group of 19–25 years. In total, 25.4% of the respondents were in the age group of 26–35 years, 10.8% of respondents were in the age group of 36–45 years, and 2.1% of respondents were in the age group of 46–55 years. The remaining 9.1% of respondents were above 55 years. The majority of the respondent (69.6%) were in the male category, and more than half (57.3%) of the respondents were unmarried. Regarding education level, 39.1% of the respondents surveyed were graduates,19.9% were postgraduates, and 25.8% of respondents were below graduation level. In total, 15.2% of the respondents had qualifications like technical degrees or diploma certificates. Regarding the monthly income level, 31.9% of the respondents were earning INR 20,001 40,000, 29.8% were earning INR 40,001–60,000 and 20.5% were receiving INR 60,001 80,000. The remaining 17.8% of respondents had a monthly income in the range of INR 80,001–100,000. Students dominated the sample with 44.6%, followed by salaried individuals (32.1%) and business professionals (12.3%).

Best Regards,
Mian Mukarram

A Study on Improving Customer Value Based on the Effect of Word of Mouth

A Study on Improving Customer Value Based on the Effect of Word of Mouth

INTRODUCTION

With the globalisation of the economic system and market competition, the status of customer has also evolved fundamentally. Customers determine the competitiveness of a company in the market as well as its ability to continue operation. In order to have a long-term friendly relationship with customers and develop sustainable profitability, many companies pass on to customers more value that better meets their needs, thereby driving customers to repeat purchases. Thus, how to use marketing tools to effectively enhance the enduring customer value when customers use products of a company has become a heated topic for marketing scholars. Several scholars propose sales promotion and word-of-mouth marketing, which are currently the main marketing methods.

LITERATURE REVIEW AND RESEARCH HYPOTHESES

Current research on customer value is mainly carried out from three different perspectives. The first is to research and define customer value from the perspective of customers, mainly from the value firms create for customers. Proposed the overall assessment of the utility of a product or service after weighing the benefits perceived by the customer and the cost of acquiring the product or service and named it customer-perceived value. Proposed customer transfer value, that is, the difference between total customer value and total customer cost. The second is to study customer value from the perspective of enterprises, typically represented by customer lifetime value (CLV). CLV refers to the total revenue that each buyer may create for the enterprise in the future. The process from the beginning of the customer–enterprise relationship to its end is a development trajectory that changes over time, which is called the customer lifecycle. It has been found that the reciprocal relationship between firms and customers, and customers’ contribution to the profits and expenses of companies exist throughout the entire customer lifecycle. The third is to study customer value from the joint perspective of customers and firms. The focus is on the value exchange process between the two, which not only realises the transactions required by customers and firms, but also forms some other economic and non-economic relationships. Few influential research results from this perspective have been achieved.

Research Hypotheses

Overlapping Marketing and Need Matching

Compared the interaction effects of personal–organisational value matching, personal–work attitude matching and personal decision-making ability matching on job satisfaction. Work attitude matching proved to have the greatest predictive effect on job satisfaction, while value matching had a certain effect and decision-making ability matching had no significant effect. Proposed that with the emergence of product homogeneity, enterprises should carry out overall product innovation. There was an interactive relationship between core product innovation and consumers’ basic needs, and continuous innovation of formal products and additional products could meet consumers’ linear and attraction needs. Argued that the link between consumer needs and product innovation required the organic integration of market driving and market-driven models. It is critical for companies to develop both market-driving and market-driven skills, and to understand when and in what ways they should work together. Proposed that new digital technologies mean that firms need to define new marketing actions that create value for consumers who are also co-producers. Based on this, the following hypothesis is proposed:

H1a: Overlapping marketing promotion management has a

positive impact on need matching.

RESEARCH METHOD

Measurement

Overlapping Marketing

This study referred to the sales promotion scale by and developed a theoretical marketing management scale for the traffic data user group, with a total of 8 items divided into word-of mouth marketing and sales promotion. For the processing of the two types of data on sales promotion and “word-of-mouth marketing,” their product divided by 5 was used to obtain the appraisal data on overlapping marketing.

RESULTS

Overall Index Model Analysis

In this study, the goodness-of-fit test was used to evaluate the fitness of the structural equation model (SEM), including the average path coefficient (APC), the average R square (ARS), and the average variance inflation factor (AVIF). The APC and ARS of the model were both significant (p < 0.001) and the AVIF was less than 5, indicating that the overall fitness of the model met the requirements.

DISCUSSION AND CONCLUSION

Conclusion

This study created a model for continuous customer value creation based on overlapping marketing, verified scales for need matching, user adhesion and overlapping marketing appraisal, and explored the impact of China’s smart terminal business on continuous customer value creation under the effect of overlapping marketing. The results proved that overlapping marketing could enhance enduring customer value creation by improving need matching and user adhesion.

Best Regards,
Mian Mukarram

E Word of Mouth

A Literature Review of Word of Mouth and Electronic Word of Mouth:

Implications for Consumer Behaviour

The rise and spread of the Internet has led to the emergence of a new form of word of

mouth (WOM): electronic word of mouth (eWOM), considered one of the most influential

informal media among consumers, businesses, and the population at large. Drawing on

these ideas, this paper reviews the relevant literature, analysing the impact of traditional

WOM and eWOM in the field of consumer behaviour and highlighting the main differences

between the two types of recommendations, with a view to contributing to a better

understanding of the potential of both.

INTRODUCTION

Consumers increasingly use online tools (e.g., social media, blogs, etc.) to share their opinions about the products and services they consume and to research the companies that sell them. These tools are significantly changing everyday life and the relationship between customers and businesses.

The rapid growth of online communication through social media, websites, blogs, etc., has increased academic interest in word of mouth (WOM) and electronic word of mouth (eWOM). Specifically, the present paper will review the literature on how these two media
have evolved, the main differences between them, and the degree to which they influence both businesses and consumers, now that they have become some of the most influential information sources for decision-making.

BACKGROUND

Word of mouth is one of the oldest ways of conveying information, and it has been defined in many ways. One of the earliest definitions was that put forward, who described it as the exchanging of marketing information between consumers in such a way that it plays a fundamental role in shaping their behaviour and in changing attitudes toward products and services. Other authors have suggested that WOM is a person-to-person communication tool, between a communicator and a receiver, who perceives the information received about a brand, product, or service as non-commercial. Likewise, WOM has been defined as communication between consumers about a product, service, or company in which the sources are considered independent of commercial influence.

These interpersonal exchanges provide access to information related to the consumption of that product or service over and above formal advertising, i.e., that goes beyond the messages provided by the companies and involuntarily influences the individual’s decision-making. WOM is widely regarded as one of the most influential factors affecting consumer behaviour. This influence is especially important with intangible products that are difficult to evaluate prior to consumption, such as tourism or hospitality. Consequently, WOM is considered the most important information source in consumers’ buying decisions and intended behaviour. For example, tourist satisfaction is of utmost importance because of its influence on behavioural intentions, WOM and purchasing decisions. In other words, overall satisfaction leads to the possibility of revisiting and recommending the destination.

WOM vs. eWOM

While many authors consider eWOM reviews to be electronic versions of traditional WOM

reviews, this paper aims to summarise and explain the main differences between the two concepts (Table 1). The first such difference is credibility as an information source, since it can influence consumers’ attitudes toward products or services, for example, with regard to the purchase of tourism services, which are considered to be high-risk have suggested that the anonymity of online messages could have a negative effect on their credibility. In contrast, other studies have argued that consumers use eWOM more to reduce risk when decision-making. Likewise, eWOM tends to be more credible when the consumer using it has previous experience.

CONCLUSION

This paper has reviewed the literature with a view to providing a clearer understanding of WOM and eWOM in the context of consumer information searches. To this end, the review found that, in keeping with numerous studies, WOM is both the oldest medium for sharing opinions about products or services and the one most likely to influence consumer behaviour, due to the high reliability and credibility transmitted by family and friends. In contrast, few studies have examined the interaction between perceived risk and eWOM source credibility.

Best Regards,
Mian Mukarram

Native Marketing

Consumer Response to Native Advertising: Acceptance, Attitudes and Brand Effects INTRODUCTION Attracting consumer attention in today’s cluttered online media environment is constantly becoming more difficult. Consumers consciously avoid advertising, click-through-rates of banner advertisements and other traditional online advertising formats are decreasing to minimal values, and ad blockers are downloaded by more consumers than ever. As a result, advertisers are forced to find more creative ways to reach potential customers and to build their brand. A popular trend in recent years has been for brands to start producing content such as articles and blog posts to catch the attention of people who already are in the mood for searching information. Such strategy of building advertising messages on content that is valuable, relevant and useful for the customer has even been presented as the next generation of branding as it creates opportunities for building and reinforcing brand awareness, transforming the company’s brand positioning and eventually even developing the status of a trusted expert brand. In a survey conducted among a set of Nordic companies in the summer of 2017, already a total of 58% of the companies participated expressed an intention to dedicate a larger share of their marketing budget to this so-called content marketing by the next summer. NATIVE ADVERTISING AND CONSUMER RESPONSE The aim of this chapter is to provide an overview to native advertising by first discussing its definition and its role in the online media environment and marketing strategy, and then discussing its potential implications to consumer response. The latter discussion will be based on existing theories about consumer response to advertisements as well as research on native advertising, content marketing and online advertising in general. The chapter is concluded with a summary of the key findings from the literature and construction of hypotheses and a conceptual model to be tested. What is native advertising?  In a growing extent, advertising manifests itself in hybrid forms, where multiple elements from a promotion mix are integrated with each other. Native advertising is a hybrid form of online advertising that integrates elements of paid advertising, editorials, and content marketing in a brand’s own media. Consequently, in order to understand what native advertising is and what it role is in the online media environment, it is necessary to begin by shortly discussing the concept of content marketing.                              The strategy of reaching and affecting consumers directly on their online purchase path by publishing content that matches their information needs is the essence of what is called content marketing or content-based marketing programs. Most often consumers are exposed to content marketing from the brands when they seek out specific information online and their search results lead them to relevant content on the brand’s website or social media sites. Accordingly, content marketing is considered to be an inbound marketing approach, which means that rather than interrupting consumers with the marketing message in inapt situations, as is the case with traditional advertising approaches, the marketing message is delivered to consumers “on demand” when they actively look for it argues that this implies a paradigm shift from brand-centric approach to customer-centric approach, meaning that the marketing messages should be created with the focus on delivering value to consumers, rather than attempting to persuade consumers through aggressive sales messages. Native advertising in turn is essentially a tactic for driving more traffic towards the content marketing by advertising or publishing the brand-created content as an integrated part of editorial media. In other words, it works like an advertisement for an advertisement. As the term native suggests, the advertising format is based on the idea of making ad content so seamlessly integrated into a media context that it feels like the content originates from the platform. So, while pure content marketing is based on reducing intrusiveness by being based on invitation, native advertising attempts to counter intrusiveness by blending into the media stream so seamlessly that the exposure to or engagement with the advertisements does not disturb the user - or reading - experience. In other words, the aim of native advertising is to make the commercial content perceived as a non-disruptive part of the media experience. This is achieved by transforming traditional advertising messages in into a form that mimics the formal style and visual looks of editorial content. This means that essentially native advertising is a hybrid form of advertising, content marketing and editorial content, which is illustrated in Figure. Figure: The interplay of brand, media and consumer and different forms of content in the online media environment. Consumer response to native advertising and native advertisements  Studying audience reactions to advertisements can reveal the effectiveness of the ads in persuading the audiences to act according to the expectations of the marketer. Hence, the purpose of this subchapter is to map out the different constructs that relate to how consumers evaluate native advertisements and how they form reactions towards them. These constructs are derived from what previous research has found on native advertising, content marketing, or related fields, and the processes that may affect evaluations and reactions to these kind of ad formats. The focus will be on ad characteristics that make native advertising unique and that are likely to affect consumers’ evaluations of the ad on a cognitive and behavioural level. The subchapter is designated to follow the research approach of the study, starting from ad-level evaluations and moving towards brand-level effects. General acceptance of native advertising  Researchers have suggested that consumers’ general evaluations of a certain advertising format affect their attitudes towards individual advertisements in that format. In native advertising, understanding consumers’ general acceptance of the ad format is particularly essential, since critics have suggested that consumer view to native advertising may not be as positive as that of advertisers. The problem, according to the critics, is that the advertiser view is likely to be based on the perceived benefits that the ad type brings for tackling the challenges that advertisers face instead of the challenges that consumers face. This means for example that the subtle and novel nature of native advertising is more likely to help advertisers to counter consumers’ habitual ad avoidance than to improve consumers’ media experience per se. That is because native advertising does not actually remove the ad clutter but just changes its form – and research suggests that consumers are most satisfied with their overall website experience when advertising content is not present at all because then they do not have to expend cognitive efforts to evaluate its motivations.  Acceptance of an ad format or an ad message has been proposed to be related to the perceived appropriateness of the persuasion tactics used by marketers and the consequent choice or intent not to reject them. Lee. They have identified that if consumers perceive that the persuasion tactic used by the advertiser is nonintrusive instead of manipulative, it is more likely that they 18  accept the message. The same authors found that native advertising is indeed perceived rather more a nonintrusive than a manipulative advertising technique. In turn have found that in general, consumers are less sceptical towards native advertisements compared to banner advertisements, and also find it less irritating. These findings imply that the acceptance of native advertising may generally be at a slightly higher level than other online advertising formats, at least when comparing to banner advertisements. Attitudes towards native advertisements  Researchers have for a long time acknowledged the cognitive processes that consumers use to evaluate advertisements and develop attitudes towards them. This is because these processes and attitudes, among others, form the base for consumer evaluations of the advertiser brand. Accordingly, attitudes towards advertisements are included as a key variable in this study.  Accordingly, attitudes are often based on or derived from cognitive consumer responses that are evaluative responses consisting of the beliefs people direct towards specific attitude objects like advertising. These evaluations range from extremely positive to extremely negative, or highly favourable to highly non-favourable. In turn defines attitudes as “learned tendencies to respond towards an entity (“the attitude object”) in a consistently favourable or unfavourable way”. In the sections to come, some precursors for attitudes towards native advertising will be discussed. Brand effects of native advertising  An extensive stream of literature over several years has shown that attitude towards ad strongly and both indirectly and directly affects following evaluations of the brand. Hence, the purpose of this section is to review consumer responses to native advertising and advertisements from a brand perspective. Here, brand effects refer to the consumer responses that have a direct effect on the evaluations and behavioural intentions at the brand level. Specifically, the factors eventually affecting the ad-evoked brand awareness, brand attitudes, brand trust and brand interest are discussed.  Brand prominence, brand awareness and customer-centricity  From the practitioner perspective, increase in brand awareness is one of the most important goals of native advertising. Brand awareness refers to the level that the brand is known by the consumer and can thus be subject of further consideration. Hence, in advertising context it demonstrates the level of brand-related learning that happens in the consumers’ minds as a result of seeing the ads.  According to, native advertising offers “an ideal venue for brand opportunities". Namely, the authors suggest that even without any engagement other than exposure to the native ad unit, native ads serve large scale brand impressions that not only contribute to awareness at the top of the so-called sales funnel (the imaginative funnel that directs users from awareness towards purchase), but also create opportunities toward mid-funnel interest. Furthermore, if the consumer opens the ad and reads the content behind it, the ad is likely to create even deeper level of engagement with the brand through the associations created by the images and narratives in the content. Consequently, it could be argued that native advertising creates opportunities for brand awareness and engagement on two levels: the level of brand impression from the native advertisement and the level of brand associations from reading the associated native article. However, the brand effects of native advertising engagement are likely to be stronger when the consumer has not only viewed the native ad but also clicked the ad to read its associated article.  Brand attitudes and brand trust  Researchers suggest that the success of persuasive communications depends on the level to which the communications can affect consumer beliefs about the brand, i.e. their strongly held associations about attributes or outcomes related to it. However, considering that other content-based marketing such as sponsored content has been found to induce brand-focused processing rather than product-related processing, brand attitudes in this context refer more to beliefs about the characteristics or qualities of the brand rather than beliefs about some specific attributes in the products or services that the brand provides.  Brand interest  Brand interest has been conceptualised as a measurement of the non-evaluative outcomes of ad exposure that indicate a behavioural orientation, or a "curiosity" or "motivational push" type of response, that leads to elevation of the brand in the consumer's consideration set. The measurement of brand interest contains an expectation that advertising should do more than just reinforce top-of-mind brand awareness. The aim of measuring brand interest is thus to identify the consumer responses that indicate interest, action tendencies and openness towards the brand.   Brand interest is not expected to affect purchase intention, but rather contact intention, which could refer e.g. intention to try the brand or search more information about it in order to renew (or establish) contact with it. Because native advertising is neither expected nor intended to directly lead to purchase intention but rather to intermediate effects, brand interest can be considered a more suitable construct than purchase intention in measuring the behaviourally oriented consumer responses to native advertising. In other words, I argue that positive evaluation of native advertising is more likely to induce intention to look for more information about the brand or intention to try the brand than direct intention to purchase the brand. METHODOLOGY  This chapter presents the methodological choices and procedures undertaken to conduct the empirical part of this study. The chapter begins with introduction to the general research design of the study, continued by discussion of the sampling strategy and questionnaire design as well description of the stimuli used in the study. These parts are aimed at giving the reader a good understanding of the strategy for conducting the research. In the second and third part of the chapter, the data collection procedures and the chosen methods for data analysis are discussed in order to report the actual methodological procedures taken for collecting the data. The chapter will be concluded with assessment the impact of the chosen research strategy to the quality of data in terms of validity and reliability.   Research design  The purpose of this study is to understand consumer response to native advertising by studying consumers’ general acceptance and attitudes towards it and the effect that it may have on consumers’ brand awareness, brand trust, brand attitudes and interest towards the advertiser brand (i.e. the brand effect). To achieve this aim, the empirical part of the study will be cross-sectional and based on a quantitative survey strategy study. The choice of quantitative approach is supported by the fact that answering the chosen research questions requires verification of theoretical relationships among variables and the verification of the conceptual model requires testing of whether the assumed correlational structures in the model are statistically relevant. Furthermore, the survey strategy is the most common method for this type of descriptive-explanatory research of attitudes, opinions and their relationships, and it also fits the nature of a cross-sectional study well. RESULTS In this chapter, the results of the conducted data analyses will be presented. The chapter will begin by presentation of the descriptive statistics to explain the characteristics of the obtained data, followed by presentation of the results of the factor analysis to test the reliability of the scale items and to create summated scales. Results from correlational analyses are also presented to show the intercorrelations between the obtained measures. The chapter will be concluded by presenting the results of the regression analyses testing the predictive and explanatory value of the presented conceptual model, after which there is a short summary of the results on hypotheses testing. The data obtained in form of open-ended answers will also be presented shortly. Descriptive statistics  The survey was answered by 103 respondents, out of which 101 were carried over to the final analyses. In the upcoming sections, the characteristics of the obtained data will be explained both in terms of respondent profile and the data quality/basic assumptions Factor analysis  Factor analyses were conducted as principal component analysis (PCA) to reduce and summarise the individual scale items into more easily manageable composite measures and check the reliability of the scale items used. Suitability of data was checked with measure of sampling adequacy and Bartlett’s test of sphericity. To be considered suitable for the analysis, KMO should have a minimum value of 0,6 and Bartlett’s test should be significant. Moreover, the correlation matrix should have at least some correlations over r=0,3. The obtained correlation matrices included many coefficients over 0,3 and KMO values in each analysis were over 0,8 (0,877 in factor analysis on independent variables, 0,887 in factor analysis on native ad evaluations and brand awareness, 0,932 in factor analysis on brand trust, 0,839 in factor analysis on brand attitudes and 0,814 in factor analysis on brand interest). Bartlett’s tests were all significant at p=0,000. This indicated that the data was suitable for further analysis of the results. The factor analyses were done with Kaisers’s criterion and Oblivion rotation method, because these are some of the most common methods to begin with to determine the number of factors in the final solution. In addition, the use of oblique techniques (Oblivion rotation method) makes sense in the beginning, as it reveals the correlations between the factors. The chapter will also include discussion of why two cases were removed from the sample. Because the conceptual model of this study consists of multiple stages with different dependence relations, the factor analyses were conducted in a stepwise manner. The analyses were begun with analysis of the 45 items measuring the ten independent native ad characteristic variables on left hand side of the conceptual model. The Oblivion method rotation with Kaiser’s criterion of eigenvalues over 1 suggested first a 10-factor solution explaining 79,45% of the variance, with most variance explained (42,1%) by the first component and 8,4%- 2,35% by the rest. DISCUSSION The purpose of this fifth and final chapter is to discuss the key findings of the study and their relation to previous literature, research questions and the study aim. The chapter will also include a discussion of the theoretical and managerial implications of these findings. In the end, the limitations of the study as well as some suggestions for further research are presented. Key findings on consumer response to native advertising The aim of this study was to examine consumer responses to native advertising by studying consumers’ general acceptance and attitudes towards it and the effect that it may have on the brand. More specifically, this study sought to find what affects consumers’ acceptance of and attitude towards native advertising and what the factors are that influence brand awareness evoked by native advertising. Moreover, this study sought to understand how consumers’ acceptance and attitude towards native advertising influences their trust, attitudes and interest towards the advertiser brand.  In the upcoming subchapters, the findings of this study are discussed with relation to these goals and other emergent key findings. First, the findings related to general consumer response to native advertising are discussed, followed by discussion of factors affecting favourability of native ad evaluations. After that the discussion shifts to the found brand effects of native advertising. This part includes a discussion of findings on brand awareness, and a collective discussion of the found relations between native ad evaluations, brand trust, brand attitudes and brand interest.  Consumers’ general evaluations of native advertising  Regarding native ad acceptance, the results of this study revealed that consumers do not seem to have a radical opinion on whether to accept or reject marketing communications in form of native advertising. In effect, it was found that consumers’ acceptance of native advertising, measured as the level of perceived appropriateness of the persuasion tactic used, is at a neutral, or at a very slightly more accepting than rejecting level with M=4,10 on a scale from 1 to 7. Brand effects of native advertising  This study sought to find the factors affecting ad-evoked brand awareness in native advertising context and found that the relative prominence of the brand in the ad is a key precedent for this matter as brand prominence was found to positively affect ad-evoked brand awareness. Although this sort of a finding might seem self-evident in many other advertising research contexts, in this very context, the finding underlines the special nature of native advertising and the challenges it brings about. The problem is that clear prominence of the brand is not something that can be taken for granted in native advertising context considering the subtle nature of the ad format.  Conclusions  Generally, this study has generated insights about consumer attitude formation processes in native advertising context, especially regarding consumers’ cognitive evaluation process of the ad type. Additionally, the study revealed the aspects that could and should be emphasised or strived for when producing content marketing for content recommendation -style native advertising. From a broader perspective, this study offers insights into how to streamline the processes from content marketing production to brand interest generation by focusing on the key aspect of building trust. In conclusion, this study serves as a base for broader understanding of why native advertising is or is not effective. Yet more research, especially in form of qualitative inquiry, is needed to understand the deeper meanings that consumers create when evaluating and responding to informational content recommendation -style native advertising.  Best Regards, Mian Mukarram