Social Media - Communal and consumption perspectives

COMMUNAL AND CONSUMPTION PERSPECTIVES PREPARED BY Michael Ling OF SOCIAL MEDIA – A LITERATURE REVIEW Communal and Consumption Perspectives of Social Media A Literature Review Prepared by Michael Ling Email: msc_ling@yahoo.com.au May 1, 2010 Page 1

COMMUNAL AND CONSUMPTION PERSPECTIVES PREPARED BY Michael Ling OF SOCIAL MEDIA – A LITERATURE REVIEW Introduction Social media is a product of Web 2.0 platform, which is an evolving technology, that basically allows interactivity and creation of user-generated content (UGC) such as text, video, audio and pictures in the Internet (Sankar & Bouchard, 2009). It can be broken down into a number of major categories: blogs, social networks (including online communities), newsgroups/forums, podcasting, online video, photo sharing, Wikis, instant messaging, instant messaging and virtual worlds (Carrabis et al., 2008). Social media, as defined by Solis & Breakenridge (2009), is “the democratization of content and the shift in the role people play in the process of reading and disseminating information”, which opens up opportunities for people to create contents or participating in the creation of contents. Most of the contents are publicly accessible and open for review and criticism. According to Wiki (2010), some of the popular social networking sites are Facebook, Bebo, Twitter, MySpace, Linkedin, Hi5, Tagged, XING, Badoo, Orkut, Friendster and renren. Facebook, for example, has 400 million active users with 50 percent of which are active users on any given day, has more than 5 billion pieces of content shared each week. People who participate in social media share their personal ideas, opinions and feelings with others whom they might not have physically met. Apparently, there are no good reasons for them to behave in such manners except for the fact that they are „connected‟ or „networked‟ to others in the World Wide Web via some sort of social networking sites or online communities (Newson et al., 2008). The Marketing Perspectives Is social media merely another marketing channel to which we can apply our existing theories and practices in marketing? Following is a brief discussion from a number of marketing perspectives. It has been argued that social media or „new media‟ is different from the “marketing model of mass media” (Maymann, 2008) and hence the “old rule of marketing‟ (Scott, 2007) is not applicable. Both refer to the traditional theory and practice of marketing that is largely built upon the “economic exchange framework” between an organization and its customers (Firat & May 1, 2010 Page 2

COMMUNAL AND CONSUMPTION PERSPECTIVES PREPARED BY Michael Ling OF SOCIAL MEDIA – A LITERATURE REVIEW Dholakia, 2006), where marketing organization assume dominant control over the marketing communication channels as well as the contents that are conveyed to their customers. Weber (2007) contrasts the main differences between traditional marketing and social media marketing, for example: (i) one-way, one-sided and undifferentiated marketing messages vs. transparent, trustworthy dialogues and relationship building; (ii) traditional demographic segmentation fails as internet consumers tend to group themselves by attitudes and interests; (iii) professional contents created and controlled by marketers vs. a mix of professionally and user- generated content; (iv) marketing information is organized into hierarchies vs. information is unstructured and available-on-demand. I agree with Weber that there are differences between the old and new media. Social media has certainly offered customers increasing power of control over what they want to read and watch online, has attributed to the popularity of user-generated contents, and has phased out the traditional print media. The new media is being pulled by consumers, rather than being pushed. For example, YouTube and Flickr give full control to users on what videos or pictures they wish to look at. Aside the traditional marketing perspective, Gronroos (1997, 2007) takes a different approach, or so-called relationship marketing approach, by emphasizing the need to do marketing differently as organizations face an increasing number of new challenges. He defines marketing as “the process of establishing, maintaining, enhancing, and when necessary terminating relationships with customers and other stakeholders, at a profit, so that the objectives of the parties involved are met, where this is done by a mutual exchange and fulfillment of promises”. Gummesson (1987, 1994) emphasizes the aspects of relationships, networks and interactions in the relationship marketing approach. Relationship marketing, whose focus on relations and networks, seems to be relevant to our study of social media marketing. The International/Industrial Marketing and Purchasing Project (IMP) group takes an integrated interaction and network approach to study the industrial markets (Hakansson and Snehota, 1995). Though the emphasis of the IMP group is mainly business-to-business marketing, its network approach is worth considering in our research. As a basic understanding of consumer segments and the underlying social motivations is key to achieving the right market orientation (Kohli and Jaworski, 1990), it is important to explore the May 1, 2010 Page 3

COMMUNAL AND CONSUMPTION PERSPECTIVES PREPARED BY Michael Ling OF SOCIAL MEDIA – A LITERATURE REVIEW consumer characteristics in social media. What are some of the common characteristics and behaviors of online consumers? Are they different from the non-users or infrequent users of social media? How can we better understand online consumers? The New Consumers Online or „virtual‟ communities, as defined by Rheingold (1993) are “a social aggregation of people carrying out public discussions long enough, with sufficient human feeling, to form webs of personal relationships in the cyberspace”. Rheingold‟s definition is unique in the sense that he introduces the emotional and human relationship elements into a virtual community, which is a type of computer-mediated communications. These virtual communities have grown and evolved into social media today. Social media sites allow users to create their personal profiles, share information, watch photos and videos, connect with other people, play games, set up fan clubs and become fans of a celebrity or a brand (Percival, 2008). Corporations such as McDonalds, Starbucks and Toyota have already set up fan pages in Facebook that allow them communicate to their target audiences. Kennedy (2009) states that people are interested in becoming members of online communities because they would like “to connect to other people”. As Retteberg (2008) comments, a significant part of the social lives of individuals, especially youths, are actually “happening” online. This suggests that, perhaps, our study should take a multi-dimensional approach that explores the social and communal aspects of their consumption behaviors. In fact, this approach is supported by the tribal marketing perspective, as will be mentioned below. According to Cova (1996), humans are highly individualistic in a postmodern society and tend to differentiate from others through consumption; however, they would be keen to establish relationships with like-minded people in a “desperate search for social links”. On the surface, the argument provided by Cova, who comes from the Post-modernist perspective, seems to fit in quite well with some of the phenomena that are exhibited by online communities. As people can make household purchases from home without making any physical contacts with people outside, they have become, arguably, more individualistic and isolated but, on the other hand, they also have become more communal via their participation in online communities. May 1, 2010 Page 4

COMMUNAL AND CONSUMPTION PERSPECTIVES PREPARED BY Michael Ling OF SOCIAL MEDIA – A LITERATURE REVIEW Sicilia and Palazon (2008) discuss that consumers participating in online communities to satisfy their social and psychological needs, which can be addressed by social media in the following ways: (i) functional value such as information and advice; (ii) social value such as self-esteem, friendship and social status; and (iii) entertainment value. Sheth and Parvatiyar (1995) state that consumers exhibit “a natural tendency to reduce choices, and, actually, consumers like to reduce their choices to a manageable set”, and “individuals compare themselves with a reference group to whom they look for guidance for their own behavior”. In fact, the effects of group conformance and choice reduction have been used to explain social influences on consumer behaviors (Coleman, 1983). Today, we are bombarded by a myriad of sales promotion and advertising, both online and offline, that makes us wonder what the correct purchase decisions should be. Moreover, it is sometimes hard to understand or predict the behaviors of consumers since they are not sure about their own desires and wishes in consumption (Proctor & Kitchen, 2002). Online communities can certainly guide us in this aspect by providing „functional‟ and „social‟ values, as discussed in Sicilia and Palazon (2008) above. Proctor and Kitchen (2002) also comment that consumers constantly adapt the meanings of products to their own needs. Consumers are less interested “in the objects of consumptions” and more interested in “the social links and identifiers that come with them” (Cova, 2002). Their views are further reinforced by Firat and Dholakia (2006), who state that consumption as a continuous “process of transforming the product from the very moment that a consumer takes possession of the product”. The emphasis here is the experiences of the consumers after they have made the purchases, where they are less concerned about the “material values” of the product and more concerned by the “experiential values of activities”. Here, we can see how the „social‟ and „entertainment‟ values of online communities, as suggested in Sicilia & Palazon (2008) above, are closely aligned to the sharing of consumer experiences. Besides the experiential aspect, consumers create their own meanings for consumption objects and perform rituals while using them (McCracken, 1986). Earls (2003) holds that “the dominant view of the consumer as an individual should be replaced with the more accurate model of the consumer as acting as part of a herd.” Tribes are fluid and dynamic where individuals can become members of various tribes and taking different roles within each. They are also free to join and leave any tribes at any time. The concept of tribes has May 1, 2010 Page 5

COMMUNAL AND CONSUMPTION PERSPECTIVES PREPARED BY Michael Ling OF SOCIAL MEDIA – A LITERATURE REVIEW close resemblance to the way that online communities function where individuals can join and leave as they wish. According to Cova (1997) and Cova & Cova (2002), tribes “concentrate on the bonding or linking element that keeps individuals in the group...differ from psychographic segments by their short life span and their diversity”, and “the tribal approach to marketing prefers to recreate and support the relation between customers.” Firstly, it seems that traditional segmentation methods such as demographic or psychographic segmentation are not applicable in this scenario as the composition of online communities invariably changes all the time. Other segmentation methods such as “communal segmentation” (Kozinets, 1999) should be considered. Secondly, the marketing approach should not be directed to individuals but rather to the relationship between them and the communal aspects of the online communities. Simmons (2008) discusses that postmodern consumers hate acting alone but prefer to be part of a community whose members share common interests. Moreover, Cova (1997) raises the point that “the goods and services which are valued are mainly those which, through their linking value, permit and support social interaction of the communal type”. Kozinets (1999), in fact, identifies “virtual communities of consumption” which “explicitly center upon consumption-related interests” and their “affiliative groups whose online interactions are based upon shared enthusiasm for, and knowledge of, a specific consumption activity or related group of activities.” These “virtual communities of consumption” are equivalent to online brand communities, where consumption knowledge is developed in concert with social relations (Walther, 1995). Based on the social and consumption relationship of an individual in online communities, Kozinets (1999) classifies individuals into four types: devotee, insider, tourist, mingler. His framework will be useful to our research in terms of understanding online communal relationships. Social capital is a metaphor that is often used to explain people who are better connected than others can perform well and be successful in societies and markets. Burt (2000) elaborates that “certain people or certain groups are connected to certain others, trusting certain others, obligated to support certain others, dependent on exchange with certain others”, and “holding a certain position in the structure of these exchanges can be an asset in its own right.” It is the resources available to people through their social interactions (Putnam, 2000). It has significant implications to social media marketing. As outlined by Valenzuela (2009), a general assumption is that “patterns of new media use related to information acquisition and community building are positively associated with individual-level production of social capital “. Online communities, May 1, 2010 Page 6

COMMUNAL AND CONSUMPTION PERSPECTIVES PREPARED BY Michael Ling OF SOCIAL MEDIA – A LITERATURE REVIEW such as Facebook and MySpace, are good media for building social capital and, as a result, marketing needs to look at how they can increase individuals‟ social capital by way of facilitating conversations and community formation. In the field of social network analysis, Gladwell (2002) discusses the social context in which ideas spread in social networks. He identifies three types of agents in social networks, where each type plays a specific role in the spread of messages. The „connectors‟, who have numerous social contacts, are capable of spreading messages to a large number of people. The „mavens‟, who are information gatherers, evaluate messages and pass on their evaluations through the network. The „salesmen‟, who are persuaders, are capable of spreading messages through their social network. Though Gladwell‟s theory seems powerful, I take the view that its applications are limited in large and relatively stable networks. However, from the theoretical perspective, he provides a methodological framework for further research into the information flow in online communities. May 1, 2010 Page 7

COMMUNAL AND CONSUMPTION PERSPECTIVES PREPARED BY Michael Ling OF SOCIAL MEDIA – A LITERATURE REVIEW REFERENCES Burt, R. S. (2000) The Network Structure of Social Capital. In Research in Organizational Behavior, 22, edited by Robert I. Sutton and Barry M. Staw. Greenwich, CT: JAI Press, 2000. Carrabis, J., Cass, J., Gillin, P., Natch, R., & Peverill-Conti, G. (2008). New Media, New Influencers and Implications for Public Relations. San Jose: Society for New Communications Research, SNCR Press. Coleman, R. P. (1983). The Continuing Significance of Social Class to Marketing. Journal of consumer Research, 10, 265-280. Cova, B. (1996). What Postmodernism Means to Marketing Managers. European Management Journal, 14(5), 494-499. Cova, B. (1997). Community and Consumption Towards a Definition of the "linking value" of Product or Services. European Journal of Marketing, 31(3-4), 297-316. Cova, B., & Cova, V. (2002). Tribal marketing: The Tribalisation of Society and Its Impact on the Conduct of Marketing. European Journal of Marketing, 36(5/6), 595-620. Earls, M., (2003) Advertising to the Herd: how understanding our true nature challenges the ways we think about advertising and market research. International Journal of Market Research, 45(3), 311-336. Firat, A. F., & Dholakia, N. (2006). Theoretical and Philosophical Implications of Postmodern Debates: some challenges to modern marketing. Marketing Theory, 6(123), 123-162. Gladwell, M. (2000). The Tipping Point: How Little Things Can Make a Big Difference. Little Brown. Grönroos, C. (1997). Value-Driven Relational Marketing: From Products to Resources and Competences. Journal of Marketing Management, 13, 407–419. Grönroos, C. (2007). In search of a new logic for marketing: foundations of contemporary marketing theory. New Jersey: John Wiley & Sons. Gummesson, E. (1987). The New Marketing – Developing Long-Term Interactive Relationships. Long- Range Planning, 20, 10-20. Gummesson, E. (1994). Making Relationship Marketing Operational. International Journal of Service Industry Management, 5(5), 5-20. Hakansson, H. and Snehota, I. (1995). The burden of Relationships or Who‟s next? In P. Turnbull, D. Yorke and P. Nande (eds) IMP Conference Proceedings: Interaction, Relationships, and Networks. Manchester: Manchester Federal School of Business and Management, 522–36. Kennedy, S. (2009). I came, I saw, I tweeted. InformationToday:The newspaper for users and producers of electronic information services, 26(6),17-20. May 1, 2010 Page 8

COMMUNAL AND CONSUMPTION PERSPECTIVES PREPARED BY Michael Ling OF SOCIAL MEDIA – A LITERATURE REVIEW Kohli, A. K., & Jaworki B.J. (1990). Market Orientation: The Construct, Research Propositions, and Managerial Implications. Journal of Marketing, 54(April), 1-18. Kozinets, R. V. (1999). E-tribalized Marketing? The Strategic Implications of Virtual Communities of Consumption. European Management Journal, 17(3), 252-264. Maymann, J. (2008). The Social Metropolis. GoViral ApS:http://www.goviral.com/orderBook.php. McCracken, G. (1986). Culture and Consumption: A Theoretical Account of the Structure and Movement of the Cultural Meaning of Consumer Goods. Journal of Consumer Research, 13, 71-84. Newson, A., Houghton, D., & Patten, J. (2008). Blogging and Other Social Media: Exploiting the technology and protecting the enterprise. Farnham, UK: Gower Publishing Limited. Percival, S. (2008). MySpace Marketing: Creating a Social Network to Boom Your Business. Que Publishing. Proctor, T., & Kitchen, P. (2002). Communication in Postmodern Integrated Marketing. Corporate Communications: An International Journal, 7(3), 144-154. Putnam, R. D. (2000). Bowling alone: The collapse and revival of American community. New York: Simon and Schuster. Retteberg, J. W. (2008). Blogging. Cambridge: Polity Press. Rheingold, B. T. (1993). Virtual Community: Homesteading on the Electronic Frontier. Cambridge, MA: The MIT Press. Sheth J. N., Parvatiyar A., (1995). Relationship Marketing in Consumer Markets: Antecedents and Consequences. Journal of the Academy of Marketing Science, 23(4), 255-271. Sicilia, M., & Palazón, M. (2008). Brand communities on the internet: A case study of Coca-Cola's Spanish virtual community. Corporate Communications, 13(3), 255-270. Solis, B., & Breakenridge, D. (2009). Putting the Public Back in Public Relations: How Social Media is Reinventing the Aging Business of PR. New Jersey: FT Press. Sankar, K., & Bouchard, S. A. (2009). Enterprise Web 2.0 Fundamentals. Indianapolis: Cisco Press. Simmons, G. (2008). Marketing to Postmodern Consumers: Introducing the Internet Chameleon. European Journal of Marketing, 42(3/4), 299-310. Walther, J. B. (1995). Relational Aspects of Computer-mediated Communication: Experimental Observations over Time, Organizational Science, 6, 186-203. May 1, 2010 Page 9

COMMUNAL AND CONSUMPTION PERSPECTIVES PREPARED BY Michael Ling OF SOCIAL MEDIA – A LITERATURE REVIEW Weber, L. (2007). Marketing to the Social Web: How Digital Customer Communities Build Your Business. New Jersey: John Wiley & Sons. Wiki (2010). http://en.wikipedia.org/wiki/Social_network; last assessed at 9.25pm 26/4/2010. Valenzuela S., Park N., and Kee K. F. (2009). Is There Social Capital in a Social Network Site?: Facebook Use and College Students‟ Life Satisfaction, Trust, and Participation. Journal of Computer- Mediated Communication, 14, 875-901. May 1, 2010 Page 10

Social Media - Communal and consumption perspectives

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