Capitolul I

Promovarea în Social Media
1
Cuprins
Capitolul I – Motivaţia ........................................................................................... 3
Capitolul II – Bibliografia parcursă ........................................................................ 4
Capitolul III - Sinteza literaturii de specialitate ...................................................... 5
Particularităţi privind diferenţa dintre promovarea online şi cea offline .............. 6
Social Media ca şi mediu de promovare .............................................................. 7
Analiza rezultatelor cercetării în funcţie de impactul creat .................................. 7
Capitolul IV- Analiza de ramură şi piaţă ................................................................ 8
Ramura- Descrierea firmei existente ................................................................... 8
Misiunea Firmei............................................................................................... 9
Resursele : Umane, Tehnico-materiale şi financiare......................................... 9
Linia de produse şi servicii .............................................................................10
Mixul de marketing.........................................................................................10
Piaţa ...................................................................................................................10
Profilul clientului ............................................................................................11
Indicatorii globali ...........................................................................................11
Capitolul V- Direcţii viitoare de cercetare. ............................................................12
ANEXE ................................................................................................................12
2
Capitolul I – Motivaţia
Tema în cauză doreşte să abordeze analizarea şi fundamentarea măsurilor de promovare

în cadrul mediului online (Social Media) cu socpul de a reliefa aspectele generale ce ţin de
implementarea unui plan de advertising cu scopul de a creşte productivitatea şi a, analiza
metodele prin care pot fi realizate acestea.
Ca şi prim aspect, o firma ar aloca fondurile financiare necesare pentru a realiza aceasta
analiza, deoarece, dupa cum putem observa în toate domeniile de activitate economică,
necesitatea promovării unui produs sau firma, este esenţială. Pentru a avea succes în cadrul
pieţei, trebuie realizata o abordare asupra perspectivei ce ţine de consumatorul în cauza. Aici
apare problema de promovare, esenţială pentru a avea succes. Totodată, dinamica mediului
online, utilizarea sa ma intensă odată cu trecerea timpului şi creşterea avansului tehnologic, face
ca acest domeniu să evolueze exponenţial.
În ceea ce priveşte cel de-al doilea aspect, facem referire la posibilitatea ca o firmă ar
putea aloca fondurile necesare, pentru acest studiu. Aceasta ar înainta doar dacă aplicabilitatea
acestuia este realizabila, şi rezultatele fiind conforme. Noile generaţii tind să se orienteze spre
promovarea în acest domeniu, una mult mai dinamică. Lucrarea prezentă este orientată către
aceste aspecte, şi va fi în conformitate cu noile trenduri de piaţă.
3
Capitolul II – Bibliografia parcursă
 The impact of online display advertising and paid search advertising relative to
offline advertising on firm performance and firm value -2020 Published by
Elsevier B.V
 A Review of Digital Brand Positioning Strategies of Internet Entrepreneurship in
the Context of Virtual Organizations: Facebook, Instagram and Youtube Samples
2019 The Authors. Published by Elsevier B.V
 Exploring the role of social media for SMEs: as a new marketing strategy tool for
the firm performance perspective Dilhan Öztamura , İbrahim Sarper Karakadılar
Nişantaşı University, İstanbul, 34030, Turkey
 Measuring the effectiveness of online advertising campaigns inthe aspect of e-
entrepreneurship Magdalena Rzemieniak ublin- University of Technology: ul.
Nadbystrzycka 38, 20-618 Lublin, Poland
 Using statistical reasoning techniques to describe the relationship between
Facebook advertising effectiveness and benefits gained Ahmet Ertugan - Faculty
of Economics and Administrative Science, Near East University, Nicosia, North
Cyprus, Mersin 10 Turkey
 Social Media in an Alternative Marketing Communication Model Cristina
Castronovo Johnson & Johnson Inc - Toronto, Canada Lei Huang Dalhousie
University, Canada
 PARTICULARS OF PROMOTING IN THE SOCIAL MEDIA - Cristian,
Morozan, Mihaela Asande
 Social Media Marketing - Dr. M. Saravanakuma , Dr.T.Sugantha Lakshmi - Life
Science Journal 2012
4
Capitolul III - Sinteza literaturii de specialitate
În zilele noastre internetul a devenit un mediu universal de comunicare prin reţelele de

social media, ce câştiga teren în detrimentul reţelelor clasice de comunicare (televiziune, radio,
ziare, etc) Prin intermediul acestuia se poate realiza şi suportul de promovare, fiind un mediu ce
are o dinamică aparte, într-o primă instanţă de la individ la individ, şi în cea de-a doua de la
organizaţie la individ.
Social media a avut o creştere exponenţială în ultima decadă, prin crearea unor noi
platforme de comunicare, şi totodată acesta a devenit un mediu foarte eficient în ceea ce priveşte
promovarea atât a produselor cât şi a serviciilor.
Putem aduce în discuţie o serie de motive prin care mediul online cât şi social media sunt
platforme esenţiale pentru promovare. A devenit clar faptul că organizaţiile îşi axează
promovarea prin social media, argument susţinut de simplul fapt că bugetele firmelor,
organizaţiilor devin din ce in ce mai mari de la an la an în ceea ce priveşte advertisingul online.
Un motiv important pentru această creştere este dat de faptul că utilizatorii caută raspunsuri
rapide la intrebările lor, în ceea ce privesc diferitele produse şi servicii. Promovarea prin social
media este eficientă datorită mesajelor promoţionale adresate prin platformele de socializare, ele
fiind clar definite pentru fiecare tip de utilizator, în funcţie de perspectivele, cautările, şi
comportamentul acestuia. Mai bine spus promovarea în social media este una subiectivă adresata
direct către individ sau grupuri de indivizi.
Este demn de arătat şi faptul că, în cadrul unei campanii publicitare prin intermediul
social media, se pot măsura rezultatele cu o acurateţe ridicată. Spe exemplu prin măsurarea în
timp real al informaţiilor se poate schimba strategia de promovare, în cazul în care aceasta nu are
rezultatele aşteptate. Această posibilitate are ca scop simplul fapt că se pot reduce costurile, şi
astfel campania va avea succes. Spre deosebire de celelalte medii de promovare, în cazul în care
campania nu aduce rezultatele preconizate, perspectiva asupra pieţei nu este una conformă.
5
Particularităţi privind diferenţa dintre promovarea online şi cea offline
Enunţate anerior avantajele şi dezavantajele promovarii online cat şi a promovării clasice

putem evidenţia o serie de particularităţi raportate la aceste doua tipuri de advertising. Ambele au
atât avantaje cât şi dezavantaje. Un avantaj al promovării offline este dat de faptul că se poate
evidenţia mai bine faţă de concurenţă în mintea consumatorilor.
Ea crează în mintea acestora brand awareness, deoarece oportunităţile plasării reclamei

(televiziune, radio, ziare) conferă o acoperire mai mare. Totodată un avantaj al promovării online
este dat de abilitatea acesteia de a avea prin cautări platite (paid search) un reach mai mare.
Pe baza unui studiu realizat în 2017, s-au cules date de la 1651 de firme din 11 sectoare
economice diferite. Perioada de referinţă este 2010-2016, fiind comparate 3 tipuri de promovare,
cea de afişare online, promovare platită, si promovare clasică.
Pe baza datelor centralizate putem observa faptul că în cadrul targhetării, a plasării, a răspunsului
direct şi al impactului catre individ, promovarea online are per total o acoperire mult mai mare
faţă de promovarea clasică
Cercetarea ofera cateva aplicări ale teoriei în practică. Având în vedere, în cazul unei
firme în ceea ce priveşte dezvoltarea pe termen mediu şi lung, se observa prin analiza datelor
financiare faptul că fluctuaţia de la nivelul vânzărilor este una redusă, creşterea fiind sustenabilă.
Observarea nu se referă doar un subansamblu al firmei, ci ca şi întreg.
Un alt argument este dat de faptul că pe baza cercetării putem evidenţia clar că eficienţa
promovarii online este net superioară faţă de cea clasică, dată de faptul că pe termen lung,
rezultatele sunt incurajatoare.
În timp ce promovarea online generează mai multe efecte pozitive decât cea offline este
de înţeles faptul că firmele şi-au crescut bugetele pentru acest tip de publicitate.
6
Social Media ca şi mediu de promovare
Eforturile în domeniul Social Media au luat amploare de-a lungul timpului, şi prin
intermediul platformelor specifice sa făcut posibilă o mai bună înţelegere a curentului.
Companiile utilizează acest mediu ca şi unealtă de marketing pentru a genera profit. Pentru a
realize aceasta, sunt necesare platformele în cauză, ce în ziua de astăzi sunt prezente peste tot.
Platformele sunt indeosebi axate pe socializarea între indivizi, ele fiind pe diferite
categorii cum ar fi cele de mesagerie, socializare, informare etc. Demn de remarcat faptul ca
majoritatea promovarii se realizează în cadrul platformelor de socializare, acestea fiind mediul
cel mai prielnic. Concluzia este susţinută de faptul că majoritatea utilizazorilor petrec cel mai
mult timp în aceasta nişă. Totodată construcţia în sine a acestora permite plasarea de advertising,
şi totodată monitorizarea poate fi realizată prin intermediul accesărilor şi monitorizarea
ecranului.
Analiza rezultatelor cercetării în funcţie de impactul creat
Pe baza cercetării documentaţiei putem observa impactul afişării publicitare.Acesta

presupune identificarea comportamentului consumatorului. Aceasta se realizează prin
intermediul istoricului motorului de căutare. Analiza acestuia va ajuta ca firma sa işi regleze şi să
gestioneze raportul dintre aceasta şi consumator. Prin această tehnică se poate trimite
consumatorul către un anumit tip de produs. Putem confirma faptul că tehnica are un efect
pozitiv, în sensul dat de consumator, acesta de a repeata achiziţionarea. Aşadar afişarea are un
impact pozitiv atât pentru performanţa firmei cât şi valoare de piaţă a firmei.
Ca şi concluzie generală promovarea în social media reprezintă una dintre metodele

principale de reclamă, ce are un trend ascendent în ultimii ani. Companiile tind să utilizeze acest
mediu ca un instrument de marketing cu un potenţial competitiv. Acestea îşi aloca importante
resurse sit imp pentru a dezvolta acest domeniu, afirmaţie susţinută de faptul că annual se
consuma miliarde de euro în acest domeniu.
7
Capitolul IV- Analiza de ramură şi piaţă
Ramura- Descrierea firmei existente
Firma se numeşte STARFIER SRL şi se afla în judeţul Suceava. Ca şi scop general

aceasta are misiunea de a prelucra şi comercializa către diferiţi terţi (atât persoane fizice cât şi
juridice) de materiale din fier forjat
Datele de identificare ale firmei. Mai jos sunt prezentate într-o manieră clară datele de
identificare.
8
Firma a fost creată în anul 2012, este o firmă ce îndeplineşte toate criteriile de legalitate, profitul
anual fiind în creştere în ultimii 4 ani. Acest lucru este datorat politicii administrative din
interiorul acesteia.
Misiunea Firmei
În ceea ce o priveşte, misiunea este îndreptată către o dezvoltare continuuă, prin creşterea
producţiei şi a numărului de angajaţi, de o retehnologizare continuă în funcţie de cererea pieţei,
şi mulţumirea clienţilor existenţi prin calitatea serviciilor oferite cât şi acapararea de noi clienţi.
Totodată negocierea atât cu diferiţi clienţi în funcţie de nivelul comenzii, cât şi cu furnizorii şi
parteneri, reprezintă un atuu al firmei, flexibilitatea fiind prezentă în activitatea sa.
Resursele : Umane, Tehnico-materiale şi financiare.
În ceea ce privesc resursele umane, firma are 15 angajati ( 8 muncitori, 2 şoferi, restul de 4
persoane îndeplinind restul atribuţiilor )
Resursele Tehnico-materiale- Acestea sunt formate din diferite materiale prime, necesare pentru
prelucrarea diferitelor articole ( porţi, elemente de, design stradal, elemente stradale, balustrade
scări, etc. ) Totodată acestea sunt atât forjate prin maşinăriile specifice cât şi amprentate ( tablă,
profiluri ) prin maşinării dedicate ( decupare laser maşinărie CCNA ).
Este prezentă şi o gamă dezvoltată de ţevi , platbant , cornier , oteluri patrate sau rotunde , lişe.
Atelierul dispune şi de alte utilaje de sudură, îmbinare, formare a profilurilor şi elementelor
fieroase şi neferoase. Firma dispune de aproximat 10000 de produse destinate utilizării pentru
crearea produselor finale.
9
Linia de produse şi servicii
In cadrul firmei întâlnim o gama largă de produse şi servicii. Acestea includ atât
materialele prime cât şi amplasarea la domiciliu a, acesora. Deviza firmei este de vanzare cu
amănuntul a, articolelor de fierărie, a vopselelor şi lacurilor, a produselor din sticlă etc.
Ca şi servicii specifice firmei, acestea sunt date de, mentenanţa articolelor montate către
beneficiar, garanţia conformă şi întreţinerea produselor.
Mixul de marketing
În ceea ce îl priveşte în cadrul firmei este utilizat acest instrument de marketing. Acesta
are scopul de a introduce produsele la momentul si preţul potrivit în piaţă. Pe baza mixului de
marketing putem trage următoarea concluzie în ceea ce priveşte firma.
Ca şi puncte tari acestea sunt date de preţul avantajos, fiind în strânsă legătură cu,
competitorii direcţi, şi calitatea produselor, fiind utilizate unele dintre cele mai bune materiale
existente pe, piaţa din zona moldovei. Ca şi punct slab, promovarea reprezintă un element lipsă
în cadrul firmei, aceasta realizându-se pe metodele clasice, (promovare OOH, radio şi ziar )
Un element considerat relevant în cadrul acestei firme este dat de elasticitatea plasării
comenzilor în teritoriu, firma având sub-sucursale. Numărul mare de comenzi şi cererea fac ca
produsele şi serviciile să fie răspândite pe o arie largă, judeţele Suceava Botoşani Iaşi Neamţ şi
Bacau. Deducem de aici faptul că există un trend ascendent de creştere şi dezvoltare, bazat pe
criteriile enunţate anterior.
Piaţa
În ceea ce priveşte piaţa principala categorie de produse şi servicii sunt date de produsele
din fier forjat, mai precis porţi, garduri, balustrade. Acestea reprezinta aproximativ 90 % din
10
totalitatea produselor vândute de către firmă. Pentru a realiza o analiză mai îndetaliată este
necesar să realizăm profilul clientului.
Profilul clientului
Persoane fizice şi juridice ce doresc amenajarea de porţi, garduri, şi amenajări interioare.

În ceea ce îi privesc aceştia se divid în două categorii, cei cu veniturii medii ridicate şi cei cu
venituri ridicate. Acest fapt determină şi nivelul comenzilor, respectiv amploarea acestora, în
sensul complexitătii produselor.
Indicatorii globali
In ceea ce priveşte cererea aceasta este una medie în timpul iernii, şi creşte treptat , atingând un
punct maxim pe timpul anotimpului de vară. Creşterea anuală este aproximativ 5% Putem
observa în graficul alăturat evoluţia.
11
Capitolul V- Direcţii viitoare de cercetare.
Ca şi direcţii viitoare de cercetare sunt necesare o serie de informaţii pentru a avea o mai
mare perspectivă asupra principalilor competitori şi strategiile acestora. Acestea m-ar ajuta să
elaborez livrabilul într-o manieră realistă.
Informaţii cu privire la concurenţă Sondaj bazat pe chestionar

Date privind platformele de promovare online Consultarea doctrinei privind software dedicat
Gradul general de mulţumire al clientului Observare calitativa.
ANEXE
12
IJRM-01343; No of Pages 16
International Journal of Research in Marketing xxx (xxxx) xxx
Contents lists available at ScienceDirect
IJRM
International Journal of Research in Marketing
journal homepage: www.elsevier.com/locate/ijresmar
Full Length Article
The impact of online display advertising and paid search

advertising relative to offline advertising on firm performance
and firm value
Emanuel Bayer a,⁎,1, Shuba Srinivasan b,2, Edward J. Riedl b,2, Bernd Skiera a,3,4
a
Goethe University Frankfurt, Germany
b
Boston University, United States of America
a r t i c l e i n f o
Article history: This research examines the impact of online display advertising and paid search advertising
First received on December 17, 2018 and relative to offline advertising on firm performance and firm value. Using proprietary data on
Available online xxxx annualized advertising expenditures for 1651 firms spanning seven years, we document that
both display advertising and paid search advertising exhibit positive effects on firm perfor-
mance (measured by sales) and firm value (measured by Tobin's q). Paid search advertising
has a more positive effect on sales than offline advertising, consistent with paid search being
closest to the actual purchase decision and having enhanced targeting abilities. Display adver-
tising exhibits a relatively more positive effect on Tobin's q than offline advertising, consistent
with its long-term effects. The findings suggest heterogeneous economic benefits across differ-
ent types of advertising, with direct implications for managers in analyzing advertising
effectiveness and external stakeholders in assessing firm performance.
© 2020 Published by Elsevier B.V.
1. Introduction
While the 2008 global financial crisis led many firms to reduce their marketing budgets, online advertising expenditures have
grown significantly since then, exceeding $100 billion in 2018 in the United States (IAB, 2019) and surpassing television advertis-
ing spending already in 2016 (eMarketer, 2016). Practitioners remain divided on the impact of online advertising: some claim that
it offers higher returns than offline advertising (Gregg, Kalaoui, Maynes, & Schuler, 2016), while others are skeptical of its long-
term impact (Watson, 2016).
Understanding the impact of online versus offline advertising on firm performance and firm value is therefore essential for both
academics and practitioners (De Haan, Wiesel, & Pauwels, 2016). While prior research has examined the link between advertising
⁎ Corresponding author.
E-mail addresses: embayer@wiwi.uni-frankfurt.de, (E. Bayer), ssrini@bu.edu, (S. Srinivasan), eriedl@bu.edu, (E.J. Riedl), skiera@wiwi.uni-frankfurt.de. (B. Skiera).
1
Goethe University and Management Consultant at Commerzbank, Department of Marketing, Faculty of Business and Economics, Goethe University Frankfurt am
Main, Theodor-W.-Adorno-Platz 4, 60323 Frankfurt, Germany.
2
Boston University Questrom School of Business, 595 Commonwealth Avenue, Boston, MA.
3
Department of Marketing, Faculty of Business and Economics, Goethe University Frankfurt am Main, Theodor-W.-Adorno-Platz 4, 60323 Frankfurt, Germany.
4
Professorial Research Fellow (part-time) at Deakin University, Melbourne, Australia.
https://doi.org/10.1016/j.ijresmar.2020.02.002
0167-8116/© 2020 Published by Elsevier B.V.
Please cite this article as: E. Bayer, S. Srinivasan, E.J. Riedl, et al., The impact of online display advertising and paid search advertis-
ing relative to offline advertising..., International Journal of Research in Marketing, https://doi.org/10.1016/j.ijresmar.2020.02.002
2 E. Bayer et al. / International Journal of Research in Marketing xxx (xxxx) xxx
and firm value, it does so primarily in the context of offline (i.e., traditional) advertising (e.g., Du & Osmonbekov, 2019; Joshi &
Hanssens, 2009; Mian, Sharma, & Gul, 2018; Srinivasan & Hanssens, 2009). A notable exception is the work of Sridhar,
Germann, Kang, and Grewal (2016), which provides initial insights into how online, regional, and national advertising affect
firm value. However, the authors do not examine the differential effects of online advertising types—specifically, online display
and paid search—relative to offline advertising on firm performance and firm value. With a sample restricted to manufacturing
firms, they call for further research on other economic sectors. The current research addresses this call by assessing the relative
impact of online display and paid search advertising on firm performance and firm value across different economic sectors.
Online display advertising is online advertising that includes banners, plain text, media-rich content, and video ads (Goldfarb, 2014);
paid search is online advertising that appears along with organic results on search engines such as Google; and offline advertising is non-
Internet-based advertising, including television, radio, and print ads. Display and paid search advertising share several key characteristics,
including an ability to provide brand information (as is the case with offline advertising); a direct response component, which stimulates
an immediate response from the consumer; and an ability for individual targeting that enables firms to approach consumers at the right
stage of the purchase decision and direct them to purchase online, which significantly increases consumers' response to such advertising.
The latter two characteristics result in better attribution of the response to the specific type of online advertising and allow the assess-
ment of the individual impact on specific consumers.
By contrast, offline advertising (e.g., television, newspapers) typically cannot determine which customers were exposed to the
advertisement or whether an immediate sale can be attributed directly to it. However, offline advertising can better differentiate a
brand from its competitors in the minds of consumers by building brand awareness, consideration, and liking because of its better
executional and placement opportunities. Within online advertising, display has an improved ability to build brands over paid
search (e.g., Dinner, Van Heerde, & Neslin, 2014). Table 1 compares several features of online display, paid search, and offline
advertising.
We exploit the characteristics that differentiate online display, online paid search, and offline (i.e., traditional) advertising to
offer hypotheses on their effects on firm performance and firm value. To test the hypotheses, we use a proprietary panel dataset
of annual observations of advertising expenditures of 1651 firms across 11 economic sectors spanning 2010–2016. Of note, our
data allow decomposing advertising expenditures into display, paid search, and offline advertising. We assess the effectiveness
of these different advertising types by comparing them in terms of two commonly employed outcome measures of firm perfor-
mance: a short-term measure, with current period sales as our proxy, and firm value as a measure of long-term performance,
with Tobin's q as our proxy. As firms may set advertising depending on unobserved factors, we use a control function approach
(Petrin & Train, 2010) with exclusion restrictions to correct for potential endogeneity bias.
Our study provides four key contributions. First, it builds on prior research by partitioning online advertising into its two key
types: display advertising and paid search advertising. Accordingly, our results provide insights into the heterogeneity that occurs
within different types of online advertising. Second, we find that display and paid search advertising each exerts significantly pos-
itive effects on firm performance (measured by sales) and firm value (measured by Tobin's q). Third, we document that display
advertising exhibits a relatively more positive effect on Tobin's q than offline advertising, consistent with its superior targeting
ability, its direct response feature, and its significant cross-channel effects (Dinner et al., 2014). Relatedly, we show that paid
search advertising has a more positive effect than offline advertising on sales, as it is closest to the actual purchase decision
and has greater effectiveness in driving sales due to its enhanced targeting. Fourth, we show that paid search is more effective
than online display advertising at generating sales.
We note that both types of online advertising have overlapping elements, including enhanced targeting, tracking, and place-
ment. The differential impact of paid search on sales relative to online display reflects its customer-initiated feature and its occur-
rence closer to the purchase decision in consumers' purchase funnel. Furthermore, firms typically use paid search to generate a
sales response, while the goal of online display advertising is often brand building. Overall, our study contributes to the
Table 1
Comparison of paid search, display, and offline advertising.
Abilities Paid Display Offline Supporting references

search advertising advertising
Brand building: building of the brand's value proposition in Low Medium High De Vries et al. (2017); Draganska, Hartmann, and
consumers' minds, leading (indirectly) to potential sales Stanglein (2014)
Direct response: stimulation of an immediate response from High Medium Low Evans (2009); Ghose and Yang (2009); Rutz et al. (2012);
the consumer in the same media, which can directly lead to Skiera and Abou Nabout (2013)
sales
Targeting: reaching the right consumer at the right time High High Low Bleier and Eisenbeiss (2015); Chandra (2009); Evans
with the right message (2009); Goldfarb and Tucker (2011); Lambrecht and
Tucker (2013)
Placement: control over the placement context of the High Medium High Goldfarb and Tucker (2010); Fournier and Srinivasan
advertisement (2018)
Attribution: attribution of sales of an individual consumer to High High Low Danaher and Dagger (2013); Evans (2009); Goldfarb
a specific advertisement (2014)
Individual impact: assessing the impact of an advertisement High Medium Low Lewis and Reiley (2014); Li and Kannan (2014)
on a specific consumer
E. Bayer et al. / International Journal of Research in Marketing xxx (xxxx) xxx 3
marketing–finance interface by quantifying the relationship between online display, paid search, and offline advertising and firm
performance and firm value.
Our findings offer several implications for theory and practice. First, we add to the collective understanding of how dis-
play, paid search, and offline advertising work together in driving firm performance and firm value. By combining several
datasets to derive the impact of both display and paid search advertising, our research goes beyond marketing expenditure
data available in public financial statements. Second, our use of both short- and long-term firm performance metrics an-
swers previous calls to consider multiple outcome measures (Katsikeas, Morgan, Leonidou, & Hult, 2016), and our use of
a broad cross-sectional multi-year sample allows us to both generalize our findings (beyond one sector such as manufactur-
ing) and provide stronger external validity. Third, our findings not only confirm variation in the effectiveness of online ver-
sus offline advertising but also highlight variation in the effectiveness within the two main types of online advertising. Our
results suggest that display (paid search) advertising's differential advantage accrues primarily through its effects on longer-
term value reflected in Tobin's q (shorter-term performance reflected in sales). Understanding these differential effects is a
critical step toward the managerial goal of better allocating advertising expenditures across display, paid search, and offline
advertising. While our results show that online advertising generates stronger economic effects than offline advertising, we
caution that this is not ipso facto evidence justifying extreme shifts in advertising budgets (e.g., allocating all offline expen-
ditures to paid search): most sample firms already invest in offline advertising, and they obtain stronger effects of display
and paid search in this context.
2. Prior literature and hypotheses
Firms allocate advertising expenditures across online and offline advertising. Online advertising, or Internet-based advertising,
is a technology-enabled, two-way form of dynamic communication (Goldfarb, 2014). Broadly, online advertising has stronger
targeting and tracking abilities, while offline advertising is more effective at brand building (e.g., by controlling placement con-
text). Prior research provides broad support for these general characteristics (e.g., Bleier & Eisenbeiss, 2015; Danaher & Dagger,
2013; De Vries, Gensler, & Leeflang, 2017; Evans, 2009; Goldfarb & Tucker, 2010; Li & Kannan, 2014), which we leverage to de-
velop hypotheses on their relative effects on firm performance and firm value.
With the recent rise of online advertising, research has become increasingly interested in examining its effects on sales. For ex-
ample, Dinner et al. (2014) compare the independent and joint effects of online display, paid search, and offline advertising and
find that cross-elasticities are similar to own-effect elasticities and that display and paid search are more effective than offline ad-
vertising, due to strong cross-effects on offline sales. Sridhar et al. (2016) compare the effects of online, regional, and national ad-
vertising on firm value and show that the joint effects are lower than all independent effects. Sridhar and Sriram (2015) examine
the cannibalization of print advertising, documenting that as online newspaper advertising increases, print advertising decreases.
Collectively, these studies provide evidence of the differential effects of online relative to offline advertising on certain aspects of
firm performance.
We build on these studies in three ways. First, we partition total advertising into online display, paid search, and offline
(i.e., traditional) advertising; by contrast, most studies do not distinguish between online display and paid search. Doing so is important,
however, because these two online categories are not interchangeable: display advertising exhibits some characteristics of traditional ad-
vertising (e.g., brand building, “pushed” by the firm) that paid search advertising does not. Collectively, the differences suggest that het-
erogeneous effects exist across these two advertising categories. To our knowledge, only Dinner et al. (2014) partition online advertising
into these two categories; however, they do not examine the long-term effects on firm value, and their sample is restricted to a single firm
(a retailer) and a short time horizon (two-year sample), which inhibits generalizability. Furthermore, while the increasing coefficients
across offline, display, and paid search advertising on sales in Dinner et al. (2014; see their Table 8) are consistent with our results, the
authors neither predict nor statistically test for these differences.
Second, we concurrently examine both short-term (via sales) and long-term (via Tobin's q) effects of the three advertising
types, whereas extant literature does not jointly examine both effects. Doing so enables us to compare the impact across the
three advertising types and, thus, to provide evidence consistent with expectations of heterogeneous effects of the differing adver-
tising types on firm performance, conditional on horizon.
Third, our sample covers all economic sectors and a long time series (2010–2016). This broad coverage allows us to generalize
our findings. Most research is more narrowly focused, using a single firm (e.g., Dinner et al., 2014), a single industry (e.g., Sridhar
et al., 2016), or a single publisher (one newspaper; Sridhar & Sriram, 2015). Our use of a cross-sectional sample enables insights
that generalize to a wide population of firms and thus provides strong external validity for our findings. Table 2 shows the posi-
tioning of our research relative to extant literature.
2.1. Impact of display advertising on firm performance and firm value
Display advertising allows for behavioral targeting, as advertisers can track pre- and post-impression consumer response. Behavioral
targeting technologies enable firms to tailor display advertisements to consumers on the basis of their past browsing history (Kannan &
Li, 2017). As such, display advertising enables better matching between the firm's products and customers' tastes through targeting
(Hoban & Bucklin, 2015). Display advertising also allows firms to attribute individual consumer sales to a specific advertisement.
Evidence suggests that online display campaigns can increase site visitation, brand search queries, and both online and offline
sales (Fulgoni & Mörn, 2009). For example, Lewis and Reiley (2013) examine 1.6 million users and find persistent positive effects
Table 2
Assessment of prior literature and contribution.
Dinner et al. (2014) McAlister et al. Sridhar et al. (2016) Sridhar and Sriram This research
(2016) (2015)
Objective Compare independent and joint Examine LT effect Compare independent Examine online Compares ST and LT impact of
effects of ODA, PSA, and offline of advertising for and joint effects of newspaper ODA, PSA, and offline
advertising on online/offline sales differentiators online, regional, and advertising advertising
versus cost national advertising on cannibalization of
leaders firm value print advertising
Primary finding(s) Cross-elasticities ≈ own-effect Advertising only Joint effects weaken all As online ODA and PSA have stronger
elasticities; ODA/PSA more has LT effect for independent (positive) newspaper ST/LT effects than offline
effective than offline advertising differentiators effects advertising advertising; PSA has stronger
from strong cross-effects on increases, print ST but weaker LT effect than
offline sales advertising ODA
decreases
Dependent variable
Firm value No Yes Yes No Yes
Sales Yes Yes No Yes Yes
Sample
# Observations 5150a 4471 6970 Variedd 8124
# Firms 1 1430 662 1 1651
# Years 2 4 12 7 7
(2008–2010) (1990–1993c) (2001–2012) (2005–2011) (2010–2016)
Industries 1 Retailerb Unknown Manufacturing 1 Newspapere All sectors
Experimental
variable
Online advertising Yes No Yes Yes Yes
Partition ODA/PSA Yes No No No Yes
Controls
Advertising Yes (AdStock) No No No Yes (AdStock)
carryover
Data sources
COMPUSTAT/CRSP No Yes Yes No Yes
Kantar Ad$pender No No Yes No Yes
Kantar Stradegy No No No No Yes
Notes: ODA = online display advertising. PSA = paid search advertising. ST (LT) = short-term (long-term).
a
1 firm × 25 markets × 103 weeks × 2 (online and offline).
b
U.S. clothing retailer.
c
Robustness tests: 15 (1996–2009).
d
7 years × 2253 advertisers.
e
With 2253 customers from many industries.
of display advertising on sales of a retailer. Furthermore, Manchanda, Dubé, Goh, and Chintagunta (2006) show that display adver-
tising has a positive effect on customer retention and, thus, repeat purchases. Accordingly, we argue that display advertising in-
creases short-term sales as well as investors' expectations of sales (i.e., firm value), leading to the following prediction5:
H1. Online display advertising has a positive impact on both (a) firm performance and (b) firm value.
2.2. Impact of display versus offline advertising on firm performance and firm value
As noted previously, online display advertising exhibits some characteristics of traditional advertising, including its brand building
ability and “push” by the firm (e.g., Colicev, Malshe, Pauwels, & O'Connor, 2018). A key advantage of display advertising is its ability to
target consumers (e.g., via behavioral targeting technologies). Specifically, offline advertising targets consumers coarsely on broad demo-
graphic or psychographic variables, whereas display advertising uses information about individual-level behavior to target consumers.
The marketing literature documents that targeting increases click-through rates of banner ads (Chandon, Chtourou, & Fortin,
2003; Chatterjee, Hoffman, & Novak, 2003; Sherman & Deighton, 2001). Matz, Kosinski, Nave, and Stillwell (2017) provide evi-
dence for the effectiveness of psychological targeting in the context of online display advertising: persuasive appeals matched
to the psychological profiles of large groups of people resulted in up to 40% more clicks and 50% more purchases than their mis-
matched or non-personalized counterparts. These arguments lead to the following expectations:
H2. Online display advertising has a greater impact on (a) firm performance and (b) firm value than offline advertising.
5
As a tension in this expectation, privacy concerns due to targeting and obtrusiveness of display advertising, as well as less control on the placement context, can
negatively affect its effectiveness (e.g., Bleier, Goldfarb, & Tucker, 2019; Goldfarb & Tucker, 2011).
Fig. 1. Conceptual framework: impact of online display, paid search, and offline advertising on firm performance and firm value.
2.3. Impact of paid search advertising on firm performance and firm value
Paid search advertising targets consumers who have already shown interest in the product by searching for an associated keyword on
a search engine (Abou Nabout, Skiera, Stepanchuk, & Gerstmeier, 2012; Sayedi, Jerath, & Srinivasan, 2014). As such, paid search has a high
ability to create awareness and deliver a strong sales impact by targeting consumers who are already in the process of buying, translating
more readily into sales (Dinner et al., 2014; Kireyev, Pauwels, & Gupta, 2016; Liaukonyte, Teixeira, & Wilbur, 2015; Srinivasan, Rutz, &
Pauwels, 2016). Paid search can also result in increased click-through and conversion rates and higher customer lifetime value than
other types of advertising (Berman & Katona, 2013; Chan, Wu, & Xie, 2011; Rutz & Bucklin, 2011).
Paid search advertisers match their ads to the content of search (Jerath, Ma, & Park, 2014). Consumers' search strings reveal
information about the products they are interested in and their stage in the purchase process. Paid search's targeting results in
relevant ads directed to consumers (Rutz, Bucklin, & Sonnier, 2012), an enhanced ability to control the placement context, and
an improved assessment of its impact on specific consumers. Accordingly, we hypothesize the following6:
H3. Paid search advertising has a positive impact on both (a) firm performance and (b) firm value.
2.4. Impact of paid search versus offline advertising on firm performance and firm value
We next compare paid search advertising with offline advertising. As mentioned previously, offline advertising has an im-
proved ability to differentiate a brand from its competitors from consumers' perspective, which eventually leads to purchases
(e.g., Colicev et al., 2018). However, paid search outperforms offline advertising on virtually every other relevant characteristic
(see Table 1)—from its direct response to targeting, to attribution, to its ability to assess the impact of an advertisement on a spe-
cific consumer. Specifically, paid search advertising affords superior targeting to offline advertising, which typically involves only
loose targeting (e.g., based on demographics).
Paid search advertising, which tends to occur closer to the purchase decision, is more likely to elicit a final purchase decision by
consumers (Goldfarb, 2014). In addition, paid search advertising often elicits a behavioral response from consumers (i.e., a click),
which is uncommon and (if available) less convenient in offline advertising (e.g., toll-free numbers). Overall, these characteristics
of paid search advertising lead to the following expectations:
H4. Paid search advertising has a greater impact on (a) firm performance and (b) firm value than offline advertising.
Fig. 1 summarizes the hypotheses.
6
Some research suggests that excessive targeting from paid search advertising can increase firms' costs because of search engines' ability to capitalize on delivering
better performance to advertisers (Abou Nabout, Lilienthal, & Skiera, 2014; Chandra, 2009).
3. Data and variables
3.1. Data description
We sourced the advertising data from Kantar Media's Ad$pender and Stradegy databases and the financial performance data from
COMPUSTAT. Research in marketing (e.g., Sridhar et al., 2016) and accounting and finance (e.g., Cohen, Mashruwala, & Zach, 2010)
has also used the Kantar Ad$pender data. The Stradegy database is the source of paid search data; all other advertising data is from Ad
$pender. The Kantar advertising data are also more granular than the commonly used COMPUSTAT advertising data. In particular, for
each firm-year, we obtain the total dollars spent for both online advertising (including disaggregated amounts within display advertising
and paid search advertising) and offline advertising (including amounts within magazines; national and regional newspapers; cable, net-
work, and spot television; national spot and network radio; and syndication and outdoor advertising).
Our initial Kantar dataset includes 641,312 firms for 2010–2016; most are smaller, private firms. We identify the 2589 firms
that are publicly listed on U.S. stock exchanges and merge the Kantar advertising data with the related COMPUSTAT data on finan-
cial performance and control variables. Finally, we exclude non-December-31 fiscal year end firms, as Kantar's data corresponds to
calendar years. This exclusion further ensures that all sample firms are subject to the same (temporal) industry conditions
(e.g., Bayer, Tuli, & Skiera, 2017; Dao, Raghunandan, & Rama, 2012; Jones, 2007). Our final unbalanced panel dataset comprises
8124 firm-year observations for 1651 firms7 over 2010–2016 and covers all 11 economic sectors. The percentage of non-
manufacturing (manufacturing) firms in our sample is 66% (34%).8 In this way, we offer generalizability of our findings to industry
settings beyond the manufacturing firms studied in Sridhar et al. (2016).
3.2. Dependent variables
To measure firm performance, we use current-period sales (Sales), which assesses the immediate (short-term) effects of adver-
tising expenditures (e.g., Lodish et al., 1995; Tellis, 2004). Following prior research, we use the natural logarithm of total sales
(e.g., McAlister, Srinivasan, Jindal, & Cannella, 2016) to facilitate the interpretation of coefficients as elasticities.
To measure firm value, we follow prior research and use Tobin's q, defined as the ratio of the firm's market value to the replace-
ment cost of its assets (e.g., Srinivasan & Hanssens, 2009). Tobin's q captures both a firm's market value and possible effects of
changes in intangible assets from advertising expenditures (McAlister et al., 2016). Furthermore, it is a forward-looking, risk-
adjusted, and cumulative measure reflecting short- and long-term effects of firms' advertising expenditures (e.g., Mittal,
Anderson, Sayrak, & Tadikamalla, 2005). Finally (and relevant to our multi-industry study), it is unaffected by accounting conven-
tions, industry specifics, or differences in firms' organizational goals (Wernerfelt & Montgomery, 1988). Similar to sales, we take
the natural logarithm of Tobin's q. Table 3 provides the definitions of our dependent variables.
3.3. Advertising variables
Kantar collects annual advertising expenditures for a large array of firms; in particular, it obtains the Ad$pender and Stradegy
data through a systematic monitoring of firms' advertising activities across different media. As a first step, we consider total Kantar
advertising expenditures (KantarAdv), which comprise the total dollar amount across all advertising categories, including online
display and paid search advertising and offline advertising (television, radio, magazines, newspapers, outdoor, and syndication).
Our focus is on firm-level advertising (not brand-level advertising) across these advertising categories, given our study's emphasis
on linking firm advertising to firm performance and firm value (i.e., at the same levels of aggregation).
For our primary analyses, we consider the following key advertising variables: (1) online advertising, (2) the decomposition of online
advertising into display advertising (DisplayAdv) and paid search advertising (SearchAdv), and (3) offline advertising (OfflineAdv). We de-
fine the last variable as the difference between total Kantar advertising expenditures (KantarAdv) and online advertising (i.e., display and
paid search advertising). Our hypotheses focus on the effects of these advertising variables on firm performance (i.e., sales) and firm value
(i.e., Tobin's q). Following previous research (e.g., Cohen et al., 2010; Sridhar et al., 2016), we use the published advertising expenditures
from Kantar; to assess the mapping of the Kantar advertising expenditures to sales and Tobin's q, we benchmark against a model with the
measure of COMPUSTAT advertising.9
To control for advertising carryover effects of each advertising category, we use AdStock (i.e., smoothed advertising expenditures).
We scale it by total assets to normalize across firms, as our sample has substantial size-based heterogeneity (Datta, Ailawadi, & van
Heerde, 2017). Thus, AdStock is the cumulative value of a firm's advertising in each advertising category at a given point in time.
The inclusion of AdStock stems from the notion that advertising builds a stock of consumer goodwill, which then decays over time.
7
Our sample includes both single- and multi-brand firms. For the latter, the respective advertising expenditures represent the sum over all the firm's brands.
8
Of the 1651 firms in our sample, 1089 do not belong to the manufacturing industry sector as measured by North American Industry Classification System codes
31–33.
9
The results from using aggregate Kantar expenditures and COMPUSTAT advertising expenditures on sales and Tobin's q are similar and are available from the au-
thors on request.
Table 3
Measures of key variables.
Variable Measure
Tobin's q Share price (PRCC_F) times common shares outstanding (CSHO) plus preferred stock (PSTK) plus short-term liabilities (LCT) minus
short-term assets (ACT) plus long-term debt (DLTT), divided by total assets (AT) (in logarithms)
Sales revenues Total revenues (REVT) (in logarithms)
Kantar advertising Log of ((Stock of advertising expenditures on online display; paid search; magazines incl. Sunday magazines; national and regional
newspapers; outdoor; cable, network, and spot TV; syndication; national spot and network radio)/total assets (AT) + 1); 1 added to
obtain uniformly positive values
Offline advertising Log of (Stock of (Kantar's Advertising Expenditures – online display – paid search)/total assets (AT) +1); 1 added to obtain uniformly
positive values
Online display Log of (Stock of online display advertising/total assets (AT) + 1); 1 added to obtain uniformly positive values
advertising
Paid search Log of (Stock of paid search advertising/total assets (AT) + 1); 1 added to obtain uniformly positive values
advertising
Financial leverage Ratio of total long-term debt (DLTT) to total assets (AT)
Profit Earnings before interest and taxes (EBIT) with advertising expenditures (XAD) added back, scaled by total assets (AT)
Firm size Number of employees (EMP) (in logarithms)
Industry growth Total revenues (REVT) in year t minus log of total revenues (REVT) in year t – 1, defined by four-digit Standard Industrial
Classification (SIC) code (in logarithms)
Industry Herfindahl–Hirschman industry index, defined by 4-digit SIC code
concentration
Industry turbulence Standard error of τ's estimated regression coefficient divided by industry sales average for years t – 5 to t – 1, in a regression covering
years t through τ (with τ = 1, 2, …, 5) that has year t – τ sales for the industry indicated by a firms four-digit SIC code as the
dependent variable and τ as a predictor variable
Notes: In line with Eqs. (5)–(8), AdStock of firm i in year t is λ × AdStocki, t-1 + (1 – λ) × Advertisingit. We estimate λ by using a grid search on the interval [0,
0.9] in increments of 0.1 and choose the model with the best likelihood; in the first year of the time series, AdStock equals the advertising expenditures in the first
year; advertising is in logs as shown.
3.4. Control variables
We include control variables previously shown to influence firm sales and firm value. First, we include financial leverage (Lev)
to control for the capital required for sales growth and its potential effects on cost of capital (Harris & Raviv, 1991) and firm size
(Size) to control for economies of scale or scope (e.g., McAlister et al., 2016; Rao, Agarwal, & Dahlhoff, 2004). Second, to control for
industry effects, we include industry growth (IndGrow) (McAlister et al., 2016; McDougall, Covin, Robinson Jr, & Herron, 1994),
industry concentration (IndConc) (Hirschey & Weygandt, 1985), and industry turbulence (IndTurb). Finally, we include current
profit (Profit) when Tobin's q (i.e., firm value) is the dependent variable, as it is a key input to shareholder value; however, we
exclude profit when using sales as the dependent variable, as it is not a predictor of current sales (McAlister et al., 2016). All con-
trol variables come from COMPUSTAT data.
4. Research methodology
4.1. Primary regressions
To test the proposed hypotheses, we estimate two models for each of our two dependent variables of sales and Tobin's q:
(1) the effect of total Kantar advertising (KantarAdv) and (2) the effects of display advertising (DisplayAdv), paid search advertising
(SearchAdv), and offline advertising (OfflineAdv). We use model (1) to assess the effect of total Kantar advertising on our two de-
pendent variables; it provides validation of the Kantar advertising data because it enables comparisons with results of prior studies
that use COMPUSTAT data. We use model (2) as our primary regressions, which assess the absolute and relative effects of display
and paid search advertising relative to those of offline advertising (and thus serve as tests of our hypotheses).
Several research design choices warrant further discussion. First, to isolate the effect of advertising expenditures on the depen-
dent variables beyond variables previously shown to influence sales and firm value, the models include not only the control var-
iables established in prior research but also year-specific indicator variables, to account for time trends. Second, we estimate
models with random intercepts and random error terms, which is a parsimonious way to parameterize unobserved heterogeneity
around firm performance, as the random intercept captures mean unobserved firm performance.10 Third, the choice of advertising
expenditures can depend on both observable factors, such as current performance (i.e., profit), and unobservable factors poten-
tially correlated with the error term; that is, firms' decisions about advertising expenditures may be endogenous to firm perfor-
mance and value (Sridhar et al., 2016). Accordingly, we employ a control function approach with exclusion restrictions to
correct for potential endogeneity bias. In particular, we include the predicted residuals from auxiliary regressions as controls in
10
We alternatively used a likelihood ratio test to examine whether a random slope model is more appropriate than a random intercept model, but we failed to reject
this null hypothesis. We also conducted a pooling test, which confirmed that we can pool our response parameters across the 11 economic sectors included in our
sample.
the main models. Finally, we use robust standard errors to make our estimates robust to cross-sectional heteroskedasticity and
within-panel (serial) correlation.
The two models with sales as dependent variable are (key variables bolded)
Salesi;t ¼ α0i þ β1 KantarAdStocki;t þ β2 Levi;t þ β3 Sizei;t þ β4 IndGrowi;t þ β5 IndConci;t þ β6 IndTurbi;t

þ β7 KantarAdv Residi;t þ β8 Year t þ εi;t ; ð1Þ
and
Salesi;t ¼ α0i þ β1 OfflineAdStocki;t þ β2 DisplayAdStocki;t þ β3 SearchAdStocki;t þ β4 Levi;t þ β5 Sizei;t þ β6 IndGrowi;t

þ β7 IndConci;t þ β8 IndTurbi;t þ β9 OfflineAdv Residi;t þ β10 DisplayAdv Residi;t þ β11 SearchAdv Residi;t þ β12 Year t
þ εi;t : ð2Þ
The two models for which Tobin's q is the dependent variable are
0
Tobin s qi;t ¼ α0i þ β1 KantarAdStocki;t þ β2 Levi;t þ β3 Profit i;t þ β4 Sizei;t þ β5 IndGrowi;t þ β6 IndConci;t þ β7 IndTurbi;t
þ β8 KantarAdv Residi;t þ β9 Year t þ εi;t ; ð3Þ
and
0
Tobin s qi;t ¼ α0i þ β1 OfflineAdStocki;t þ β2 DisplayAdStocki;t þ β3 SearchAdStocki;t þ β4 Levi;t þ β5 Profit i;t þ β6 Sizei;t
þ β7 IndGrowi;t þ β8 IndConci;t þ β9 IndTurbi;t þ β10 OfflineAdv Residi;t þ β11 DisplayAdv Residi;t
þ β12 SearchAdv Residi;t þ β13 Year t þ εi;t ; ð4Þ
where (see also Table 3):
Salesi,t = total revenues of firm i in year t (in logs),

Tobin's qi,t = Tobin's q of firm i in year t (in logs),
KantarAdStocki,t = stock of Kantar advertising expenditures of firm i in year t (in logs),
OfflineAdStocki,t = stock of offline advertising expenditures of firm i in year t (in logs),
DisplayAdStocki,t = stock of display advertising expenditures of firm i in year t (in logs),
SearchAdStocki,t = stock of paid search advertising expenditures of firm i in year t (in logs),
Levi,t = financial leverage of firm i in year t,
Profiti t = profit of firm i in year t,
Sizei,t = size of firm i in year t,
IndGrowi,t = growth of the industry of firm i in year t,
IndConci,t = concentration in the industry of firm i in year t,
IndTurbi,t = turbulence in the industry of firm i in year t,
KantarAdv_Residi,t = residual from auxiliary regression for Kantar advertising expenditures of firm i in year t,
DisplayAdv_Residi,t = residual from auxiliary regression for online display advertising expenditures of firm i in year t,
SearchAdv_Residi,t = residual from auxiliary regression for paid search advertising expenditures of firm i in year t,
OfflineAdv_Residi,t = residual from auxiliary regression for offline advertising expenditures of firm i in year t,
Yeart = binary indicator variable that denotes year t,
α0i = random intercept of firm i, and
εi,t = random error term of firm i in year t.
We define the stock variables in Eqs. (1)–(4) as follows (e.g., Dinner et al., 2014), where parameters λ represent carryover ef-
fects:
KantarAdStocki;t ¼ λKantar KantarAdStocki;t−1 þ ð1−λKantar Þ KantarAdvi;t : ð5Þ

OfflineAdStocki;t ¼ λOffline OfflineAdStocki;t−1 þ 1−λOffline OfflineAdvi;t : ð6Þ

DisplayAdStocki;t ¼ λDisplay DisplayAdStocki;t−1 þ 1−λDisplay DisplayAdvi;t : ð7Þ
SearchAdStocki;t ¼ λSearch SearchAdStocki;t−1 þ ð1−λSearch Þ SearchAdvi;t : ð8Þ
Following Dinner et al. (2014), we use a grid search to determine the carryover parameters. In addition, we take the natural
logarithm of all advertising variables, to allow the coefficients to be interpreted as elasticities.
Table 4
Distribution of observations across economic sectors and descriptive statistics.
Panel A. Distribution of firm-year observations across economic sectors
Total sample % of sample
Financials 1709 21.0

Information technology 1449 17.8
Consumer discretionary 1264 15.6
Industrials 1131 13.9
Health care 906 11.2
Energy 478 5.9
Materials 374 4.6
Utilities 305 3.8
Consumer staples 258 3.2
Telecommunication services 156 1.9
Real estate 94 1.2
Number of firm-year observations 8124 100.0%
Panel B. Descriptive statistics (N = 8124)
Mean SD 1 2 3 4 5 6 7 8 9 10 11 12
1 Tobin's q 1.340 1.402 1.00

2 Sales 0.763 0.685 0.34 1.00
3 KantarAdStock 0.095 0.535 0.14 0.15 1.00
4 OfflineAdStock 0.062 0.443 0.11 0.13 0.88 1.00
5 DisplayAdStock 0.010 0.081 0.10 0.09 0.43 0.30 1.00
6 SearchAdStock 0.025 0.238 0.08 0.08 0.55 0.10 0.17 1.00
7 Lev 0.217 0.205 0.22 0.03 −0.07 −0.04 −0.07 −0.06 1.00
8 Profit 0.058 0.133 0.21 0.41 0.12 0.14 0.08 −0.02 0.04 1.00
9 Size 1.309 1.880 0.01 0.30 −0.12 −0.07 −0.09 −0.13 0.20 0.30 1.00
10 IndGrow 0.084 0.270 0.14 0.10 0.02 0.01 0.01 0.02 0.04 0.00 −0.02 1.00
11 IndConc 0.368 0.287 0.12 0.26 0.01 0.03 −0.02 −0.04 0.07 0.18 0.19 0.03 1.00
12 IndTurb 1.314 0.782 0.01 −0.03 0.00 0.00 −0.01 −0.01 −0.08 −0.04 −0.16 0.04 0.07 1.00
An alternative to our modeling approach is a vector autoregressive model (VAR), which is well-suited to capture long-term ef-
fects when granular weekly data are available for a long time span (e.g., Kireyev et al., 2016). The data requirements to estimate a
VAR model in our context are substantial: in particular, it would require the availability of weekly sales revenue data.11 However,
such granular data are unavailable for the large set of firms we study. Accordingly, our proposed approach aligns with our goal to
assess the effects of online display, paid search, and offline advertising on firm performance and value in a broad cross-sectional/
time-series setting.
4.2. Auxiliary regressions
Eqs. (1)–(4) include the predicted residuals as control variables from auxiliary regressions, which we use to correct for poten-
tial endogeneity bias (Petrin & Train, 2010). The four predicted residuals are KantarAdv_Resid, DisplayAdv_Resid, SearchAdv_Resid,
and OfflineAdv_Resid. The auxiliary regressions use the respective advertising variables as dependent variables and require a
new variable that correlates with each of our four advertising variables but does not directly correlate with unobserved determi-
nants of Sales and Tobin's q.
Following Sridhar et al. (2016), we use the average advertising expenditures by firms, excluding the focal firm, in the same
four-digit SIC code (see also Lev & Sougiannis, 1996). We expect the instrument to positively relate to our advertising expenditure
variables. The identifying assumption is that the industry's overall average advertising expenditures do not correlate with firm-
specific performance shocks but are highly correlated with our variables.12 Adding the predicted residuals from the auxiliary re-
gressions mitigates potential endogeneity, as the retained independent variables should no longer correlate with the error
terms in Eqs. (1)–(4). Eqs. (9)–(12) show the auxiliary regressions; the suffix _IndAvg indicates the industry's average of the re-
spective advertising stock variable (for related results, see Web Appendix A):
KantarAdStocki;t ¼ α0i þ β1 KantarAdStock IndAvgi;t þ β2 Levi;t þ β3 Profit i;t þ β4 Sizei;t þ β5 IndGrowi;t þ β6 IndConci;t
þ β7 IndTurbi;t þ β8 Year t þ εi;t : ð9Þ
11
Regarding our main equations (models 2 and 4), the Sales (Tobin's q) equation has 10 (11) parameters (including the intercept and excluding the auxiliary regres-
sion residuals). Including the five equations in the VAR with exogenous variables (one each for display, paid, and offline advertising as well as for sales and Tobin's
q) leads to the large number of parameters to estimate, in addition to the 15 parameters required for the variance–covariance matrix.
12
Sridhar et al. (2016) provide an extensive discussion of the use of the industry's overall average advertising expenditures as an excluded variable.
DisplayAdStocki;t ¼ α0i þ β1 DisplayAdStock IndAvgi;t þ β2 Levi;t þ β3 Profit i;t þ β4 Sizei;t þ β5 IndGrowi;t þ β6 IndConci;t
þ β7 IndTurbi;t þ β8 Yeart þ εi;t : ð10Þ
SearchAdStocki;t ¼ α0i þ β1 SearchAdStock IndAvg i;t þ β2 Levi;t þ β3 Profit i;t þ β4 Sizei;t þ β5 IndGrowi;t þ β6 IndConci;t
OfflineAdStocki;t ¼ α0i þ β1 OfflineAdStock IndAvg i;t þ β2 Levi;t þ β3 Profit i;t þ β4 Sizei;t þ β5 IndGrowi;t þ β6 IndConci;t
5. Results
5.1. Descriptive statistics
Panel A of Table 4 presents the number of observations in each economic sector, revealing broad representation, and panel B
presents the descriptive statistics and correlation matrix. On average, the firms exhibit moderate leverage (Lev = 0.217), are prof-
itable (Profit = 0.058), and are moderate in size (Size = 1.309). The share of Kantar's online advertising expenditures (i.e., display
and paid search advertising) as a percentage of total Kantar advertising expenditures varies from 17% to 19% for our sample of
8124 firm-year-specific observations. All four advertising variables (KantarAdStock, OfflineAdStock, DisplayAdStock, and
SearchAdStock) correlate positively with Sales and Tobin's q.
To assess the reliability of the Kantar advertising data, we estimate the intra-class correlation coefficient (ICC) between total
Kantar advertising expenditures (KantarAdStock) and the total advertising expenditures disclosed by the firms and available on
COMPUSTAT. The ICC and its 95% confidence interval measures (1) absolute agreement or (2) consistency of agreement by
using a two-way random-effects model in each case. The ICC (0.766 [0.745; 0.786]) for absolute agreement and the ICC (0.773
[0.763; 0.783]) for consistency of agreement are within the range indicating reliability of the Kantar data (Cicchetti, 1994).
Table 5
Impact of online display and paid search advertising on firm performance and firm value.
Dependent variable: Sales (N = 8124) Tobin's q (N = 8124)
Coeff. S.E. Coeff. S.E. Coeff. S.E. Coeff. S.E.
(1) (2) (3) (4)
Advertising variables
KantarAdStock 0.242 0.060 ⁎⁎⁎ 0.239 0.088 ⁎⁎⁎
OfflineAdStock 0.097 0.019 ⁎⁎⁎ 0.270 0.132 ⁎⁎
DisplayAdStock (H1) 0.231 0.108 ⁎⁎ 0.880 0.295 ⁎⁎⁎
SearchAdStock (H3) 0.583 0.107 ⁎⁎⁎ 0.562 0.319 ⁎
Control variables
Lev −0.011 0.016 −0.015 0.016 0.557 0.095 ⁎⁎⁎ 0.564 0.062 ⁎⁎⁎
Profit 1.109 0.154 ⁎⁎⁎ 1.064 0.092 ⁎⁎⁎
Size 0.030 0.004 ⁎⁎⁎ 0.030 0.004 ⁎⁎⁎ −0.055 0.016 ⁎⁎⁎ −0.054 0.012 ⁎⁎⁎
IndGrow 0.006 0.003 ⁎⁎⁎ 0.007 0.002 ⁎⁎⁎ 0.131 0.022 ⁎⁎⁎ 0.132 0.022 ⁎⁎⁎
IndConc 0.044 0.008 ⁎⁎⁎ 0.040 0.007 ⁎⁎⁎ 0.135 0.062 ⁎⁎ 0.148 0.058 ⁎⁎
IndTurb −0.001 0.006 −0.001 0.006 −0.010 0.038 −0.011 0.029
KantarAdStock_Resid −0.078 0.017 ⁎⁎⁎ −0.072 0.093
OfflineAdStock_Resid −0.084 0.020 ⁎⁎⁎ 0.048 0.045
DisplayAdStock_Resid −0.017 0.123 −0.786 0.311 ⁎⁎⁎
SearchAdStock_Resid −0.002 0.020 0.102 0.043 ⁎⁎⁎
Constant 0.842 0.009 ⁎⁎⁎ 0.846 0.008 ⁎⁎⁎ −0.515 0.068 ⁎⁎⁎ −0.530 0.044 ⁎⁎⁎
Fixed effects Year Year Year Year
R2 0.32 0.30 0.06 0.06
Overall test of significance (Wald) 232.49 ⁎⁎⁎ 214.70 ⁎⁎⁎ 741.50 ⁎⁎⁎ 890.17 ⁎⁎⁎
DisplayAdStock = OfflineAdStock, Chi2 (1) (H2a) 1.44 (H2b) 3.28 ⁎
SearchAdStock = OfflineAdStock, Chi2 (1) (H4a) 19.47 ⁎⁎⁎ (H4b) 0.66
SearchAdStock = DisplayAdStock, Chi2 (1) 6.75 ⁎⁎⁎ 0.56
Notes: See Table 3 for variable definitions. The residuals are obtained from the auxiliary regressions. All variables are winsorized (1%). Coeff = coefficient;
SE = robust standard error.
⁎ p b 0.10.
⁎⁎ p b 0.05.
⁎⁎⁎ p b 0.01.
Table 6
Robustness checks.
Dependent variable: Sales (N = 8124) Tobin's q (N = 8124)
Coeff. S.E. Coeff. S.E. Coeff. S.E. Coeff. S.E.
(1) (2) (3) (4)
Fixed Effects Interactions Fixed Effects Interactions
Advertising variables
OfflineAdStock 0.092 0.010 ⁎⁎⁎ 0.091 0.018 ⁎⁎⁎ 0.216 0.082 ⁎⁎⁎ 0.409 0.121 ⁎⁎⁎
DisplayAdStock 0.180 0.057 ⁎⁎⁎ 0.344 0.139 ⁎⁎⁎ 1.244 0.423 ⁎⁎⁎ 0.682 0.298 ⁎⁎
SearchAdStock 0.291 0.035 ⁎⁎⁎ 0.607 0.110 ⁎⁎⁎ 0.955 0.189 ⁎⁎⁎ 0.328 0.121 ⁎⁎⁎
DisplayAdStock × OfflineAdStock 0.038 0.050 −0.017 0.033
SearchAdStock × OfflineAdStock 0.013 0.012 −0.046 0.046
DisplayAdStock × SearchAdStock −0.740 0.109 ⁎⁎⁎ 0.253 0.156
Control variables
Lev −0.052 0.009 ⁎⁎⁎ −0.015 0.016 1.048 0.053 ⁎⁎⁎ 0.581 0.062 ⁎⁎⁎
Profit 1.227 0.114 ⁎⁎⁎ 0.988 0.095 ⁎⁎⁎
Size 0.025 0.001 ⁎⁎⁎ 0.030 0.004 ⁎⁎⁎ −0.066 0.007 ⁎⁎⁎ −0.049 0.012 ⁎⁎⁎
IndGrow 0.010 0.007 0.007 0.002 ⁎⁎⁎ 0.255 0.034 ⁎⁎⁎ 0.133 0.022 ⁎⁎⁎
IndConc 0.054 0.007 ⁎⁎⁎ 0.040 0.007 ⁎⁎⁎ −0.116 0.038 ⁎⁎⁎ 0.138 0.058 ⁎⁎
IndTurb 0.000 0.005 −0.001 0.006 −0.064 0.028 ⁎⁎ −0.002 0.029
KantarAdStock_Resid −0.080 0.011 ⁎⁎⁎ −0.085 0.020 ⁎⁎⁎ 0.039 0.038 −0.147 0.046 ⁎⁎⁎
OfflineAdStock_Resid −0.189 0.061 ⁎⁎⁎ −0.014 0.124 −1.059 0.463 −0.545 0.310 ⁎
DisplayAdStock_Resid 0.006 0.009 −0.001 0.020 −0.887 0.198 ⁎⁎ −0.183 0.121
Constant 0.833 0.016 ⁎⁎⁎ 0.845 0.008 ⁎⁎⁎ −0.961 0.082 ⁎⁎⁎ −0.547 0.045 ⁎⁎⁎
Fixed effects Year Year Year Year
R2 0.35 0.30 0.45 0.07
Overall test of significance 164.37 ⁎⁎⁎ (F-test) 308.48 ⁎⁎⁎ (Wald) 196.12 ⁎⁎⁎ (F-test) 909.76 ⁎⁎⁎ (Wald)
DisplayAdStock = OfflineAdStock, F (1)/Chi2 (1) 2.01 3.28 ⁎ 5.40 ⁎⁎ 0.67
SearchAdStock = OfflineAdStock, F (1)/Chi2 (1) 26.76 ⁎⁎⁎ 21.64 ⁎⁎⁎ 12.95 ⁎⁎⁎ 0.23
Notes: See Table 3 for variable definitions. The residuals are obtained from the auxiliary regressions. All variables are winsorized (1%). Coeff = coefficient;
SE = robust standard error.
⁎ p b 0.10.
⁎⁎ p b 0.05.
⁎⁎⁎ p b 0.01.
The advertising carryover parameters from Eqs. (5)–(8) are similar to the carryover estimates of Dinner et al. (2014) for the
high-end apparel retailer they analyze. The values of the carryover parameters are as follows: λTraditional = 0.6, λOnlineDisplay =
0.8, and λPaidSearch = 0.2.
5.2. Empirical results
Table 5 presents the results for the effects of online display and paid search advertising on firm performance and value. Col-
umns (1) and (2) present the results with firm performance (Sales) as the dependent variable, and Columns (3) and (4) present
those with firm value (Tobin's q) as the dependent variable. In line with the findings of previous research (e.g., Srinivasan &
Hanssens, 2009), we document that total Kantar advertising has positive effects on both sales (0.242, p b 0.01) and firm value
(0.239, p b 0.01). In addition, offline advertising shows positive effects on both sales (0.097, p b 0.01) and Tobin's q (0.270,
p b 0.05).13
We now turn to testing our hypotheses. First, assessing the absolute effects of online display advertising (DisplayAdStock), we
find significantly positive coefficients on both Sales (0.231, p b 0.05) and Tobin's q (0.880, p b 0.01); this result provides support for
H1a and H1b. Second, we assess the relative effects when Sales is the dependent variable in Column (2) of Table 5. As expected,
the coefficient for display advertising (0.231) is directionally more positive than that for offline advertising (0.097), but this differ-
ence is insignificant (χ2 = 1.44); thus, we fail to find support for H2a. However, when Tobin's q is the dependent variable (Column
(4)), the coefficient for display advertising (0.880) is significantly more positive than that for offline advertising (0.270) (χ2 =
3.28), in support of H2b.
Note that these estimates for advertising's impact on Tobin's q (which capture the effects of advertising intensity) are similar in
magnitude to previous research. For example, McAlister et al. (2016) report a firm value impact of 0.53 for advertising of
differentiators, and Sridhar et al. (2016) report estimates of 0.12 for national advertising, 0.32 for online advertising, and 0.76
for regional advertising. Edeling and Fischer (2016) note that the optimality of advertising expenditure implies a firm value
13
As further validation of the Kantar advertising data (i.e., the Kantar data are broadly representative of advertising investment by the sample firms), untabulated
results using advertising from COMPUSTAT (as well as our sample observations and control variables) reveal the expected significantly positive coefficients between
this latter variable and both Sales and Tobin's q. In addition, our results are unaffected by the choice of AdStock as operationalization of advertising variables versus un-
smoothed advertising expenditures.
elasticity of zero, assuming that firms want to maximize shareholder value. An implication therefore is that firms do not set op-
timal advertising budgets, given that the (average) firm value elasticity estimates are higher than zero.14
Next, we examine the effects of paid search advertising. Focusing on the absolute effects, we find significantly positive coeffi-
cients for paid search advertising (SearchAdStock) both when Sales is the dependent variable (0.583, p b 0.01) and when Tobin's q
is the dependent variable (0.562, p b 0.10); thus, we find support for H3a and H3b. For the relative effects, when Sales is the de-
pendent variable, we find a significantly more positive coefficient for paid search advertising (0.583) than offline advertising
(0.097) (χ2 = 19.47), in support of H4a. As Ailawadi (2018) notes, paid search elasticities, which are higher in magnitude than
typical advertising elasticities, should be compared with distribution elasticities because paid search is more about finding prod-
ucts online rather than advertising; empirical generalizations in marketing indicate that distribution elasticities should be at
least an order of magnitude higher than advertising elasticities (Hanssens, 2015). As expected, when Tobin's q is the dependent
variable, the coefficient for paid search advertising (0.562) is directionally more positive than that for offline advertising
(0.270), but this difference is insignificant (χ2 = 0.66); thus, we fail to find support for H4b.
Finally, we also assess the relative effects of paid search versus online display advertising. For the relative effects, when Sales is
the dependent variable, we find a significantly more positive coefficient for paid search advertising (0.583) than online display ad-
vertising (0.231) (χ2 = 6.75). This result (see Table 5) indicates that paid search has a stronger impact than online display adver-
tising on short-term firm performance. When Tobin's q is the dependent variable, the coefficient for online display advertising
(0.880) is directionally more positive than that for paid search advertising (0.562), but this difference is insignificant (χ2 = 0.56).
5.3. Control variables
We next confirm that the control variables operate as expected. When Sales is the dependent variable, consistent with econo-
mies of scope and scale, we find that size (Size) consistently exhibits a significantly positive effect on sales. In addition, we find a
similar positive effect for industry growth (IndGrow) (Haleblian & Finkelstein, 1993; McDougall et al., 1994). Although financial
leverage (Lev) and industry turbulence (IndTurb) are insignificant (as in McAlister et al., 2016), we find a significantly positive co-
efficient on industry concentration (IndConc), consistent with the notion that concentrated industries have high market power.
When Tobin's q is the dependent variable, we find a significantly positive association with leverage (Lev), which increases firm
value through either signaling or lower cost of capital. We also find a consistently positive association between profit (Profit) and
firm value (Srinivasan, Pauwels, Silva-Risso, & Hanssens, 2009). In addition, size (Size) has a negative impact on firm value, con-
sistent with “size” effects documented in both finance (Schwert, 1983) and marketing (McAlister et al., 2016). Industry concentra-
tion (IndConc) is positively associated with firm value, as concentrated industries offer improved opportunities to the firm
(McDougall et al., 1994). Industry growth (IndGrow) is also positively associated with firm value, while industry turbulence
(IndTurb) is insignificant (McAlister et al., 2016). Overall, the results for the control variables are consistent with prior research.
5.4. Robustness checks
We perform several robustness checks; in general, the results from these analyses are consistent with our primary results. First,
we re-estimate the primary Eqs. (2) and (4), now using fixed effects instead of the random effects used in the primary analyses.
Use of industry-fixed effects controls for industry-specific factors that may drive our outcome variables. Table 6 presents the re-
sults, with Sales as the dependent variable in Column (1) and Tobin's q as the dependent variable in Column (3). The estimates
(and related inferences) are similar to those of our main models in Table 5.
Second, we supplement Eqs. (2) and (4) by including interactions between our three advertising variables: display, paid search,
and offline advertising. These interactions account for different kinds of advertising varying in their ability to target consumers. In
addition, this specification provides insights into the joint impact of the three advertising types to maximize the effectiveness of
overall advertising expenditures. Columns (2) and (4) of Table 6 present the results. We again find similar coefficients to those
of our main models (Table 5).
Regarding potential synergies across the advertising types, we find that the interactions of online display and paid search ad-
vertising with offline advertising are insignificant for both Sales and Tobin's q. Thus, we fail to find evidence of sub- or super-
additive joint effects of display and paid search advertising with offline advertising. However, the interaction between online dis-
play and paid search advertising is significantly negative for Sales in Column (2) of Table 6 (−0.740, p b 0.01); this finding sug-
gests that paid search advertising mitigates the marginal effect of display advertising (and vice versa) (Sridhar et al., 2016).
When Tobin's q is the dependent variable (Column (4)), we fail to find a significant interaction between online display and
paid search advertising.
There are several potential explanations for the sub-additive effect of online display and paid search advertising. Display and
paid search serve inherently different purposes. For example, firms use display advertising to build awareness at the top of the
purchase funnel, while they frequently use paid search advertising to create short-term sales conversions at the bottom of the pur-
chase funnel (e.g., Dinner et al., 2014). Thus, display and paid search advertising may have sub-additive effects when used jointly
from the potentially conflicting messages that can lead to consumer confusion. In addition, consumers' serial consumption of on-
line content within a short period (multiplexing) makes it difficult for media planners to understand potential substitutions and
14
That is, the model-recommended allocation of advertising expenditures across the different types based on the relative elasticities of online and offline advertising
versus the actual allocation in the sample of firms differs.
complementarities (e.g., Jeong & Fishbein, 2007; Lin, Venkataraman, & Jap, 2013). This difficulty is exacerbated in the online chan-
nel, as browsing on the Internet consists of reiterated (1) typing of keywords into a search engine, yielding paid (and non-paid)
search results, and (2) consuming website content, including display advertisements. Finally, Sridhar et al. (2016) suggest that the
sub-additive effects within their setting likely capture opportunity costs of poor tactical and strategic integration across media. For
example, different digital advertising personnel typically manage display and paid search advertising for a firm, often resulting in a
lack of coordination and, thus, synergy. Furthermore, recent empirical studies present mixed evidence of the presence of synergy
between display and paid search: Kireyev et al. (2016) document positive synergy for a commercial bank, whereas Pauwels,
Demirci, Yildirim, and Srinivasan (2016) do not find a positive synergy between display and paid search advertising in the four
industries analyzed (retail, travel services, furniture supplier, and scholastic preparation services).
As a third robustness check, we examine alternative measures of our key dependent variables Sales and Tobin's q. Specifically,
for short-term performance, we replace Sales, a measure of top-line performance, with Return on Assets, a measure of bottom-line
performance. The results, presented in Column (1) of Web Appendix B, are unchanged from our primary results. For long-term
performance, we similarly replace Tobin's q with Unlogged Tobin's q. Recall that our primary analyses use logged Tobin's q so
that we can interpret the coefficients as elasticities. Nonetheless, use of Unlogged Tobin's q provides similar results, as revealed
in Column (2).
Fourth, we investigate longitudinal trends in the aforementioned associations. In particular, the absolute magnitude of online
(offline) advertising has been increasing (decreasing) over time, suggesting potential temporal changes in the associations we doc-
umented. Accordingly, we define an indicator variable LaterPeriod as equal to 1 for sample years 2014–2016 and 0 otherwise
(i.e., for sample years 2010–2013). For both analyses of short-term firm performance (i.e., dependent variable of Sales) and
long-term performance (i.e., dependent variable of Tobin's q), we interact LaterPeriod with each of the advertising variables. Col-
umn (3) in Web Appendix B presents the results for Sales and Column (4) the results for Tobin's q. In general, we fail to find ev-
idence of temporal changes in the previously documented associations; only online display advertising appears stronger in the
later part of our sample period (DisplayAdv × LaterPeriod = 0.150, p b 0.10). This result corresponds to our expectation that online
display advertising better targets consumers than offline advertising (e.g., via behavioral targeting technologies), as targeting abil-
ities have improved over time (e.g., due to real-time advertising).
6. Discussion
Advertising expenditures worldwide for 2018 are $628 billion, with substantial growth driven by online advertising
(eMarketer, 2018). However, little is known about the impact of the key types of online advertising (display and paid search)
on firm performance and firm value. Using a proprietary panel dataset of annual observations of display, paid search, and offline
advertising expenditures for a broad cross-section of firms spanning 2010–2016, we fill this void by testing hypotheses on the ab-
solute effects of online display and paid search advertising on firm performance and value, as well as their effects relative to offline
advertising.
This research advances the advertising literature by documenting that display and paid search advertising exhibit positive ef-
fects on short-term firm performance (measured by current period sales) and long-term firm value (measured by Tobin's q). These
insights complement prior research (e.g., Sridhar et al., 2016) documenting a positive association between sales and firm perfor-
mance, with online advertising broadly defined, by revealing that these effects manifest across both types of online advertising,
with each exhibiting both short- and long-term effects. Of note, this study also documents relatively greater positive effects of
paid search and display advertising than that of offline advertising: paid search (online display) advertising exhibits more positive
effects on firm sales (firm value) than offline advertising. Furthermore, the stronger effect for online display is accentuated in the
latter half of our sample period, consistent with improving targeting abilities over time that enhance online display's superiority to
offline advertising. Finally, while online display and paid search advertising share characteristics such as enhanced targeting, track-
ing, and placement, we show that paid search exhibits more positive effects on firm sales than online display. This latter effect
likely arises because paid search is consumer-initiated and occurs close to the purchase decision. Furthermore, firms typically
use paid search for performance marketing, aiming to generate a direct sales response.
Combined, these results are consistent with online display (paid search) advertising's differential advantage accruing from a
long-term (short-term) perspective and superior targeting. Paid search's differential advantage on sales is likely to accrue because
of its ability to control the placement context of the advertisement; this ability is confirmed through its significantly more positive
effect than online display on sales. Additional tests verify the robustness of these associations. Collectively, our results add to mar-
keting theory and contribute to the literature on the marketing–finance interface by shedding more light on both the absolute and
relative economic effects of display and paid search advertising.
6.1. Practical implications
Our findings offer several implications for managers and financial statement users. First, when allocating advertising budgets,
marketing managers should be aware that online display, paid search, and offline advertising differ in their effects on firm perfor-
mance and firm value. Our evidence reveals a differential advantage of paid search (online display) over offline advertising with
respect to short-term sales (long-term firm value). We find that a 1% increase in online display (paid search) advertising intensity
increases sales by 0.23% (0.58%) and firm value by 0.88% (0.56%). Similarly, we find that a 1% increase in offline advertising inten-
sity increases sales by 0.10% and firm value by 0.27%. These results reflect the stronger economic effects of display and paid search
advertising than offline advertising. However, we caution that our analyses do not allow us to conclude about advertising budgets'
extreme shifts (e.g., allocating all offline advertising expenditures to online paid search), given that we obtain the effects of online
display and paid search advertising from a sample of firms that have already invested in offline advertising.
Second, we show that the emphasis of advertising in the firm accentuates the effectiveness of paid search advertising, at least
in the short run. In addition, our finding on the sub-additive effects of display advertising and paid search advertising suggests that
managers should strive to better integrate, both strategically and tactically, their online display and paid search advertising to build
a cohesive message across advertising types to increase their individual and joint impact.
Third, our findings also are relevant to financial statement users. In particular, the results show considerable variation in how
the different types of advertising map onto firm performance and firm value. Given the dearth of information on the types of ad-
vertising expenditures—particularly from firm-sourced disclosures such as financial statements—our findings suggest potential
benefits to financial statement users from efforts to obtain and analyze firms' investments across the various advertising categories
(display, paid search, and offline advertising).
6.2. Limitations and future research directions
We note that our findings are subject to several limitations, which provide avenues for future research. Of primary consider-
ation, the Kantar advertising data come from advertising outlets rather than firm-sourced disclosures. Future research could vali-
date the Kantar data and better map the disaggregated advertising expenditures onto different aspects of firm performance.15 In
addition, our findings assume that our designations of the Kantar fields as display, paid search, and offline advertising reasonably
capture the economic distinction of these three broad categories of advertising expenditures. Future research could consider alter-
native methods to partition the data into these groupings as well as other types of online advertising, such as mobile or social
media advertising. Research also could examine firm-level (and industry-level) characteristics that may lead to variation in our
documented effects, such as by comparing multi-channel firms with both physical and online stores with only physical or only
online stores. Finally, going beyond firm value as a key performance metric, future research could examine how balancing adver-
tising expenditures across display, paid search, and offline advertising affects firms' risk exposure.
Overall, our findings confirm heterogeneous effects of online display, paid search, and offline advertising on both short- and
long-term firm performance in the context of a wide cross-section of firms over a multi-year period. These findings should be use-
ful to managers in their resource allocation decisions regarding advertising expenditures, to investors in their evaluation of firms,
and to regulators in their ongoing assessment of appropriate disclosure requirements for firms for this critical outlay.
Acknowledgments
Shuba Srinivasan acknowledges research funding from the Barron Chair at the BU Questrom School of Business for the pur-
chase of the Kantar data. The authors also thank the E-Finance Lab, member of the House of Finance at Goethe University, for pro-
viding financial support for this project.
Appendix A. Supplementary data
Supplementary data to this article can be found online at https://doi.org/10.1016/j.ijresmar.2020.02.002.
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3rd World Conference on Technology, Innovation and Entrepreneurship (WOCTINE)

3rd World Conference on Technology, Innovation and Entrepreneurship (WOCTINE)
A Review of Digital Brand Positioning Strategies of Internet Entrepreneurship in

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Yagmur Sacide BAHCECIKª, Senem Seda AKAYᵇ, Ali AKDEMIRcc

Yagmur Sacide BAHCECIKª, Senem Seda AKAYᵇ, Ali AKDEMIR
ª Beykent University, Institute of Social Sciences, Departmant of Business Administration, Istanbul, 34433, Turke
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Arel University, Faculty of Economics and Administrative Sciences, Department of Business Administration, Istanbul, 34295, Turkey
Abstract
Abstract
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© 2019 The Author(s). Published by Elsevier B.V.
© 2019 The Authors. Published by Elsevier B.V.
© 2019 The Author(s).
Peer-review Published by Elsevier B.V.
Peer-review under
under responsibility
responsibilityof of the
the scientific
scientific committee
committee of of the
the 3rd World Conference
3rd World Conference on on Technology,
Technology, Innovation
Innovation and
and
Peer-review
Entrepreneurship
Entrepreneurshipunder responsibility of the scientific committee of the 3rd World Conference on Technology, Innovation and
Entrepreneurship
Keywords: Internet Entrepreneurship, Virtual Organizations, Brand Positioning, Strategic management
Keywords: Internet Entrepreneurship, Virtual Organizations, Brand Positioning, Strategic management
* Corresponding author. Tel.:+90 555 832 4800

* Corresponding
E-mail author. Tel.:+90 555 832 4800
address: yagmur.akay@gmail.com
E-mail address: yagmur.akay@gmail.com
1877-0509 © 2019 The Author(s). Published by Elsevier B.V.

1877-0509
Peer-review©under
2019responsibility
The Author(s). Published
of the scientificbycommittee
Elsevier B.V.
of the 3rd World Conference on Technology, Innovation and Entrepreneurship
Peer-review under responsibility of the scientific committee of the 3rd World Conference on Technology, Innovation and Entrepreneurship
1877-0509 © 2019 The Authors. Published by Elsevier B.V.

Peer-review under responsibility of the scientific committee of the 3rd World Conference on Technology, Innovation and Entrepreneurship
10.1016/j.procs.2019.09.083
2 Yağmur Sacide Bahçecik et al. / Procedia Computer Science 00 (2019) 000–000
514 Yagmur Sacide Bahcecik et al. / Procedia Computer Science 158 (2019) 513–522
Introduction
Today, the concept of “internet entrepreneurship is being discussed. The speed, communication, and reliability of
communication technologies coupled with marketing strategies increase the profitability of businesses around the
world. In this context, every website established should be considered as an organization. Existing job opportunities
are growing with the use of electronic media and especially internet technologies in trade and business relations.
Sales of marketed products have become easier; advertising, brand positioning, product promotion, pre-sales and
after-sales support and similar channels have become more effective in electronic environment. Internet and e-
commerce not only provide opportunities for existing businesses, but also create great opportunities for new
entrepreneurs who want to start a business.
Internet entrepreneurs need to implement important strategies in order to exist in a virtual environment and to
continue their organizational activities. They pay sufficient attention about important strategies such as brand
expansion, developing new brands and digital brand positioning.
Digital brand management enables to have direct interaction between internet entrepreneurs and customers as
never before. Successful organizations use social media, website content and even mobile applications to expand
their brand awareness, interact with their target audiences and increase their reach.
Digital brand positioning is a strategy related to how the organization wants to be perceived in the eyes of its
important stakeholders according to the area it is in and the value it provides.
Strong brand positioning clearly identifies the key target audience and specific needs that are important for virtual
organizations.
In this study, descriptive analysis method was used. In this context, the conceptual definition and characteristics
of entrepreneurship and internet entrepreneurship and their importance for virtual organizations are examined in the
theoretical part. In the second stage, the importance of digital brand positioning strategies within the structure of
virtual organizations of internet entrepreneurs is mentioned.
In the analysis section, an evaluation was made on the sites that are still the trend in the world and which publish
information in different forms on the internet. Limitations of this study; facebook, instagram and youtube sites.
1. The Concept and Importance of Entrepreneurship
It is very important for the definition of entrepreneurial activity to be made correctly, that the valid indicators of
entrepreneurship can be collected and compared among countries, and that analysts and decision makers have a
better understanding of the factors that affect the value and form of this activity, productivity and richness and
contribution to employment, and its results and effects.
The concept of entrepreneurship has been developed since 1730, when it was first used, with the contributions of
various economists, and in 1934 Joseph Schumpeter associates entrepreneurship with “innovativeness and has
become close to its generally accepted meaning. Schumpeter defines entrepreneurs as innovators who implement
entrepreneurial change in markets. There are 5 indicators of the defined interventional change: 1. Introducing a new
(or improved) product to the market, 2. Developing a new production method, 3. Creating a new market, 4. Making
a new source of input available, 5. Reusing business management processes Configuring / organization [1]
There are many definitions of entrepreneurship and entrepreneurial concepts. In addition to being an economic
value generation, entrepreneurship is a concept that is closely related to social, cultural, economic and political
dynamics both in terms of the environment in which it occurs and the innovative mobility it creates.
Entrepreneurship is the subject of the branches of science such as psychology and anthropology as well as business,
Yagmur Sacide Bahcecik et al. / Procedia Computer Science 158 (2019) 513–522 515
Yağmur Sacide Bahçecik et al. / Procedia Computer Science 00 (2019) 000–000 3
economics as it is essentially human and human group and communities. One's perspective, attitude and character
affect entrepreneurship. According to Schumpeter, entrepreneurship also affects the needs of individuals such as
acceptance and status in society. Entrepreneurship is also associated with society's perspective, value judgments, and
the cultural structure and traditions of society. Production, new investment, tax payment, employment, etc.
parameters are related to economy and economic development. The environment in which it belongs, and the
cultural environment also affects entrepreneurship. [2]
There is an important consensus that entrepreneurship is a combination of many personal characteristics. In

general, entrepreneurs are independent, risk-taking, innovative, taking measures against uncertainties, evaluating
opportunities to achieve, and having proactive personality traits. However, there is no capital concept in these
characteristics. However, it can be an entrepreneur who owns capital, but can be an entrepreneur even if it is not a
capital owner. [3]
The use of the concept of entrepreneurship in today's sense is related to the dominance of the capitalist mode of
production. This concept’s entrance to literature takes place in 19th and 20th century. According to Baptiste Say, the
concept of entrepreneur is the person who brings together all the factors of production and manages to produce a
product that is thought to be valuable and risk the profit for its profit. Say's entrepreneurial definition is based on the
principle of having both risk-taking and management skills. [4]. In order to be successful in entrepreneurship; it is
very important to act in accordance with the risks and continue the management activities effectively.
1.1 Internet Entrepreneurship
The development of technology in the new century has led many systems to intertwine with technological
processes. Entrepreneurship in the traditional sense has also started to be influenced by new technologies. In
particular, internet and internet tools have become an important medium for entrepreneurs.
Entrepreneurs must monitor the opportunities created by environmental trends and changes. Entrepreneurship is
very important at the national level as well as at the individual level. Entrepreneurship is the cornerstone of
economic growth and development; It also promotes innovation and creativity. As a result of the development of
internet-based technologies, entrepreneurs had the opportunity to expand into new markets. It can be said that the
rapid developments in information technologies have a positive effect on the entrepreneur. For information-based
economy, information and data processing technologies play an important role and provide competitive advantage to
economies. The source of this competitive advantage encourages entrepreneurs to own businesses of all sizes. [5]
The European Union defines Internet entrepreneurship as “creating or developing economic activities or social
benefits in ways that cannot exist without the Internet, by taking risks, combining creativity and / or innovation with
healthy management, outside the core business areas of new or existing organizations. [6]
With the development of internet channels in recent years; entrepreneurship has started to be realized not only
at the enterprise level but also through individual websites. One of the most important characteristics of individuals
engaged in entrepreneurship activities through the internet is that they are creative and different from other
individuals. Because it is necessary to be creative to create a different option within such a wide range of products
and services. [7]
For internet entrepreneurship, individual creativity is very important. Because internet entrepreneurship, unlike
corporate entrepreneurship; it also includes individual thinking and acting.
When internet entrepreneurship is examined from the perspective of entrepreneurship ecosystem, it is seen that
the existence of an internal market with the infrastructure and competence to receive the products and services
offered is necessary for the formation of internet enterprises. The size of this domestic market directly affects the
ease of entrepreneurs' access to capital and the growth rate of enterprises. [8]
1.2 Difference of Internet Entrepreneurship from Other Entrepreneurships
Internet entrepreneurship has three important differences from other entrepreneurs;
• Low initial capital requirement

• Low operating cost
• Access to broad markets and targeted audiences[8]
• No Need For An Office Or Store, Opening To Low-Cost

Low Starting Capital Locations
• Reduce Sales and Marketing Costs Through Partnerships
With Social Networks and Other Websites.
Low Fixed and Variable Cost İtems • In Most Internet Business Models, Cost İtems Such As
İnventory, Tenants, İnsurance, Tax, Electricity Are
Lower Than Non-Internet Jobs.
• Access To A Wide Range Of Customers, Regardless Of Time

Access To Broad Markets And And Space.
Target Audiences
• Ease Of Access To More Clearly Defined Audience (With
search engine optimization and internet advertising)
Figure 1 Contribution of the Internet to entrepreneurship [8]
• Low initial capital requirement,
Operating capital is a factor that prevents or forces many entrepreneurs to start a business, as it requires
financing. The initial capital consists of fixed costs, rent and general expenses, sales and marketing expenses,
personnel costs and inventory expenses. In the case of Internet businesses, the initial capital is lower than in other
areas, due to the fact that a physical office or store is largely not needed or the required office or store is more cost-
effective. In addition, sales and marketing costs may be lower than those in the physical environment. Testing and
marketing costs for products or product demand (launching, branding spending) is advantageous because it is more
cost-effective or variable, such as the use of social networks and marketplaces, partnerships with other sites, and
search engines..
• Low operating costs
After the initial stages, the operating costs of the internet organizations may be in a lower cost structure.
The fact that the cost items such as inventory, rent, insurance, tax, electricity, etc. are not present at all or are low in
the works carried out on the internet allows the operation costs of internet entrepreneurship to be lower. As an
example, the main operating expenses of an internet store operating in the retail sector and the physical store abroad
were compared. It can be seen that the retail store has an advantage of 14 points compared to the physical store due
to the low rent requirement.
• Access to broad markets and targeted audiences
In addition to the advantages created by the Internet on the expense side, it also has significant advantages on
the revenue and customer acquisition side.
Besides being a cost efficiency tool, internet has many advantages of increasing the percentage of income and
number of customers. Also internet provides the entrepreneurs a source which reaches via search engines to the
mass volume of targeted customers free of place and time. In addition to broad mass transportation, the opportunity
to reach the target audience with variable cost is possible with internet marketing (search engines, local marketing).
Because of these three factors, the internet provides a very suitable environment for entrepreneurship and allows
entrepreneurs to test and grow their ideas at low costs.
2. Virtual Organizations
As the developing technologies and the internet are the fastest way to reach the consumers, organizations have
changed their models and management in recent years. Virtual organizations are the form of cooperation of various
organizations in the market to ensure their continuity in the rapid development of the internet.
A virtual organization is defined as an organization that does not need to gather employees at a certain place and time,
where the enterprises in different places can take part in the production of a product or service, and constantly
communicates with the information and communication technology facilities and provides goods or services to its
customers like a single organization. [9]
2.1 General Characteristics of Virtual Organizations
In order for an organization to be virtual, it is necessary to have interactive working and space independent work.
In the process of having these features, it is foreseen that it is necessary to utilize various communication technologies
and social media in the digital media at the highest level.
The general features of the virtual organization are as follows [10]:
• Their ability to meet customer demands is high. They can return quickly.
• Employees do not have hierarchical titles.
• It is based on knowledge and expertise.
• They are capable of adaptation.
• There are no unnecessary processes. So businesses focus on what they do best.
• They specialize in evaluating opportunities.
• They achieve high efficiency at low cost.
2.2 Virtual Teams
Teams formed in traditional organizations are in a different formation in virtual organizations. Virtual teams, which
are a component of virtual organizations; Information technology platforms and internet portals, are the central
functions of the development of products and services that add value to new virtual consumers. [11]
It is the developments in communication and information technologies that make virtual organizations, virtual teams
and virtual workplaces possible. After creating virtual teams, Internet entrepreneurs develop various strategies to
increase the best awareness of their products or services in various virtual channels. In this context, different strategies
are developed in order to locate the brands created in virtual environments.
3. Digital Brand Positioning Strategies
The formation of the concept of media starting in the second half of the 19th century, it has rapidly integrated with
the social error by developing in the electronic field. Media; with the emergence of new inventions in economic,
social, cultural and political conditions and serving to a mass industry, it gained its present appearance under the name
of ‘digital revolution after intense capitalization. [12]
Virtual organizations that operate in a digital environment create digital content with the virtual teams they create.
There are various contents that digital content should possess. Sincerity: Because the information is very difficult
to control in the digital environment, the content that has been created has to be sincere. Consistency: It is important
that the content presented in content distribution channels is consistent with each other. Thus, confidence in the brand
is increased. Creating value and creating a lifestyle: Brands should create value and create a lifestyle with the content
they create. This leads to brand loyalty. Awareness-raising: Digital content, which has the characteristic of attracting
attention with its original structures, has positive results for the brand. The brand can create a unique style. Education:
As the content contains more or less information, it can be said that the content educates the consumer. Emotion:
Digital content that can benefit from various consumer needs, such as purchasing and meeting needs, offers content
in line with these needs. Clarity: The message to be conveyed to the target audience and followers should be very
clear and understandable. Up-to-date: Presenting up-to-date content can not only affect the attitude towards the brand,
but also develops a sense of trust towards them, and it is possible to create awareness with content that contains
accurate, up-to-date information. Allowing the consumer to contribute to the content: Web 2.0 technology enables
users to be included in the content and allow them to contribute to the content, thus strengthening the emotional link
between the brand and the people. [13]
In general brand positioning is the work of creating a permanent and special place for the brand in the minds of the
consumers identified as the target audience through marketing and advertising. Positioning is the starting point for
building strong awareness among competitors and gaining competitive advantage. Brand positioning is the entire
process of taking place in the minds of customers. [14] In literature, the following methods are used as a basis for
product positioning; Positioning that emphasizes product characteristics, positioning based on price-quality
relationship, positioning that emphasizes the use of the product, positioning that emphasizes the product class,
positioning that emphasizes product users, positioning with competitors, positioning with cultural symbols [15]
Internet entrepreneurs develop various strategies to increase the demand for their products in the market. The
increasing use of the Internet in the last 20 years has made it compulsory for organizations to brand the products or
services they create and position the brands they create in the market in order to provide competitive advantage.
Understanding the brand, enriching people's perceptions and attitudes towards the brand; can help strategies,
contribute to a differentiating brand identity, lead the communication effort, at the same time create brand value. [16]
For this reason, in the positioning process, brand strategists must be able to perceive the brand to consumers, tell their
strategies and policies to differentiate the brand from its competitors, and have strong intuition and competence. Only
in this way can the brand be positioned with the right strategies in the targeted market. The added value elements of
brands provide the benefits for customers to purchase. [17]
With the developing technology, organizations have started to diversify their brand positioning strategies in digital
environments because the product and service are presented at the same time. Just creating the product and adding
brand value to it is not enough. At the same time, strategies to increase the awareness of the product or service created
and to extend the product life in the market and to solve the problems that will be faced after sales are of great
importance.
The provision of various products and services on the internet at the same time requires payment at the same time.
Payment systems such as virtual cards, Paypal, 3 Pay micro payment system, 3D secure system, Pay U have forced
banks and private associates to innovate in order to exist in virtual environments. Entrepreneurs of virtual
organizations have had to develop different strategies for digital platforms. Virtual organizations develop branding
strategies by identifying how they want to be perceived in the eyes of important collaborators according to their field
and value.
A strong brand positioning in the digital environment defines which needs of the targeted consumer audience can
be met by the brand. Virtual organizations, established in digital environments, develop strategies on how
entrepreneurs can effectively manage this audience for consumption after identifying the target audience, how it can
provide continuity and meet differentiated consumer demands. In addition, various strategies should be developed for
security, protection of personal data, and the elimination of technological and operational problems encountered after
shopping. In this context, even if they have their own sites from various social media environments, the brand develops
strategies to talk about the brand and keep in mind.
The created digital brand positioning strategy necessitates the use of social media tools and various activities for
these channels.
4. Social Media
Nowadays, the virtual organizations' positioning themselves in the market, their efforts to hold on and gaining the
competitiveness power make it necessary for them to use the opportunities offered by digital media. In literature
studies, social media is often referred to with web 2.0 technology. The reason for this is the structure of web 2.0
technology based on web.1.0 technology that enables users to actively participate in the internet environment. [18]
Lon Safko (2010) pointed out that the meaning of social media is determined by the concepts created by the users
and defines social media as a set of tools used by organizations to reach existing customers and target groups. The
concept of social media and technologies provide the opportunity to reach customers, target groups, communicate and
establish relationships in a way that builds trust in organizations offering goods or services. [19]
4.1 Social Media Tools
4.1.1 Facebook
The most popular example of social networks today is Facebook, which was founded by Mark Zuckerberg in
February 2004 for Harvard University and is spread around the world. Established under the name “Thefacebook site,
the site was first made available to other universities in the state of Boston and then to Canada and other US
universities. [20] Facebook is a social network that aims to allow people to communicate with other people and
exchange information. Nowadays, internet entrepreneurs share their own organizations in order to benefit from this
social network.
Facebook Business advises internet entrepreneurs on how to share on their Facebook page and how virtual
organizations can achieve their goals.
4.1.2 Instagram
Instagram, which is the most widely used social media channel, is actively producing and managing content.
Founded in October 2010 by Kevin Systrom and Mike Krieger primarily for iOS (iPhone-iPad). [21] Facebook
acquired Instagram in 2012. Instagram, a photo and video based social media tool, allows users to express themselves
through personal sharing and create their own content. Initially based solely on photo sharing, instagram has become
a social media platform with a broader door.
Internet entrepreneurs use instagram to reach their consumers.
Bio Section: “Bio is located at the top of the instagram profile. This section contains basic information about the
brand. When the target audience looks at the brand's instagram profile, it indicates in what field the brand does business
and how they will reach the brand. This is the first part of the brand and the first part to introduce the brand.
Associating an Instagram account with other social networks: Integrating social network accounts with each other
is one of the best ways to increase the number of followers and interaction. Facebook or Twitter accounts are integrated
into Instagram to reach a wider audience.
#Hashtag usage: The concept of hashtag, which we know through Twitter and entered our lives rapidly, continues
to maintain its place with Instagram. Hashtag’s is the most important factor in reaching the target audience in the
fastest way by identifying the issues that the photos we share in instagram are relevant and enabling the brand to
receive more likes and followers.
Correct visual sharing to the right target audience: The Internet entrepreneur uses Instagram effectively to ensure
that messages represent their brand identity and corporate culture accurately and effectively, with images they share
their brands with.
Organizing an Instagram campaign: Brands seek to organize a variety of campaigns to increase their attractiveness
in Instagram. Photo contests created by requesting users to vote for their favorite photos and determining a winner
among them are the most used brands in Instagram. [22]
4.1.3 Youtube
Three American businessmen Chad Hurley, Steve Chen and Jawed Karim founded Youtube for entertainment It
was then purchased by Google. [21]
Virtual organizations use viral marketing in order to be in the mind of the consumer via youtube and to position
their brands on digital. Viral marketing is the result of messages surfing the Internet. E-commerce, groups,
communities and messaging; These are the tools used by companies to improve their promotion activities. [23]
Conclusion
Today, the emergence of the Internet and the use of social and organizational transformation has increased with
each passing day. All traditional processes are virtualized through digital platforms. This transformation necessitated
the presence of entrepreneurs on the internet in order to ensure their continuity in the market. The borders that
disappeared thanks to the Internet made a new entrepreneurial trend compulsory. Internet entrepreneurship provides
entrepreneurs with various advantages and disadvantages. Internet entrepreneurs are structured in a different way from
the classical organizational structure. Other organizations are in cooperation. It is not possible to reach the consumer
in the internet environment and provide satisfaction by satisfying all their desires in a single way. Therefore,
organizations combine with other organizations to form virtual organizations. Virtual organizations create various
content in digital environments through virtual teams. Brand positioning strategy is transferred to digital environment
by virtual teams and differs from classic brand positioning strategy. The reason for this is social media. Thanks to the
Internet, listeners, viewers and readers meet on a single platform. The concept of social media based on interaction,
redefining communication and shaping its framework has led to a new dimension of the relations between brands and
consumers. In the process of digital transformation, the way brands interact with their target audience has also started
to change. Thanks to social media platforms such as Facebook, Instagram and Youtube, brands have the opportunity
to reach new and different target audiences outside their target audience.
Facebook, Instagram and Youtube, the social media platforms used today, provide a digital marketing environment
for brands. Through these channels, consumers have the opportunity to see what they are talking about without
intermediaries and establish one-to-one relationships with them. They can follow the first reactions related to the
products or services they have developed and make their own products and services in line with the user comments.
One of the most important points that differentiates brands from their competitors is how the brand positions its
products in the digital environment in order to ensure the satisfaction of consumers who have difficulty in choosing
between product and service options.
Digital brand positioning strategy is an element affecting the consumer's decision making process. For virtual
organizations that position their brands expressing market power, it is important to create a positive thinking in the
minds of the target audience and to ensure retention in mind. Virtual organizations that want to take part in the minds
of consumers can share the messages they want to give through social media with consumers. These applications,
which differentiate the product or service from the consumer point of view and make it easy to remember, provide
important opportunities for virtual organizations and internet entrepreneurs in terms of digital brand positioning
strategies.
In this research, the relationship between internet entrepreneurship and digital brand positioning strategy is tried to
be explained. In this context, moderator of virtual organizations has been used as variable.
This study is expected to constitute a new ground in terms of theoretically being addressed, supported by subsequent
field studies and giving direction to the studies to be carried out.
References
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[2] Akdemir Ali, (2015) 'Kavramsal Temeller' Editör: Prof. Dr. Ali Akdemir 'Girişimcilik Ve İş Kurma', Içinde, Ankara, 2015, S. 7-19.
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No: 16, 125-138.
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Durum Raporu 10 Nisan 2013 (13, 14 )
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[11] Yılmaz, Huseyin. (2004 , İşletmelerde Sanal Takım Modeli Ve İşletmelere Sağladığı Yararlar, Verimlilik Dergisi(1)
Http://Dergipak.Org.Tr/Verimlilik/Issue/30738/332190>)
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[13] Dilek Penpeçe, (2013) Dijital İçerik Pazarlaması , Adana: Karahan Kitapevi, 2013, S. 62-65
[14] (Https://Pazarlamaturkiye.Com)
[15] Arli, E. (2012) ‘Konumlandırma Stratejilerinin İşletme Performansı İle İlişkisi: Liman İşletmeciliğinde Bir Uygulama’102-103
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[18] Alexander, B. (2006). ‘Web 2.0: A New Wave Of Innovation For Teaching And Learning? ‘Educause Review, 41(2), 32
[19] Safko, L. (2010) ‘The Social Media Bible: Tactics, Tools, And Strategies For Business Success’ John Wiley & Sons.
[20] Phillips, S. (2007)’ A Brief History Of Facebook’. The Guardian, 25
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ScienceDirect
Procedia - Social and Behavioral Sciences 150 (2014) 511 – 520
10th International Strategic Management Conference
Exploring the role of social media for SMEs: as a new marketing

strategy tool for the firm performance perspective
Dilhan Öztamura , İbrahim Sarper Karakadılarb, b
a,b
Nişantaşı University, İstanbul, 34030, Turkey
Abstract
Social-media is not only a communication tool for amusement, but it is also an important part of marketing strategies in business
life. This paper aims at analyzing the role of social media for Small and Medium-Sized Enterprises (SMEs); as a new marketing
strategy tool for the firm performance perspective. This manuscript is focused on a case study including the comparison and
analysis of totally four American and Turkish companies’ Facebook and Twitter accounts in terms of the number of likes and
followers, richness of content, interaction with customers and the use of language. Within this research, the qualitative method is
used in order to see how these companies engage with their customers online and use social media as a strategic tool of social
network marketing (SNM). Briefly findings of this study suggests that: the common problems of the Turkish SMEs are related with
using formal language during the customers communication process and creating unattractive content lacking richness to attract
their customers' attention in their social media activities. Another noteworthy point is that from the American SMEs perspective,
they are less effective in using Twitter when compared to their Facebook accounts.
© 2014 The Authors. Published by Elsevier Ltd. This is an open access article under the CC BY-NC-ND license
(http://creativecommons.org/licenses/by-nc-nd/3.0/).
Peer-review under responsibility of the International Strategic Management Conference.
Keywords: Micro-blogging tools; Social network marketing (SNM); Word of mouth marketing (WOM); Qualitative descriptive and content analysis
1. Introduction
The internet gives us a wide range of opportunities such as; having a connection with people all around the World,
creating, sharing and disseminating contents, gaining and searching information on unlimited number of subjects and
staying up to date. More or less, there are some indisputable outcomes and changes due to the emergence of internet
but especially the widespread use of social media. One of these crucial changes happens in business models, as well.
By the beginning of 21th century, the use of internet and social media has become a part of business strategies. In
addition to this, the companies started using unique qualities of web and have shifted their market strategy to
e-commerce. Web has become one of the most profitable tools of promoting the products and services to attract the
target audience. Some of them got into the market as an e-retailer, some others became content provider, transaction
broker, market creator or service provider. However, one of the most important reasons that made them penetrate into
the market is low barriers to entry. That’s why many small and medium sized enterprises (SMEs) put their products on

Corresponding author. Tel. + 90-212-210-1010 fax. +90-212-224-0090
Email address: ibrahimsarper.karakadilar@nisantasi.edu.tr
1877-0428 © 2014 The Authors. Published by Elsevier Ltd. This is an open access article under the CC BY-NC-ND license
Peer-review under responsibility of the International Strategic Management Conference.
doi:10.1016/j.sbspro.2014.09.067
512 Dilhan Öztamur and İbrahim Sarper Karakadılar / Procedia - Social and Behavioral Sciences 150 (2014) 511 – 520
the web or use multiple business models including the internet.
Henceforth, the firms began adding online infrastructure to their business model as well. In addition to this, they
changed the revenue models because of the remarkable return on the internet and modified and renewed the key
elements of traditional marketing. By the time of these ground breaking developments; social media has also become a
turning point due to its realistic opportunities from the standpoint of business such as; cost effectiveness, time saving
and engagement with customers. The more companies, especially SMEs started taking the advantage of social media;
the more it has become a popular marketing tool under the title of Social Network Marketing (SNM). However, there
are some crucial and controversial points concerning the effectiveness of SNM. Particularly, debates take place over
the measurement of success in terms of quality and quantity.
The main objective of this paper is to explore the role of social media for SMEs as a new marketing strategy tool
for the firm performance perspective. Furthermore, the paper is trying to highlight the utilities and qualitative returns
in the light of SMEs. To achieve this target, this study aims to answer some research questions such as;
x Whether there is a remarkable differentiation between Turkish and American SMEs social media activities in terms
of the number of likes and followers, richness of content, interaction with customers and the use of language or
not?
x How are social media customer communication endeavor levels distinguished between more dynamic industry and
conventional industry?
x Which country SMEs prefer to use more intensively which social-media medium in order to reach their target
customer effectively?
Since our sample set consists of four companies; it is impossible and unrealistic to make a generalization or
induction. The ultimate goal of this research is to reveal the specific differences between the selected firms in terms of
the social media performances.
2. Literature Background
Even though long time has not passed since the social media has been started to be used to keep interaction with
customers, it has become an important role in the business life. In this regard, some important seminal articles in the
literature have been studied about using the social media as a strategic tool particularly for SMEs in this short time
period. In the literature review section, we would like to define which factors of the SMEs marketing activities
through social media are affecting their performance. In this content firstly, social media user customer types are
categorized based on the literature definitions and then how social media users affect the SMEs marketing efforts on
social media medium are specified. At the second phase, the defined performance criteria in the literature for
measuring the effectiveness of social media through marketing activities for SMEs are identified.
2.1. Importance of using social media as a marketing strategy
Web 2.0 social media is a potentially powerful medium for finding key consumer influencers, engaging them, and
generating brand advocates. However, in order to build viral campaigns and foster online word of mouth marketing
(WOM), trust must be established and subsequently reinforced in order to overcome any reluctance on the part of the
would be consumer (Miller and Lammas, 2010:7). After the emergence of new technologies, customers have been
looking at social media instead of Google or other search engines in order to get information about the companies
(Newman, 2013). Social Media is an advantage to build trust between the customers and the company in a way that
has never been seen with the traditional media (Deelmann and Loos, 2002).
Some research studies in the literature have been seeking the answer to the question of “how consumers’
interaction” with social media has become crucial to marketers? One stream of research suggests the existence of a
“loyalty ladder” in social networking communities that splits users into categories such as;
x “Lurkers” those who are reticent to contribute to sites,
x “Tourists” those who post comments but demonstrate no commitment to a network,
x “Minglers” those who post with no regularity or frequency and
x “Evangelists/insiders” those who are enthusiastic, expert and regular in their contributions.
Dilhan Öztamur and İbrahim Sarper Karakadılar / Procedia - Social and Behavioral Sciences 150 (2014) 511 – 520 513
Some other researchers split users into slightly different sets, for example;
x “Social clickers” users who communicate with friends and create content on message boards and review sites,
x “Online insiders” avid online shoppers who vocalize product preferences and
x “Content kings” young men addicted to online entertainment.
These groupings demonstrate the complexity and lack of uniform measurements for marketers targeting users of
social media (Miller and Lammas, 2010:3). In order to use social media as a marketing tool first of all, it is crucial to
do the market discovery. The first step is to define the target customers. There are some questions that might be
helpful, such as, “what are their demographic characteristics?”, “do they have a specific location?”, “what are their
desires?”, and “what do they currently buy?”
The second step is to know where they go online. It is sacrosanct to know which social media channels they prefer,
what blogs they regularly read; what articles interest them and what videos they watch. The last step is to define the
competition. The company must know the major players in the market; who is buying AdWords ads and who has the
top rankings in order to create the content in a similar way. Besides, there are some other important channels
concerning the way to find the target customers like discussion forums and press releases. They can generate traffic to
companies’ content through finding communities and key words they include. Awareness, trust and reputation are the
important benefits of using social media for companies to reinforce their market position (Gligorijevic and Leong,
2011).
Social Network Marketing (SNM): Due to technological infrastructure dramatically changes in the last decade that
requires the social media and marketing works closely in business life. Marketing teams use various ways of social
media. That increases the searchability of the brand or the company and creates two way communication with
customers. The term, Social Network Marketing (SNM), arise out of this connection. Currently, most prevalent SNM
practices involve creating and operating a company’s fan page, managing promotions, maintaining public relations,
and conducting market research. Other activities include providing customer support, encouraging customer reviews
and discussions, and recruiting (Bettiol et al., 2012; Chua et al., 2009; Gligorijevic and Leong, 2011; Newman, 2013;
Pentina et al., 2012). It is known that, key to business success with SNM is the ability to engage followers.
In addition to this, smaller companies are more suited to utilize SNM due to their greater flexibility and higher need
to contain marketing communications costs (Pentina et al., 2012:67). According to the SMEs organizational objectives
and capabilities some of them only use internet forum-blogs in order to gather industry specific information and
promoting their events. Some others are highly active on micro-blogging tools (such as Facebook, Twitter and
Google+) for online advertising and creating an effective online communication network (Gligorijevic and Leong,
2011:496). SNM is more effective in building brand awareness and enhancing brand reputation than generating leads
and increasing sales. But even in this function, SNM is only one part of integrated marketing communications and it is
difficult to ascertain its contribution compared to paid advertising and other types of promotion (Pentina et al.,
2012:68).
Word of Mouth (WOM) and e-WOM Marketing: With the proliferation of social media websites, the importance of
word of mouth marketing and peer recommendation is becoming more pertinent for companies that are immersing
themselves in online conversation with consumer communities. Social media provides platforms for consumers to
share experiences in their social networks, and to evaluate businesses through websites featuring reviews and
recommendations of products and services. These practices of posting information on frequently-visited websites can
build or destroy the reputation of a business organization. Appropriate communication channels and context of
messages are crucial elements in developing trust, as they help to clarify expectations in prospective relationships
between companies and their customers (Gligorijevic and Leong, 2011:495). Because the main target is to create
online brand reputation; another term, e-word of mouth marketing gives an opportunity for SMEs. The more people
talk and write online about the brand in a positive way, the more effective marketing strategies work.
Currently there are various online applications (online feedback mechanisms, viral marketing, social networking,
blogging) that are a form of e-WOM, however, considering the speed, scale and ubiquity of the internet, many
researchers agree that the effects of e-WOM are more impactful, and even different, from those of offline-WOM,
favoring rapid product adoption or leading to increased sales and brand advocacy through solving product and
customer problems faster and cost-effectively (Bulearca and Bulearca, 2010:299).
2.2. Measuring success of social media performance
Social media measurement has become popular among the companies and researchers. Day by day, it is possible to
encounter with more reasonable solutions and tools to measure companies’ Social Network Marketing (SNM) success.
The more measurement systems are improved, the more number of metrics increase and become trustworthy. It is
required for SMEs to measure success against original goals. However the important point is that companies should
look beyond the retweets and likes. In other words, they should also remember to measure beyond the numbers.
Because these results are going to be helpful in terms of managing crisis; increasing brand sentiment besides reactive
and proactive social support. Metrics such as the number of viewers, visitors, friends, or followers do not
automatically translate to higher conversions, order value, or sales. It is true that given their viral characteristics,
Social Network Marketing (SNM) may be more effective in building brand awareness and enhancing brand reputation
than generating leads and increasing sales. It is difficult to ascertain its contribution compared to paid advertising and
other types of promotion. Another issue is the length of time required for each new SNM tactic to work and the
resulting problem of measurement timing. Finally, quantifying engagement (the main goal of SNM) that does not
necessarily parallel numbers of friends, subscribers, tweets, and retweets is still an unresolved issue (Pentina et al.,
2012:68).
While many social marketers fixate on volume metrics (website traffic, hit rates, click-throughs, time spent on-line,
postings etc.), however, such metrics often need to be customized for individual campaigns and need be considered in
the pre-launch phase, ideally incorporated in message testing. The often unanswerable prediction is whether online
viral marketing campaigns will be effective in the short and long terms. Viral marketing is notoriously difficult to
execute successfully and measure adequately. The quest for reliable metrics means that some marketers will shy away
from implementing online viral tactics that draw only short-term attention (such as viral videos) to tactics that actually
allow for prospect identification and capture of behavioral data. Much of what happens in social marketing is little
more than experimental, or simply about “insights” rather than metrics (Miller and Lammas, 2010:7). There are 2
kinds of metrics that worth examining; “engagement metrics” (followers, fans, comments) and “sentiment metrics”
(positive and negative comments of the customers).
In general, it is agreed that mishandling social media and Twitter can have significant negative impacts, as e-WOM
could produce irreparable or costly damage and that research is needed in order to clearly understand how and what
should be done, if anything, with models like Twitter as marketing tools. There is also another important issue –
contrary to general belief, Twitter is not free, if properly undertaken as a marketing tool. That requires time to develop
relationships, as well as commitment, people, finance and management buy-in, conditions easy for large companies to
achieve, but very difficult for SMEs to comply with as a marketing tool, and not many are convinced of its strategic
viability (Bulearca and Bulearca, 2010:300). The effects of social media users, in other words potential influencers are
indisputable in the context of SNM. The demographic qualifications of these influencers vary and they are not always
celebrities or opinion leaders. The important thing is, following the influencers through related topics and analyzing
the strategic ways to benefit. There is a strong correlation in a user’s influence rank across different topics, leading to
two interesting conclusions. First, most influential users hold significant influence over a variety of topics. This means
that local opinion leaders and highly popular figures could indeed be used to spread information outside their area of
expertise. In fact, new advertisement campaigns have recently been launched that insert advertisement links into a
popular person’s tweet. Second, the power-law trend in the difference among influence of individuals indicates that it
is substantially more effective to target the top influentials than to employ a massive number of non-popular users in
order to kick start a viral campaign (Cha et al., 2010).
The revenue which is generated by using social media should be revealed. In addition to this, investments made in
social media should be taken into account and the rate of return should be calculated. There are numerous open
questions and controversies related to actual business potential of social-media. In addition to “Return on Investment
(ROI)” measurement issues and lack of strategic understanding and planning, there are even critics questioning
especially Twitter’s actual future; accusing the difficulty to understand Twitter and to measure results. Furthermore,
small and medium-sized enterprises (SMEs) seem to have a more acute dilemma, since the lack of necessary
resources, people and time have prevented most of them to experiment with Twitter (Bulearca and Bulearca,
2010:297-298).
3. Research Approach
In this research, a case-study intends to analyze the SMEs social media efforts in the aspects of reach (the firm’s
access and connection to customers), richness (depth and detail of two way information between the company and the
customer) and affiliation (facilitating useful interactions with customers). In other words, this study is focused on
analyzing how SMEs view the World through the customer’s eyes and constantly seek ways to create more value via
social media for the customer satisfaction and produce fewer complaints (Hitt et al., 2013:104-105). Therefore,
qualitative content analysis (Özdemir, 2010) is the main method for this particular work, because the ultimate target is
to see the companies’ strategical use of social media, including which contents they choose, how often they update
their accounts, what style of language they use and how effective their communication is.
A qualitative–exploratory approach is chosen, in order to uncover how companies utilize social media, to gain
practical insights into how they perceive social media as a useful marketing tool and perhaps new ideas that could be
recommended to other similar companies (Bulearca and Bulearca, 2010:301). Qualitative methods and in particular
case studies allow to conduct an in-depth and longitudinal observation of phenomena and processes that are not yet
clear in literature in order to single-out variables and relationships among them and to orient further analysis and
exploration (Bettiol et al., 2012:11). Successful social marketing often depends more on qualitative metrics for
desirable signs of the tone, quality and customer benefit of the interaction. These may include: unique visitors,
interaction rates, relevant actions taken, conversation size, conversation density, content freshness and relevance,
audience profiles, unique user reach, and so on. Such metrics not only measure whether people are engaged, but how
they are engaging.
4. Case Study and Findings
In this paper, we analyzed the “Facebook and Twitter” networks particularly due to their widespread use and
popularity among the customers. Almost every SMEs have Facebook and Twitter accounts but the important thing is
the firms performance of using social media as a new marketing strategy tool. In order to have a competitive
advantage, companies should create value for the customers. Social media may have a supportive role during this
process. The target of this analysis is to contribute to the studies conducted so far, regarding the social media and
SMEs; and to bring a new perspective to these studies in terms of performance assessment.
As a part of the case study, we chose the companies from USA and Turkey in order to make a comparison with
their social media activities. We made a list of small and medium sized companies with similarities in both Fashion
industry and Organic Bread industry. Then we randomly chose four of them and matched in order to contrast and
analyse. Selected industries and firms were chosen because of their theoretical relevance and their novel social
network marketing concepts strives, according to appropriateness of their sizes and the business-to-consumer (B2C)
industry structure. In the sampling selection process; at first an appropriate company was randomly decided then its
pair was found. For instance; the first two companies are both medium sized, in terms of the number of the employees
they have and besides, both of them perform in fashion industry with retail chain stores. The second group of firms is
both small sized and their line of business is organic-healthy foods; especially their core competency is “making
organic-healthy breads”. All the selected companies are well-known brands by their target customers, also both
industry represented companies have similar firm profiles and they have same experience of period in the social media
activities. This is why these four companies were chosen particularly. The observations and the analysis were done
between January and February 2014. We gathered information on the chosen firm’s social media accounts and focused
on specific details such as; the number of likes and the followers, frequency of the updates, richness and relativeness
of the content, interaction of the engagement and the use of language.
4.1. Fashion-retail industry analysis
The fashion company from USA has interesting content for the target customers in the Facebook business page in
terms of many aspects. First of all, they post different kinds of surveys, contests and questions in order to attract the
attention of their customers. This is actually a good example of engaging with the customers. Secondly, they post
some surveys regarding the outfits and colors. They sometimes share the pictures of their designer and the crew as
content. The firm posts not only pictures, but also videos about the backstage and the designs with a high resolution.
Besides, they give some information and tips about fashion which strengthens the message of the content. They never
forget to celebrate special days. Another important point is that, the company shares customer views on their Facebook
business page. This is also crucial for customer retention. This American fashion company is quite active about
creating content on social media. For instance, they take part in volunteer projects and post some pictures in order to
let their customer know. Furthermore, they also pursue the agenda of the industry and make interviews with other
SMEs performing in the same industry, regardless of the competitor rivalry. This attempt can be considered as a
remarkable strategy. Since the company updates Facebook business page every day and post more than one content
which are genuinely rich, related and striking; interaction of the engagement with customers is really effective. At the
same time, they reply almost every question and comment of the customers. The answers are not cliché vice versa they
reply almost always in a different way. Whether it is a complaint or commendation; the company replies by repeating
the name of the customer. When we consider the way they use language; the company is totally different from the
other compared firm in terms of wording. First of all, their language is not formal; besides they reply the questions as
if both the designer and the owner of the company would not do. Their wording is like storytelling and quite sincere.
Also, they prefer using vivid descriptions and this directly affects the general frame of the content in a positive way.
The Company’s Twitter content resembles with the “Facebook business page” including same surveys, small
questions, discount announcements and tips. Tweets are always vivid and sincere. This is one of the best ways to
attract the followers especially in fashion industry. As for using “hashtags”; they often use the company name but also
the colors, styles and designs as hashtag. This is also crucial to engage the attention of the potential followers and
promote the Twitter account. The Company retweets customer views and replies almost every tweet of the followers.
They don’t use a prototype; besides thank and appreciate every each comment of the customers and fans. The firm’s
wording is quite casual and in a friendly style. In addition to this, they use “smiley” in order to cherish the
conversation. There is no punctuation or spelling mistakes.
Table 1. General overview of the first group (fashion-retail industry) selected firms social-media activities analysis
Firms profile
Headquarters: New York USA, Istanbul Turkey,
Founded: 1984 1986
Facebook business page related activities
The number of likes: 24.925* 154.781*
The frequency of update: Everyday Almost everyday
Richness and relativeness of the content to take More product related content rather than
Quite rich customer oriented content
attention of target customers: customer focus
Interaction of the engagement with customers: Effective (as responding all questions Special relevance of interacting for more
and comments) personal manner
The use of language: Quite sincere (friendly style) Quite formal
Punctuation or spelling mistakes: Well written (there is not any Well written (there is not any
orthographic mistakes) orthographic mistakes)
Twitter account related activities
The number of the followers: 4.462* 13.159*
The frequency of update: Everyday (approximately 3 tweets in a Everyday (approximately 3 tweets in a
day) day)
Richness and relativeness of the content: More actively up to date content than
Same as the Facebook page content
the Facebook page
Interaction of the engagement with customers: Effective (as replying almost every Intensive (as retweeting the customer’s
tweet) tweets)
The use of language: Vivid and sincere (as casual manner) Standard (as formal manner)
orthographic mistake) orthographic mistake)
*Note: these numbers were observed in January 27th, 2014.
On the other hand, Turkish Fashion Company often shares the photos of their latest fashion collection on the
Facebook business page. Besides, they post discount announcements, small surveys and small questions. The company
has one video backstage; however there are some complaints from the customers regarding the low resolution of this
video. One of the most important and remarkable point is that; they engage with the followers and form two way
communication through the use of Facebook business page. There are some comments under almost every picture and
the content they post. Customer complaints, comments and questions are replied. Meanwhile, the company asks for
the contact information of that particular follower in order to keep in touch. In addition to this, whenever a customer
asks a question about a size or color of an outfit; they always reply and try to find a solution or if a customer
complains about the quality of an outfit; they immediately report the problem. Nevertheless, this Company uses the
formal wording in the social-media communication and the answers are given with same words. Besides the all
valuable efforts on social media to communicate with target customers, their language still needs more human touch.
On the Twitter account Turkish Fashion Company uses the same content like Facebook page, such as small
questions, discount announcements. However, they share more surveys than they do on their Facebook business page.
They post many surveys; it is a way to show that the company gives importance to their followers’ ideas. They use the
“company name, fashion and accessories, Friday night-out” as hashtag. In addition to this, the company has a
sponsorship agreement with a TV serial in Turkey. They also use its hashtag in order to attract the potential followers.
The Company replies almost every tweet and question. Besides, they retweet the follower’s tweets regarding their
company. Their wording is quite formal and standard on Twitter as well, but there is no punctuation or spelling
mistakes.
When we compare these two fashion-retail industry companies’ social-media profiles, they have similar strategies
in terms of the richness and relativeness of the content. Both of them share pictures, surveys, small questions and tips
regarding the fashion collection of the company and the fashion industry in general. However, the American company
has an extensive content if we consider the interviews they are doing and the volunteer projects they are taking part. In
addition to this, the two companies have a different style in terms of the use of language. The Turkish company is
quite formal, distant and repetitive but the American company is quite unique and sincere. This may create different
perceptions about company’s corporate culture and corporate image. The American company uses Twitter more
effectively and share more content when compared to Turkish company. However, both of them do not create different
contents on Twitter. They prefer using the same posts with Facebook pages.
All in all, both companies create engagement and two way of communication which is an important tool of SNM
and the process of forming differentiation.
4.2. Bakery-retail industry analysis
This organic bread bakery company from USA reflects Its mission and vision through the contents and posts they
share on the Facebook business page (besides, they use solar system and also share contents about the sustainability as
well). They post information about healthy nutrition, recipes for special days, pictures of the products, employees and
the actual family farm where their organic wheat comes from. Besides, they often share the pictures of the
supermarkets and stores they work with. The company gives importance to awards. Since their mission is to sell
organic products and care about human health; they have many awards such as “Leadership in Sustainability” award
of being one of the best working place in USA. In addition to this, they sometimes post some questions and surveys
directly related with the industry. One of the noteworthy contents they share is contest. Contests are a part of
company’s communication strategy. They often organize contests among adults and children resulting in small
presents (like free coupon or picnic baskets). This is an effective way to engage with the customers and followers
through social media. It is obvious that, their target customers are not only adults; but also all other age levels. The
company not only answers the comments and questions but also shares the customer thoughts and comments.
Furthermore, they are holding discussions on ecology and organic foods which creates interaction. Another important
point is that, the company celebrates every October as co-op month! They give importance to cooperation among the
employees and prefer a glasnost policy. As a result, they create a positive impression. They always communicate with
the winners of the contests through Facebook business page and form two way communications. The Company prefers
an informal language. Their wording is quite sincere. They answer almost every question through different words. The
crucial thing is that; the wording reflects their passion and excitement to work.
Table 2. General overview of the second group (“organic-healthy bread” bakery-retail industry) selected firms social-media activities analysis
Firms profile
Headquarters: California USA, Istanbul Turkey,
Founded: 1979 1988
Facebook business page related activities
The number of likes: 3.911* 257*
The frequency of update: Approximately 2 or 3 times in a month Approximately 3 or 4 times in a month
Richness and relativeness of the content: Providing information to support their Not informative enough
product differentiation
Interaction of the engagement with customers: Discussing about organic products to Not sufficient communication effort
make conscious their customers with their customers
The use of language: Informal language (personalized N/A (there is not enough samples to
communication) define exactly)
orthographic mistakes) orthographic mistakes)
Twitter account related activities
The number of the followers: 1.744* 54*
The frequency of update: The most recent update was done in
Once or twice in a month
September 2013
Richness and relativeness of the content: Similar with Facebook page content, but Not intend to update contents
not as active as Facebook page
Interaction of the engagement with customers: Rarely use hashtags and retweet their Not using any hashtags
customers comments
The use of language: Unique special messages for each The use of language is quite dull and
customers uninteresting
orthographic mistake) orthographic mistake)
*Note: these numbers were observed in February 2 nd, 2014.
The Company’s Twitter content is similar with their Facebook business page. However, their Twitter account is not
as effective and active as their Facebook Business page. This organic-bakery company creates interaction through
replying follower’s tweets and questions. However they rarely retweet their follower comments. Besides, they rarely
use hashtags; they generally use #nonGMO, #organic and #vegan as hashtags. The firm’s language and wording is
sincere. They try to create uniqueness and try to make their followers feel special through the use of language. There
are not any orthographic mistakes.
The healthy bread and pastry company from Turkey generally posts the pictures of their products (breads, cakes,
desserts, coffees and breakfasts), the pictures and the addresses of the company chain stores. In addition to this, there
are a few questions and surveys posted by the company. However, most of them do not attract the attention of the
customers. Besides, the firm organizes an event called “secret customer”, but they do not post any explanations.
However they reply the questions from the customers regarding this event. Since the company’s core competency is
organic breads, they upload more information about it. They have one video about the bread making process. The
Company shares the pictures of the products taken by the customers under the title of “things from you”. This is a
good attempt for engaging with the customers. However, the company does not reply every question or complaint
posted by the followers. This causes a serious lack of communication. For instance, one of the customers complains
about the food and claims that she got poisoned because of chicken. Although she goes on writing and complaining;
the company does not reply and prefers to be silent. This is a stunning example of a wrong strategy. Keeping silent or
ignoring the problems cannot be strategic tools of SNM. On the contrary, they hasten the process of bad reputation
through WOM and there should be more explanation about the pictures they share. The wording is quite important in
terms of social media marketing. However since the company posts less information about their products or their
mission and vision; they are not keeping in touch with the customers. It is not possible to make a sophisticated
analysis about the language they use. But as far as it is understood, they have formal and standard style. There is no
punctuation or spelling mistakes.
On the Twitter medium the Company uses the same content of their Facebook business page. They do not use
hashtags. They make announcements about the presents and discounts on special days. Besides, the same tweets are
iterated for months. They do not renew the content. They reply the tweets in the same way. They answer the questions
regarding the changes on prices and apologize. Besides, the company retweets the follower’s posts and comments
about the products. The main problem is that; their wording does not include any human touch, sincerity or
uniqueness. The use of language is quite dull and uninteresting.
When these two bakery industry companies were compared owing to their social media medium endeavor, it was
observed that these two companies have totally different social media marketing strategies. The American firm is quite
active especially on Facebook and they share various kinds of contents. Besides, they have successful communication
skills and they know how to engage with the customers. As for the language, their wording is friendly but not
unconventional. Their main problem is the content of their Twitter account. It is obvious that, they give more
importance to Facebook business page. However, when a social media account is neglected, it means that this platform
may not be appropriate for the company’s marketing strategy. At that time, the needs and the short term plans should
be reviewed. Conversely, the Turkish firm has lots of problems regarding the online communication. First of all, they
are not as active as the American company in social media medium. Although they try to create content, they do not
know how to engage with the customers and attract their attention through the use of images and words. In addition to
this, they rarely reply comments and questions when compared to the American firm. The company’s wording is
monotone and colorless which has a negative impact on SNM. Similar with the American company, the Turkish
company does not use the Twitter account effectively even less than their Facebook business page.
All in all, the American Company is more efficient and successful than the Turkish company in terms of content,
engagement with customers and the use of language.
5. Concluding Remark
This paper aims to research the social media use and performance of SMEs as a new marketing tool. Specifically,
we analyzed four companies which are chosen randomly under the title of small and medium sized enterprises
according to their operation areas in USA and Turkey. The target was to focus on their social media accounts during a
certain period of time regarding some aspects such as; the number of likes, the frequency of update, richness and
relativeness of the content, interaction of engagement, the use of language and punctuation or spelling mistakes. These
are important points because especially SMEs may sustain their position and create loyal customers through the
effective use of stated factors in social network marketing (SNM). The study analyzed the Facebook and Twitter
accounts of randomly selected “fashion retail chains” and “healthy bakery retail chains” SMEs from USA and Turkey;
in order to make a comparison of each two companies which are performing in the same industry. The findings enable
us to comment on different performances and point of views of the companies’ social media use in terms of new
marketing strategy.
The research intends to show how effective and active are these companies’ social media accounts from the stand
point of social marketing network. According to these findings, we can summarize that the American companies are
more prone to apply the required strategies and the factors when compared to social media use of Turkish companies.
Dynamic industries such as “fashion-retail chains” strive more than conventional industries such as “bakery-retail
chains” on social media medium and this obviously affects their amount of customer followers. In both industries,
American companies’ Facebook business pages meet SNM needs and expectations whereas their Twitter accounts can
be defined as below the line in default of the factors mentioned above. On the other hand, Turkish companies show the
average success in terms of their Facebook business pages; however they are posterior due to their underdeveloped
and neglected Twitter accounts. Finally, we found that the enterprises which are analogous according to their size and
scope; may have different approaches to strategic use of social media and these discrepancies become obvious when a
systematical comparison is made between them. The main suggestion of this paper for SMEs, planning to use social
media mediums as a competitive marketing tool; is that they should spend time to create rich contents on their social
media accounts to attract their target customers’ attention. In addition, they should also be more sincere while
communicating with their target customers and should prefer to communicate in a more friendly style and to respond
in a quick manner to all communication attempts of their customers.
6. Limitations and Future Research Directions
As all scholarly studies contain some limitations, this study has some limitations too. First of all, this study
investigates the social media (Facebook and Twitter pages) efforts of business-to-consumer industry related SMEs.
Research approach was decided as qualitative content analysis with observing selected sample firms Facebook
business page and Twitter accounts. Although the semi-structured interview was prepared to conduct with sampling
firms, unfortunately responsible employees from the selected companies showed no intention to answer our interview
questions. Thus, our paper findings only depend on our external observations. Future researchers should conduct
interviews with key informants to obtain more detailed and more specific information, related to their firms’ social
network marketing activities to reach their overall marketing targets. Additionally research other social media
mediums should be observed (e.g. Google+, LinkedIn, internet forum blogs etc.) in the future as well. On the other
hand, future studies might design comprehensive research methodology with wide range industry comparison and
large sample size. This kind of research application might be useful to find out what types of social network marketing
endeavors enhance the firms’ performance. Furthermore, how companies should design their social media activities
for different social media followers’ clusters in order to increase effectiveness of reaching marketing targets can be
explored. Finally, researching the impact of social network marketing efforts on the “financial (i.e. ROI) and market
(i.e. sales revenue) performances” might be beneficial for SMEs to decide what level they should invest and spend
their time and management efforts.
References
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ScienceDirect
Procedia Computer Science 65 (2015) 980 – 987
International Conference on Communication, Management and Information Technology

(ICCMIT 2015)
Measuring the effectiveness of online advertising campaigns

inthe aspect of e-entrepreneurship
Magdalena Rzemieniak*
Lublin University of Technology: ul. Nadbystrzycka 38, 20-618 Lublin, Poland
Abstract
A fast and problem-free access to information is a very special good in the contemporary entrepreneurship. Over a
span of recent years the internet has become one of the main marketing communication channels and online
advertising is permanently present in advertising campaigns of both large and small companies. The main goal of
the article is to present the model forms of effectiveness of online advertising and analyse the online advertising
effectiveness. It has been assumed that the greater effectiveness of online advertising contributes to improving the
entrepreneurship among entities that use it. The article contains hypothesis that online advertising is the effective
form of advertising. The hypothesis has been verified on the basis of desk research, as well as exploratory and
experimental research.
© 2015
2015 The
Magdalena
Authors.Rzemieniak.
Published by Published by This
Elsevier B.V. Elsevier
is anB.V.
open access article under the CC BY-NC-ND license
Peer-review under responsibility of Universal Society for Applied Research.
Peer-review under responsibility of Universal Society for Applied Research
Keywords: online advertising; effectiveness, advertising campaigns
*Corresponding author. Tel.: +48 81 5384468.

E-mail address: m.rzemieniak@pollub.pl
1877-0509 © 2015 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license
Peer-review under responsibility of Universal Society for Applied Research
doi:10.1016/j.procs.2015.09.063
Magdalena Rzemieniak / Procedia Computer Science 65 (2015) 980 – 987 981
1. Introduction
Year in, year out online advertising is becoming more and more important in creating marketing campaigns.
It reaches a great number of recipients and enables quite easy assessment of its effectiveness. It is interactive,
because apart from informing recipients about a given product, it also allows them to perform interactive actions
such as: visiting company’s website, sending e-mails with inquiries or purchasing in online stores [1]. Such a fast
and problem-free access to information is conducive to the development of entrepreneurship. This role is
emphasized by many authors [2]. Currently, the internet is one of the main channels of marketing communication
and online advertising has already settled in advertising campaigns of both small and large companies. The word
„internet” is purposefully written in a lowercase letter as it is treated as a communication media, much like
traditional media, i.e. radio, press and television. The main goal of this paper is to present exemplary forms of
evaluating the effectiveness of online advertisements.
2. Methodology
The goal of the research was to assess the effectiveness of online advertising from the standpoint of an entrepreneur.
The main goal was divided into several detailed goals such as:
x Assessing the effectiveness of the internet campaigns settlement.
x Measuring the impact of the location of the advertising unit on the website on its effectiveness.
x Assessing the selection of tools for measuring the effectiveness of internet campaigns.
x Assessing the designation of the most effective locations that allow advertisement transmission.
The detailed goals will confirm or disprove the following research hypotheses:
x The effectiveness of online advertising depends on proper selection of the form of the advertisement, its,
impression location, advertising unit location on a website and campaign settlement model.
x Advertisers regard online advertising as the most effective.
Research that has been carried out is explorative and aimed at providing more detailed explanation of the
research problems. In order to gain the most credible results, the research survey method with the use of survey data
collection technique was adopted. The questionnaire was designed using the online platform that allows to create
and distribute survey e-forms.
Research survey with the use of IT techniques. It has been assumed that 50 entrepreneurs would participate in
the research and 50 surveys were filled in by the respondents. The group of respondents consisted of employees
from marketing departments or similar departments, low/mid/high level management and company owners. The
companies vary in terms of size, the market that they operate on and activity profile. The non-probabilistic method
was used in the selection of the research sample. This method allowed to gain the most representative sample of the
whole population.
3. Measuring the effectiveness of advertising campaigns
Online advertising campaigns can be executed on the basis of different settlement models. Campaign settlement
models can be divided into three main groups, such as: impression models (FF, CPM), effectiveness models (CPC,
CPA, CPS, CPV, CPL and others) and hybrid models – CPM+CPC, CPM+CPS, and others [3], [4]. The oldest and
the simplest impression model of campaign settling is the FF model (flat fee). The cost of marketing campaign in
this model depends on two factors, i.e. the advertisement size and the impression time. The advertiser pays the
publisher a specific sum for the impression time of one advertising unit (e.g. 1 month), regardless of the number of
generated advertisement views during that period. Therefore, reaching the target recipients is guaranteed only by the
number of persons that visit the advertising contractor’s website [5]. This model is commonly used in image-
building and brand campaigns as it allows to improve the brand awareness and at the same time promotes a specific
product [6]. The payment in this model is the most beneficial, mainly from the standpoint of publishers (website
owners) as they receive a pre-agreed sum of money for a pre-agreed advertisement broadcasting time, regardless of
generated web traffic [7]. The group of impression models also includes the CPM model (from Latin: Cost Per
Mille), also known as the CPT (Cost Per Thousand). This model is based on the CPM index which determines the
982 Magdalena Rzemieniak / Procedia Computer Science 65 (2015) 980 – 987
cost born by the advertiser in order to reach 1000 recipients of the advertisement. The fact whether or not the
advertisement recipient made any action regarding the advertisement (e.g. clicked on an advertisement or made
purchase in an advertised store) is not taken into consideration in this case. Just as the flat fee model, it is also
commonly used in image-building and brand campaigns, where much of the emphasis is put on the effect of
memorising the brand by the advertisement recipients, not on performing specific actions (e.g. product purchase,
sending an inquiry regarding contact) The payment use in this model is most beneficial from the standpoint of
advertising contractors, as they receive payments or real number of advertisement broadcasts, regardless of the
impact of the advertisement on recipients (e.g. sale). This form of settlement often uses the advertisement
impression limit for a given user, the so called camping model [8]. In order to settle advertisement impressions in
this model, it is necessary to use the AdServer which, on the basis of logs, allows to determine the number of
impressions on a given webpage and use that data to assess the publisher’s payment [9], [10]. The CPC model
(Cost per Click) is an effectiveness model and it is one of the most popular methods of settling online advertising
campaigns. It is based on a CPC index, which determines the cost per click (interaction) on an advertisement unit.
The advertiser pays a specific sum only for actual clicks on the advertising unit that will redirect the user to an
advertised website [11]. The assessment of the effectiveness of the CPC model uses the CTR index (click through
rate), which is a click-frequency rate. It allows to determine what percentage of the total advertisement impressions
ended up with the user interaction (clicking on the advertising unit) and redirecting to the advertiser’s website. This
model is often used in campaigns carried out by affiliate networks and contextual advertising networks, such as
AdWords, AdKontekst, OnetBoksy. From the standpoint of the website owners, settling the campaigns on the basis
of pay per click is less profitable than the CPM or FF advertisement impressions, as the number of clicks on
advertisements depends largely on the advertisement creation quality (the creation should attract attention of the
recipient) and matching the theme of the advertisement to the theme of a target website [12].
Another settlement model in the effectiveness model group is the CPA model (Cost Per Action), i.e. the
settlement for a performed action. The advertiser bears costs of the advertisement only when a user performs a
specific interaction, e.g. enters the advertised website and fills in the order form or provides contact details. The
rates in this form of settlement may depend on actions performed by the user or upon the defined percentage on
sales. The model is used primarily in marketing activities in which the main goal is to sale product or service. It is
less commonly used in image-building activities. This model is very popular among bank service selling or
insurance selling companies, which execute their advertising campaigns in cooperation with affiliate networks, e.g.
Netsales, Fialo [13], [14]. In order to assess the effectiveness of the CPA model it is possible to use the so called CR
(conversion model), which allows to determine which percentage of users “incoming” under the impact of the
advertisement will perform a given action (e.g. filling a form). The CPA settlement model has many forms such as
CPS, CPL, CPE, CPO, CPV. These models are different from one another by the type of action the advertiser pays
for. In the CPS model (Cost Per Sale) the advertiser pays for the advertisement only when the user makes purchase
of a product or service under the impact of the advertisement. This form of settlement is used in partnership
programmes of online stores that offer a specific income percentage on sales generated by the person that made
purchase under the impact of the advertisement [15]. The CPV model (Cost Per View) is commonly used in
advertising campaigns that use the pop-up, pup-under and interstitial advertisement formats. The advertiser pays
only for each one-time impression of a website (pop-under) or an advertisement (pop-up, interstitial) [16]. Currently,
this model is also used in the Google Adwords network video advertisements in which the advertiser pays for each
view of the advertisement by the user. These advertisements are displayed in the YouTube search results or before a
target video. Another form of the CPA model is the CPL model (Cost Per Lead) which consists in charging fees for
providing contact data by the user through the registration process or filling in a form. The predetermined fee is
charged for each performed ‘lead’. This model is very often used in affiliate networks and in campaigns that
advertise bank products such as credits and bank accounts. The final and the most recent group of campaign settling
methods are hybrid models. They are created via combining a couple of settling models, e.g. CPM+CPC,
CPM+CPL, CPM+CPS. The hybrid model is becoming more and more popular in the internet campaigns as it
guarantees a certain level of profit for the publisher (settlement for impressions) and allows the advertiser to reduce
costs as they pay more only under the condition that the user clicks on the advertisement [17]. The ROI rate model
(return on investment) which shows the percentage return on investment can be useful in the assessment of online
advertising campaign effectiveness. It allows to determine whether or not the means invested in advertising
campaigns generated any profit e.g. in a form of additional online store orders. This rate is relatively unpopular
among small and medium-sized advertisers. It is also the only model that allows to determine whether or not
running a given advertising campaign is economically justifiable [18], [19].
4. Website statistics
Each marketing action oriented to increasing the website popularity requires a permanent control. The viewing
statistics are used in order to carry out the control process. This data allows to constantly monitor the effects of
carried out actions. There are both commercial and non-commercial solutions available on the market – each with
different pricing and functionality [20], [21]. Website owners in Poland tend to use such statistics as: Stat24, Piwik
or Google Analytics. The Stat 24 statistics are a tool created by the Polish company Redefine ltd., which specialises
in providing services supporting the development of websites. Stat24 offers two kinds of services, paid
(statBiznesPRO) and free (statStandard) which vary in terms of available functions. The statStandard service is
primarily aimed at owners of blogs, homepages and hobby-oriented websites, theme websites and small company
websites. On the other hand, the statBiznesPRO service is aimed at owners of advertising and interactive agencies,
large online portals and websites and online stores. The free version of the service has limited functionality. It is
required to position the stat24 advertising button on a website (e.g. impression of the research questionnaires). The
Stat24 usage allows to gain valuable data on users visiting the website and use it to optimize the website, which
leads to increasing the effectiveness of marketing actions [22]. The Piwik statistics are a continuation of the
phpMyVisites open source GPL licenced project which was created in 2003 and since 2007 known as Piwik. Unlike
solutions offered by other producers, the Piwik statistics offer full control over the statistics code and allow full
discretion (only the owner and persons authorized by him have an access to statistics) as they are installed on
a website owner’s server. The installation is free and very simple, therefore the whole process should not take more
than 5 minutes [23]. One of the main advantages of the Piwik statistics is the access to API which gives virtually
unlimited possibilities of adapting the statistics to individual needs and the mobile version dedicated to mobile
devices such as smartphones and tablets. It is a great alternative to other free statistics such as Google Analytics,
stat24. These statistics are used by millions publishers of websites and large companies and organizations such as T-
Mobile, Wikimedia, Forbs, Sharp [24]. The Google Analytics platform was created in 2005 by the American
search engine giant – Google Inc. It was created on the basis of the system purchased from the Unrich Software
company [25]. According to the data published by Google in 2012, 10 million websites used the Google Analytics
services, including 55% of the ten thousand world’s biggest services. Statistics are available to users both in the free
version, which has some limitations, as well as in the paid Google Analytics Premium version. The latter has no
limitations and is available only in selected countries such as France, Spain, USA, Great Britain, Germany, Japan.
Due to its price ($150,000 per year), the paid version is primarily aimed at large online services [26]. The platform
also allows to combine statistics with Google Adwords software, allowing access to information on paid key words
[27], [28]. Google Analytics statistics have a series of useful functions, from basic metric data to advanced reports
allowing to monitor marketing activities [29], [30]. The Google Analytics platform offers a vast array of functions
and configuration capabilities, which makes it a very good alternative to every commercial solution that offers the
analysis of effectiveness of online marketing activities.
5. Results
The research show that as many as 76% respondents execute advertising campaigns by means of the Internet. In
the following question, the respondents (who answered positively to the previous question) were asked to pick the
campaign settlement model that was the most often used in their respective companies. Each respondent could select
up to 3 answers and, when selecting the field “other”, write their own answer (Fig. 1).
090% 079%
080%
070%
060%
050% 042%
040%
030% 024%
018% 021% 016%
020%
010% 000%
000%
Fig. 1. The selection of the model of settling advertising campaign effectiveness in a company.
Almost 80% of the respondents declared that the settlement model they use the most in the internet campaigns is
the CPC (cost per click) model. The second most often declared model, indicated by over 42% of the respondents,
is the Flat Fee model (cost per impression time). The respondents to a lesser degree use such effectiveness models as
the CPA, CPL and CPS, as declared by 20% of them.
The next question was also aimed at entrepreneurs who use internet campaigns. The respondents were asked to
choose the campaign settlement models that they consider the most effective. Each of them could select up to three
answers (Fig. 2).
070% 061%
060%
047%
050%
040%
029% 026%
030% 021%
020%
010% 005%
000%
000%
Fig. 2. The selection of the most effective models of settling online advertising campaigns by the respondents.
According to the majority of the respondents (over 60%), the most effective model of settling online advertising
campaigns is the CPC model. It is followed by the CPS effectiveness model indicated by over 47% of the survey
participants. In case of the Flat Fee model, only 26% indicated it as one of the most effective. The CPM model is
considered the least effective model of settling campaigns.
The next question was to determine which types of advertisements the respondents consider the most effective
in terms of the impression location. Each entrepreneur was allowed to select up to two answers and provide their
own answer (Fig. 3).
060% 056%
050%
050%
040%
030%
020% 020%
020% 012% 012%
010% 006%006% 004%
000%
Fig. 3. The selection of the most effective advertisements as viewed by entrepreneurs.
According to the majority of the respondents (28 out of 50), the most effective type of online advertising is the
search engine advertisement. Nowadays, the search engines have become the primary tool for searching for
information on the Internet .Therefore, the search engine advertising offers the possibility of accessing large and
well-adjusted group of recipients.
Another most effective advertising location are websites connected strictly with the theme of a given
advertisement. This answer was indicate by 50% of the respondents. Just like the search engine advertising,
advertisement on theme websites offers the possibility of accessing a selected target group.
News portals and social media advertisements were considered effective by every fifth respondent. Thanks to the
development of mobile technologies, the social media have currently become an indispensible element of life of
millions of people around the globe and therefore offer the possibility of accessing a large group of recipients. Only
12% of the respondents consider advertising on internet fora or e-mail advertisement effective.
6. Discussion
The majority of the respondents consider search engine advertising to be the most effective type of online
advertising. According to the 76% of the respondents, the effectiveness of this form of internet advertisement is good
(36^) and very good (40%). Only 14% of the respondents claim that the effectiveness of this type of advertising is
weak (10%) or very weak (4%).
Another well-assessed type of online advertising was sponsored links advertisement. A total of 56% of the
respondents consider this type of advertising to be very good (18 respondents) or good (10 respondents) . According
to every fifth respondent, effectiveness of this type of advertisement is optimal. Every fifth respondent also claims
that this form is weak (6 respondents) or very weak (4 respondents).
The weakest type of advertisements in terms of effectiveness are pop-up windows. 13% of the respondents
consider their effectiveness to be weak, and 23% to be very weak. Only 12% view effectiveness of these
advertisements as very good (6%) or good (6%).
Other advertisements that were considered to be not very effective were interstitial ads. 44% indicated that they
are weak or very weak effectiveness and only 10% of the respondents consider them very good or good. Every fifth
respondent could not assess the effectiveness of this type of advertisement. As viewed by 34% of the respondents,
the brandmark advertisement has an optimal effectiveness and only 12% regards this type of advertisement as good.
36% consider this type of advertisement weak or very weak and every fifth respondent could not assess the
effectiveness of this type of advertisement. Almost every third respondent thinks that the effectiveness of banners is
optimal. 20% consider this type of advertisement good and 10% - very good. A total of 38% claim that this type of
advertising is weak (28%) or very weak (10%).
Similarly to the advertisement in a form of a banner, the respondents also assessed the effectiveness of
advertising in a form of a billboard. Just as in case of a banner, every third respondent considers the effectiveness of
a billboard to be optimal and 38% of the respondents consider it to be good or very good. Only 32% thinks that
effectiveness of advertisement in this form is weak or very weak. According to 40% of the respondents, the
effectiveness of video advertisements is very good or good, and 34% consider it to be weak or very weak. Only 22%
regard this type of advertisement as satisfactory.
The opinions of the respondents regarding the effectiveness of advertisement in a form of mailing are varied. A
total of 44% of the respondents think that the effectiveness of mailing is weak (24%) or very weak (20%) and 34%
think that is good (20%) or very good (14%). 18% of the respondents consider the effectiveness of this form of
advertising to be optimal.
The last type of advertisement assessed by the respondents was top-layer type ad. According to 36% of the
respondents, its effectiveness was very good or good, and 24% assessed it as optimal. Only every third respondent
claims that the effectiveness of this form of advertisement is weak or very weak.
The survey carried out among entrepreneurs allowed to clearly determine that online advertising is very popular
in micro-companies. The main effectiveness models used by advertisers for settling online advertising campaigns
were the cost per click and cost per action. According to entrepreneurs, the factors that affect the effectiveness of
internet advertisements the most are the ad location, advertising creation and adjusting the theme of the
advertisement to the theme of the target website. This is why the majority of the respondents declared that the most
effective advertisement impression locations are theme websites and search engines (advertisements are adjusted to
the key word typed by the user). They also indicated that the most effective advertisements are located at the very
top of the website. This respondents’ opinion allows to confirm the hypothesis regarding the interrelation between
the selection of the type of advertisements, ad impression location, the location of the advertising unit of a giver
website, the campaign settlement model and the campaign effectiveness.
Most of the companies that participated in the survey declared that they use graphic ads in their campaigns. This
allows to confirm the hypothesis that this form of internet advertising is widely used by entrepreneurs in their
advertising campaigns. The research hypothesis regarding entrepreneurs’ opinion on the internet being the most
effective advertising medium was also confirmed. Over a half of the respondents consider the internet to be the most
effective advertising medium.
The goal of this paper was to present and assess the effectiveness models of online advertising. Year in, year out
online advertising gains greater and greater participation in companies’ advertising budgets. It is also evolving
through the emergence of new forms of online advertisements. Only a few years ago the main type of online
advertisement most commonly used by marketing specialists was graphic advertisement on websites. Nowadays, this
type of advertisement has been mostly replaced with search engine and contextual advertising.
References
[1] Kryński M. Evaluation of the effectiveness online advertising. Elaboration unpublished: Lublin 2014.
[2] Nowakowska-Grunt J. Selected martketing-logistics management concepts. Monographs No 7: The Faculty of Management Czestochowa
University of Technology. 2007, p. 7.
[4] Guziur P. Internet marketing - small and large businesses strategies. Gliwice: Helion, 2011, p.91.
[6] Gancarz-Wójcicka B. E-biznes Bible. Gliwice: Helion, 2013, p.272.
[8] Herzberg A. Google Adsense. Explorer secrets of Google. Gliwice: Golden Means, 2007, pp.54-55.
[12] Kryński M. Evaluation of the effectiveness online advertising. Elaboration unpublished: Lublin 2014
[14] Gancarz-Wójcicka B. E-biznes Bible. Gliwice: Helion, 2013, p. 237.
[16] Calcott L., Weller B. The Definitive Guide to Google AdWords: Create Versatile and Powerful Marketing and Advertising Campaigns. New
York: Apress, 2012, p. 9.
[17] Gancarz-Wójcicka B. E-biznes Bible. Gliwice: Helion, 2013, p. 237.
[19] Majewski P. E-Biznes time. Gliwice: Złote Myśli Sp. z o.o., 2008, p. 474.
[21] Danowski B., Makaruk M. Positioning and optimization of web pages HOW TO MAKE. Wydanie II. Gliwice: Helion, 2009, p. 289.
[23] Miller S. Piwik Web Analytics Essentials. Birmingham UK: Packt Publishing Ltd., 2012, pp.1-2.
[25] Jerkovic J. SEO Fighter. Gliwice: Helion, 2011, p. 149.
[26] Jerkovic J. SEO Fighter. Gliwice: Helion, 2011, pp. 15-19.
[27] Ledford J. SEO Bible. Gliwice: Helion, 2008, p. 168.
[29] Holdren A. Google Adwords Effective online advertising campaign. Gliwice: Helion, 2012, p. 58.
[30] Geddes B. Advanced Google AdWords. Indianapolis: Sybex, 2010, p. 45.
ScienceDirect
ScienceDirect www.elsevier.com/locate/procedia
9th
9thInternational
InternationalConference
Conferenceon
onTheory
Theoryand
andApplication
Applicationof
ofSoft
SoftComputing,
Computing,Computing
Computingwith
with
Words and Perception, ICSCCW 2017, 24-25
22-23 August
August 2017,
2017, Budapest,
Budapest, Hungary
Hungary
Using statistical reasoning techniques to describe the relationship

between Facebook advertising effectiveness and benefits gained
Ahmet Ertugan*
*Faculty of Economics and Administrative Science, Near East University, P.O.BOX:99138, Nicosia, North Cyprus, Mersin 10 Turkey
Abstract
There is an escalating use of Facebook among marketers. Naturally, the research in this field has also been escalating in recent
years. Businesses need to understand Facebook and its benefits in achieving effective advertising campaigns. Further
investigation is still needed to understand how effective social media and particularly, Facebook are for advertising. This study
aimed to understand if there is a relationship between Facebook advertising effectiveness and benefits gained from such
advertising. Statistical reasoning was used to measure the extent of two advertising benefits and their correlation in creating
effective advertising campaigns on Facebook. Pearson’s bivariate correlation and linear regression analysis were implemented
on data obtained from carrying out a survey on undergraduate students. The benefits of “customer relationship management” and
“promoting new products” were tested in relation to Facebook advertising effectiveness. The results supported that Facebook is
seen as an effective medium for advertising and it has a strong association with the described benefits of “customer relationship
management” and “promoting new products”.
© 2018 The Authors. Published by Elsevier B.V.
Peer‐review under responsibility of the scientific committee of the 9th International Conference on Theory and application of
Soft Computing, Computing with Words and Perception.
Keywords:Customer relationship management; effective advertising on Facebook; promoting new products
1. Introduction
Many agree that the Social Media has changed the way we give and receive information. Social media is defined
as a connection between brands and consumers offering a personal channel and currency for user-centred networking
and social interaction (Chi, 2011). Mangold and Faulds (2009) describe the way business organizations connect
* Ahmet Ertugan. Tel.: +90- 392-675-1000(3125); fax: +90-392-6751051.

E-mail address: ahmet.ertugan@neu.edu.tr
1877-0509© 2018 The Authors. Published by Elsevier B.V.

Peer-review under responsibility of the scientific committee of the 9th International Conference on Theory and application of
Soft Computing, Computing with Words and Perception.
1877-0509 © 2018 The Authors. Published by Elsevier B.V.

Peer-review under responsibility of the scientific committee of the 9th International Conference on Theory and application of Soft
Computing, Computing with Words and Perception.
10.1016/j.procs.2017.11.220
Ahmet Ertugan / Procedia Computer Science 120 (2017) 132–139 133
with their customers and argue that businesses need to learn using the media in parallel with their business plans.
Social Media and thus the Social Networking Sides present an opportunity for businesses to reach larger markets as
with their communications as with advertising.
Facebook is a Social Network Site that has been the most important social phenomenon of the last ten years.
Almost two billion people (Kallas, 2017) are known to use it around the globe every day. Businesses are interested
in exchanging information, trading products or services, connecting to current and potential customers, ensuring a
better understanding of targeted customers and business benefits offered by Facebook. It should be noted, however,
that Facebook is not a substitute for the traditional marketing media but it’s a complement to the existing systems.
Advertising campaigns aim to create awareness, inform, promote brand differences and in parallel to business
objectives. The essence of making advertisements is to attract consumers to patronize the company’s product or
service, which in turn garner profits from sales to the company. Advertising without understanding the targeted
consumers and the nature of advertising media carries risks. Correlations between benefits gained with what
considered as effective advertising are one of the issues that need to be understood.
There is a need to understand if there is a relationship between Facebook advertising effectiveness and benefits
gained from such advertising. This study tested the correlation between two advertising benefits and the
effectiveness of Facebook advertising. The benefits tested were “customer relationship management” and
“introducing new products”. The correlations of these benefits with the effectiveness of Facebook advertising were
measured.
University students using Facebook are frequently bombarded with advertisements, related or not to their
lifestyles, wants and values. Most adverts are mass targeted with little consideration to the demographic
backgrounds of customers. Therefore, university students comprised the sample of the study as they regularly use
Facebook and come into contact with Facebook advertising.
This study aimed to find out the extent to which Facebook advertising is effective in particular benefits by
trying to find answers to the following research questions:
a. Is there a customer relation management benefit gained with Facebook advertising?

b. Is there an effective promotion of new products benefit gained with Facebook advertising?
c. Do University students think that Facebook advertising is effective?
d. Is there a positive relationship between customer relationship management and Facebook advertising?
e. Is there a positive relationship between promoting new products and Facebook advertising?
Advertising has the same meaning with marketing to most people. Advertising, in fact, is just one of the
communication mix elements. Kotler and Armstrong (2008) define advertising as the delivers information, reminder
and persuasion on products and brands.
The aim of advertising is explained by Quinn (1985) as to create a response in buying or a desire to find more
about a product. Advertising has types explains Aaker and Mayaers (1975) such as to inform, persuade and to
remind consumers on given products.
The traditional marketing media included radio, television, magazines and newspapers. There is a decline in the
number of people following the traditional media as Gurevitch Coleman and Blumber (2009) reports. The extensive
reach to the Internet with smart phones, tablets and other computerised equipment meant more use of Social
Network sites by Consumers. Kin (2008) portrays that the popularity of social networks have escalated more than
before. The young population are the major adopters. Teenagers are followed by the 25 to 34 age group. White
collar workers use the social network sites more than any other occupations.
This growing trend indicates that the marketers need to explore the effectiveness of different social networks as it
will be hard to communicate and create value for consumers in the future.
There is little research carried out on the effectiveness of social media for advertising purposes. The current
research on social network Sites is mainly exploratory on topics such as networks and network structure, and similar
other issues (Boyd and Ellison, 2007). There is still a gap in understanding the effectiveness of social media
advertising on consumers.
Many think that the social media has changed the way businesses interact with their customers and business
owners greatly. Mangold and Faulds (2009) suggest that businesses must learn how to use social media in parallel
134 Ahmet Ertugan / Procedia Computer Science 120 (2017) 132–139
with their business plans. This is because Social Networking Sites present an opportunity for businesses to extend
their marketing activities to a many segments. Social media advertising as a “connection between brands and
consumers, while offering a personal channel and currency for user centred networking and social interaction.” as
defined by Chi (2011).
So far, studies rarely described the advertising benefits that businesses gain from social media advertising.
Research is needed to offer a better understanding of advertising benefits from social media advertising.
Considering the amount of spending on advertising, it is essential to understand what advertising effectiveness is
and how it is measured. Understanding what leads to advertising effectiveness, however, is far more important as
any waste in spending might be avoided in advance. This has become more challenging with the increase use of
social media since the 2000s.
A definition of advertising effectiveness was provided by Corvi and Bonera (2010) as the extent to which
advertising ends in a desired effect. They also found measuring the effectiveness advertising difficult as it interacts
with marketing, financial, environmental, competition and other variables. They further described that that the
effects of advertising cannot always be measured with quantitative measures but advertising has effects which are
not possible to measure at the time of costs.
Li and Leckenby (2004) and Pavlou and Stewart (2000) argue that social media advertising should be
considered the same as the general philosophy of advertising effectiveness. The Nielsen Company (2010) measures
the social media advertising effectiveness by using the brand favourability, message equity, brand consideration,
purchase propensity, the effectiveness of creative execution, place impact, and frequency of exposure.
Chu (2011) explains that when users pass on advertisements promoting brands they reveal their personal
information and their connection with Facebook groups. He depicts that consumers see Facebook groups as channels
useful in seeking self-status in a product class as they pass on information on brands to their Facebook group
members.
Chu (2011) further observes that university-aged, young users show the most favourable attitudes toward social
media advertising and are the largest growing demographic group. This makes social media sites a better advertising
media for companies with targeted segments of younger customers. Cox (2010) also studied the correlation between
age and attitude toward social media advertising. She discovered that the attitudes of social network users toward
online advertising differed across age groups. She observed that users in the eighteen (18) to twenty-eight (28) age
groups have strong positive attitudes towards advertising formats such as blogs, video, and brand channel. She points
to the eye-catching, informative and the amusing characteristics of these formats as an explanation. Most users like
the characteristics of these formats with younger groups showing a higher preference. However, most network users
dislike advertisements interfering with online social networking activities, such as pop up, expandable, or floating
formatted advertisements (Cox 2010).
Chi (2011) suggests that the motivations of users on online social networks may play an important role in
defining consumer’s reactions to social media marketing. He explains that users see advertising differently
depending on the social network. Harris and Dennis (2011) determine that consumers, particularly students, have a
hierarchy of trust when using Facebook and other social media. Students are noted to go in the descending order of
Facebook friends, expert blogs, independent review sites and lastly celebrities and e-retailer sites.
Di Pietro and Pantano (2012) explain enjoyment as the major factor that influences consumers to use social
networks in their buying intensions. They depict that Facebook gives fun and the opportunity for users where they
can ask for suggestions in an easy and entertaining way.
Individuals are motivated and are more interested in products announced on Facebook. Di Pietro and Pantano
(2012) advised businesses to develop their Facebook appearance by adding amusing interactive applications such as
games and contests. Heinonen (2011) argues that consumers’ activities are not related to one single motivation but a
variety of combinations. He finds the classic view of individuals as mere customers out of date. He argues that user
generated content is diminishing the effect of traditional marketing strategies and consumers should be viewed as
active producers of business value. Businesses can increase consumer awareness on their brands by being
imaginative when interacting with customers on social media sites. Shankar et al. (2011) views promotion social
media as important. According to Curran et al. (2011), Facebook and other similar social media websites are far
superior to other advertising media because they store personal details on all their users which ensure that marketers
use the information in reaching their targeted segments.
Facebook has become the most popular social network site that has brought a notable social change into our
lives during the last decade. The growth rate of Facebook has been remarkable which attracted a lot of research
interest. In 2017 figures, there are almost 1.97 billion active users of Facebook who enjoy a social network service in
70 different languages (Kallas, 2012).
Customers are increasingly spending more time on social networks and therefore coming across more with
online advertising than on traditional channels Edelman (2007). As also Luke (2009) puts it Facebook allows
companies to establish better and more communications with their customers than any other way such as through
emails, phone calls and meetings. This creates an advantage in lower marketing costs. Therefore, social network
sites like Facebook have provided a communications medium where businesses can manage marketing and
advertising campaigns at a lower cost. Facebook has created opportunities for businesses to communicate
interactively and faster with individual customers (Mize, 2009; Palmer & Koenig-Lewis, 2009). Facebook facilitates
an advertising medium which has initiated a new era of personalized advertising.
Opportunities seem to exist for organisations to benefit from Facebook. Opportunities or some of the benefits
which are offered by Facebook amongst many are “Customer Relationship Management” and “Promoting new
products”.
Marland (2008) explains that Facebook facilitates a channel through which a strong bond between the customer
and the business organisation is formed. Thus, advertising on Facebook provides a whole new way of advertising
which enables interactivity to users enhancing the relationship between customers and the business organization
(Logan, K., Bright, L.F and Gangadharbatla, H. 2012).
Facebook is the least costly way announcing and promoting new products and services as explained by Sarah E
Needleman (2011). Facebook is a more convenient way announcing new products and services to targeted
segments. Organizations are switching to Facebook advertising for various reasons Bernoff (2008). The existence
of electronic Word of Mouth (eWOM) on social media provides significant amount of information for new products
where potential buyers can share information that will affect their purchase intentions (Nail & Jim, 2005).
2. The conceptual model of the study

Customer Relationship
Management
Effectiveness of
Facebook Advertising
Promoting New
Products
Fig.1. The conceptual model of the study
The development of the above model was the result of the literature review carried out for this study. The
effectiveness of Facebook advertising and benefits were assumed to be correlated and such effectiveness has been
the main apprehension of this study. Being regarded as the research problem the “effectiveness of Facebook
advertising” was regarded as the dependent variable. The benefits “customer relations management” and
“promoting new products” were considered as the independent or predictor variables.
The model proposes that the effectiveness of Facebook advertising increases by the extent of its benefits to
marketing organisations. The more the benefits, the more effective the Facebook advertising results will be. This
research study has focused on two benefits: customer relationship management and promoting new products or
services:
Customer relationship management is vital to the growth of companies. Facebook enhances customer
relationship management by achieving strong bonds between the customer and the organization, therefore adding to
the strength of the organization. Facebook allows the company to know more about the customers, their preferences
and market trends, celebrate their memorable moments and empathize with them during grief. Knowing the
preferences of customers helps in developing more competitive products and developing more effective advertising
campaigns.
Facebook is relatively an easier medium to inform the market about new products and services. Announcing new
products or services is possible with less effort. It creates a medium that makes it easier to spread information on
new products and services through word-of-mouth. Sheryl Sandberg (2010) explains this as "We enable effective
word-of-mouth advertising at scale…"
In parallel to the conceptual model designed in Figure 1, the following study hypotheses were formulated;
H1 There is a positive association between customer relationship management and the

effectiveness of Facebook Advertising.
H2 There is a positive association between promoting new products and the effectiveness of
Facebook advertising.
3. Methods
A research design is mostly described as a series of steps that improves the validity of a research results. It is
defined as “a blueprint for conducting a study with supreme control over features that may impede with the
legitimacy of the findings” Burns & Grove, (2009). Parahoo, (2006), on the other hand defines it as “a plan that
depicts how, when and where data are to be gathered and examined”.
This study was interested in describing the relationships between variables to describe the effectiveness of
Facebook advertising and the benefits of Facebook advertising. Therefore, it is descriptive by its nature and
correlative as a type of investigation.
The study took place in a natural environment and was carried out with minimal interference and manipulation
to the variables. It can be described as a field study as it took place at university campus where the targeted
population was engaged with Facebook activities. Individual students were regarded as the unit of analysis. The
aim of the study was to define the benefits of Facebook advertising from the eyes of the individual university student
users. The study was cross-sectional in time horizon as data was collected over a single period of time.
A questionnaire was used as a survey method to collect quantitative data. Fink (2003) describes the survey
system as “setting objectives for data collection, designing the study, preparing a reliable and a valid instrument,
administering the survey, managing and analysing data and reporting the results.” The survey questionnaire was
developed from the literature review and the conceptual model as illustrated in Figure 1.
The questionnaire included four sections. The sample selected was from the Faculty of Economics and
Administrative Sciences and so The Section I consisted of one (1) screening question to ensure that the students
came from the selected Faculty and two (2) personal details questions of the respondents asking their gender and age
group. The remaining parts of the questionnaire consisted of attitude statements measurable on a 5-point Likert
Scale. The section II consisted of five (5) statements on Customer Relationship Management, Section III three (3)
statements on promoting new products and finally Section IV five (5) statements on the effectiveness of Facebook
advertising. A pilot test was first carried out on an initial sample of twenty students. The questionnaires were
prepared in both English and Turkish languages as the sample of students comprised of speakers of both languages.
The pilot test was to ensure that the questionnaires were free of error, comprehendible, consistent and easily could be
completed by the responding students.
A total number of two hundred and fifty (250) questionnaire forms were administered to individual students
selected randomly at the faculty of Economics and Administrative Sciences.
A convenient, non-probability sampling design was adopted as the responding students were readily available
during the period of the investigations. All respondents were requested to complete the questionnaire based on their
experiences.
The sample size set for this study was two hundred and fifty; (250) a size assumed right for this descriptive study.
A sample size is defined by Malhorta (2010) as the number of elements that are included in a study. Malhorta
(2010) suggests that sample size for the study of advertising, the minimum should be one hundred and fifty (150)
and the typical range of around two hundred (200) to three hundred (300). Whereas, Sekaran (2003) suggests that
sample size which are larger than thirty (30) and less than three hundred (300) are normally applicable for most
research, and recommends the sample size should be ten (10) times the number of variables in the study.
Respondents in this study were 250 students of the faculty of Economics and Administrative Sciences of Near
East University in Northern Cyprus.
In analysing the data statistical reasoning was used. Garfield (2002) describes statistical reasoning as more than
the execution of statistical procedures but he describes it as “the way people reason with statistical ideas and make
sense of statistical information”. In this study, Statistical Package for Social Science 21® (SPSS) was used to
analyse the data obtained from the questionnaire forms. Each questionnaire was coded and entered into the SPSS
data view. The first survey instrument used was the reliability analysis, which shows the “extent to which a scale
produces consistent results if repeated measurements are made on the characteristic” (Malhorta, 2007). This was
followed by the descriptive analyses which were carried out on the demographics of the respondents indicating the
profile sample by age and by gender.
The correlation analyses were carried out to demonstrate the influence and direction of the relationship between
the variables which results were used for the hypothesis testing. The regression analyses were run in order to
determine the relative importance of the independent variables on effectiveness of Facebook advertising.
The validity and reliability of the questionnaires were estimated by using Cronbach’s Alpha as a coefficient of
internal consistency. This shows the extent to which a scale produces consistent results if repeated measurements
are made on the characteristic as described by Malhotra, 2010).
4. Results
Out of the 250 questionnaire forms, twenty-five (25) were screened as they were not completed by students of
the Faculty and four (4) questionnaire forms were not returned. The total number of questionnaires realized was two
hundred and twenty-one (221).
Cronbach's (alpha) as coefficient of internal consistency was used to estimate the reliability of the questionnaire
responses. The Cronbach’s coefficient alpha of the 21 attitude statements items was 0.883, suggesting that the items
had optimal reliability and relatively high internal consistency. This is a popular test for consistency reliability and a
coefficient above 0.60 is sufficient for most social science studies (Sekaran and Bougie 2009).
A total of 110 of the respondents were male which represents 49.8% while 111 were female which represents
50.2% - almost equal in number! A 60% person of the respondents was under 24 years of age.
In response to the attitude statements on customer relationship management the responding students generally
agreed that Facebook is effective and that it creates a bond between the customer and the seller. Respondents also
agreed that Facebook is an effective tool in promoting new products.
Correlation analysis was adopted to test the relationship between the variables and to determine whether the
hypotheses were supported or not. The results showed that Customer Relationship Management has a significant
positive relationship with Facebook advertising effectiveness at a variance of r (221) = 0.37 and p=0.01. This
relationship is considered moderately strong hence H1 was supported. Promoting New Products has a significant
positive relationship with Facebook advertising effectiveness at a variance of r (221) = 0.76 and p=0.01. This
relationship is considered very strong hence H2was supported.
A simple linear regression analysis was also carried out to determine the degree of association between the
independent variables (customer relationship management and promoting new products) and the dependent variable
(Facebook Advertising effectiveness). The variables had the following standardized regression coefficients;
customer relationship management (β = 0.120, p < 0.01) and announcing new product (β = 0.742, p < 0.01). These
results showed that the most influenced variable as regards Facebook advertising effectiveness is promoting new
products followed by customer relationship management.

5. Conclusion
This research study was set up to define the effectiveness of Facebook advertising in relation to two advertising
benefits. A sample population of university students was selected. A conceptual model was proposed comprising
Customer relationship Management and Promoting New Products to see their degree of influence on Facebook
Advertising effectiveness.
The empirical findings depicted that among the responding students Facebook advertising is effective in building
customer relationships and it creates a bond between the customer and the seller. The respondents also agreed that
Facebook advertising is an effective tool in promoting new products. In parallel to this, both the research hypotheses
suggesting positive associations between Customer Relationship management and Facebook Advertising
Effectiveness and between Promoting New Products and Facebook Advertising Effectiveness were supported.
In response to the research questions one can conclude that Facebook advertising is effective in building a
positive customers relationship management. There is also evidence that Facebook advertising creates a bond
between the customer and the seller. Facebook advertising was described by the respondents as an effective way in
promoting new products. Finally, most of the responding students expressed a positive attitude to Facebook
Advertising finding it effective.
There were two limitations of this study envisaged. One is that that there are other benefits of Facebook
advertising that need to be explored. For the reasons of parsimony, this study concentrated on two benefits. Two is
that, the study results are based on a convenience sampling of university students. Clearly, a better representative
sample is needed to be able to generalize the results.
Further research is recommended to explore, identify and test the association of other benefits of Facebook
advertising.
It was clear from this research study that Facebook has created a new and an effective medium for advertising.
There is evidence of some benefits and a need for others to be explored.
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Social Media in an Alternative Marketing Communication Model
Cristina Castronovo
Johnson & Johnson Inc. Toronto, Canada
Lei Huang
Dalhousie Unive rsity, Canada
While current literature has sufficiently profiled word-of-mouth (WOM) marketing, customer relationship
management, brand communities, search engine optimization, viral marketing, guerilla marketing,
events-based marketing, and social media each on an isolated, individual basis, there is no
comprehensive model that effectively incorporates all of these elements. The first purpose of this paper is
to therefore profile the current literature landscape surrounding WOM marketing, alternative marketing
communications, and social media as viable components of integrated marketing communications.
Additionally, this paper aims to develop an integrated alternative marketing communication conceptual
model that can be applied by industrial practitioners to help them achieve their marketing objectives.
INTRODUCTION
As companies begin to realize the value of the Internet as a primary component of their
communications platform, they are correspondingly beginning to leverage alternative marketing practices
that are more cost-effective and more efficient at actively engaging with consumers, than traditional
advertising channels. While the use of social media, guerilla tactics, and experiential campaigns are
becoming more prevalent, best practices surrounding the strategic execution of these ever-evolving
marketing tools and their incorporation into an integrated marketing communications (IMC) approach has
not yet been robustly identified.
The effective use of alternative marketing practices can be especially advantageous for smaller to
medium sized firms in the consumer products and services industry, which oftentimes lack the resources
that are necessary for employing traditional forms of advertising. When integrated through a social media
platform, viral, guerilla, and events-based marketing are cost-effective promotional options that can also
deliver measurable business results. When developed in accordance with a company’s overall strategic
objectives, a smaller firm not only has the ability to communicate its message to its target audience, but
also the ability to begin to cultivate meaningful relationships with its consumers.
The purpose of this paper is two-fold: firstly, it will provide insight into the current best practices for
the formation and execution of alternative marketing strategies, specifically in terms of word-of-mouth
(WOM) marketing strategy, marketing communications, and social media marketing. Secondly, it will
develop a managerial model for alternative marketing, geared toward small to medium sized
entrepreneurial firms in the consumer products and services industry.
Journal of Marketing Development and Competitiveness vol. 6(1) 2012 117

LITERATURE REVIEW
Word-of-Mouth (WOM) Marketing as a Viable Strategy

Consumer purchase decisions are highly affected by the opinions and decisions of one’s peers, with
peer-to-peer communication acting as a highly valid and reliable source of product information. As
previously summarized by Cheema and Kaikati (2010), word-of-mouth information sharing is a crucial
component of the marketing process, as consumers tend to greatly rely on the advice of others when
making purchase decisions, especially when purchases are financially or psychologically risky (Gershoff
& Johar, 2006). Moreover, word-of-mouth has been shown to be even more effective in influencing
purchase decisions than traditional advertising channels (Godes & Mayzlin, 2004; Herr et al., 1991) and
retaining customers over time (Trusov et al., 2009). Consumers are motivated to spread information via
word-of-mouth communications when they are satisfied or dissatisfied with a product (Anderson, 1998)
and highly committed to the firm (Dick & Basu, 1994).
The advent of the Internet has increased the ability of individuals, and potential future customers, to
interpersonally connect with one another, thereby creating a powerful means through which product
information can be rapidly disseminated and products be more cost-effectively adopted by the market
(Trusov et al., 2009). As a result, marketers can use these interpersonal networks and online communities
to promote their products and services through electronic forms of word-of-mouth. The most recent and
up-to-date WOM model is the Network Coproduction Model, which postulates the idea that both the
consumers and the marketer develop WOM communications together by taking into account the fact that
marketing messages are no longer unidirectional, largely as a result of the Internet, with messages and
meaning being actively exchanged within a consumer network (Kozinets et al., 2010). In this model,
marketers use various new types of tactics and measures to influence the consumer or opinion leader.
WOM referrals have also been shown to significantly increase new customer acquisition and boast
much longer carryover effects than traditional marketing actions as well as higher response elasticities
(Trusov et al., 2009). WOM marketing is quickly becoming a driving force behind all strategic marketing
campaigns as the wide variety of social media outlets are increasing in prominence and maturity, and act
as crucial resources for informing influencers’ decisions. Tie strength, which refers to the strength of an
interpersonal relationship, has been shown to be one of the most important factors that influence the
spread of word-of-mouth communication, with stronger ties resulting in increased reliance on WOM
information as a basis for purchase (Brown & Reingen, 1987). Source expertise is another important
factor, with consumers being more likely to trust and believe experts in a particular field (Bansal &
Voyer, 2000).
In terms of the online world, networks of friends tend to be the best suited for rapid dissemination of
word-of-mouth referrals, as opposed to other types of stakeholder networks (De Bruyn & Lilien, 2008).
However, more public forums are also effective, whereby users are connected through some common
interest and trust others’ opinions as a result of their unique experiences, but do not necessarily know one
another on a personal level (Dellarocas, 2006). With the majority of WOM marketing moving online, the
spread of WOM messages is becoming more heavily influenced by what Huang (2010) refers to as
predispositional ties: preexisting similarities between the source and receiver in terms of their attitudes
and interests. Within an online social community, the network must define content in such a way that
provides users with an enjoyable experience that keeps them coming back and contributing.
Social networking sites allow for viral marketing and word-of-mouth promotion to be just as effective
– if not more effective – than traditional media outlets because of the high levels of consumer engagement
associated with these alternate forms of Web-based media. Opinion leaders have the ability to greatly
influence the beliefs, behaviors, and values of consumers, and they are able to effectively reach masses of
individuals through blogs and social networks (Acar & Polonsky, 2007). Social networking sites have
provided marketers with new and efficient ways of reaching deeply into their target market to
communicate their message (Trusov et al., 2009). Managers can thus encourage positive word-of-mouth
communication and favorable recommendations among online communities by increasing consumers’
118 Journal of Marketing Development and Competitiveness vol. 6(1) 2012

commitment to the company; this increased commitment can be achieved by aligning customer values
and identities with those of the organization (de Matos & Rossi, 2008).
There are various scales and tools that have been developed to assess the degree and success of WOM
marketing. Kumar, Petersen, and Leone (2010) have developed a way to measure customer referral value
(CRV) using a four-step approach: first, determining whether a consumer would have bought regardless
of referrals; second, predicting the future value of each referred customer; third, predicting the number of
referrals; and fourth, predicting the timing of customer referrals. This four-step approach is predicated on
the idea that future behavior can be predicted by past behavior, with a marketing campaign potentially
acting to increase the predicted CRV of a customer. The effectiveness of a WOM program in a social
media marketing program, as summarized by Figure 1, can be measured as “word-of-mouth equity”,
which gauges the impact of WOM messages on consumers’ decisions to purchase. WOM equity is a
metric that takes into account both the impact (the ability of the message to change behavior) and the
volume of messages that are comprised of both recommendations and dissuasions (Harrison-Walker,
2001), and how together these factors affect sales and market shares for various products, and the
effectiveness of individual campaigns. (See Appendix Figure 1)
Alternative Marketing Communications with Social Media

Customer Relationship Management (CRM)
CRM is one aspect of the marketing mix that benefits from synergistic strategic planning and
integration (Rust & Verhoef, 2005). The use of relationship-oriented interventions to build consumer
loyalty, which requires personalized marketing efforts for individual consumers, will only be effective in
increasing a firm’s profitability if these efforts are realized (Rust & Verhoef, 2005). There has been a shift
away from a product-centric approach to marketing towards that of a customer-centric focus in that
consumer opinions are largely affected by the combination of messages they receive from marketers and
their peers. A customer relationship is cultivated by four key actions of a firm: customer acquisition,
customer retention, customer growth, and the winning back of customers (Reinartz & Venkatesan, 2008).
Effective customer relationship management begins with properly identifying and acquiring the right
customer, and accurately estimating each customer’s lifetime value so as to appropriately allocate
marketing resources to relationship development.
Overall, effective CRM strategies consist of two key components. The first is firm competence in
knowledge management: the collection, analysis, dissemination, and application of customer information
from its dynamic customer database. A database provides the firm with the information it needs to
effectively understand, segment, and target its customers in such a way that allows them to more
efficiently allocate resources to creating customer value, devising customer-centric strategies, increasing
customer loyalty, and consequently increasing firm profitability. More specifically, a customer database
can provide a firm with recency-frequency information as well as behavior and characteristic information
regarding their customers (Abe, 2009). This type of informationprovides marketers with the tools they
need to identify active customers, predict purchase patterns, and customize marketing efforts in line with
overall marketing objectives (Rust & Chung, 2006; Sun, 2006).
The second is firm competence in relationship marketing: developing and maintaining fruitful
relationships over time (Arnett &d Badrinarayanan, 2005). Taylor (2010) stresses the importance of long-
term coordination of marketing communications in such a way that a consistent message is communicated
at all points of contact between the marketer and the consumer. In order to catch consumers’ attention in a
cluttered advertising environment, firms must begin to plan for synergy among various communication
and media outlets (Taylor, 2010). The rapid growth in new media, while challenging preexisting business
models, also provides opportunities for firms to better understand consumers and manage customer
interactions. Social media platforms have allowed customers to become more active parties in marketing
exchanges and these platforms therefore act as a database for marketers, as user-generated content creates
an abundant source of customer preference, behavior, and characteristic information (Hennig-Thurau et
al., 2010). An increased emphasis on customer relationship management has resulted in significant
changes to how companies market their products and services.

Brand Communities
A brand community refers to “a group of ardent consumers organized around the lifestyle, activities,
and ethos of the brand” (Fournier & Lee, 2009). Strong brand communities are formed on the basis of
understanding the individual and social needs of consumers, and connect consumers along these lines
through affiliation with the brand itself. In order for a brand community to be a success – in that it elicits a
high level of consumer loyalty, marketing efficiency, and brand authenticity – firms must incorporate
brand communities into their overall business strategies, focus on engineering the community rather than
building the brand, and allow community members to manage and control themselves, defining only the
terms of participation (Fournier & Lee, 2009). Brand communities provide a platform through which
consumers can share information and experiences regarding a certain product or service; this in turn
provides marketers with a means for identifying consumer needs and promoting brand loyalty
involvement (Casalo et al., 2008). The effectiveness of a brand community may be measured in terms of
engagement indices, the size of the community, the loyalty garnered from members, and member-
generated ideas for growing the business. Consumer participation in such virtual brand communities is
positively correlated with affective commitment to the brand itself, thereby providing marketers with a
cost-efficient way to retain customers and strengthen consumer ties (Casalo et al., 2008).
Email Marketing
The formation of a permission-based email database can be a valuable tool in CRM, offering firms a
straightforward and cost-effective way to acquire customers and strengthen customer relations. Email
provides marketers with an additional channel for interactively reaching their consumers such that a
stronger brand identity and loyalty among consumers can be built. Email marketing increases consumers’
involvement with a brand, and this increased involvement has been shown to consequently increase
purchase intent and positive word-of-mouth recommendations (Muller et al., 2008). As a result, the
effectiveness of an email marketing campaign can be measured in terms of its delivery and open rates,
link clicks, and brand website traffic.
Search Engine Optimization

As consumers continue to move online to obtain product information, search engine optimization
(SEO) campaigns are becoming increasingly more crucial to integrated marketing communications. A
well-planned SEO campaign typically begins with a keyword analysis, in which the appropriate key
words are mined and assessed. Website content is then crafted to include the keywords in titles, tags, and
other text. Additionally, companies have the option to engage in paid search advertisements, wherein a
search engine is paid to serve text advertisements in response to certain generic or branded keywords
(Rutz & Bucklin, 2011). The success of such a campaign can be measured by analyzing website rankings
and traffic, impressions, clicks, and referrals, and these metrics are often made readily available through
search engines themselves.
Viral Marketing
Viral marketing encourages word-of-mouth promotion by capitalizing on social networks and
customers’ desire to contribute to and share message content with their peers. A viral marketing campaign
is more likely to succeed when the message content is able to highly resonate with the target audience and
appeal to this group’s motivations for sharing information. Consumers who are more individualistic (in
that they want to differentiate themselves from others) and/or more altruistic tend to be those who are also
most likely to forward online content (Ho & Dempsey, 2008). In general, there are three types of
strategies that marketers can use to seed a viral campaign: seeding emails, online advertising, or offline
advertising. Once a campaign has been initiated, it is crucial that marketers effectively manage every
stage by analyzing the source of the viral content invitation; if and when a customer accesses the viral
campaign page; and the number of referrals a customer makes to his or her friends (van der Lans et al.,
2010).

Guerilla Marketing
Online communications channels have also helped in increasing the effectiveness of guerilla
marketing campaigns. Levinson (1993) first introduced the concept of guerilla marketing, identifying
these campaigns as those intended for small businesses. Guerilla campaigns are characterized by their low
cost but extreme effectiveness in building a firm’s reputation through generating buzz and favorable
consumer perceptions. Guerilla marketing is creative, energetic, and flexible. Online venues allow for
guerilla marketing messages to be virally spread within blogs and social networks, thereby increasing the
relative exposure and effectiveness of the program when compared to offline guerilla venues alone. The
effectiveness of such a campaign can be measured by such metrics as the attendance at guerilla events, the
sales and customer acquisitions that result, and the effects on company’s website traffic.
Events-based Marketing
Events can be essential to marketing strategy and marketing communications as they help to build
one-to-one relationships with stakeholders. They can take various forms, including cause-related
marketing; sports, cultural, and musical events; lifestyle marketing; and sponsorships. Events allow a firm
to build its image and reputation within its industry, as well as establish and nurture important contacts
within its target audience. Moreover, events allow for the circulation of a firm’s message to other
consumers who are potentially outside of the primary target market, thereby expanding the reach and
impact of the communications. Successful events are characterized by high fit between the brand
personality and the event itself, as well as the ability to foster a sense of entertainment and excitement
among the audience, with the event audience consisting of members of the firm’s target market (Samu &
Wymer, 2009). An experiential campaign’s effectiveness can be measured by its effect on sales, the level
of attendee engagement that results, and the number of new relationships that are fostered.
Mobile Marketing
Mobile marketing is a very recent form of marketing communications that is beginning to grow in
popularity. It has the ability to integrate all forms of media and marketing communications to drive sales,
collect CRM data, and add viral value. Mobile marketing can take several forms, including messaging,
Wireless Application Protocol (WAP) and the mobile Internet, streaming media, and downloadable
content. Consumers are readily accessible through this emerging form of new media, with mobile
campaigns having the ability to build a database of consumers that can be mined to better understand
consumer wants and needs, which in turn can help develop highly targeted campaigns (Ferris, 2007).
Messaging allows for marketers to extend their reach beyond traditional media to target specific
audiences and encourage immediate consumer action upon viewing an advertisement. It can take the form
of mobile alerts, content services, mobile coupons, voting, quizzes, and sweepstakes. WAP and the
mobile Internet allow marketers to leverage the Internet to deliver content. Streaming media (video,
audio, and text) allows for content to be consumed as it is delivered, and can take the form of on-demand
streaming or live streaming. In a mobile marketing campaign, streaming media can be used to deliver
communications messages through subsidized advertisement content, opt-in video ads, or branded
entertainment. Downloadable content is often used to increase consumer engagement with a campaign,
acting as a motivator for campaign participation (Mobile Marketing Association, 2007). Mobile
marketing effectiveness can be measured in terms of cost-per-acquisition and the relative level of
consumer engagement with the various aspects of the campaign. Additionally, mobile marketing provides
the opportunity to leverage social networks to increase engagement with and consumption of digital
content. According to Truong and Simmons (2011), consumers are highly inclined to use their mobile
devices to access social media networks. Consequently, a combination of mobile-accessed social
networks can be used to push communications and target specific segments of consumers.

Summary
The above-discussed forms of marketing communications and their corresponding evaluative criteria
are summarized in Table 1. Success stories of each type of communication are also briefly identified for
illustrative purposes. (See Appendix Table 1)
BACKGROUND OF THEORETICAL FRAMEWORK
Social media take advantage of social interaction in order to be distributed. The role of social media
in a company’s overall communications program can have significant business results if implemented
correctly. With the advent of Web 2.0, advertising has become about engaging in conversation with
consumers, as the most trusted sources of recommendation come through word-of-mouth communication.
While a set of hard-and-fast rules for incorporating social media into an overall communications
campaign does not exist, there are a variety of best practices that can be leveraged to maximize the
effectiveness of a social media program.
User-Generated Content in Social Media

According to Moran and Gossieaux (2010), a successful social media strategy must begin with an
understanding of consumer conversations and characteristics. Consumers are more likely to respond to a
social media strategy when they are able to interact with and help others. The ability to foster a social
relationship between consumers and companies is the most important component of a social media
strategy. Moran and Gossieaux (2010) explain that a firm must first listen to what existing online
communities are saying about their products and services before a social media strategy can be developed.
The success of a social media program is highly dependent upon knowing where the majority of
conversations are occurring.
Once these conversations have been identified, marketers must leverage social media to participate in
the conversation and effectively manage their customer relationships. Social media is about fostering
communication with consumers rather than a one-sided push of a brand message (Hennig-Thurau et al.,
2010). A social media strategy must therefore allow for users to share and contribute to content. A content
strategy must be developed according to the characteristics of preexisting online consumer communities
and supported by an integrated online campaign (including a company blog, interactive website, articles,
and videos). The social media tools employed in such a campaign should be chosen based on where the
majority of conversations about a company are taking place and the social media habits of the
participants.
Social Media Marketing Tools

There are a variety of tools to choose from when formulating a social media strategy. The network’s
power must be multiplied through the integration of various social media tools. The mix of social media
highly depends on the objectives of the strategy and the trends in social media usage among the target
market. A summary of these tools and the corresponding objectives that they achieve can be found in
Table 2.
Chat Rooms
Chat rooms are one of the oldest forms of social media, but still have significant value in terms of
developing an effective social media strategy. This is particularly true when a firm is trying to identify
where conversations are already occurring about their products and services (Moran & Gossieaux, 2010).
Incorporating a chat room or discussion board into a firm’s website has the ability to improve customer
service, increase the sense of consumer community, and effectively address consumer needs through
better communications and enhanced relationships.

TABLE 2
SOCIAL MEDIA TOOLS AND THEIR OBJECTIVES
Tools Objectives
x improve customer service
Chat Rooms x create sense of community
x garner customer feedback
x drive WOM recommendations
Blogs x build meaningful relationships
x increase loyalty
x harness power of video to increase
You Tube
embedding of content in other sites
x Advertising
Facebook x develop a community
x target specific audiences
LinkedIn x connect with professional communities
x customer engagement
Twitter
x conversation propagation
x increase collaboration and engagement
Google Wave
x crowdsourcing
x increase local and mobile connectivity
Four Square
x increase network engagement
Blogs
A business blog is a powerful and universal way to drive positive word-of-mouth recommendations
through the content that a company publishes. Blogs enable companies to establish and build meaningful
relationships with their target, thereby increasing customer loyalty and the number of third-party
advocates for the firm. A blog is considered to be a successful marketing tool when the conversation on
the blog turns into online buzz for the firm (Niederhoffer et al., 2007). A business blog can be used as a
marketing tool by using it as a forum to offer tips and advice, publish an incentives program that
encourages referrals, hold contests, answer questions, gather and showcase customer stories, and
publically respond to stakeholder comments to maintain the conversation.
YouTube
Harnessing the powers of video is critical to the content of many social media campaigns. YouTube is
the second most searched site after Google (McNealy, 2010). Maintaining a YouTube channel for one’s
company allows for videos to also be embedded within a company’s blog, thereby cross-pollinating the
sites, which in turn helps to increase website traffic. YouTube also allows for consumer engagement
through user-generated content (Hennig-Thurau et al., 2010).
Facebook
Facebook boasts more than 400 million active users and is therefore the most popular social
networking site (McNealy, 2010). Not only does Facebook offer various advertising programs, but it also
enables companies to create their own customized profile and share important information in the creation
of their own brand community. Furthermore, Facebook provides companies with the unique opportunity
to very specifically target users and spawn a two-way conversation with consumers (Hennig-Thurau et
al., 2010).

LinkedIn
LinkedIn is another social networking site that is geared towards a more professional audience. Like
Facebook, there are opportunities to advertise one’s business on this site, develop a profile for a company
that is visible to LinkedIn users, and foster two-way relationships with individual career professionals as
well as other firms (Hennig-Thurau et al., 2010).
Twitter
Twitter is referred to as a “micro blogging” tool, as posts are limited to 140 characters. Twitter is
beneficial for engaging with customers and propagating the conversation about one’s brand, products,
and/or services. It is also ideal for building relationships with key stakeholders (Hennig-Thurau et al.,
2010; McNealy, 2010).
Up & Coming
The future of social media is likely to be influenced by two key platforms. Google Wave is expected
to have a revolutionary effect on collaboration and engagement once it becomes mainstream. This tool
works in such a way that consumers can actively interact and engage with one another in real-time, and
with marketers. It will enable marketers to create rich brand experiences through crowdsourcing (Laker,
2010). Four Square is another new tool that is still in its infancy. It leverages networked activity to
connect individuals on a local and mobile basis, while incentivizing participants through increased
participation. Businesses may use Four Square as a means of encouraging engagement within their
networks, whether externally or internally (Armano, 2009).
Measurement of a Social Media Program

The power of an effective social media program must be measured. This can be accomplished by
continually assessing the level of dialogue and engagement among members. Specifically, relationships
and content constitute the two sources of social media currency. The effectiveness of a social media
marketing program must be measured in terms of its ability to generate positive buzz about a firm, as well
as its products and services. This, in turn, should translate into measurable business results for the firm --
whether in the form of increased awareness, increased sales, or increased loyalty. Social media
effectiveness should not solely be measured in terms of the volume of WOM buzz; rather, the importance,
impact, and level of involvement of WOM communication must also be quantified (Dwyer, 2007).
Similarly, Stewart and Pavlou (2002) explain that in an interactive context, measuring the structure of the
interaction is crucial for assessing a social media program. While exposure metrics (such as click-through
rates, cost per click, number of hits, and Web site traffic) are ways of beginning to understand how well a
program is working, interaction-related outcomes that add value and quality to consumer-marketer
interactions must also be a focus of measurement (Stewart & Pavlou, 2002). A wide variety of free
analytical tools are available for measuring the success of a social media marketing strategy and are
summarized in Table 3 (Barros, 2009; Hall, 2010).
Generally speaking, social media can be used to accomplish one of three goals for a business:
building awareness, increasing sales, or building loyalty (see Table 4). If the goal is to build awareness,
measurement of success will revolve around the analysis of web traffic, web traffic referrals, search
volume trends, volume of followers, social mentions, and share of voice. If the goal is to increase sales,
measurement of the social media program’s success must take into account web traffic, time spent on the
site, bounce rate, repeat visits, content acceptance rate, followers, social mentions, and share of voice. If
the goal is to build loyalty, success measurement will need to include an analysis of time spent on the site,
repeat visits, followers, content acceptance rate, repeated social mentions, share of voice,
recommendations and reviews, and social connectivity among purchasers. Therefore, the most appropriate
success measurement techniques depend on the specific goal that is being pursued through the social
media marketing program (Baer, 2009).

TABLE 3
MEASUREMENT OF SOCIAL MEDIA MARKETING
Analytical Tools Functions

Google Analytics,
x provide detailed reports on web visitor characteristics
Woopra, Clicky, Piwik
x provide key visitor information, including demographics and
category interests
Yahoo! Web Analytics
x provide campaign management features
x assist in the understanding of audience needs
x track blog visits in addition to other key statistics about the
Blog Tracker
blog’s performance
x integrate visitor information, referring URLs, and search
GoingUp
engine traffic statistics to aid in searching in optimization
x provide statistics on the number of times website posts are
Gr.aiderss.com
shared on social networking sites
Socialmeter.com x measure a website’s social popularity
x compare up to three websites simultaneously on the basis of
Statsaholic.com
relative rankings and other information
x compare the performance of a website to the performance of
Webslug.info
any other site
Pagealizer.com x suggest ways to optimize website performance
TABLE 4
SOCIAL MEDIA STRATEGY GOALS AND RELATED METRICS
Goals Related Metrics

x web traffic and web traffic referrals
x search volume trends and volume of followers
Build Awareness
x social mentions
x share of voice
x web traffic and time spent on site
x bounce rate and content acceptance rate
Increase Sales x repeat visits and volume of followers
x social mentions
x share of voice
x time spent on site
x repeat visits and volume of followers
x content acceptance rate
Build Loyalty x repeated social mentions
x share of voice
x recommendations and reviews
x social connectivity among purchasers

When measuring the effects of social media in coordinating all aspects of a firm’s marketing activity,
it is crucial that a measurement system is built into the program from the very beginning. More
importantly, benchmarks should be set so that they are comparable to traditional marketing metrics, such
as sales, traffic, brand satisfaction, and customer loyalty (Hennig-Thurau et al., 2010).
SOCIAL MEDIA MARKETING COMMUNICATION MODEL
While current literature has sufficiently profiled WOM marketing, CRM, brand communities, SEO,
viral marketing, guerilla marketing, events-based marketing, and social media each on an isolated,
individual basis, there is no comprehensive model that effectively incorporates all of these elements.
Moreover, the research in this field lacks a model that is actionable and specific, and that can be applied
and adapted by firms to help them achieve their various marketing objectives. Therefore, the following
model has been developed based on the research findings detailed in the existing literature. (See
Appendix Figure 2)
Model Components
A word-of-mouth strategy forms the foundation of the model. The entire model is predicated on the
goal of creating and sustaining positive buzz for a firm. All components of the model work together in an
integrated fashion to reinforce the message that a firm wishes to communicate to consumers, thereby
enticing consumers to pass the firm’s message along to others.
A social media platform serves as the vehicle through which all marketing communication efforts are
connected into one easily accessible, integrated consumer venue. Social media is pervasive by nature and
is characterized by its ability to instantaneously connect an infinite number of people. As a result, it
represents the hub of the model. In order for social media to be an effective platform, its presence must
funnel through from the firm’s main Website.
This platform can take the form of any or all types of social media, including a blog, YouTube
channel, Facebook page, and/or Twitter account. The specific social media chosen should reflect the
firm’s objectives in terms of the content it wishes to create, the manner in which it wants to communicate
this content to consumers, the extent to which the firm engages consumers in a two-way conversation, and
the degree of consumer conversion that is being sought. A blog is an effective way to develop high
quality, meaningful content for consumers, as well as an effective means for clearly articulating a
particular message. YouTube also represents a way in which content can be generated by firms. Facebook
and Twitter are effective ways to engage consumers in conversation. All social media formats have the
potential to convert consumers into loyal customers by connecting with consumers on a one-to-one level
and cultivating meaningful relationships with them.
Guerilla marketing, events-based marketing, and search engine optimization (SEO) represent the
inputs that support the social media hub. Guerilla marketing focuses on the building of a firm’s reputation
through boldly unique tactical marketing executions. Through the integration of guerilla marketing
executions with the social media hub, such as through pre- or post-campaign promotions via the social
media platform, a firm is ultimately able to multiply the effects of the guerilla program. In other words,
guerilla marketing feeds into the social media hub so as to encourage viral spreading through blogs and
social networks; this, in turn, increases the exposure and effectiveness of the program.
Events-based marketing focuses on developing one-to-one relationships with members of a firm’s
target audience. Similarly to guerilla marketing, the integration of pre- and post-promotion of events with
the firm’s social media platform enables the life of the event to be extended and the reach of the program
to be infinite. An event can be documented through video and photos, for example, which can then be
incorporated into the social media hub and spread from consumer to consumer.
Search engine optimization acts as a foundational support for the social media platform. It increases
the effectiveness of exposing consumers to a firm’s Website and social media efforts. SEO can be
accomplished through paid insertion, wherein a company pays a search engine to ensure its site is present
when a consumer types in a particular keyword; paid advertisements, wherein a company pays for its site

to appear as an advertisement alongside search results that use a particular keyword; or organic means,
wherein a company creates content in a strategic way such that its site is listed when consumers make
particular search queries.
Events-based marketing and the social media platform enable a firm to build a consumer database and
engage in effective CRM. Any event hosted by a firm as a means of engaging with stakeholders provides
that firm with the opportunity to build its database of consumers and contacts. Additionally, the social
media platform provides a firm with a variety of ways to interact with consumers and obtain their
permission to archive their personal information, particularly email addresses. The more comprehensive a
customer database becomes, the better equipped firms also become in their ability to effectively
understand their customers and meaningfully target them.
A database-driven CRM program that is continually adapted to changing consumer needs will drive
consumer loyalty and sustain it over the long-term. The building of consumer loyalty represents the
ultimate goal of any CRM program. The consumer database is a means through which a firm can
effectively bridge the CRM program with this objective of increased consumer loyalty. By leveraging
consumer information from the database and translating this information into actionable targeting
strategies, personalized marketing efforts for consumers can be developed and executed. Personalized
marketing efforts result in the creation of value for consumers and set the stage for establishing and
maintaining long-term relationships with clients.
Viral marketing and brand community development represent the outputs of the social media
platform. A social media platform takes in the content from guerilla marketing and events-based
marketing, and leverages SEO in such a way that a firm’s alternative marketing efforts become
centralized and reinforce one another as well as the overall message being projected. Blogs and social
networks enable marketing content to be rapidly disseminated and transferred among individuals and
groups of individuals, thereby exponentially increasing consumer exposure to and engagement with such
content. This constitutes viral marketing. Additionally, these same blogs and social networks provide
consumers with an interface through which they can come together with one another as well as with firm
representatives to form a brand community. This is the ultimate expression of brand loyalty. Through
online viral marketing and brand communities, as supported by a social media platform, WOM buzz can
be rapidly generated.
The model serves to effectively accomplish the objective(s) of a firm’s alternative marketing
communications program. A program that is designed out of this model will enable a firm to 1) increase
consumer awareness; 2) increase sales; and/or 3) increase consumer loyalty. An objective of increasing
consumer awareness will result in an emphasis on developing the inputs into the social media hub
(guerilla and events-based marketing, SEO). An objective of increasing sales will result in an emphasis on
driving the CRM component of the model. An objective of increasing loyalty will result in an emphasis
on both CRM and developing the outputs of the social media hub (viral marketing and brand community
development). However, it is important to note that while different components of the model are
emphasized to achieve different objectives, a successful program will still integrate all components to one
degree or another. The model is one of a synergistic nature, meaning that in order for its effectiveness to
be optimized, all components must work together and feed into one another to communicate the
overarching message to all stakeholders.
Additionally, the firm’s focus in terms of the objectives being pursued will determine how success of
the program is measured.
Measurement of the success of a program contributes to a feedback loop that determines how future
executions will be adjusted to increase the program’s effectiveness. The program must be evaluated pre-
and post-execution in order to assess the extent to which the firm’s objectives were achieved. Based on
these measures, ways to improve future programs should be identified and incorporated into any relevant
aspect of the model. Tables 3 and 4 in the literature review outline the various social media measurement
tools and metrics for program evaluation.

CONCLUSION
It has been said that the age of interrupted marketing is over, with future marketing efforts taking the
form of community creation and one-to-one relationship building to sell products and develop brand
loyalty (Hennig-Thurau et al., 2010). The current consensus is that social media marketing works to
effectively achieve the latter through word-of-mouth referrals and communication, when it is properly
executed. Proper execution involves the integration of all of a firm’s marketing efforts within one
coherent strategy, with social media acting as the means through which all efforts can be coordinated. A
successful IMC program incorporates both traditional and alternative tactical executions (CRM, brand
communities, search engine optimization, viral marketing, guerilla marketing, events-based marketing) to
maximize the impact of the overall marketing strategy. All components of a marketing communications
campaign must feed into and reinforce one another, and communicate to consumers the same consistent
message. Both traditional and evolving metrics must be used in combination to measure the results of
interactive marketing programs (Stewart & Pavlou, 2002).
The alternative marketing model proposed herein provides marketers with a framework for
effectively leveraging the efficiencies and synergies of WOM marketing through a social media platform,
supported by alternative marketing communications. It is the first model to integrate a variety of
marketing communication tactics in such a way that reinforce and promote the same brand message at all
consumer touch points. With the industry-wide movement towards IMC, this conceptual model will
provide both marketers and academics with a clear template for efficiently and effectively organizing
communication campaigns and interacting with stakeholders. Marketing practitioners can use this model
to structure a campaign according to the objectives they wish to achieve, and execute their campaign
through the different alternative communication forms that are identified to help achieve such objectives.
Future research should attempt to understand how this conceptual model and alternative marketing
communications in general could be combined with more traditional forms of marketing to create an
overarching marketing guide. Additionally, this model should be tested in field as to its ability to deliver
measurable business results for both small and medium sized enterprises, as well as larger corporations.
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APPENDIX
TABLE 1
FORMS OF ALTERNATIVE MARKETING COMMUNICATIONS
Formats Measurement Criteria Example

x customer base
online &
CRM x sales revenues and marketing costs Ritz-Carlton: CRM system to personalize guest experience
offline
x partnership with customers
x engagement and loyalty
Brand online &
x size of community Harley Owners Group (H.O.G.)
Communities offline
x ideas generated
x link clicks and customer service calls Kayak.com: emails build a relationship, well-designed and easy to
Email online x delivery rates read, targeted to the recipient, encourage communication
x open rates and conversion rates (Premick, 2008)
x website ranking and link popularity NY Times: through SEO program, 300% increase in referrals
Search Engine online x traffic from 2005-08, 65% yearly growth rate in site traffic, increased
x referrals user engagement (SEO Case Studies, 2009)
x number of pass-alongs or forwards,
embeds, and comments
x content downloads
Viral online x total views and unique viewers Old Spice: The Man Your Man Could Smell Like viral video
x conversions and click-throughs
x URL referrals
x Email addresses collected
x attendance Toyota Scion: brand reps positioned at street corners, with music
online &
Guerilla x sales and customer acquisition blaring and Scion banners displayed, stop passersby to encourage
offline
x website traffic test driving (Palmeri, 2003)
x business, behavioral, and learning
Events-Based offline Becel: sponsorship of Heart & Stroke Foundation’s Ride for Heart
impacts
x cost-per-acquisition
Mobile online American Idol: AT&T partnership for texting to vote
x consumer engagement
FIGURE 1
THE ROLE OF WOM IN SOCIAL MEDIA MARKETING
FIGURE 2
A PROPOSED ALTERNATIVE MARKETING MODEL ON A SOCIAL MEDIA PLATFORM
PARTICULARS OF PROMOTING IN THE SOCIAL MEDIA

Cristian, Morozan1
Mihaela, Asandei2

Abstract:
The classical promotional media, especially the television, have been often criticized for the
contradictory effects that they have on the consumers. Compared to those, the Internet and social networks
that support them represent an interactive environment, because consumers have more time and space to
evaluate the products compared with the traditional seconds or tens of seconds of the TV spots or the few
printed lines in newspapers.
The promotion on the web and social media have an important role in consumers' informing, by
providing the data they need for the purchasing decision, by providing feedback from others etc. For
example, in the discussion groups and social networking sites, such products/services and software news are
discussed and carefully evaluated by a permanent feedback from users, their responses being made posted on
the internet.
Keywords: promoting, consumers, social media, network, internet.
JEL Classification: M37, L82
1. Introduction
As a means of universal communication, the Internet and social networks focus all of
the traditional media, being rapidly adopted as advertising support. Moreover, it offers –
unlike the traditional media - two-way communication, from one to one and from one to
many, so that not only the organization can send messages containing advertising, but
consumers can get involved. The Internet has an agent effect in a unique way in relation to
the other medium, being a communication channel used to transform, change, correct,
attack or support a message in unique way (Gregory, 2009).
However, the Internet and new sophisticated communication technologies make
possible a different approach, completely different from the traditional advertising by
permission marketing (Petre, Nicola, 2009), which identifies the advertisement message
and brings in front the consumer' interests.
2. Reasons for online and social media promotion

It becomes increasingly evident that many organizations are looking for new uses of
the Internet, discovering social media for promotion. The social networks, blogs and
microblogging services have until recently a restricted public and were not relevant to the
particular business, but in recent years the situation has changed, the number of companies
interested to promote in this environment and the dedicated budgets increasing rapidly
(Arsene-Bărbulescu, 2011).
An important reason for this development is that the online use, as mentioned above,
a different strategy - consumers seeking information from organizations and expects a
quick response, looking organization details through their own (data, images, testimonials
etc.) that they comment with other users. The information are quickly distributed because
they are supported by local social networks in connection with the remote ones, being used
technologies that facilitate instant communication at a multiple scale (Green, 2009).
1
Ph.D. Associate Professor, „Constantin Brâncoveanu” University from Piteşti, Faculty of Administrative
and Communication Sciences Brăila, cristi.morozan@gmail.com
2
Ph.D. Professor, "Constantin Brâncoveanu" University from Piteşti, Faculty of Management-Marketing in
the Economic Affairs Piteşti
711
The internet promotion is successful because of the rich content of information that it
provides, enjoying the fact that the cyberspace is less expensive. Organizations that have
had, so far, to compress messages on a particular area of the newspaper page considers the
freedom of expression that it provides the internet space.
An online communication campaign on social networks can address to a group of
acquaintances, so, there is a chance that the target audience can be approached from several
directions. This ensures that the message is credible ("if so many people accept a product /
service it means that is good") and can be repeated, being able to remind to the public
members (Green, 2009). Another advantage is the fact that the organization can easily find
out the people interest counting the hits to their website and can provide information to
strengthen the already existing relationships with customers.
The online broadcasting strategy for the promotional messages can be accurately
projected because the profile of a site user is easy to achieve, so that the message goes
straight to the targeted audience. Moreover, it can be easily measured the campaign effects
during the course of it, it can be changed certain actions, and the costs are lower compared
to other promotional media (Zbuchea, Pînzaru and Galalae, 2009).
3. Planning and implementing a social media promotion

As a rule, after the organization's management has decided to promote on the Internet it
will decide on the amount available to be spent and, of course, on the methods to be used. In
most cases, for social media promotion it will be defined a coherent strategy and a long term
vision, including them in the overall thinking, involving a mix of promotional media to be
used by the organization.
Especially the small organizations start from the existence of a website and a blog to
support basic communication and continue with the presence in social media as more of the
major social networks - inexpensive actions, which may establish communication with
current and potential customers, but it isn't done the promotion itself. For this latter objective
the organization can appeal to a specialized agency.
In the recent years, the methods of promotion on social networks were diversified,
starting from the creation of interactive applications to promote a product and continuing
with competitions, pages specially designed to motivate consumers to begin discussions
about a brand or different actions (online paid content delivery etc.).
In the social media, social networks become the more effective, gaining many
supporters and potential customers, with a cost equivalent to other forms of promotion. For
example, in the case of a small organization, traditional advertising strategy can be
completed with the online presence by creating a website and a blog that start the
communication and then, with the involvement in many important social networks, actions
with reduced costs. Basically, it's a concept that involves social media relations and defines
the establishing of a communication relation with customers.
At a larger scale, international studies show that a brand name will become known
among a double number of people in a social network than any other site, while intention to
buy the advertised products and services can be four times higher. In social media matters the
positive references made by users to friends on blogs and social networks, they getting to be
worth more than traditional commercials on the internet (Arsene-Bărbulescu, 2011).
According to ExactTarget 2013 Study - Marketers from Mars, conducted on the United
States consumers, come out that the e-mail and Facebook are the most common medium
through which users come into contact with brands and companies they trust. Email is used
by 45% of marketers, 36% of consumers with smartphone and 49% of consumers without
smartphones, and the Facebook is used by 21% of the marketers, 31% of consumers with
smartphone and 26% of those without a smartphone (Crăciunescu, 2013).
712
A method used for social media promotion is the one that involves using the discount
coupons websites, which are accessed by small organizations to attract customers. Even if
there isn't a proper promotion environment, offering coupons seeks quickly customers’
action motivating to reduce periods when sales are low.
Especially youth of today are different from those of previous generations by the fact
that they belong to the digital world, whose technologies influence the brain, thing
explained by Nicholas Carr in the book "Superficialii" (Carr, 2012): the users in this age
segment accesses search engines for research, so they consider relevant the most popular
items, reducing the total number of used sources; when the have to document from the
existing virtual materials the youth must choose content from various hyperlinks; the same
thing is happening by developing social networks that provide updated information.
To be marketing successful, especially in the social media, organizations need to
create messages for the communication campaigns, taking into consideration some aspects
(Furtună, 2012): to be based on simplicity, easy to understand messages being easily
accepted; to draw attention from the start, because the users, especially the young ones,
tend to keep their focus on a subject for a little while; to be offered an interesting to
distribute content in the social networks, using the same language. These requirements are
particularly important as 85% of Facebook users are content creators, regardless of its
quality, and brands should see it as an opportunity.
Sometimes there is a marketers misunderstanding about the reasons why a consumer
appreciates a brand in social media. On the one hand, experts believe that attracting
customers appears by publishing an agreeable content, including detailed information
about the brand or products. In turn, consumers give "Like" on Facebook to brands for
games, contests and promotions, to find out about new products and show to their friends
that are brand' fans. As far as the Internet makes information available and social media
makes it easier to communicate, the friends of Facebook fans are top consumers, so that
brands should not overlook them in a campaign.
In the current period, the online presence reduce and even canceled distances between
individuals and groups through applications like Skype or Messenger, which allows initiating
and maintaining dialogue through live sound and image with people all over the world,
intermediates watching videos from a global perspective. It also notes that many of the
discussions about the products can be found in social media, in private profiles and not on the
organizations official websites or on their dedicated websites, which means the shift to such
sources of information, where consumers express their opinions and form opinion trends.
If many organizations are concerned with finding those customers attraction reasons
mainly related to their work (eg.: Sign up and you get a voucher/discount/prize), it is
necessary to create those excuses to coincide with proper interests (the community of
travel enthusiasts and the community of parents) because the messages are more relevant
to consumers.
It is also important that the actions of public communication, especially with youth -
always connected to the Internet, to be constantly made, avoiding the situation of
developing it for a limited period, after which the contact stops, waiting to is back with a
message during other campaigns. However, what the companies declare when they
communicate with younger people must, also, realize through BTL, which offers more
interaction and involvement and translates the brand values into the real life. It is reached
the situation that companies offer, through brands, an example and values to be adopted by
the young people, revealing, thus, their personality.
713
4. Experiences of promotion in social media
Internationally, the money spent on social media promotion exceeds several billion
euros, up exponentially from year to year. This growing of different sizes organizations
interest is obvious, reaching that the dissemination of advertising messages on social
networks becomes one of the commonly used forms of promotion on the Internet, with a
market of over four billion euros worldwide and two million euros in Romania in 2012.
The largest contribution to this expansion has Facebook, which has over 600 million users
worldwide, in which over 6 million in our country, being considered "the industry motor"
(Arsene-Bărbulescu, 2011).
A strong presence on the national online advertising market have blogs and
microblogging platform Twitter, which has become lately a support for advertising in the form
of published messages or other networks such as Hi5.com, Youtube, Tpu.ro, Neogen ş.a.
The most important advertising investors from our country have been targeted and
continue to be concerned with social media promotion strategies. Be it about mobile
telecommunications companies, manufacturers and car dealers, the suppliers of financial
services and banking, all these organizations have tighter sized promotion budgets and
have turned to social media for reasons of cost, positive impact on the public,
diversification of the ways in which they get to be known and to persuade the consumers.
According to a study conducted from August to October 2013 that analyzes the
responses of 173 representatives of organizations from various industries (of which 79%
are organizations with annual revenues exceeding 10 million euro), called "Social Media
and Romanian business "(performed by EY Romania and taken from
www.businesscover.ro), in Romania four of five companies use social networks for
advertising, particularly Facebook, followed by YouTube and Linkedin. This, while 97%
of global companies are present on social networks (Zamfir, 2013).

> from 5
years
4-5 years
3-4 years
2-3 years
1-2 years

Graphic no. 1. Do you use marketing on social networks? Since when?

Over half of the representatives of the companies said they use social media
marketing for 1-3 years (the most used network is Facebook with 93% utilization rate,
YouTube with 43% and LinkedIn with 43%), showing a quick orientation to social media
to promote their offers, while only 39% having a specialized department. On the other
hand, almost all respondents use social networks associated with the marketing
department.
714

another
department
marketin
g

Graphic no. 2. What department of your company dealing with social media?

An important category of respondents (45%) use social networks for recruiting and
18% say they will use this way in the future. Half of the companies post announcements
daily, 15% once every 2-3 days, 21% weekly, 6% monthly and 9% every few months.

Disagree
2%
Unde-
cided
8%
Totally
agree
45%
Agree
45%

Graphic no. 3. The marketing through social media is important for your company?

Regarding the results of using the social networks, representatives of companies
believes that it be reached: the increase of market exposure (83%), the increase of
company notoriety (79%), the customer loyalty (52%), and the increase of customer traffic
(52%), the sales increase (46%), and the decrease of marketing expenses (37%), the
developing of business partnerships (13%).
The campaigns administrated on their own on the social networks are performed by
59% of companies surveyed, while 41% use external services for this purpose.
We complete the above analysis with a profile of beneficiaries, through social media,
of the results of involvement in promotional online activities of the national organizations.
This profile resulted from "Digital Barometer - Exactly Research and Consulting"
conducted online on a panel of 600 urban respondents, both men and women, aged
between 15 and 49 years (Crăciunescu, 2013).
715
use
external
services
manage

Graphic no. 4. Do you manage on your own the company’ campaigns on social networks
or use external services (specialized agencies)?
Of the more than 2.4 million women in our country, who are enclosed in the study
respondent profile, 1,630,000 make online purchases; almost all of them have a Facebook
account, 83% are accessing the social network daily and 45% are using smartphones to
browse the Internet every day.
Women are very much concerned about finding and connecting with old friends, 70%
stated that they use social networking for this purpose, give "Like" more often (40%) and
traditional media are a source of information about the brand.
For men it is important to make new friends on Facebook (36%) and to promote
themselves (28%), and to learn about the brands they prefer to access the discussion forums.
Regarding the relationship with brands in online domain, over 60% of men and
women are fans of brand pages, but the reasons why they choose to follow it on Facebook
are different: women - to read other people's opinions about the brand, because they find
opportunities for online shopping, discounts, coupons and special offers; men - to show
everyone that prefers to feel part of the brand community, because it provides them a
certain social status and because the Facebook brand's page has games and applications,
most of the time. Overall, nearly half of women are more decided to buy directly from
Facebook, while for men the share is about a third.
5. Conclusions
Starting as an experiment, promotional communication on social networks has now
become one of the most fashionable forms of communication with the purpose of
promoting on the Internet. Even if the time when begin to see the first results is high, this
form of promotion is on the rise, especially since the social media campaign costs very
little compared to one from outdoor or television.
In Romania, social media is still underdeveloped, so the amounts involved are not yet
very large, some organizations being still retained to assign a significant part of the
available budgets for promotion.
Although, from the whole market of Internet advertising, social media continues to
be a quite low part, the opening to this segment begins to be increasingly higher, which is a
step forward.

716
References:
1. Arsene-Bărbulescu, A., 2011. Ghid de promovare in social media. Cum sa te vinzi pe
internet, available at www. smark.ro.
2. Carr, N., 2012. Superficialii. Efectele internetului asupra creierului uman. Bucureşti:
Publica Publishing House.
3. Crăciunescu, M., 2013. Comunităţile digitale – cum convingi fanii să ţi se alăture,
available at www.smark.ro.
4. Crăciunescu, M., 2013. Femei vs. barbati în social media, available at
www.smark.ro.
5. Furtună, R., 2012. Generaţia Z: influenţa tehnologiei şi oportunităţi pentru branduri,
available at www.smark.ro.
6. Green, A., 2009. Comunicarea eficientă în relaţiile publice. Crearea mesajelor şi
relaţiile sociale. Iaşi: Polirom Publishing House.
7. Gregory, A., 2009. Planificarea şi managementul campaniilor de relaţii publice. Iaşi:
Polirom Publishing House.
8. Morozan, C., Enache, E., 2013. Brand Communication For Youth. Ovidius
University Annals, Economic Sciences Series, volume XIII, Issue 1, 2013
9. Morozan, C., Enache, E., Purice, S., 2012. Communication by Means of the New
Social Networks. The Annals of the University of Oradea – Economic Sciences, tom
XXI, 2nd issue, december 2012
10. Petre, D., Nicola M., 2009. Introducere în publicitate. Bucureşti: Comunicare.ro
Publishing House.
11. Zamfir, R., 2013. Peste trei sferturi din firmele româneşti sunt prezente în social
media. Majoritatea pe Facebook, available at www.businesscover.ro.
12. Zbuchea, A., Pînzaru, F., Galalae, C., 2009. Ghid esenţial de promovare. Bucureşti:
Tritonic Publishing House.
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Life Science Journal 2012;9(4) http://www.lifesciencesite.com
Social Media Marketing
Dr. M. Saravanakumar 1, Dr.T.SuganthaLakshmi 2

1.
Associate Professor, School of Management Studies, Anna University,Regional Center Coimbatore, Jothipuram
Post, Coimbatore – 641 047, Tamilnadu, India. Email: skumar_rvs@rediffmail.com
2.
Assistant Professor, School of Management Studies, Anna University,Regional Center Coimbatore, Jothipuram
Post, Coimbatore – 641 047, Tamilnadu, India. Email: sugi1971@rediffmail.com
ABSTRACT: During different time era's different methods of communications has developed and changed the day
by day life. Social media has become the method of statement in the 21't century, enabling us to express our belief,
ideas and manner in a absolute new way. This way of message have also have a huge impact on corporation, where
they have realize that without a correct plan and social media strategy they have no chance to stand out in the rapidly
changing digital freedom. To guarantee a successful attendance on social media the companies need to take different
marketing theories into consideration so that they can boost their brand in different aspect. If this can be collective
with original ways of consumer interaction the companies have a good chance to take the lead in social media
marketing'. The meteoric growth of community websites, such as Twitter, Facebook and Linkedln, have usher the
world into a new era of social media. The global reach is nothing short of marvelous, so much so that if Facebook
were a country, it would be third largest, next to China and India. Some even say that this is the biggest shift since
the industrial revolution, which means that the world has a brand new playing meadow At its center, social media is
any kind of online media that stimulates participation, openness' conversation, Connecters and sense of community.
The social media phenomenon has a profound impact. Social media has transformed research methods. This allows
brands to communicate better with their consumers, and intensify their association with them. The advertising world
has not been spared from social media influence. Companies are now more careful with advertising; chiefly in
anticipate consumer response and avoiding unanticipated blunders to prevent a viral consumer backlash in
networking sites. Social media plays a hybrid role in the promotion mix. It allows companies to talk to their
clientele and, at the same time, it allows regulars to talk to one another. Shaping customers' discussions to ensure
they are aligned to the organization's goals is the firm's best importance. Companies have started provided that their
consumers with networking platforms, and have occupied them during blogs and other social media tools. Social
media is seen by Marketers today as a great opportunity to boost market share figures. Marketers are only too happy
to view the social web as a new set of channels through which to market their goods or services. Social media
marketing is a hot topic for companies. It allows companies to establish a communication channel with its
customers, market their products, build brand equity, and boost clientele faithfulness.However, as it is a two-way
channel, it requires effort and care to manage this communication. Dissatisfied customers can protest out loud,
attainment many other customers easily and damaging the brand's image. In order to avoid the risk of damaging the
brand's image rather than improving it, the company should align their social media marketing with the global
marketing strategy of the company. In order to do this, the business should choose the profile of people that matches
its target segment and communicate with them accordingly.
[M. Saravanakumar, T.SuganthaLakshmi. Social Media Marketing. Life Sci J 2012;9(4):4444-4451]. (ISSN: 1097-
8135). http://www.lifesciencesite.com. 670
Keywords: Social; Media; Marketing
1.0 INTRODUCTION of the previous industrial media paradigm.

Marketing is a well-developed methodological Traditional media such as television, news papers,
science and is constantly changing its rules according radio and magazines are in one direction static show
to the needs and developments taking place in and technologies. New web technology have made it
around it. To establish itself in the new eta, it has simple for anyone to create and most highly, issue
begun adapting the new methods of virtues to come their own content. A blog position, tweet or youtube
to terms with the new paradigms of business. The video can be twisted and viewed by millions almost
role of marketing in the development of business is for free. Advertisers don't have to reimburse
intact but the way it was executed is radically publishers or distributors huge sums of money to
changing due to contributions made by satellite embed their messages and they can make their own
communication and extensively developed scientific interesting content that viewers will flock to. Social
devices. Social Media is best defined in the context media comes in many forms and the eight most
4444
popular are: Blogs, Microblogs, Social Networks, their primary digital tool to reach customers, and that
Media-Sharing Sites, Social Bookmarking and proportion is probable to increase to 47 percent
selection Sites, analysis Sites, forum and effective within the next four years. fuel this growth is a
Worlds. growing list of success stories from majority
2.0 TECHNOLOGY AND ITS IMPACT ON companies:
BUSINESS Creating buzz: Eighteen months before Ford
Over the past 40 years, there has been a radical re-entered the US subcompact-car market with its
shift in how business is conducted and how people Fiesta model, it began a broad promotion movement
cooperate. The preface of private computers, the called the Fiesta Movement. A major part involved
Internet, and e-commerce have had a great impact on giving 100 social-media influencers a European
how businesses function and promote. The preface of model of the car, having them whole "missions,,, and
social media technology is accelerating and it can ask them to paper their practice on a selection of
expect it to have a similar impact on businesses now social channels. Videos related to the Fiesta
and into the prospect. As new technologies become campaign generated 6.5 million views on YouTube,
existing, business that learn to use innovative and Ford received 50,000 requests for information
technologies increase great reimbursement. Some of about the vehicle, mostly from non-Ford drivers.
the best-known examples include technology-driven When it finally became available to the public, in late
companies such as Microsoft, eBay, Amazon and 2010, some 10,000 cars sold in the first six days.
Google. Finally' the explosive growth of the smart Learning from customers: PepsiCo has used
phone market and mobile computing is affecting the social networks to collect customer insight via its
strategy, as social media connectivity is becoming DEW McCray promotions, which have led to the
easier and is helping social media glow even faster. making of new variety of its Mountain Dew brand.
3.0 BIG BRANDS AND SOCIAL MEDIA Since 2008, the company has sold more than 36
Social media is being widely used by almost all million cases of them.
and even the companies, in spite of their size have Targeting customers: Levi Strauss has used
started using social media to advertise and promote social media to offer location-specific deals. In one
themselves. Big brands make use of the social media instance, direct interactions with just 400 consumers
to convey their strong existence and friendly led 1,600 people to turn up at the company's stores-
customer relationship. Big brands like IBM, Dell and an example of social media's word-of-mouth effect.
Burger King have made use of the social media to a The number of companies with Facebook
greater extent. IBM owns more than 100 different pages, Twitter feeds, or online communities continue
blogs, a dozen islands in the virtual world, several to grow. Marketing primary objective is to reach
official Twitter accounts, and a accepted forum called consumers at the moments, or touch points, that
DeveloperWorks. It publishes a machine series on influence their purchasing behavior. Social media is a
youTube, and several employees upload exclusive component of the consumer decision
presentations to the media-sharing-site SlideShare. journey: it's the only form of marketing that can
Dell has tapped the power of social media with finger consumers at each and every stage, from when
its hugely popular IdeaStorm website, where users they're pondering brands and products right through
add thoughts for new creation lines and enhancement, the period after a purchase, as their experience
choose them up or down, and comment on influences the brands they prefer and their potential
submission. Because of the site, Dell has ongoing to advocacy influences others.
ship computers with Linux install, and has added 5.0 THE PILLARS OF SOCIAL MEDIA
community carry. Starbucks has also started to use MARKETING (Table 1)
this representation to some success with its
MyStarbucks Idea Site. Burger King has made Table 1. Commonly Used Social Media Marketing Tools
headline time and time again with its innovative and
viral social marketing campaigns. The burger chain
offered Facebook users a free Whopper coupon if
Facebook 92% Twitter 84% LinkedIn 71%
they would "unfriend" 10 of their social network Blogs 68% Youtube 56% Forums 24%
connections. Foursquare 17% MySpace 6% Social BookMarking 26%
4.0 THE SOCIAL CONSUMER DECISION 5.1 Blogging
JOURNEY A blog is a type of content management system
Companies have quickly learned that social that makes it easy for anyone to publish short articles
media works: 39 percent of companies surveyed by called posts. Blog software provides a variety of
McKinsey Quarterly use social-media services as social features, including comments, blog rolls,
4445
trackbacks and subscriptions that make it perfect for  Stay on top of what the competitor is doing;
marketing purposes. Blogs make great hubs for other  Keep in touch with the own clients
social media marketing efforts, as they can be (subscribe to their Tweets and see what they are
integrated with nearly every tool and platform. Every doing);
company with a website should have a blog that  Offer private discounts and sales
speaks to its current and potential customers as real announcements;
people. Blogs are not the right place for corporate-  Provide internal updates to team members
speak press releases; blogs should be conversational and employees;
in tone.  Get leads on business opportunities, trends,
Mashable is one of the five most popular blogs and a jump on late-breaking news.
on the web, according to Technocratic, and is the 6.0 SOCIAL NETWORKS
leader in the social media niche. Blogs influence As the World Wide Web grew in popularity,
roughly one in five readers at important purchase- social networking moved to web-based applications.
decision stages, according to Buzz Logic and Jupiter The first wave was built for specific functions or
Research’s "Harnessing the Power of Blogs" report. audiences. In 1995, Classmates.com and Match.com
Specifically, blogs help consumers discover products were created; both remained fairly popular sites in
and services, refine choices, get support and answers, their niche. In 1999, more targeted networks were
and decide on a specific product or service. From a launched. The modern era of social networks began
direct marketing perspective, these findings make in2002, when Jonathan Abrams launched Friendster.
sense because blogs aggregate customers who have In 2003, Intermix Media developed the social
similar demographic, psychographic, and behavioral network, MySpace. It duplicated the core
traits. According to the research, readers trust blog functionality of Friendster. Initially powered by
content more than social media sites for shopping. Intermix Media's large mailing lists, MySpace
This makes sense, since shoppers look for detailed quickly became a leader among social networking
information to help them make a decision rather than sites. In October 2003, Mark Zuckerberg went on to
engage with random posters who may have opinions create the Facebook, a social network that began as
about products. an exclusive site for Harvard Students. Finally, in
While no longer the latest, preferred form of 2006, anyone with an e-mail id can sign up.
online communications, blogs can be highly effective Sometime between 2008 and 2009, Facebook
and cost-efficient in driving sales. But they aren't a overtook MySpace.
quick marketing fix. They're a form of online media Facebook would be a natural fit for internet
that requires a long-term investment to help and marketing. How would a marketer take advantage?
engage the customers and create more interest in the Some ways may include:
product offering. By their nature, blogs also aid  Establishing and enhancing the brand image
search optimization and reduce the burden of post-
 Establishing and enhancing the company’s
purchase support and customer service. authority in the market , a thought leader
5.2 Twitter and Micro Blogging
 Using the network for market research
Micro blogging is a form of blogging that limits
(opinions and viewpoints, good for surveys)
the size of each post; for instance, Twitter updates
can contain only 140 characters. Twitter started to  Creating a Facebook group of people of
take off in terms of popularity in the first half of 2009 similar interest. Great for networking.
as a result of high-profile celebrity members and a  Targeted Advertising
mention on Oprah, and now it has become more main According to the wall Street Journal, Facebook is
stream than other social media tools. Most companies working on a system to allow targeted advertising to
should be on Twitter; it's easy, requires very little specific networks of people with similar interest.
investment of time, and can quickly prove Social-networking Web site Facebook Inc. is quietly
worthwhile in increased buzz, sales and consumer working on a new advertising system that would let
insight. Twitter can also be used to announce offers marketers target users with ads based on the massive
or events, promote new blog posts, or keep the amounts of information people reveal on the site
readers in the know with links to important news about themselves. Eventually, it hopes to refine the
stories. Twitter can be one way of staying on top system to allow it to predict what products and
what the competitor is doing. The company can also services users might be interested in even before they
show support for their Twitter-loving customers by have specifically mentioned an area.
subscribing to their tweets. Briefly, Twitter for EBay’s Group Gifts service, employs Facebook
businesses is a fast, easy (and free) way to: platform technology. To use Group Gifts, users log in
with their Facebook credentials, which loads up the
4446
list of their Facebook friends? The user can then items at ridiculously low prices for fans only. Most
choose the friend for whom she wants to get a gift discounts were in the range of 90% and were limited
and then proceed to look for an appropriate item. The to the first 100 people to check out with the item at
site can offer generic gifts, but a savvy user can ask lowes.com. Not only did this engage existing
the application to look at the gift recipient's list of customers, but it drove new customers to "like"
Likes on Facebook and recommend a set of items that Lowes' Facebook page, allowing Lowes to post
match the recipient's interests. Once the gift is future deals-on their newsfeeds.
chosen, the user can decide how much to contribute 7.2 Crowd sourcing
herself and how much to leave for others to chip in. Wal-Mart and Gap have used crowdsourcing
Then, she can automatically post a status update on tactics on Facebook, inviting large groups to
Facebook that alerts others that they can contribute to participate in shaping an offer or strategy. The Wal-
that gift. When these friends see the update, they can Mart Crowd Savers program, for example, offers a
click on it to go to the Group Gifts site and add their potential deal to Facebook fans that is only activated
contributions. Once the sum of all contributions if enough fans "like" the promotion - in effect,
equals the purchase price of the gift, the transaction joining together to reach a goal - much like
is executed and the recipient receives the gift, a list of Groupon's model. Similarly, last year Gap asked its
all the friends who contributed to it, and brief notes Facebook fans to comment on its new logo design.
from them. After a barrage of negative feedback from fans, Gap
It is truly social. It overcomes some real off-line invited them to submit their own designs.
difficulties related to group gift giving - like having Responding to customers' outcry, the retailer
to solicit people directly and risking embarrassment ultimately restored its original logo.
when you ask someone to contribute who does not 7.3 Check-ins
want to do so. The online application simply puts it Mobile-device check-ins is a popular way to
out there for people to contribute if they wish. Also, electronically announce the arrival at a location. This
it seeks to strengthen relationships between friends. It has enormous potential value for retailers who, if
also has real strategic benefits for eBay. The they identify customers at all, typically don't do it
company can sell a greater volume of more expensive until checkout, at which point it's too late to influence
items. And since individuals are, in essence, a purchase. Facebook Deals enables retailers to
advertising the service to their friends, it lowers provide electronic coupons and loyalty points when
eBay's cost of acquiring customers. In other words, customers check in at arrival, increasing store traffic
this kind of social strategy produces a win-win for and sales, and giving retailers a clearer picture of
Facebook users and a company. their customers' behavior. Last year REI drove traffic
7.0 USING FACEBOOK TO CAPTURE to its stores by offering $1 donations to charity for
CUSTOMERS every check-in, with a ceiling of $100,000. American
A central tenet of retailing is to put stores near Eagle has offered 20% discounts to customers who
customers. Now that 600 million potential customers check into its stores.
are on Facebook, retailers are flocking to the site and 7.4 Games
aggressively experimenting with new communication Games like Farmville and Mafia Wars hosted on
strategies. Here are five ways they're connecting with Facebook are immensely successful, creating an ideal
customers on Facebook. opportunity for retailers to do something they know
7.1 Promotions well: marry entertainment and merchandising. Last
For retailers, the key is to treat "fans" differently summer 7-Eleven partnered with game-maker Zynga
than other customers by providing special access to to extend social games into the physical world. Items
offers and information. Using Facebook as a one-way such as slurpees and Big Gilps were branded with
communications channel is a baby step, but Farmville, Mafia Wars and YoVille designs that had
broadcasting deals already found in other channels redemption codes for in-game rewards. Meanwhile,
isn't a particularly effective engagement model. A teen-fashion retailer Wet Seal has been developing its
smarter approach is to reward fans by, for instance, own Facebook game, Chic Boutique. The retailer is
providing Facebook-only discounts and sneak peeks hoping customers will compete with each other
at upcoming products. online to design outfits compiled from items in its
Participatory promotions are particularly catalog, increasing awareness of Wet Seal's offerings
effective as they add excitement to online purchasing and driving sales.
and an incentive for customers to invite other friends. 7.5 Social Shopping
For example, Lowes ran a Black Friday campaign on The most obvious use of Facebook is also the
Facebook in which it offered a limited number of most elusive - to create more than just an e-
4447
commerce store within a Facebook frame. Over the Internet. Social Bookmarking is a technique that is
past two years several retailers have made it possible explained as organizing and maintaining resourceful
for customers to browse a subset of products on the bookmarks online. The method began in April 1996
company's Facebook page, but they usually rely on when the website itList was launched giving users the
their e-commerce site to complete the transaction. capability of having public or private bookmarks.
This is a step in the right direction, but to take real Over the next few years online bookmark services
advantage of Facebook, retailers must make it easier began to go head to head with each other and the
for people on the site to communicate with each other industry became very competitive with venture-
about products, promotions' and reviews, and backed institutions such as Hotlinks, ClickMarks,
seamlessly make purchases. Clip2, Blink and Backflip amongst others entering
To that end JCPenney recently opened a the marketplace.
storefront on Facebook containing its entire catalog In 2003, Delicious was formed and pioneered a
of products. The UK retailer ASOS quickly followed term called 'tagging' which allowed users to search
suit. Facebook is testing a Buy-with-Friends program' for bookmarked items by a keyword, Delicious also
currently limited to virtual goods, that publishes coined the phrase 'Social Bookmarking'. Social
users' purchases on friends' newsfeeds and, by bookmarking is a very useful way to access a
offering discounts, encourages those friends to make compiled list of bookmarks from a variety of
the same purchase. All companies, not just retailers, computers, manage a large amount of bookmarks and
should be using social media like Facebook to listen share the bookmarks with contacts. Many
to what customer are saying about their products and bookmarking sites have implemented a voting system
brand; attract them by using promotions, contests, where users are encouraged to indicate bookmarks
and games; and involve them to keep them loyal and that they found to be interesting or of use. As a
take advantage of the power of influential’s. These bookmark receives more votes its visibility increases
are the early days, and while it's uncertain what will on the website which in turn generates more and
work best, it's likely that retailers that don't more votes.
experiment with social commerce will find their 10.0 REVIEW SITES
customers defecting to those that do. A review site is a website on which reviews can
8.0 MEDIA SHARING SITES be posted about people, businesses, products, or
Media sharing sites allow you to upload your services. These sites may use web 2.0 techniques to
photos, videos and audio to a website that can be gather reviews from site users or may employ
accessed from anywhere in the world. Most services professional writers to author reviews on the topic of
have additional social features such as profiles, concern for the site. Early review sites included
commenting, etc. The most popular by far are Epinions.com and Amazon.com. Review sites are
youTube (videos) and Flickr (pictures). Whether it's generally supported by advertising. Some business
Pinterest, Instagram, Flickr or one of the many photo review sites may also allow businesses to pay for
sharing sites popping up online, image-driven social enhanced listings, which do not affect the reviews
media networks and sites are a great resource for and ratings. Product review sites may be supported
B2B companies. Online marketing doesn't just by providing affiliate links to the websites that sell
consist of Facebook, PPC efforts, and banners. the reviewed items.
Online marketing is about providing current and With the growing popularity of affiliate
potential customers with interesting, informative programs on the Internet, a new sort of review site
content. This includes images. Because many photo has emerged - the affiliate product review site. This
sharing sites are free, a business's biggest investment type of site is usually professionally designed and
is time. B2B companies can truly benefit from having written to maximize conversions, and is used by e-
corporate accounts on a number of these photo commerce marketers. It's often based on a blog
sharing sites. platform like Wordpress, has a privacy and contact
9.0 SOCIAL BOOKMARKING AND VOTING page to help with SEO, and has commenting and
SITES interactivity turned off. It will also have an e-mail
Social bookmarking sites are a popular way to gathering device in the form of an opt-in, or drop-
store, classify, share and search links through the down list to help the aspiring e-commerce business
practice of folksonomy (an Internet-based person build an e-mail list to market to. These sites
information retrieval methodology consisting of generally review e-books. Because of the specialized
collaboratively generated, open-ended labels that marketing thrust of this type of website, the reviews
categorize content such as Web pages, online are not objective.
photographs, and Web links) techniques on the
4448
Studies by independent research groups like who in turn can manipulate elements of the modeled
Forrester Research, comScore, The Kelsey Group, world and thus experience a degree of telepresence.
and the Word of Mouth Marketing Association show Such modeled worlds and their rules may draw from
that rating and review sites influence consumer the reality or fantasy worlds. Example rules are
shopping behavior. In an academic study published in gravity, topography, locomotion, real-time actions,
2008, empirical results demonstrated that the number and communications. Communication between users
of online user reviews is a good indicator of the can range from text, graphical icons, visual gesture,
intensity of underlying word-of-mouth effect and sound and rarely, forms using touch, voice command
increase awareness. In 2007 even large companies and balance senses.
such as Best Buy and Walmart began to mention In the virtual world, people can meet,
online reviews in television advertisements and on collaborate, plan, visualize, train and learn together.
the back of receipts. They can use the same tools as in real life meetings
11.0 FORUMS such as whiteboards and PowerPoint as well as
An Internet forum, or message board, is an accessing media such as You Tube and Websites.
online discussion site where people can hold Furthermore they can visualize information three
conversations in the form of posted messages. They dimensional. For example, instead of seeing a list of
differ from chat rooms in that messages are at least potential clients, they could walk onto a live Google
temporarily archived. Also, depending on the access map and touch a marker to bring up media relevant to
level of a user or the forum set-up, a posted message the organization such as their website , news
might need to be approved by a moderator before it coverage , press release etc – all in one space – and
become visible. Forums have a specific set of jargon share that experience with other team members ( no
associated with them; e.g. a single conversation is matter where they are in the world).
called a “thread”. A discussion forum is hierarchical 13.0 SOCIAL MEDIA STATISTICS
or tree-like in structure: a forum can contain a Facebook:
number of sub forums, each of which may have 1. There are now more than 800 million active
several topics. Within a forum’s topic, each new Facebook users, with more than 200 million added in
discussion started is called a thread, and can be 2011 .
replied to by as many people as so wish. Depending 2. B2C Facebook results are 30% above average on
on the forum’s settings, users can be anonymous or Sundays. (Convince & Converts)
have to register with the forum and then subsequently 3. Nearly every charity and University in America is
log in order to post messages. On most forums, users on Facebook. Less than 60% of the fortune 500 are.
do not have to log in to read existing messages. (Grow)
Forum marketing is great way to make your 4. The average Facebook user has 130 friends and is
online business stand out from the crowd, forum connected to 80 pages, events and groups. (Social
users are generally net savvy and open to making Media Examiner)
online purchases. Many forum users are also 5. 95% of Facebook wall posts are not answered by
respected experts and bloggers in the specific topics brands (Facebook).
covered by the forum. Forum marketing is a high 6. Auto-posting to Face-book decreases likes and
ROL strategy because making a good impression in comments by 70%.(inside Facebook)
front of this savvy and influential audience can help 7. When it comes to liking brands on facebook, the
your marketing message spread far and wide. reasons are varied, but for the most part, respondents
12.0 VIRTUAL WORLD said they “Like” a brand on Facebook because they
A virtual world is an online community that are a customer(58%) or because they went to receive
takes the form of a computer-based simulated discounts and promotions(57%).(Mashable)
environment through which users can interact with 8. 77% of consumers said they interact with brands
one another and use and create objects. The term has on facebook primarily through reading posts and
become largely synonymous with interactive 3D updates from the brands…(Mashabke)
virtual environments, where the users take the form 9. 17% of respondents said they interact with brands
of avatars visible to others. These avatars usually by sharing experiences and news stories with others
appear as textual, two-dimensional, or three- about the brand and only 13% of respondents said
dimension representation a, although other forms are they post updates about brands that they like
possible (auditory and touch sensations for example). (Mashabke)
In general, virtual worlds allow for multiple users. 10. 56% of consumers said they are more likely to
The computer accesses a computer-simulated recommend a brand to a friend after becoming a fan
world and presents perceptual stimuli to the user, on facebook (Mashable)
4449
11. There are more than3.5 billion pieces of said Facebook is one of their top three social media
content(web links, news stories, blog posts, etc.) platform priorities. Twitter was second with 77% and
shared each week on Facebook. (Hubspot) Youtube trailed with 42%. (Scratch Engine Watch).
Figures on Social Media 26. The Mobile marketing Association of Asia atated
12. Roughly two-third of social media users say that that ouyt of the 6 billionpeople on the planet, 4.8
staying in touch with current friends and family billion have a mobile phone while only 4.2 billion
members is a major reason they use these sites while own a toothbrush. (60 Second Marketer)
half say that connecting with old friends they have 27. 61% in 2010 and 65% in 2011, Fully 65% of
lost touch with is a major reason behind their use o adult internet users now say they use a social-
these technology.( PEW research) networking site like MySpace, Facebook or Linkedin,
13. One in three respondents (33%) said that they up from 61% one year ago. This marks the first time
could prioritize social media freedom, device in Pew Internet surveys that 50% of all adults use
flexibility and work mobility over salary in accepting social networking sites. (Wired PR Works)
a job offeer ( GIGAOM ) 28. IT professionals see serious risks assocaited with
14. One in three textors would rather text than talk enterprise social network use – and only 29% say
(NY TIMES: BITS) they have adequate protection. (InformationWeek :
15. 73% of people think employees over share on The BrainYard)
social media (marketing piligrim) 29. Social media is responsible for one-third the web
16. 43% of all online consumers are social media traffic in Malaysia. (ReadWriteWeb)
fans or followers (HUBSPOT) 30. 44% of companies track employees’ social-media
17. 64% of AMERICAN stream mobile vedio at use in and out of the office (TheNextWeb)
work (TUBE FILTER) 31. 84% Among college students and young
18. According to Threatmatrix survey of 722 active professionals, 24% experience three to five
internet using consumers, 37% intend to make a interruptions in a given hour, while 84% get
purchase using their smartphone, nearly three times interrupted at least once while trying to complete a
as many as those who plan to use their tablet. (Get project. (GigaOm)
Elastic). 32. The mean half life of a link on Twitter is 2.8
General Social Media hours, on Facebook it’s 3.2 hours and via “direct”
19. Tablet owners tend to consume a greater variety sources( like email or IM clients) it’s 3.4 hours. So
and volume of news on their devices, and Tablets’ you can expect, on average, an extra 24 minutes of
visual , interactive features encourage in-depth attention if you post on Facebook than if you post on
exploration, according to a joiny study from Starcom Twitter. (bitly blog)
Mediavest and the online division of the BBC. 33. 20% of searches on Google each day have never
(Mashable) been searched for before. (HubSpot).
20. More Smartphones and Tablet owners are 34. SEO : Still dominates for marketers, with both
researching products than purchasing them – 80.8% B2B (57%) and B2C (41%) businesses stating it
compared to 41.4%, according to BIGResearh – but makes the biggest impact on their lead generation
attitudes vary quite a bit among different age goals. (AllTwitter).
groups.(eMarketer) 35. AÂ : Overall. 57% of comments about U.S.
21. 40% of bloggers themselves are professionals.( airlines on social media in the past year where
MediaBistro/ State of the Blogosphere 2011) negative. But American Airlines- The world’s 4th
22. A 2011 study by the National Restaurent largest airlines stood out with only 12% of social
Association conforms that consumers who use social media opinions about the airlines being positive. (The
media including apps, Twitter, Facebook, RealTime Report)
FourSquare, UrbanSpoon and more, not only dine out 36. 56% of college students said that if they
more, but are more likely to become return encountered a company that banned access to social
customers. (ReadWriteWeb) media they would either not accept a job offer or
23. Linked In : Linkedin has 64 million users in would join and find a way to circumvent corporate
North America alone.(All Twitter) policy. (GigaOm)
24. John Hopkins, facebook’s birth place Harvard, 37. Only 15% have the average local business’s fans
and Notre Dame are the top schools for social are in the city where the business is located. (WSJ)
media.( Boston.com) 38. According to a new studt published by Neilsen
25. Facebook, Twitter and Youtube are now those two categories eat up 23% of internet usage
considered cornerstones of most social-media overall. This is double online gaming, which comes
strategies in larger companies. 94% of respodents in at number two and after that, it takes 75 different
4450
categories to account for the remaining 35% of time Facebook and other social networking sites, it is
spent (Marketing Pilgrim) bound to bring in more customers for the business
39. There are 245 million internet users in the U.S, and much more promotions and marketing thus
according to internet world statistics. Nielsen making social media, the better platform for
estimates that social sites and blocks reach 80% of all marketing.
active U.S internet users (PR Week)
40. 30% of B2B marketers are spending millions of Corresponding Author:
dollars annually on social marketing programs, Dr.T.SuganthaLakshmi
though nearly 30% are not traking impact of social Assistant Professor, School of Management
media programs on lead generation and sales. Studies,Anna University,
41. NETFLIX: Netflix’s price hike caused 8,05,000 Regional Center Coimbatore,
paid subscriber to jum ship in the most recent quarter. Jothipuram Post, Coimbatore – 641 047,
Twitter Tamilnadu, India. Email: sugi1971@rediffmail.com
42. E-Marketer estimates there will be nearly 21
million twitter users in the U.S by the end of this Reference :
year, and a sizable minority of those will use the 1. David Meerman Scott., “ The New Rules of
service at least in part to follow brands Marketing and PR: How to Use News Releases,
43. 34 % of marketers have generated leads using Blogs, Podcasting, Viral Marketing and Online
twitter and 20% have closed deals using twitter Media to Reach Buyers Directly”, Published by
Wiley; First Edition , 2008.
(AllTwitter) 2. Paul Gillin., “The New Influencers: A Marketer's
44. 40% actually don’t tweet but simply dip into their Guide to the New Social Media”, Linden Publishing ,
Timeliness to keep tabs on what people are saying 2007.
45. 55% of them access Twitter via mobile 3. Steve Weber., “Plug Your Business! Marketing on
47. What makes people to tweet MySpace, YouTube, blogs and podcasts and other
(Figure 1) Web 2.0 social networks”, Published by Weber
Books , 2007.
4. Dave Evans., “Social Media Marketing: The Next
100% Generation of Business Engagement”, First edition,
2010.
50% 5. Brian Halligan & Dharmesh shah., “Inbound
Marketing: Get Found Using Google, Social Media,
0% and Blogs (The New Rules of Social Media)” ,
Wiley, 1 edition , 2009
6. Tamar Weinberg., “The New Community Rules:
Marketing on the Social Web”, Published O'Reilly
Media, First edition, 2009.
7. Trattner, C., Kappe, F.: Social Stream Marketing on
Figure 1. Plot repsentation
Facebook: A Case Study International Journal of
Social and Humanistic Computing (IJSHC), 2012.
14.0 CONCLUSION 8. Lon Safko & David K. Brake ., “The Social Media
Social media isn't about money or Bible: Tactics, Tools, and Strategies for Business
institutions. It isn't about stockholders making Success”, Wiley, 1 edition, 2009
billions of dollars. It isn't about corporate ownership. 9. "6 ways foursquare can help your social-media
Social media is about ordinary people taking control strategy". Bizjournals.com.
of the world around them and finding creative new 10. Muntinga, Daniel, Moorman.M & Smit.E.,
ways to bring their collective voices together to get “"Introducing COBRAs exploring motivations for
what they want. Social Media Marketing (SMM) is brand-related social media use", International Journal
of Advertising 30, Pg 13–46. (2011).
primarily internet-based but has similarities with non- 11. Erik Cambria, Marco Grassi, Amir Hussain and
internet-based, marketing methods like word-of- Catherine Havasi., "Sentic Computing for Social
mouth marketing. SMM is the way of promoting a Media Marketing". In press: Multimedia Tools and
website, brand or business by interacting with or Applications Journal. Springer-Verlag, Berlin
attracting the interest of current or prospective Heidelberg , (2011).
customers through the channels of social media.
Facebook, Twitter and Youtube are the most popular 11/20/2012
social media that are widely used by the companies
and the celebrities in promoting themselves and their
brands. With the number of users rising each day in
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Promovarea în Social Media

Tema în cauză doreşte să abordeze analizarea şi fundamentarea măsurilor de promovare

În zilele noastre internetul a devenit un mediu universal de comunicare prin reţelele de

Enunţate anerior avantajele şi dezavantajele promovarii online cat şi a promovării clasice

Ea crează în mintea acestora brand awareness, deoarece oportunităţile plasării reclamei

Analiza rezultatelor cercetării în funcţie de impactul creat

Pe baza cercetării documentaţiei putem observa impactul afişării publicitare.Acesta

Ca şi concluzie generală promovarea în social media reprezintă una dintre metodele

Ramura- Descrierea firmei existente

Firma se numeşte STARFIER SRL şi se afla în judeţul Suceava. Ca şi scop general

Resursele : Umane, Tehnico-materiale şi financiare.

Persoane fizice şi juridice ce doresc amenajarea de porţi, garduri, şi amenajări interioare.

Informaţii cu privire la concurenţă Sondaj bazat pe chestionar

Contents lists available at ScienceDirect

Full Length Article

The impact of online display advertising and paid search

Abilities Paid Display Ofﬂine Supporting references

2. Prior literature and hypotheses

2.1. Impact of display advertising on ﬁrm performance and ﬁrm value

Fig. 1 summarizes the hypotheses.

3. Data and variables

3.1. Data description

3.2. Dependent variables

3.3. Advertising variables

3.4. Control variables

4.1. Primary regressions

Salesi;t ¼ α0i þ β1 KantarAdStocki;t þ β2 Levi;t þ β3 Sizei;t þ β4 IndGrowi;t þ β5 IndConci;t þ β6 IndTurbi;t

Salesi;t ¼ α0i þ β1 OfflineAdStocki;t þ β2 DisplayAdStocki;t þ β3 SearchAdStocki;t þ β4 Levi;t þ β5 Sizei;t þ β6 IndGrowi;t

where (see also Table 3):

Salesi,t = total revenues of ﬁrm i in year t (in logs),

KantarAdStocki;t ¼ λKantar KantarAdStocki;t−1 þ ð1−λKantar Þ KantarAdvi;t : ð5Þ

SearchAdStocki;t ¼ λSearch SearchAdStocki;t−1 þ ð1−λSearch Þ SearchAdvi;t : ð8Þ

Panel A. Distribution of ﬁrm-year observations across economic sectors

Total sample % of sample

Financials 1709 21.0

Panel B. Descriptive statistics (N = 8124)

1 Tobin's q 1.340 1.402 1.00

4.2. Auxiliary regressions

5.1. Descriptive statistics

Dependent variable: Sales (N = 8124) Tobin's q (N = 8124)

Coeff. S.E. Coeff. S.E. Coeff. S.E. Coeff. S.E.

(1) (2) (3) (4)

Dependent variable: Sales (N = 8124) Tobin's q (N = 8124)

Coeff. S.E. Coeff. S.E. Coeff. S.E. Coeff. S.E.

(1) (2) (3) (4)

Fixed Effects Interactions Fixed Effects Interactions

5.2. Empirical results

5.3. Control variables

5.4. Robustness checks

6.1. Practical implications

6.2. Limitations and future research directions

Appendix A. Supplementary data

Supplementary data to this article can be found online at https://doi.org/10.1016/j.ijresmar.2020.02.002.

3rd World Conference on Technology, Innovation and Entrepreneurship (WOCTINE)

A Review of Digital Brand Positioning Strategies of Internet Entrepreneurship in

Yagmur Sacide BAHCECIKª, Senem Seda AKAYᵇ, Ali AKDEMIRcc

* Corresponding author. Tel.:+90 555 832 4800

1877-0509 © 2019 The Author(s). Published by Elsevier B.V.

1877-0509 © 2019 The Authors. Published by Elsevier B.V.

1. The Concept and Importance of Entrepreneurship

There is an important consensus that entrepreneurship is a combination of many personal characteristics. In

1.1 Internet Entrepreneurship

1.2 Difference of Internet Entrepreneurship from Other Entrepreneurships

Internet entrepreneurship has three important differences from other entrepreneurs;