Assessing the Effectiveness of Social Media Marketing on Small and Medium-scale Enterprises
Chapter One
General Objective
The general objective of this study was to determine the effectiveness of social media marketing to small businesses performance in Yaba Lagos state.
Specific Objectives
- To determine the effectiveness of Facebook for small businesses’ performance in Yaba, Lagos state.
- To determine the effectiveness of Instagram for small businesses’ performance in Yaba, Lagos state.
- To determine the effectiveness of twitter for small businesses performance in Yaba, Lagos state.
CHAPTER TWO
LITERATURE REVIEW
Introduction
This chapter reviews literature of various scholars on the effect of Facebook to market accessibility for small business performance, the effect of Instagram to market accessibility for small business performance and the effect of Twitter to the optimization of small businesses performance. Literature reviews first the effect of Facebook to market accessibility for small businesses performance. Second it discussed on the effect of Instagram to market accessibility for small businesses performance and third determines the effect of twitter to the optimization for small businesses performance in Yaba, Lagos state. Lastly is the chapter summary that explained the main points that are discussed on this chapter.
Effect of Facebook to the Market Accessibility for Small Businesses Performance Facebook is a digital communication platform that was created by Mark Zuckerberg in the year 2004 at Harvard University. This interactive online communication platform was realized to the general public in the year 206 after being restricted to certain age for the last two year. The research conducted in 2014 showed that Facebook has more than 1.23 billion registered users, while social network keep improving and boosting its appeal to users with different new applications. Such opportunities has been considered by many businesses who sees social as a way to boost their business in conducting business under low cost, increasing market accessibility and easy communication process (Paquette, 2013).
Recent statistics shows that Facebook has made over 5 billion dollars from advertising made it a key to social media marketing. Facebook has recently acquire shares on Instagram, snap chat and vine made it accessible through out and impact more to the society, which increase the significant effect on how businesses advertise on the internet. Unfortunately any small businesses lack the opportunities of using Facebook towards business operations and to generate maximum profit from social media use due to illiteracy level and accessibility of internet in rural areas. Often times, small business owners simply do not have the technical background to understand how to use social media to grow their businesses (Abbot, Donaghey, Hare & Hopkins, 2013).
Increase in Brand Awareness
According to Zinnbaue and Honer (2011) explained that the main requirement to connect brands with their user community are information, advocacy, utility, conversation, affiliation and identity. Moreover, marketers need to understand internet user’s concerns and social effects before engaging in the marketing process. To consider what people in the society are more concern with including moral values of what is right and wrong, what considered attactive and basic requirements. Hence using social media such as Facebook as a strategic marketing tool to discover the rights and wrongs in the society is a key towards market development (Zinnbauer & Honer, 2011).
According to Mathe (2010) explained that with the increase popularity of Facebook as a social media network, yet there is no research that has been done to examine how Facebook impact brand recognition to the society for business growth. Due to this, March came up with the study that analyze existing Facebook marketing practices and tools and concerns associated with this type of social media marketing that benefits businesses towards brand recognition and expansion. Facebook has enabled virtual communities of consumers formed around tangle brands such as in cars like Jeep and goods like Nutella to form a real marketing environment with an online interaction and transaction (Raïes & Gavard-Perret, 2011).
Purchasing Power Decision
Oyza and Edwin (2015), carried out an assessment into the influence of Social media on the purchasing decisions towards local small businesses in U.S; found that 62% of the customers do visit different business social media pages to see what they offer before purchasing for products. The research also was conducted of small business owners to check how often they visit and refresh their business pages. The research showed that thirty percent of the small business owners visit their business pages several times a day before setting foot in the business. Also different promotions and discounts displayed on the business social media page have paved way towards multiple increase in sales. From the research conducted by Oyza and Edwin (2015) showed that eighty four percent of citizen in US felt that an offer or deal on Facebook played a large role in their decision to purchase for goods and services. Facebook ads might also prove to be quite profitable with fifty eight percent of respondents stating that they’d engaged with a Facebook ad for a small business at least once a week.
Safko & Brake (2009) stated social media as “online applications, platforms and media, which aim to facilitate interaction, collaboration, and the sharing of content. Nowadays, Facebook and other Social Networks are becoming increasingly important in consumers’ purchasing decisions, mainly because they amplify word of mouth. They may even become more important than advertising as a trusted source of information. However, it is important to stress the fact that, in Social Media Marketing, marketers have less control over messaging and positioning.
CHAPTER THREE
RESEARCH METHODOLOGY
Introduction
This chapter explores on the research methodology and procedures that were used during the collection of field data on the effectiveness of social media marketing in small business: a case study of Yaba Lagos state. This chapter covers; Research design, population, data collection, data analysis, research procedure and finally the chapter summary.
Research Design
This study adopted descriptive research design. Descriptive research design attempts to identify and explain the variables that existed in a given situation and describe the relationship that exist between these variables in order to provide a picture of a particular phenomenon (Cooper & Schindler, 2008). The study sought to establish the relationships between the effectiveness of social media marketing in small business growth. Descriptive design was convenient for this study as it enabled the researcher make inferences on the role of social media marketing to small businesses. The independent variables in the study included the effect of Facebook to market accessibility for small businesses, effect of Instagram in promoting market accessibility to small businesses, effect of twitter to the optimization for small businesses while the dependent variable is social media marketing in small business.
Population and Sampling Design
Population
Cooper and Schindler (2008) describe a population as the total collection of elements whereby references have to be made. In this study, the targeted population consisted of all small businesses in Yaba. According to CBS, ICEG and K-Rep Baseline survey, there were 12,500 small businesses in Yaba (CBD) in 2015 with a growth rate of 4.8% per annum, therefore in 2016, the estimated number of small business at the CBD was13, 100 business.
CHAPTER FOUR
RESULTS AND FINDINGS
Introduction
This chapter addresses the results and findings on the effectiveness of social media in small business a case study of Yaba Lagos state. The findings are based on the responses from the questionnaires filled and information gathered on the research objectives. The first research determines the effectiveness of Facebook for small businesses performance. The second objective explained the effectiveness of Instagram for small businesses performance, and the third objective is to establish the impact of effectiveness of twitter for small businesses performance.
CHAPTER FIVE
DISCUSSIONS, CONCLUSIONS AND RECOMMENDATIONS
Introduction
This chapter provides a discussion on the findings of the research as compared to the findings in the literature review, the summary of the study and recommendations for further improvements on measures to be taken to on effectiveness of social media marketing in small business performance: a Case Study of Yaba Lagos state. The study is finalized drawing conclusions from the research objectives.
Summary
The purpose of this study was to assess the effectiveness of social media marketing in small business performance: a Case Study of Yaba Lagos state. The research was guided by three research objectives: effectiveness of Facebook to market accessibility for small businesses performance in Yaba, Lagos state, to determine the effectiveness of Instagram to market accessibility for small businesses performance in Yaba, Lagos state and to determine the effectiveness of twitter to the optimization for small businesses performance in Yaba, Lagos state.
The research design of the study was descriptive design that attempts to identify and explain the variables that existed in a given situation and described the relationship that existed between these variables. The sample of 100 businesses was taken from a 12,500 businesses to fulfill the research results. Data collection used both open and closed ended questions to the respondents. The researcher administered all the questionnaires in person to all the respondents who agreed to take part in the study. A response rate of 87% was attained and this was sufficient to provide representative outcome of the findings which could be generalized for a larger population.
On the effect of Facebook to the market accessibility on small business performance, majority of the respondents agreed that the Facebook enables business to discover what the society needs and majority of respondents strongly agreed that Facebook has enable increase in brand awareness of your products and services. A large proportion of respondents agreed that Customers visit different business pages before purchasing a product. Moreover, a larger number of respondents to a high extent agreed that promotions and discounts displayed on the business Facebook page increases sales. On the other hand, a large number of respondents disagreed Facebook has led to less environmental use in conducting your business. Many respondents Facebook has increase close customer relationship with your business.
Regarding implication of Instagram to the market accessibility for small businesses performance. Respondents agreed Instagram enables business to connect deeper with the consumer. Moreover, they agreed that business should entertainment and information posts for customers to engage. However, majority of respondents disagreed Instagram has enable your business to engage easily with customers by sending samples, adverts. Majority of respondents agreed that Instagram has modify your marketing strategies and push to internet marketing. On the other hand, respondents strongly disagreed that Consumers uses business post for their next purchases. A large number of respondents agreed that use of Instagram has pushed your business towards E-commerce use in conducting business such as internet advertisements. Moreover, a large proportion of respondents it is easy to connect with your customers through Instagram when passing marketing information.
The findings on the effect of twitter to the optimization of small businesses performance, majority of respondents agreed that Customers could influence products through twitter. A large proportion of respondents disagreed Twitter has increase the consumer purchasing decision in your business. Majority of respondents disagreed that using Twitter in Business has cut down the cost of operation. A large number of respondents disagreed Twitter enables easy interaction with customers and majority of respondents strongly disagreed using Twitter to market for your business is inconvenient especially with the environment you live.
Discussion
Effect of Facebook to the Market Accessibility on Small Businesses Performance
The findings indicated that 55% of respondents strongly agreed that Facebook has enable increase in brand awareness of your products and services. The results were consistent with Paquette (2013) study that Facebook opportunities has been considered by many businesses who sees social as a way to boost their business in conducting business under low cost, increasing market accessibility and easy communication process. The findings illustrated that 50% of respondents strongly disagreed that Facebook helps customer identify with SME’s product brand. This was consistent with study done by Raïes and Gavard-Perret (2011), who explained that Facebook has enabled virtual communities of consumers formed around tangle brands such as in cars like Jeep and goods like Nutella to form a real marketing environment with an online interaction and transaction. Hence, a large number of respondents’ disagreed that Facebook has helped the large companies brand rather than the SME’s.
The findings indicated that 55% of respondents strongly agreed that customers visit different business pages before purchasing a product. This findings are in line with a research done by Paquette (2013) who measured the impact of Facebook on the purchasing decisions towards local small businesses in U.S; found that 62% of the customers do visit different business Facebook pages to see what they offer before purchasing for products . Also, the findings revealed 65% of respondents agreed that Promotions and discounts displayed on the business Facebook page increases sales and 50% of respondents agreed that Facebook facilitates interaction and collaboration between customers and business . This findings are in line with a study done by Paquette (2013) and Safko & Brake (2009). They explained different promotions and discounts displayed on the business Facebook page has pave way towards multiple increase in sales. From the research conducted by Paquette (2013) showed that eighty four percent of citizen in US felt that an offer or deal on Facebook played a large role in their decision to purchase for goods and services.
Facebook leads to environment preservation. The findings showed that 72% of respondents disagreed that Facebook has led to less environmental use in conducting your business. These is inconsistent with the study done by Jones et al. (2013) who portrayed that Facebook page to conduct business with less environmental use hence less pollution to the environment. Furthermore they explain that with different posts, concerning environmental preservation helps to retailers to conduct business under environmental friendly use. The findings revealed that 45% of respondents strongly agreedbusiness use Facebook platform to promote environmental messages. This findings align a study done by Mathe (2010) the public platforms such as Facebook play meaningful communication strategies that promote a socially responsible image and inciting consumers to adopt environmentally friendly behaviors.
Facebook has increase close customer relationship with your business. The findings strongly agreed with a study done by Chung & Buhalis (2008) that Facebook plays a vital role in marketing and mostly in creating relationship with customers, the further proclaim that there are so many countless opportunities that small businesses are missing due to the lack of understanding in using social media such as Facebook as a means of marketing .
However, 67% of respondents largely disagreed that Facebook has become a major source of interactive with your clients, which was inconsistent with findings from Mangold and Faulds (2009)who explained social media marketing such as Facebook enables companies to achieve a better understanding of customer needs in order to build effective relationships.
Effect of Instagram to the Market Accessibility for Small Businesses Performance
The findings indicated that 81% of respondents agreed that business should be entertaining and information posts for customers to engage and 76% of respondents strongly agreed to large extent that Instagram enables business to connect deeper with the consumer.This findings are consistent with study done by Cvijikj & Michahelles (2013) and Neti (2011) who potrayed that explained that contents such as entertainment and information raises, on average, the number of likes, comments, and shares can be done by anyone which brings equal cntribution to anyone including customers for the company. They further argued that explained that instagram is a best opportunity available to connect brand at a deeper level with a prospective consumers, hence a medium of socialization. Through instagram, different brands find themselves into a new word of a virtual customers and increase spread in marketing channels.
74% of respondents strongly agreed that Instagram has modify your marketing strategies and push to internet marketing which aligns with study done Baker et al. (2010) that, explained that businesses are changing marketing strategies based on information they find in social media feeds from their competitors. They further potray that keeping an eye on competitors, their strengths and weaknesses can determine their marketing efforts, the gathered information helps to implement things that might be needed to improve such as social media campaigns, contests, giveaways or types of content the followers may be responding to the most.
Findings potrayed that 54% of respondents disagreed Instagram enables business to communicate open and clear messages. This findings were similar with study done by Kim et al. (2010) explained that by providing messages that are open, transparent and helpful, social audiences will learn that your business cares about its customers and potential customers. One can position their company as a valuable resource by simply sharing information like advice, tips, or just answering questions about the industry.
Quantitative research was conducted on the number of people who uses Instagram and for consumers if their buying decision is influenced with the use of Instagram. The sample counted 116 respondents and from the statistical perspective, the conclusions were established in terms of the univariate and bivariate analysis(Ioanas & Stoica, 2014).The study agreed by the research 68% of respondents agreed that Instagram has influence buying decision to customers and increase more selling.
Instagram becomes an important communication tool that people use to connect to other people or organization. People use Instagram to share their experiences, reviews, information, advice, warnings, tips and any kind of issues that are interesting to their connection or friends (Oyza, 2015). The findings revealed that 50% of respondents strongly disagreed that Consumers uses Instagram to connect to the world of business. The findings revealed that 70% of respondents strongly disagreed that Consumers uses business post for their next purchases. This finding controverts with Oyza (2015) who explained that that the information, which is posted, is a helpful source, which may Influence consumer’s decision making. She portrays that people use information on Instagram as the guideline for their future purchase. In addition, Instagram is used as advertising for the marketer. Marketers take this advantage and create marketing strategy, which in turn could help them gain more customers.
The findings indicated that 55% of respondents strongly agreed that use of Instagram has pushed your business towards E-commerce use in conducting business such as internet advertisements. This aligns with the study done by Hubspot (2012) who explained social media like Instagram has been convenient for many people who are trying to market products and services to people online. Actually, social Media Marketing has become a very effective way to drive targeted traffic to companies’ website or blogs.
Effect of Twitter to the Optimization of Small Businesses Performance
Twitter enables companies to network with customers in order to build relationships and achieve a better understanding of customer needs (Halligan et al., 2009). This study was similar to the findings where by 41% of the respondents strongly agreed that customers can influence products through twitter. However 36% of respondents strongly disagreed that using Twitter encourage better understanding of customer’s needs.
Moreover findings also indicated that 50% of respondents disagreed to large extent that Twitter enable easy reaching of customers and 61% of respondents strongly disagreed that Twitter has increase the consumer purchasing decision in your business . This refuted with a study done by De Vies et al. (2012) who portrayed that small firms are generally at an advantage because their small size makes it easier to get close to customers and obtain valuable feedback. He further explains such an advantage enables small businesses to take advantages of the marketing opportunities networking like use of twitter and word of mouth marketing provide.
The findings revealed 95% of respondents disagreed, using Twitter in business has cut down the cost of operation. These findings contradicts with a study done by (Levinson & Gibson, 2010) who observed the cost effective marketing solution used by the businesses is twitter. The social media marketing tools can be freely and easily used compare to other promotion tools.According to Hubspot (2012) 57% of small and medium businesses say social media like twitter is beneficial to their business by improving the brand identification to the society. This is indifferent with the study in which 75% of respondents when starting using Twitter in marketing your business you have been modifying your brand since then.
The findings revealed that 61% of the respondents disagreed to large extent that Twitter enables easy interaction with customers. The findings also indiacted 57% of respondents disagreed that when starting using Twitter in marketing your business you have been increasing the number of sales.Moreover the findings matches the findings of Mangold and Faulds (2009) who explained a unique role of twitter is to create Buzz marketing, that enabling customers to talk to one another is, in a sense, an extension of traditional word of mouth communication.
Conclusions
Effect of Facebook to the Market Accessibility for Small Businesses Performance
Regarding brand awareness, majority of the respondents agreed that Facebook has enable increase in brand awareness of your products and services. However, a large number of respondents strongly disagreed that Facebook helps customer identify Facebook with SME’s product brand. This indicated that majority of respondents in this study disagree that Facebook leads to brand awareness of small business only the large companies. The study analyzed the how facebook affects the purchasing power. Majority of respondents agreed that customers visit different business pages before purchasing a product and promotions and discounts displayed on the business Facebook page increases sales.
On environmental preservation, majority of respondents strongly disagreed that Facebook has led to less environmental use in conducting your business and they disagreed that Facebooks promotes green retailing such as reduction of packages. This implies that Facebook leads to environmental preservation.
Lastly, the study examined how Facebook leads to increase customer relationship, majority of respondents agreed Facebook has increase close customer relationship with your business. However, majority of respondents that Facebook disagreed has become a major source of interactive with your clients. This implies majority of respondents agreed that Facebook leads to customer relationship.
Effect of Instagram to the Market Accessibility for Small Businesses Performance
On engaging with customers majority of respondents disagreed that Instagram has enable your business to engage easily with customers by sending samples, adverts etc, however majority of respondent strongly agreed that Instagram enables business to connect deeper with the consumer. This implies that Instagram leads to engagement with customers. Modification in Marketing Strategies, majority of respondents agreed that Instagram has modify your marketing strategies and push to internet marketing. Respondents further agredd that Instagram enables business to communicate open and clear messages and Instagram led to more creativity in advertising and personal selling when meeting customer’s needs.This implies that Instagram leads to modification of marketing strategies.
On influence on buying decision , majority of the respondnets agreed that Instagram has influence buying decision to customers and increase more selling.Respondents also agreed that Consumers uses Instagram to connect to the world of business.This indicates that respondents agreed that Instagram leads to influencing buying decision. The influence of e-commerce on customers, majority of respondents agreed that Use of Instagram has pushed your business towards E-commerce use in conducting business such as internet advertisements. Respondents also agreed that it is easy to connect with your customers through Instagram when passing marketing information. This indicate that Instagram has lead to incrrease of e-commerce.
Effect of Twitter to the Optimization of Small Businesses Performance
On understanding customer needs, majority of respondents strongly agreed that Customers can influence products through twitter. Moreover majority of respondents agreed that Using Twitter encourage better understanding of customer’s needs. Easy reach to customers, a large number of respondents strongly disagreed that Twitter enable easy reaching of customers. Moreover, respondents strongly disagreed that twitter has increase the consumer purchasing decision in your business this indicates that twitter does not help business to reach their customers.
On low operating cost, majority of respondents disagreed that using Twitter in Business has cut down the cost of operation. Finally, on interaction with customer’s majority of respondents disagreed that Twitter enables easy interaction with customers. Moreover, respondents disagreed that when starting using Twitter in marketing your business you have been increasing the number of sales and using Twitter to market for your business convenient especially with the environment you live. Thus majority of respondents disagreed that Twitter enables interaction with customers.
Recommendation
Recommendation for Improvement
Effect of Facebook to the Market Accessibility on Small Businesses Performance
The study is recommending that for small business to succeed, Facebook should be used as a marketing tool for products and services. Customers spend most of their time on Facebook and it is where business will meet new customers getting feedback on how the customers want to be satisfied. Satisfactions of customers always come from their expectation and not every business know if they meet that satisfaction unless they get feedback from the customers. Facebook marketing made that possible by giving customers a way of talking to their provider that is the business.
Effect of Instagram to the Market Accessibility for Small Businesses Performance.
Small business should make sure that the complaints of the customers through Instagram are answered and changes should be made to satisfy the customers and not to destroy company’s image. More complaints than satisfaction from customers’ means that the small business has no future if the complaints are not responded by taking actions to fix it. The business should go through the customers’ feedback answer their questions and promise them that problems will be fixed in order to build trust between them and your small business.
Effect of Twitter to the Optimization of Small Businesses Performance
The study recommends that, business should make use of Twitter to keep their customers close by updating them with the product information and not only telling them what service and product they offer but also why that particular product and service are offered by the business. Small businesses need to learn more on how to communicate with their customers and the usage of Twitter. Small businesses can use examples of big businesses that use Twitter to market their services and products.
Recommendation for Further Studies
The study targeted only targeted social media and market accessibility of small business. The study suggests that future researchers can be conducted to analyze more determinants of social media on small business to make the research more authenticated and realistic. In addition to that, future researchers can add on knowledge gap on the discrepancies of how social media can be used in optimization of small business.
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