Impact of Social Media on Customer Purchase: ASOS Case Study

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TOPIC: EXPLORING THE IMPACT OF SOCIAL MEDIA ON CUSTOMER PURCHASES (CASE STUDY OF ASOS)

Introduction

This chapter provides general information on the various impacts of the customer purchases because of the influence of social media. The study will include the background information, objectives of the study, research questions, literature review research methodology, recommendations and conclusions.

In the world today human beings are increasingly becoming more social; consumers take part in a range of activities from sharing experiences, sharing of knowledge and opinions with other consumers using online media platforms (Wang and Wei, 2012). with the advancement of technology internet has become an important tool through which communication takes place. Moreover, the presence of internet has enabled the interaction between different individuals without the need of physically meeting (Rishika et al, 2013). This is possible through social media platforms such as Facebook, email, and Twitter.  web 2.0 applications is the main facilitator of all these processes by enabling the transfer of the Internet to a social environment thus the interaction and coming up with new ideas online (Goh et al, 2013). More use of the online platforms and social media, the access and sharing of information is made easy. Due to the reference and recommendations of other consumers, there are different sources of information which a consumer can use to guide his /her buying decisions as a lot of business use social media as a platform to push or sales of their products or services. This can be through their social media plat form or the use of online influencers.

Social media helps in creating various ideas to organizations such as encouraging word to word communication, improving on the popularity of the brand, improving on the volume of sales and creation of a more positive social support to the customer (Rapp et al, 2013). There is also an improvement on the level of trust due to networking and sharing of ideas through social media. With the advancement of social media and social networking sites, many organizations are placing importance on these new technological changes. The organizations identify means which they can make valuable and profitable use of the media application such as Facebook, Twitter, LinkedIn, Instagram and Youtube. Since each media application attracts different groups of individuals and the company must put effort to ensure their presence where their customers exist (Rishika et al, 2013). Therefore, the various forms of social media application can be used as a very important tool for marketing which enables close interaction with the consumers. Organizations in a competitive environment use social media platforms to attract and reach out to their customers at a low cost and also conveniently deliver the message (Goh et al, 2013).

The numerous advantages associated with the use of social media platforms, many organizations and marketers invest in the social media. With the emergence of the online communities, the geographical barriers dividing individuals is now on the decline. Additionally, through these media platforms, individuals can share information on product brands thus creating a new profile of consumer and new customer trends (Goh et al, 2013). It also influences the consumer decision when it comes to buying, from information acquisition to the period after purchase. Since customers nowadays place a lot of importance on reviews and recommendations on social media websites rather than traditional methods before undertaking a buying decision (Gallaugher and Ransbotham, 2010) through the usage and availability of these social media applications, new methods of consumer purchasing behavior have emerged. Therefore, marketers must take into consideration these when it comes to consumer purchasing behavior (Wang and Wei, 2012). Conclusively he various social media application has created new space for the exchange of information and plays an important role in influencing consumer behavior since most consumers use information from these tools to make their purchase decision. This research aims to explore the impact of social media on customer purchases. To achieve this, the study should understand more on the consumer buying behavior and factors affecting it. It will provide more information on how consumers behave in the digital environment and how this becomes useful in making a buying decision.

Objectives

  1. To evaluate the how social media influence the purchasing decision of customer
  2. To find out the effects of social media on customer purchases

Research questions

  1. How do social media influence the purchasing decision?
  2. What are the effects of social media on customer purchases?

Literature review

This chapter provides more insight on the consumer behaviour. Moreover, it will give more information on the consumer behavior while in the digital environment and how social media interaction influences the consumer behavior (Gallaugher and Ransbotham, 2010). The chapter will outline the key factors that influence the consumer’s purchase decisions and in brief, enlighten the consumer buying process.

The development of online platforms has made consumers have an influence on the products and brands. As a result, there are three types of social influences on the consumer behavior: subjective norms occur when there is a social actor who has control wants individuals to carry out some behavior. Group norm occurs when one is influenced to adopt ideas shared by others. Lastly, there is the social identity this is when an individual gets influenced to have a relationship with another group.

Social networking sites is one of the most important ways channels of communication which facilitate the interaction with others and creating of virtual communities based same interests (Rapp et al, 2013). Consequently, there are different types of virtual communities that affect the purchase decision of the consumer in different ways. They include multi- user dungeons the social relationship exists to each other in the form of playing, chat rooms are created to enable different individuals to chat and interact on a particular topic, board, and blogs which are personal journals (Goh et al, 2013). The benefits of using the virtual community are that it can reach a diverse group of individuals, also help in getting information on a product or company

Online platforms have become more reliable in providing information than getting it directly from the company. As a result, consumers find out and source company products and services online. Because the consumers can interact with each other and either get positive or negative response to the products and services thus having an influence on the purchasing decision

According to Sashi, (2012) consumer purchase decision behavior is the process through which an individual arrives at choosing to use or purchase a product or service. To understand the influence of the social media on consumer choice the different parts of decision making must be analysed. The decision making process which is the central part of consumer behavior is made up of the following steps:

Problem recognition is the initial stage for decision making there are those decisions which are easy to make like the need of food while others are complex in nature.As a result, different factors affect the problem recognition like for instance social, cultural and environmental factors among others (Wang and Wei, 2012). Information search is the next step where the consumer looks for information regarding the item to be purchased. The consumer can source the information internally or externally; internal source involves the consumer’s knowledge of the product. While external source involves getting information through visiting the stores, word of mouth and online social media platforms (Rishika et al, 2013). Decisions arrived based on the information will be heavily influenced by the internet. When evaluating the alternatives, the consumer takes the choice which best suits the needs. Also after evaluating on the best choice, the consumer settles down on the product of choice. The product of appeal can be influenced by the information from various sources which includes the internet

There are different social network groups which consumers belong to, which in turn influence the purchasing decisions of the consumer. The different social network groups that can influence the purchase decision are: primary groups, secondary groups, informal groups, formal groups and virtual groups (Rapp et al, 2013). The different kinds of groups influence the purchase decisions in the following ways: information influence which is simply information on other brands.The utatalitarian influence which simply means that the decision is based on meeting needs of other in the same social group, Value-expressive influence  means that the decision depends on the image which other people have on the customer.

Research methodology

This study will make use of the qualitative method in determining the impact of social media on customer purchases as this will enable collection of large volumes of data and gain a deep understanding of the problem through well-elaborated interpretations (Gallaugher and Ransbotham, 2010). An exploratory research design will be used to have ingenious information on the study area.

Conclusion

Because of the study, it can be summed up that social media platforms have a great influence on the purchasing decision process. This is because the social media applications bring more appropriateness to the consumers. ASOS as a well known brand relies on social media platforms to get customers and at the same time retain the customers. The use of influencers also has increased, as they get popular bloggers and celebrities to wear their brands and promote it for a fee. Social media has change the way people spend on goods or services, as people would rather wait for a product to be used by another person and blog bout it before they make their own purchases. Although social media has proved to bevery effective it also has a default, which is people getting paid to leave wrong reviews so consumers will still make a purchase.

References

  • Gallaugher, J. and Ransbotham, S., 2010. Social media and customer dialog management at Starbucks. MIS Quarterly Executive, 9(4).
  • Goh, K.Y., Heng, C.S. and Lin, Z., 2013. Social media brand community and consumer behavior: Quantifying the relative impact of user-and marketer-generated content. Information Systems Research, 24(1), pp.88-107.
  • Rapp, A., Beitelspacher, L.S., Grewal, D. and Hughes, D.E., 2013. Understanding social media effects across seller, retailer, and consumer interactions. Academy of Marketing Science. Journal, 41(5), p.547.
  • Rishika, R., Kumar, A., Janakiraman, R. and Bezawada, R., 2013. The effect of customers’ social media participation on customer visit frequency and profitability: an empirical investigation. Information systems research, 24(1), pp.108-127.
  • Sashi, C.M., 2012. Customer engagement, buyer-seller relationships, and social media. Management decision, 50(2), pp.253-272.
  • Wang, X., Yu, C. and Wei, Y., 2012. Social media peer communication and impacts on purchase intentions: A consumer socialization framework. Journal of Interactive Marketing, 26(4), pp.198-208.

Appendices

Appendix 1: Gannt Chart

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