MEDI-CAPS UNIVERSITY

INDORE

Project Report

ON

“A Study on the Impact of Social Media Marketing on

Consumer Buying Behavior”

Submitted as Partial Fulfillment for

Degree of Bachelor of Commerce (Hons.) to Medi-Caps University,
Indore

2019

GUIDED BY – SUBMITTED BY –
Prof. Bhawna Bhagerwal Miss. Simran Khan
CM16CM301051
B.Com (Hons.) VI SEM

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 INDEX

S. NO CONTENT PAGE NO.

PREFACE 3
CERTIFICATE 4
DECLARATION 5
ACKNOWLEDGMENT 6
1. INTRODUCTION 7-9
 RATIONALE OF THE STUDY 10
 OBJECTIVE OF THE STUDY 11
2. CONSUMER BUYING BEHAVIOR 12-21

3. SOCIAL MEDIA 22-26

4. LITERATURE REVIEW 27-35

5. RESEARCH METHODOLOGY 36-38

6. DATA ANALYSIS 39-44

7. LIMITATIONS OF THE STUDY 45-46

8. CONCLUSION 47-50

9. REFERENCES 51-52

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 PREFACE
On a daily basis in present-day, 100,000 tweets are sent, 684,478 pieces of content
are shared on Facebook, 2 million search queries are made on Google, 48 hours of
video are uploaded to YouTube, 3,600 photos are shared on Instagram, and 571
websites are created.

The advent of social media has created a new landscape which lays out a new grid
of personal connections. Businesses see enormous opportunities and are eager to
tap into the trend, whereas consumers are put back to the center in the business
world because of social media. There are many studies explaining reasons to tap
into social media and to help companies to gain a better position in the transition;
yet a few intend to study from the perspective of consumers, let alone those in
Finland. Oftentimes, consumers feel differently from what marketers think, for
instance what “brand engagement” via social media looks like to consumers may
not be quite what marketers think.

The objective of the research is to explain why, when, and how social media has
impacted on consumer decision process. The theoretical framework rests on
literature of consumer decision making process, social media, as well as previous
studies relating to social media marketing. Quantitative research method is adapted
for the purpose of this research. The empirical data was gathered by sending out
questionnaire to individuals in Indore.

This research gives explanation on how individuals are attending, processing, and
selecting the information on social media before a purchase. Findings and
conclusions presented in the research are only valid within the population selection
and cannot not to be generalized elsewhere due to the differences in environmental
factors.

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 CERTIFICATE OF THE SUPERVISOR

This is to certify that Miss. Simran Khan has executed the project entitled “Impact
of Social Media Marketing on Consumer Buying Behavior” my supervision
and the report submitted therewith is the result of work done under my supervision.

Prof. Bhawna Bhagerwal

Date:

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 DECLARATION

This is to certify that the project entitled “A study of the impact of social media
marketing on consumer behavior” is a bonafide work done by me Simran Khan
under the supervision of Prof. Bhawna Bhagerwal in a partial fulfillment for the
degree of Bachelor of Commerce (Hons.) From Medicaps University.

Name: Simran Khan

Batch: B.com (Hons.)
Place: Indore
Date:

Signature of the guide

(Prof. Bhawna Bhagerwal)

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 ACKNOWLEDGMENT

The most awaited moment of successful completion of an endeavor is always a

result of a person involved implicitly and explicitly there in and it is impossible
without help and guidance of the people around.

I would like to express my immense thanks to my supervisor Prof. Bhawna

Bhagerwal Ma’am who supported me and guided me in the completion of this
report; she guided me in every stage of the research and helped me to clarify my
doubts. Thank You Ma’am.

I would also like to show my special gratitude to Prof. Haldar Sharma Sir
because without his support it is impossible for me to complete my project as he
guided me and helped me in resolving problems related to hypothesis etc

Last, but not the least, my heartfelt gratitude to Dean Sir, Dr. Harish Bapat, my
friends, other faculties and to all those people who knowingly or unknowingly
supported me.

Thanks to all of them.

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1. INTRODUCTION

Social media marketing is enabled by the information consumers provide about

themselves and their social contacts, mostly via apps that they buy cheaply or
receive for free. Apps are chunks of software – installed on one’s computers,
tablets, or smartphone – that are gateways to games, online resources, and social
networking. Apps also collect user’s, personal information and provide them to the
apps’ developers.

The inception of Social Media Marketing (SMM) is one of the mightily

development in the history of commerce. This particular technical revolution
during the last decade has drastically revolutionized the traditional marketing
approaches and brought marketers to a new era.

Social media revolution has changed the marketing landscape & has strengthened
the marketing communication process. The customer now has more power than
ever to initiate, drive & change the entire buying process. This cost effective way
has 0not only helped companies to increase brand awareness but has drastically
improved brand loyalty and customer satisfaction by helped companies to increase
brand awareness but has drastically improved brand loyalty and customer
satisfaction by helping them gain better marketplace insights. With consumer
spending more & more time in the social media realm an increasing share of
communication occurs within these social network environments. This implies that
brand related interaction & exposure to marketing campaigns increasingly takes
place within social media. The emerging communication setup has thereby
transformed consumers from being passive participants in marketing to being
active creators & influencers (Kozinets et al,2008, Merz et al, 2009) & has shifted
some power over brands directly to the consumer(Constantinides &
Fountain,2008).

Social media encompasses a wide range of online forums including blogs,

company sponsored discussion boards & chartrooms, consumer to consumer e
mail, consumer product or service rating websites & forums, internet discussion
boards & forums, moblogs, (sites containing digital audio, images, movies, or
photographs), and social networking websites, to name a few. (Mangold, W.G.,&
Faulds, D.J.(2009)) The interactive ability of social media with its ability to
establish conversations among consumers& firms helps companies in value
creation & has excited the practitioners with its potential to better serve customers

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& satisfy their needs. People are exposing themselves to a wide range to social
media for gathering information about products, purchasing & consuming them
and communicating their experiences with others. On other hand companies
respond to this consumer shift by increasing their use of social media marketing
channels.

Social Media Marketing puts consumers back to the center of the business world
and provides marketers a new set of tools to interact with consumers and to
integrate them into the brands through innovative ways. In essence, marketers
have to understand how the social media has influenced Consumer Buying
Decision Making (CBDM).Consumer behavior is an important aspect of
marketing as it assists marketers to devise strong and robust marketing
strategies and techniques. For instance, organizations launch new products or
services, which are generally bought by few customers in the initial phase and
gradually, there is an increase in the users.

Today, organizations are employing social media technique in order to change

consumer’s behavior and to win their loyalty. Nowadays social media becomes
part of a person's life. Social media such as Facebook, Twitter, Instagram or
LinkedIn has a numeral number of the user and keeps growing every day. It is
estimated that over 500 million people are interacting with social media (Ostrow,
2010). The number of social media users growing has attracted marketers.
Marketers have recognized that social media marketing as an important part of
their marketing communication strategies. Also, social media helps organizations
to communicate with their customers.These interactions help marketers
determine customer needs and understand what their market might look like.

Key business factors of social media allow consumers to estimate products, make
recommendations to contacts or friends, and share any of the purchases
through their social media. Communication through social media has found
impact on consumer decision-making and marketing strategies. Consumer
socialization theory predicts that communication among consumers affects their
cognitive, affective, and behavioral attitudes. Also, the advertising on social
media page has built new consumer’s behavior. Consumers tend to make purchases
or conduct business on social media.

Recommendations by friends or connections on social media also could help

consumers on decision-making. Those recommendations could help brand
attitudes, purchasing attitudes, and advertising attitudes. The more good

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responses on the products or services, the more attractive for consumer
purchasing. Most of top brands and services notice it and started to
Focus on social media marketing. Therefore, this research attempts to explore
how SMM influences on CBDM process.

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 1.2 RATIONALE OF THE STUDY

The study is done to investigate the variables that may have an impact
on consumer buying behavior because of social media marketing and
how consumer buying behavior is affected by social media. In the study
we have discussed how industries are using social media platforms to
promote or advertise their products and how the consumers are reacting
to it. The research was conducted from a consumer’s point of view to get
a better understanding of how ads on social media affect individuals.

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 1.3 Objectives of the study
 The main objective of the study is to explain why, when, and how
social media has impacted on consumer decision making process.

 To understand the changes social media has brought to consumers in

different stages of their decision making.

 To understand the dynamics of social media and its strategic and

promotional advantages over other media.

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2. Consumer Buying Behavior

Consumers:
Consumers are actors on the market place stage. Consumers, in general, can be
related to individuals who purchase or consume products and services; however, in
terms of buyer and consumer, there is a slight difference. Buyers are the people
who are acting either as ultimate, industrial or institutional purchasers. The latter
one, consumer, refers to individuals who purchase for merely ultimate use, which
is more restrictive in terms of meaning; that is, the end users for whom the
products or services are ultimately designed for.

Consumer buying behavior:

Consumers have to make countless decisions every day and thereby have to cope
with increasing information overload. They therefore develop certain habits, which
are shortcuts and used in decision making, to cope with this mental overload. The

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consumer decision-making process comprises the various steps a consumer passes
through when making a purchase decision.

Inevitably, businesses encounter bottlenecks where the message is not reaching

their consumers and prospects, with the fact that, at times, consumers and
prospects are facing significant blocks in their decision process. If not, each of
them should be fully committed, loyal, enthusiastic, repeated consumers; however,
this is not the case. Today the accessibility and transparency of information has
profoundly influenced the decision making process; therefore, it is important to
examine what are the hurdles and fiction points that hold prospects becoming
consumers, or keeps consumers hesitating from repurchasing.

Engel, Kollat, and Blackwell (EKB) have presented a comprehensive model

dealing with ultimate consumer‘s behavior in 1978, which attempts to capture the
critical aspects of individuals‘ consumption behavior.

Consumer buying behavior is usually divided into five stages –

1) Problem recognition,
2) Search of information,
3) Evaluation of alternatives,
4) Final decision, and
5) Post purchase decisions

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 Figure 1 Consumer buying process model

1. Need Recognition:
The need is a source or force of buying behaviour. Buying problem arises
only when there is unmet need or problem is recognized. Need or problem
impels an individual to act or to buy the product.

Buyer senses a difference between his actual state (physical and mental)
and a desired state. The need can be triggered by internal or external
stimuli. Internal stimuli include basic or normal needs – hunger, thirst, sex,
or comfort; while external stimuli include external forces, for instance,
when an individual watch a new brand car, he desires to buy it.

Marketer must identify the circumstances that trigger a particular need. He

can collect information from a number of consumers regarding how stimuli

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spark an interest in products. Based on information, he can develop
marketing strategies to trigger consumer interest.

2. Information Search:
Interested consumer will try to seek information. Now, he will read
newspapers and magazines, watch television, visit showroom or dealer,
contact salesman, discuss with friends and relatives, and try all the possible
sources of information.

Mostly, the consumer can try one or more of following sources of

information:

i. Personal Sources:
They may include family members, friends, package, colleagues, and
relatives.

ii. Commercial Sources:

Advertising, salesmen, dealers, package, trade show, display, and
exhibition are dominant commercial sources.

iii. Public Sources:

Mass media (radio, TV, newspapers, magazines, cinema, etc.), consumer-
rating agencies, etc., are main public sources.

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iv. Experimental Sources:
They include handling, examining, testing, or using the product. Selection
of sources depends upon personal characteristics, types of products, and
capacity and reliability of sources. Each information source performs
different functions in influencing buying decision. By gathering
information from relevant sources, the consumer can learn about different
products and brands available in the market.

Note that consumer will not collect detail information on all the brands
available in the market. He scrutinizes all the brands in sequence, like total
(brands) set to awareness set to affordable set, and to choice set. Consumer
collects information only on limited brands, say, choice set.

Marketer must try to get his brand into the prospects’ awareness set and
choice set. Moreover, the company should identify sources and their
relative importance. Company must ask the consumers regarding types of
sources they exercise. They can elicit valuable information about sources
they normally use and their relative value. On that basis, effective
communication can be prepared for the target market.

3. Evaluation of Alternatives:
In the former stage, the consumer has collected information about certain
brands. Now, he undergoes evaluation of brands. He cannot buy all of
them. Normally, he selects the best one, the brand that offers maximum
satisfaction. Here, he evaluates competitive brands to judge which one is

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the best, the most attractive. Evaluation calls for evaluating various
alternatives with certain choice criteria.

Following criteria are considered while evaluating alternatives:

i. Benefits offered by the brands

ii. Qualities, features or attributes, and performance

iii. Price changed by various brands

iv. History of brands

v. Popularity, image or reputation of brands

vi. Product-related services offered by the brands, such as after-sales

services, warrantee, and free installation

vii. Availability of brands and dealer rating.

Different criteria are used for different products. For example, if a person
wants to purchase a motorbike out of Enfield Bullet 350; TVS Victor, TVS
Centra, Suzuki Ferro; Hero Honda Spender, Ambition, and CBZ;
Kawasaki Bajaj Boxer, Pulsar and Caliber; LML Freedom, etc., he will
consider following criteria:

i. Price

ii. Pick-up and performance

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iii. Facilities and comfort

iv. Gear-transmission system

v. Get-up/appearance

vi. Speed per hour

vii. Average per liter petrol

viii. Maintenance costs

ix. Image, status and novelty

x. Safety

xi. Resale value

xii. Services, guarantee, warrantee, etc.

The brand that meets most of the above conditions reasonably is more
likely to be preferred. Marketer should highlights superior features of his
brand. Some companies also advertise comparative table to help
consumers evaluate various brands. For example, Yamaha, Maruti, and
Hyundai provide comparative table in newspapers to show how the
bike/car is superior to other brands.

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4. Purchase Decision:
This is the stage when the consumer prefers one, the most promising band,
out of several brands. The former stage helps consumers evaluate various
brands in the choice set. The brand that offers maximum benefits or
satisfaction is preferred.

Simply, the most attractive brand, that can offer more benefits in relation
to price paid, is selected by comparing one brand with others. Comparison
shows superiority/inferiority of the brands.

Now, consumer makes up his mind to purchase the most preferred brand.
However, three factors further affect whether buying intension result into
actual purchase. More clearly, the consumer’ decision to avoid, modify, or
postpone a purchase decision is influenced by these factors.

The first factor is attitudes of others. The impact of other persons’ attitudes
depends on degree of their negative attitudes toward the consumer’s
preferred brand, and consumer’s degree of compliance with other persons’
wishes.

The second factor is unanticipated situational factors. Purchase intension

may change due to certain unanticipated situational factors like price hike,
loss of job, family income, major medical expenses, non-availability of the
preferred brand, or such similar factors.

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The third and the last factor is consumer’s perceived risk. Degree of risk
depends on price, attribute uncertainty, entry of a new superior product,
and his self-confidence.

Sub-decisions in Purchase Decision:

Consumer’s buying decision involves following five sub-decisions:
i. Brand Decision,
ii. Vender Decision,
iii. Quantity Decision,
iv. Timing Decision,
v. Payment Decision

5. Post-purchase Decisions:
Consumer buys the product with certain expectations. Though he decides
very systematically, there is no guarantee of a complete satisfaction. There
is always possibility of variation between the expected level of satisfaction
and the actual satisfaction. His subsequent behaviour is influenced by
degree of satisfaction/dissatisfaction.

Marketer must monitor the post-purchase experience of the buyers

that includes:
a. Post-purchase Satisfaction

b. Post-purchase Action

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c. Post-purchase Use and Disposal

Post-purchase Satisfaction:
Actual satisfaction may not be equal to the expected one. He may find
some problems or defects in the product while using. It is the matter of
interest for marketer to know whether consumer is highly satisfied,
somewhat satisfied, or dissatisfied. Consumer’s satisfaction is the function
of the relationship between expected/perceived performance (expectations)
and actual performance.

The larger the gap between expectations and performance, the greater the
consumer’s dissatisfaction will be. The consumer is satisfied when product
meets or exceeds all the expectations and vice versa. If he is satisfied, he
buys the product again, and talks favourably. In order to minimize the gap
between expectations and performance, the seller must not exaggerate the
product benefits; must make truthful claim of product’s likely
performance.

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3. Social Media:

Social media refers to means of interactions among people in which they create,
share, and exchange information and ideas in virtual communities and networks.
Social media depends on mobile and web based technologies to create highly
interactive platforms through which individuals and communities share, co-create,
discuss, and modify user-generated content. The structure of social media includes
consumer’ profiles, friends and groups within social networks, interactions among
group members, and opt-ins and opt-outs that people use to control the information
they post or receive online.

Social media and consumers :

Has the emergence of social media changed consumer behavior? If yes, in what
direction? Are the concepts relevant in the era of social and digital branding?

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These are some of the basic questions that need to be addressed before we go
through the consumer behavior concepts. While social media has had a profound
impact on how consumers behave towards brands and the market place, the
appreciation for the basics of consumer behavior have only become stronger. In
this digital era, social media is a tool through which consumers interact and the
decades old concept of reference groups has come alive in consumer behavior.
This is an example of how classic concepts are being considered.

Content co- creation with the involvement of the consumer may work with brands
like Nike and BMW but may not work for all brands. Kingfisher beer may bring
consumers together on social (digital) platform through a comic theme but similar
approaches may not work for all brands. A brand like Coca–Cola needs to follow
an approach that is different than the one associated with Fastrack when it comes
to Synergizing online digital with conventional communication process.

Figure 2. Social media components (Dann and Dann 2011, 345)

A Neilsen study indicated that about one third of consumers found ads on social
networks annoying. However, 26% were more open to ads recommended by

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friends, another 26% said that they did not mind being identified based on their
social media profiles, and 17% felt connected to brands advertised on social
networking platforms.

Most brands now have official Twitter handles and facebook pages. Companies
have discovered that customers are highly enthused about and more responsive to
Twitter messages from the corporate bosses, especially if such messages encourage
consumers to tell the senders about their experiences with the brands. Some
companies have decided that centralizing social media communication is
impractical, so they train and empower their employees to participate in social
conversations with customers, within defined guidelines.

Most companies selling consumer goods have integrated social media into their
advertising campaigns. Established brands – such as Coca-Cola, Volkswagen,
At&T, etc. – are directing viewers of their ads to their Twitter messages or
Facebook pages, sometimes with sophisticated cloud based ad platforms. The
growth of social media has also changed long-standing practices. In the not-for-
profit sector, during one of the most destructive hurricanes in history, transit
agencies used social media extensively to calm irate riders and keep them
informed.

One of the myths regarding social media has been that it reaches only young
consumers. However, the age gap on social networks has been narrowing rapidly.
In one year, only 9% of internet users 55 to 64 years old used social networking,
but 43% this age group reported doing so two years later.

Social Media Communication Channels

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There are several types of social media channels:

1. Owned social media, which consist of messages sent by marketers to

consumers via channels that the marketers control.
2. Paid social media, which consist of messages sent via channels that are not
owned by marketers, who pay for using the channels.
3. Earned social media, which are channels where consumers pass along
messages about brands to one another.
Commonly, when using paid social media, an advertiser pays the social
network only after users click on its ads. However, more and more
advertisers prepay for large blocks of ads placed on social media users,
pages or sent to them via live news feed.

The most widely used platforms to transmit social message are:

1. Branded blogs and micro-blogging platforms that encourage interactions
among consumers; these message resemble conversations.
2. Social networks such as Facebook and Myspace.
3. Widgets, gaming, and other applications that users can download.
4. Mobile phones

Social Media And Marketing

Social Media Marketing is an umbrella term that can be described as the utilization
of social media platforms as marketing tools. According to Weinberg (2009), he
refers social media marketing as leveraging the ‘social’ through the ‘media’ to
‘market’ businesses’ constituents; in other words, it is a process in empowering
individuals to promote their websites, products, and/or services through online

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social channels, to interact with and to tap into a much larger community that may
not have been available via traditional advertising channels. It is no longer a
striking fact that most of the advertisements via mass media are not as efficient as
in the past, because by advertising through the mass, the message is generally
reaching far more people than the potential customer intended to reach (Weber
2009; Weinberg 2009). Social web is where people with a common interest can
gather to share thoughts, comments, and ideas; hence, instead of continuing as
broadcasters, marketers should become aggregators of customer communities; that
is, the Web should not be considered as a mere advertising channel, it is a place
where marketers can listen and respond to communities, review contents, as well
as promote a particular piece of content within the vast social sphere (community
building) (Weber 2009).

What makes social media marketing special?

Upon the insufficient advertising budget that companies oftentimes encounter via
the traditional channels, social media marketing might be, particularly, easier and
more effective for small and medium-size companies to take maximum advantage
of it. While social media marketing is an evolving technology with much potential,
yet marketing’s role still reminds the same – defining the target market,
communicating with prospects, building loyalty, customer engagement and so on.
(Weber 2009).

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4. Review of Literature

Based on Rockendorf, 2011, thus social media becomes a hub for

market intelligence as marketers begin to understand consumer’s purchasing
behavior and gain insight as to why consumers feel the way that they do about
certain. This article examines the SMM tools, role of online advertisement, online
communities, and E-word of mouth influencing consumer’s brand loyalty and
intentions to purchase.
Regarding to Forbes & Vespoli, 2013, The influence of social media on
buying behavior can be in any services or products. Quality, brand,
advertising or price could affect consumer decision-making. The results of
this research present that consumers are buying either inexpensive or expensive
items, and are doing so based on recommendations from social media by their
contacts or friends on social media.

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 According to Taining, 2012, the relationship between social media and
consumer decision-making present that social media affects advertising
attitudes, brand attitudes, and purchasing intentions of consumer. It will not
necessarily affect consumer’s decision-making, but might possess a mediating
effect.
Social media can build brand attitudes that affect buying behavior. The good
image of brand or product can lead the consumer to make decision on their
purchases. When consumer’s friend on social media shares or recommends
services or products on their social media, it affects brand attitude and influences
their decision making. Yet, advertising on social media, which is provided by
commercial sources affect both consumer brand attitudes and purchasing intention
(Yang, 2010).
marketers begin to understand consumer’s purchasing behavior and gain
insight as

The information consumers share on social media, helps marketers plan their
marketing strategies. Many marketers use social media for marketing campaigns. It
is the easy way to communicate with consumers; also it is inexpensive to
advertise their brands or services. Social media is not only for advertising, but it
can also be a tool for brands or services to connect with their consumers. Another
study shows that social media allows consumers and prospective consumers to
communicate directly to a brand representative. Since most consumers are
using the social media as tool to search and purchase items, brands or services
use this advantage to advertise their products.

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The online consumer is a booming market worldwide; however it is giving a
globalized level of segmentation cross-culturally (Vinerean, Cetina &Tichindelean,
2013).

If they have some problems on products or services, consumers could reach the
company via social media, which is an easy way to connect and contact with them.
Companies are challenged by how they chose to react to comments or responses
on social media. Their reactions and responses can build strong brand images
and get more consumers to purchase products or services. When a consumer
wants to make decision on product, every single detail could be an influence to
their decision-making. Consumer motives for engaging in social media provide
insights into consumers’ activities. Consumers have three main gratifications or
motives for using the Internet as a medium, namely, information, entertainment,
and social aspects (Heinonen, 2011).

The motivation is in two main groups: rational motives, such as knowledge-

sharing and advocacy, and emotional motives, such as social connection and
self-expression (Krishnamurthy & Dou, 2008). Consumers’ activities in social
media have been found based on consumers' conduct online. Nowadays
consumers are using Internet as their tools to achieve their motivations.
motivation could be connected to their old friends, business, or reviews to
support their decision-making. Reviews on social media become second-hand
resources to support social media not only affect too expensive items, but also
inexpensive items as well. People can see the reviews on cosmetics, books, cars,
hotels, or even nail polishes. Those reviews can motivate purchases or supports
consumers decision-making by make it more reasonable to views on spend the
money on it.

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Social media does not only effect consumers’ decision making on products or
services, but also it helps in other fields of studies or careers such as political or
juror impartiality and fair trials too. In context of justice system, the easily
accessible nature of the Internet has results in jurors having the ability to consult an
online social media source in order to aid their decision-making and deliberations
(Simpler, 2012). Social media helps juror to broadcast their options about ongoing
court. Jurors find some advantages of information or any evidence that can
support their decision and help them making their decision. Twitter is the most
important for sharing news, and information, which is up-to-date. This information
may not be confirmed that it is true or not true but at least it will give the jurors the
idea and know what other people think about the case. Today researchers have
found that social media helps jurors to have a wide open vision of the case and can
also influence to the juror’s decision-making (Simpler, 2012).

consumer’s decision-making because they want they want value from their dollar.
Re
Another study examined the effect of social media on a person's decision-making
by sharing health information on news and social media. The study observed the
coverage of influenza vaccination on Dutch news sites and social media websites.
Dutch news sites and social media websites were promoting the campaigns of
influenza vaccine during February, March, and April, 2012. From this study
the results showed that news media and social media give different tones in
messages. News media reports tended to be more objective and non-
judgmental, while social media more critical of behaviors of Internet users and
may influence the success of vaccination campaigns and recommendations
made by health authorities (Lehmann, Ruiter & Kok, 2013).

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However, this study concludes that it was a first step in e-Health announcements.
People tend to respond to the news on social media more than news media. It is
attractive and influences people on their decision-making due to the Internet and
might be an important source of health information.

Since people can’t try travel-related products and services before they
consume them, dynamic processes with various amounts and types of
information sources have been used (Fodness, & Murray, 1977).

Many studies have found that many travelers used social media as a guideline for
their trip. Reviews of places, hotels, transportation, food, or restaurants could have
large affects on traveler’s decisions. Travel organizations and businesses
have used social media as a communication tool for their audience by
posting travel information; uploading photos, warnings, advice, or sharing
personal traveler reviews. Those things can influence trip's decisions and even
create future trip destination impressions. Fifty-eight percent of U.S. online
travel used ratings for their travel information: 49% of them checked reviews and
recommendations: 18% used photos and friends’ social network sites: 12% read
Blogs: and 5%watched videos (eMarketer, 2007).

Venkatesh, Speir, and Morris (2002) showed the theory of social influence affected
person’s decision-making. People participating in social media Activities are
usually in communities and appear to be socially influenced by the community
group members. Social influence is defined as the degree to which a person
believes that person to perform a particular behavior (Venkatesh, Speir, & Morris,

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2002). From the social theory, it shows the support of the idea that social media
has become a key influence in a person's decision-making process..., they need
confirmation on what they decide is the best.

Social media are the two-way communication platforms that allow users to interact
with each other online to share information and opinions. Social media are online
applications, platforms and media which aim to facilitate interactions,
collaborations and the sharing of content (Richter & Koch, 2007). Social media are
changing the way society consumes and contributes to the creation of information.
Technology now allows individuals to easily contribute their thoughts, opinions
and creations to the Internet. This has radically altered the way in which
information is created and disseminated (Buhalis & Law, 2008Buhalis, D. and
Law, R. 2008.) Understanding the role of social media in the context of marketing
is critical for both researchers and managers (e.g. Fong & Burton, 2008; Kumar,
Bezawada, Rishika, Janakiraman, & Kannan, 2016; Schultz & Peltier, 2013).

Safko and Brake (2009, s.6) define social media as ‖activities, practices & behavior
among communities of people who gather online to share information, knowledge,
and opinions using conversational media‖. According to Robinson (2007) social
media are the tools used for communication that have Web 2.0 attributes that is,
they are participatory, collaborative, and have knowledge sharing and user
empowering tools available on the Web. As an effective use of time and resources,
social media marketing give companies‘ better communication grounds with the
consumers to build brand loyalty beyond traditional methods (Jackson, 2011;
Akhtar, 2011). A study by Info-graphics puts forward that at least half of Twitter
and Facebook users say they have become more likely to talk about, recommend or

32
purchase a company's products after they began engaged with the company on
social media (Jackson, 2011).

Businesses can promote products and services, provide instant support, and/or
create an online community of brand enthusiasts through all forms of social media
such as social networking sites, content communities, virtual worlds, blogs, micro
blogging sites, online gaming sites, social bookmarking, news sites, forums and
more (Zarella, 2010; Kaplan and Haenlein, 2009; Weinberg, 2009). Additionally,
social media enables consumers to share information with their peers about the
product and service brands (Stileman, 2009; Mangold and Foulds, 2009). These
conversations between the peers provide companies another cost effective way to
increase brand awareness, boost brand recognition and recall, and increase brand
loyalty (Gunelius, 2011). Thus, it can be said that social media helps firms to build
brand loyalty through networking, conversation, and community building (McKee,
2010). As their use increases exponentially, not only existing social networkers but
even business firms and governmental organizations are joining and using them as
communication tools. Unlike individual social networkers, these entities actively
make use of the media for advertising and marketing. While commercial messages
and interactions with consumers partner with media, events, entertainment,
retailers, and digital services through social media, it is possible to perform
integrated marketing activities with much less effort and cost than before.

Today the accessibility and transparency of information has profoundly influenced

the decision making process; therefore, it is important to examine what are the
hurdles and fiction points that hold prospects becoming consumers, or keeps
consumers hesitating from repurchasing. (Silverman 2001.)

33
Social media influence several components of consumer behavior such as
awareness, information acquisition, opinions,attitudes, but also purchase behavior
and post-purchase communications and evaluation (Mangold & Faulds, 2009). It is
claimed for example that virtual communities, a term used to describe a subset of
social media, serve as reference groups with their power derived from the
heterogeneity of its members, while their influence differs across the various
phases of the consumer decision process (De Valck et al., 2009).

According to social media marketing industry report, the social media realm is
not a mere fad in which marketers are increasingly attracted, 83% of them place
high value on social media of their businesses (Stelzner 2012). The buying
attitudes of consumers are not merely affected by traditional channels but social
media plays an important part in the consumer buying behavior process which is
now highly affected by peer reviews, social networks, blogs etc. Weinberg (2009)
has proposed few reasons to tap into a solid social media strategy in addition to (or
instead of) the traditional ones, which are – facilitation in natural discovery of new
content, boost up in traffic numbers, strong relationship building, as well as a
cheap alternative to traditional marketing.

While social media marketing is an evolving technology with much potential,

yet marketing‘s role still remains the same – defining the target market,
communicating with prospects, building loyalty, customer engagement and so on.
(Weber 2009). Constantinides and Fountain (2008) have suggested an innovative
Stimuli and Response model based on Kotler‘s (1984) framework, due to the
increasing usage of social media. within a traditional shopping environment,
consumers are most likely to be affected by the traditional marketing mix (e.g. ads
on radio, newspaper, television, and so on) and other uncontrollable stimuli (e.g.

34
values, societies, demographics, perceptions, and so on); however, with social
media and Web 2.0, it extends to online marketing mix (e.g. emails, banners,
cooperate websites, and so on) and the social media experiences, which are far
beyond the marketer‘s control. Since the contents on social media are rather
democratic and neutral, according to Vollmer and Precourt (2008), consumers are
turning more frequently to various types of social media to conduct their
information searches and to make their purchasing decisions. Due to the degree of
connectedness and increased communication facilitated by social media and SNSs,
consumers can in essence access the power of the people more readily in relation
to companies through the online communities which have brought them together in
single spaces. Given these factors, Kozinets (1999) argues that building
relationships and engaging in conversations with consumers in online communities
has become increasingly important. This relationship building he calls virtual
relationship marketing‘. In addition, Gillin (2007: xiii) states that social media
presents an opportunity for marketers to converse with customers. Central to this
discipline, which Gillin (2007) refers to as conversation marketing‘, is dialogue.

Conversation marketing‘ will require marketers to approach consumers in a

new way and to not only take from consumers but give back to consumers. The
empowered consumer will expect to receive something of value in return for their
participation. Gillin (2007: xiii) concludes: it means understanding who your
customers are, who influences them and how to engage with those influencers‘. As
a result, it is not the message and pushing it onto consumers that is important but
creating a real and meaningful dialogue with them (Meadows-Klue, 2007).

One of the most important aspects of social media is the conversation that
takes place is dynamic & two ways, which has affected the accessibility &

35
transparency of data in a positive way. Social media enables two way flow of
information and plays an important role in sending, receiving and exchanging
information without any limitations. Since the flow of communication does not
merely impact how companies can access their targeted groups, but also it
influences throughout the entire decision process, from interpreting the message,
searching for available alternatives, as well as actions carried out in the after
purchase; thus, It is important to denote that message rejection, misinterpretation,
and misunderstanding are the possible pitfalls in the flow of communication (Smith
and Zook 2011, 120).

In relating to social media marketing, the biggest fear of companies and

brands is to give up the control over the content, and the frequency of information;
however, it is essential for marketers to realize that reviews and discussions, as
user generated contents, serve to demonstrate a company‘s transparency. (Weber
2007.

5. RESEARCH METHODOLOGY

The objectives of this research are twofold – first to find out the components and
variables involved in decision making process; second to identify the changes that
social media has brought to the decision making process, in which, essentially by
elaborating the difference between marketing via social media and via traditional
ones. This research strives to provide a clearer, and perhaps a better, understanding
to both consumers and companies of why, when, and how social media has

36
impacted on decision making process. It may also offer possible insights for
companies to identify the pitfalls and opportunities in new marketing era.

In essence, the dominant approach of this research involves the development of a

theory that is subjected to a rigorous test, where the theoretical framework provides
the basis of explanation, permit the anticipation of phenomena, predict their
occurrence and therefore allow them to be controlled. (Hussey and Hussey 1997,
52.) Secondary data – theoretical framework serves as the foundation for this
research, and primary data aims to answer the objectives stated in the research and
to provide evidence in supporting the secondary data. The primary data of this
research were collected through questionnaires from individuals in Indore.
Theoretical part regarding steps and components constituting the consumer
decision making process has demonstrated a systematic approach in buying of the
stages individuals would engage in a potential market transaction before, during,
and after the purchase. On the other hand, it has also identified the essence of
social media marketing in which has illustrated a clarification on the change of the
nature in today’s marketing approach, and its effects on purchasing decision.

The empirical part focuses on finding out how individuals in Indore process
information on social media before a purchase, the actions carried out after a
consumption, as well as what are their perspectives regarding the new marketing
era, in particular with social media. By getting a general perspective on the current
buying behavior in Indore, this research also aims to provide new insights
regarding the impacts of social media on different demographics (age and gender)
in the decision making process.

Research design

37
Again, the aim of the survey is to find out how, why, where social media has
influenced individuals in the process of decision making, as well as, hopefully, to
identify new insights that companies may take advantage of. The survey was
carried out in the form of questionnaire.

Since there was only one chance to collect the data, the researcher had to identify
precisely of what data is needed, and to design the questionnaire in order to meet
the research objectives. The questions for the questionnaire were designed and
built closely upon the theoretical framework – decision making process,
information processing theory, and social media marketing, which has discussed
thoroughly in previous chapters of the research. In order to ensure respondent
decodes the questions in the way the researcher intended, the clarity of the
questionnaire structure was a dominant factor.

Since the researcher had to keep an appropriate length of the questionnaire, thus,
not every theory discussed previously could all be included in the questionnaire.
The logical order of the questions was structured mainly based on the steps carried
out during the decision making process – problem recognition, search of
information, evaluation of alternatives, final decision, and post purchase behavior.
Components of information processing theory were integrated in the questions as
well.

As stated in the beginning of the research, the researcher tries to examine the
relationship between social media and consumer behavior from a consumer
perspective, therefore, they are many questions subjected to individuals’ beliefs
and attitudes, which are expressed in the form of scale questions. Considering the
matter of subjectivity, the use of close questions was critical in order to allow
statistical conclusions to be made in a relatively objective manner; likewise, a few

38
open-ended questions allow individuals to develop own responses, and may reveal
attitudes or facts.

6. DATA ANALYSIS

There are two distinct research methods – quantitative and qualitative, in

collectiing data for the purpose of obtaining information from them, to solve or
answer a particular research problem or question. Quaitative data is any data
collection technique or data analysis procedure that generates or uses numerical
data; whereas qualitative data is in form of descriptive accounts of observations or

39
analysis which is conducted through the use of conceptualization. Although it is
usually better to link quantitative data with other methods (such as in-depth
interviews) in order to complement the findings of a research, this research is to
identify the stage where social media has interfered in the consumer decision
making process, in which is to describe facts and reasons in different phenomena
(social media and traditional mass channels) and to explain the case-and-effect
relationship between overwhelming information on social media and consumers’
responses. For the purpose of this research, quantitative data was gathered and
utilized. With the strategy of survey, it allows the collection of a large amount of
data from a sizeable population in a highly economical way, it is also a logical and
critical approach which allows the researcher to control measurement and outcome.
Since the scope of the research focuses on a geographical area; thus the aim of the
research method is to reach individuals ranging in different age and gender groups
within Indore, and the more responses are collected the higher the credibility of the
findings are. Taking the sample size into consideration, the researcher has decided
not to conduct any in-depth interviews with the targeted respondents as the results
may be difficult to analyze due to the subjectivity of individuals’ beliefs and
attitudes.

40
The study was conducted by sending out questionnaire to various people in Indore.
The questionnaire was made using google forms. The response was collected
through it and then evaluated to get the following data.The survey was conducted
between people from various age groups. I sent the questionnaire to 50 people and
received 27 responses. The data collected from the survey is as given below:

The research was conducted among people from various age groups, i.e. from 18
year old teenagers to people who are older than 30. The first question asked was a
general question: Do you actively use social media platforms? Most people (about
80%) answered yes. Only 11% respondents said that they do not use social media
actively.

41
The above charts show the how people responded to the question. According to the
graph for question 2 about 71 % people actively use media sharing sites i.e.
youtube etc. Now a days almost all media sharing sites are displaying ads which
cannot be skipped, unless you make a premium account. But not every person can
make a premium account for every application or website. Which means, that at
least half of the people using media sharing sites, are subjected to watch a 30
second advertisement every half hour. This means of advertising has been opted by
many industries.

42
When asked if social media is a better place to promote a product about 70% of
respondents agreed. 14% were neutral about the matter while 7% disagreed with
the statement.

The researcher also asked people if they were likely to believe reviews from social
media. Only 25% said that were likely to believe bad reviews on social media
while 14% said they would not. While the other 59% replied, maybe. This shows
though people may look up information regarding a product on social media, they
do not believe it to be always correct.

When the researcher compared social media to mass media comparing the
information available on both, the respondents agreed that social media is a better
and easier way to get information regarding any product or service.

43
the researcher also asked respondents if they would share an ad or content
regarding a product on social media if they liked it. Less than half of the
respondents said they would share the content with their friends or families the
others half said maybe and 14% said they wouldn’t. This shows that people are
more inclined to share thing that they have a personal connection to rather than
sharing something they saw online, even if they liked it.

44
The researcher also asked if companies should continue social media marketing,
88% people said yes. The other respondents replied maybe. This shows that
though advertisement on social media may be an inconvenience to people, they
still find it useful enough to ask them the companies to continue doing it.
When asked if social media marketing is better than mass media, 80% said yes.

Since this research was limited to only a few people, the researcher referred to
existing research papers to get a better idea on how social media affects consumer
behavior. An existing research by Lee Ethel (2018), showed that consumers felt
connected to the industries through social media.
When asked about post purchase actions, responders said that social media is a
good place to give feedback regarding a product. Many individuals have noticed
and agreed that with social media, they are able to voice out their opinions and to
communicate with other consumers and with the company more effectively.
However, again, many of them have felt not encouraged to voice out their
feedbacks and to pass along their comments to peers, friends, or family members
via social media.

45
7. LIMITATIONS

With regard to the objectives, conducting the research from the perspective of
consumers would be a considerably suitable approach. The researcher realizes that
there are many available reports and studies which rather aims to help businesses
to gain a better understanding in social media marketing but not to help consumers
to identify reasons that social media has changed their decision making process.
Since the purpose of marketing is, in sum, about consumer; therefore, by having
the starting point from the perception of consumer, and by collecting data from
consumers’ point of view, fresh insights can be gathered. The research also aims to
serve as an indicator to potential readers (companies) of how they can tab into the
decision making process via social media sites.

The first limitation of the research is that the research was conducted at a particular
place with a small population to conduct the survey. Hence the data collected may
vary if the research was conducted with a large population.

Factors, such as technology, infrastructure, cultural values, norms, and so forth,

across continentals are different, the implication of this research may vary in
countries and regions accordingly; but the research targets at a geographical area,
Indore, where individuals share a similar background within a standardized
infrastructure. The research focuses on the behavior of end consumers (individuals)
and particularly within the retailing industry, for instance clothing, food and
beverage, consumer electronics, and so on. This a limitation of the research
because the result of the research may vary when conducted elsewhere.

Social media marketing is no longer a new aspect, and yet it is still considerably a
developing and evolving topic in the field. With a quick literature scan on the

46
related topic, indeed there are vast amount of journals and articles, but with few
scientific/academic research and classical literatures about social media marketing
associating with changes of consumer behavior. Thus, this would be another
limitation of the research that the discussion on the topic is rather in a general
manner.

47
8. CONCLUSION

The motive of the research was triggered by personal interest in how consumer
behavior has changed in the Digital Age, in particular with social media. The
amount of information available to us increases in each new day, as a result, we are
overwhelmingly exposed and attained to different aspects of information via the
Social Web. The accessibility and transparency that social media offers has led
changes in how consumers position themselves in today’s market, in which it is
inevitable and necessary for companies to equip with a new marketing mindset.
The central gravity of the research was to explain why, when, and how social
media has impacted on consumer decision making process both in theory and in
practice.

There is a generous amount of reports relating to social media marketing which are
primarily aimed to help businesses benefit from this marketing trend. Oftentimes,
businesses assume that they are on the right track in the new marketing era, for
instance engaging customers by creating a Facebook page; in fact, customers may
not share the same picture as businesses may have.

Therefore, the research was carried out in the perception of consumers (in Indore),
which was aimed to explain the impacts of social media on different stages in their
decision making process, by finding out how consumers perceive social media in
the entire process.

Essentially, the theoretical framework of this research was built upon consumer
buying model and the changes social media has predominately brought to
marketing. The five stages in the buying model served as a basis of the logical

48
order of how the survey was carried out and the theories in social media provided
guideines on which set of questions would grasp the research questions.

The objective of the research was to to explain why, when, and how social media
has impacted on consumer decision making process. Research questions were
designed to narrow down the subject and to help the researcher to identify the
explanations of the issue.

To begin with, social media has brought profound changes to both consumers and
businesses, the findings of this research are consistent with the theories presented
in the theoretical framework.

The existing literature and the data analysis of the research have both proven that,
no matter it is in association with social media or mass media, consumers are
highly selective in attending, process, and selecting the information before a
purchase takes place. Information exposure is highly selective in the initial stage of
information, because consumers have the selections of information source, in
which determinates the type of information that consumer will be exposed to. To
be noted, personal attitude is a crucial factor which underlines during the course of
information acquisition and evaluation. As a result, not only judgments regarding
products or services are presumably based, but also it is an vital determinant of the
information consumers will seek out, in which it eventually affects the extent of
the information reception.

At the essence, all platforms available on social media have offered a two-way
communication flow, which is highlighted theoretically and practically.
Consequently, this principle feature of social media has created a new landscape in

49
supporting the socialization of information, and has forced marketers to give up the
old mindset in dealing with mass media marketing.

Finally the core objective of the entire research was to find out the changes that
social media has brought to consumers in each stage of their decision making
process. In theory, information exposure through mass media is considered as a
passive process as individuals are exposed and receiving information
unconsciously. However, when consumers seek out information initiatively, it is
perceived as an active process. In the research findings, consumers play an active
role in the course of information acquisition because of the accessibility and
availability of information on social media platforms.
The accessibility and transparency of information that social media has offered to
consumers have been indicated throughout the entire research. Consumers are able
to access to relevant information not only in a great range but also in a faster speed,
which mass media consumes more time in searching information. In contrary,
contents are not in control and monitored, thus the chance of getting fasle and
nonfactual information which the consumers have shown concern of. In terms of a
business context, marketers have to be aware of the bad mouth on social media,
because it can be spread virally and led to a damage to brand’s reputation.

The research finding has revealed the current situation concerning consumers’ post
purchase behavior. Many individuals have noticed and agreed that with social
media, they are able to voice out their opinions and to communicate with other
consumers and with the company more effectively.

To conclude, from the findings of this research, it can be observed that consumers
in Indore are actively utilizing social media platforms as a tool in validating of the

50
purchase decisions; however, consumers are deemed to be inactive in sharing their
word of mouth to others with the available social media platforms. The consistency
in the gathered data and time-honored theories relating to consumer behavior and
contemporary frameworks regarding social media marketing, it has suggested that
the essence of consumer behavior still remains the same even after the advent of
social media, in which individuals have to go through the all the stages before a
purchase, instead of straight to the purchase decision once a thought of purchase
being triggered.

Future Research

Considering the limited time and scope of this research, many theories related to
the subject were covered but in a rather general perspective so as to provide a big
picture for the readers. Therefore, if further research could be conducted, then an
in-depth survey should be carried out in tackling the research objective.

It would be undoubtedly useful and interesting to have a case company as a

reference of the research. By studying the case company, it may offer a comparison
between what company thinks it is working out, and what does its consumer
actually perceive? Would the result reflect a diverse perception from two different
parties in regards of social media and decision making process? The results could
help company to gain evident insights and to identify actual tactics to tackle the
situation.

Nonetheless, if further research could be conducted for companies, then theories

could be implied more accurately, because some of the theories are proposed and
developed in aiming to help companies to gain a better position in the transition

51
from the traditional marketing approach to the new marketing mindset. In that
case, findings and conclusions could be drawn without vagueness.

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