Week 3Turban Chapter 3Tuten Chapter 1Supporting Theories a

Week 3
Turban Chapter 3
Tuten Chapter 1
Supporting Theories and Concepts for Social Commerce
Learning Objectives
Describe the factors that influence online consumer behavior.
Understand the decision-making process of consumer online
shopping & other related theories.
Explain how consumer behavior can be analyzed for creating
personalized services.
Describe online word of mouth and its benefits.
Define online engagement and describe its influence on social
trust.
Describe social psychology theories relevant to social
commerce, social network analysis, the social graph & social
capital.
Opening Case: Netflix Increases Sales Using Movie
Recommendations by Customers
The Problem
Customers often have difficulty deciding what they want to
watch so they choose the most recent and popular titles
The
Solution

Using the “recommendation algorithm” compares an
individual’s preferences with people that have similar tastes by
using the collaborative filtering software
Opening Case: Netflix Increases Sales Using Movie
Recommendations by Customers
The Result
Effective recommendations – 60% follow
75% watch based on recommendation
Customer satisfaction – 90%
Finance – growth in membership
Ratings – 3.5 billions ratings
Lessons Learned from the Case
This case illustrates the use of collaborative filtering to
influence customers
Netflix’s recommendation algorithms (AI) are designed to
increase customer satisfaction and loyalty
Netflix gained a substantial advantage over its competitors

Learning Objectives
Cultural
culture
sub-culture
social class
Social
groups
social network
family and household
roles and status
Personal
age
life-cycle
occupation
economic situation
life-style
personality
self-concept
Psychological

motivation
perception
learning
beliefs and attitude
Need recognition
Info search
Evaluation of alternative
Post-purchase Behaviour
Purchase

Figure 3.1 EC Consumer Behavior Model
Learning Objectives
The Consumer
Purchasing-Decision Process

The AIDAS Model
A—Attention (awareness)
I—Interest
D—Desire
A—Action
S - Satisfaction
Five steps of Purchase Decision Making Process:
Need identification: notification.
Information Search: Product brokering (e.g. electronic catalog)
or merchant brokering (google).
Evaluation of alternatives: comparison, samples, etc.
Purchase and delivery: ordering, payment, delivery.
After-purchase evaluation: customer support, installation,
returns, etc.
<More on week 7 Social Shopping>
Consumer Purchasing-Decision Process
Impact of Internet Media on Purchase Decision Process
Inform. search
Inform. search
Social Media

Social Media
Social Media e.g SCRM, Ratings, Chatbot
Social Media e.g. Blogs, Influencers, Artificial Intelligence
AI
Marketing objectives and social media
Increase
awareness
Influence
desire
Encourage

trial
Facilitate
purchase
Cement
brand loyalty
Recover
from service failures

Roles people play in decision-making
(It is a participatory process – social commerce)
Initiator—suggests/thinks of buying a particular product or
service
Influencer—advice/views carry weight in making a final buying
decision
Decider--makes a buying decision or any part of it
Buyer—makes the actual purchase
User—consumes or uses a product or service
Who do you think has the strongest influence on purchase?

Learning Objectives
Behavioural Targeting and Personalization
Behavioural targeting using personalization to influence
consumer to conduct social commerce
Personalization: Process of matching content, services, or
products to individuals’ preferences
Alternative methods
Solicit information from users profile
Use clickstream data
Collaborative filtering
Collaborative filtering (big social data analytics)
A personalization method that uses customer data to predict,
based on formulas derived from behavioral sciences, what other
products or services a customer may enjoy; predictions can be
extended to other customers with similar profiles or in the same

social group
Micro marketing – targeting individuals based on his/her needs.
Make use of personalization technology.
16
Example of Collaborative Filtering
This is why the Facebook login
Learning Objectives
Word of Mouth in Social Commerce
Word of Mouth marketing(WOMM): person-to-person

communication. Viral marketing
Targets WOMM to influencer with many connections.
The Benefits of WOM
Metcalfe’s Law Value of Network proportionate to N square
90% trusts WOMM
67% spend more money because of WOMM
44% of purchase are influenced by WOMM
Awareness, brand health, engagement, action, innovations
19
Figure 3.3 The Process of Digital WOM
Word of Mouth in Social Commerce
Viral Videos
How to make your video content go viral
https://www.youtube.com/watch?v=lEn_YCY4tKM
Life of an entrepreneur in 60 seconds
https://www.youtube.com/watch?v=h-KHWUq3B7I

What Makes Content Go Viral?
http://mashable.com/2011/12/03/viral-
infographic/#P4eVztHwpEqo
What makes a content viral?
22
Learning Objectives
trust.

Online Consumer Engagement & Trust
Online customer engagement - “Engagement of customers with
one another, company or a brand. Consumer or company led”
The Benefits of Engagement
Increase customer trust
Customer interaction and awareness
Quick response to consumer changing needs
Leverage on customer contribution – crowdsourcing
Increase satisfaction & loyalty to existing customers.
Reduce operating cost (gain market insight).
Trust: Psychological status to pursue further interactions to
achieve a planned goal
Ratings, comments, liking, social shopping, online public
relations – cause marketing, authoritative articles,
conversational marketing, crowdsourcing, etc.
24
Social Media don’t drive sales but engagement
Video: “How Do You Define Online Engagement? – Social
Media Camp 2011 Ep#36” at youtube.com/watch?v=sF0U-
OYuKFU
Read https://conversionxl.com/how-to-use-social-media-to-

drive-sales & http://marketingland.com/report-fewer-than-1-of-
sales-can-be-tracked-back-to-social-media-22708
SM in SN drives engagement (attention, interests & desire)
leading trust (in going to your website for further action).
MOTIVATIONS OF PARTICIPATION IN SM
Less than 5% of sales derived directly from SM
25
Affinity
1
Contact, comfort & immediacy
3
Altruism
4
Curiosity
5
Personal utility
2

Validation
6
The SMM functions

26-1
Q. How companies increase consumer trust in using social
commerce?
26
Value Creation and the Marketing Process
Step 1
Step 2
Step 3
Step 4
Step 5
Marketing Definition: The process by which companies engage
customers, build strong relationships, and create value in order
to capture value from customers in return.
‹#›
27

Learning Objectives
trust.
Describe social psychology theories relevant to social
commerce, social network analysis, the social graph & social
capital.
Social Psychology Theory
Social psychology - “the study of the manner in which the
personality, attitudes, motivations and behavior of the
individual influence and are influenced by social groups.”
(Merriam-Webster dictionary)
Social Commerce Psychology – “harnesses the human capacity
for social learning , i.e. learning from the knowledge and
experience of others we know and/or trust &… profit from
social situation” (Marsden 2009 ).
Video: “Social Psychology: Milgram study on obedience to

authority
https://www.youtube.com/watch?v=yr5cjyokVUs
Social Psychology Theory Applied
The Universal Heuristics of Shopping (Robert Cialdini , 2008),
Shoppers use thin sliced information:
social proof (follow the crowd)
authority (follow the authority)
scarcity (scarce products must be good)
liking (follow those you like)
Consistency & commitment after agreeing e.g. StickK
reciprocity (repay favors e.g. get RM10 coupon).
https://www.youtube.com/watch?v=0qelyk_mWBs
Social Network Theory (1950s)
Social network – a structure that describe social relationships &
flows of info & activities among participants in a community.
Social network analysis (SNA) - measuring of both relationships
and information flows among groups, organizations, and other
connected.
Social Network Theory and Analysis

Figure 3.5 A Simple Social Network Structure
(There are only three connections between You and Me)
Social Graphs (using SN Analysis software)
The mapping of relationships and information flows among
people, groups, organizations, computers, and other
information- or knowledge-processing entities in SN. The nodes
in the network are the people and groups, whereas the links
show relationships or flows between the nodes. Social graphs
provide both visual and mathematical analyses of relationships.
What is the use?
9-33
Social Capital
Help to find friends.
Finding influential bloggers. Knowing the size of an interest.
Determine the importance of a person and a topic.
This is use to find associate bloggers for their product or
services and to get support to advertise their products by

clicking the like button or to comment about their products and
services.
Find the best person for WOM advertisement
33
Twitter social graph. Colors represent different
communities.
Which are the most influential persons? Who can help to
link to other community?
9-34
The Benefits of Social Network Analysis
Identify the individuals, teams, and subgroups who play the
influencers roles in social networks.
Leverage peer support e.g. crowdsourcing
Market insight on an individual or group (Big Social Data)
Help to refine SC strategy e.g. targeted segment
Find information flow problems and identify those who are not
getting information properly as a result of the problems
(collaborative problem solving)

social capital
social networks have value; just as physical capital or human
capital can increase productivity (both individual and
collective), so do social contacts affect the productivity of
individuals and groups. Why?
Metcalfe Law -Value of Network proportionate to N square
7-36
Digital democracy – add value by recommendations, rating,
creating content, products, crowdsourcing, collective
intelligent, network effect – more users, more value an
application. E.g. Dota2, Skype.
All of these are useful for Social Media Marketing e.g WOM,
getting premium users to encourage free users to convert. E.g.
Skype – group conference.
36
9-37

37
An architecture of participation and digital democracy
encourages users to add value to the application as they use it.
The ability to tap into the collective intelligence of users.
Example?
Data is made available in new or never-intended ways. Why?
Relies on user-generated and user-controlled content and data.
How are they useful to companies?
9-38
SOCIAL CAPITAL - CHARACTERISTICS OF SM
Crowdsourcing – Wikipedia, DellIdeaStorm, Living Social,
Users are excited to share their personal data.
Data useful for profiling, targeted advertisement, developing
new products, better service to customers, etc.
Provide reviews and ratings. Add application e.g. google map
(marshup). Create products/services (virtual goods in social
games); Provide Intelligence; Bring Crowd (WOM
advertisement); More users more value (e.g. Skype, Dota 2);
Pinterest – add value by adding pins related to an interest;
marketer can profile consumer better.

38
Chapter 6
Social Shopping:
Concepts, Benefits, and Models
1-2
Unit objectives
1. identify the various tools of social media and describe how
those tools are used to engage customers
2. identify, analyse and critically assess the suitability of
various social commerce models and strategies for various e-
businesses
3. explain the various principles and theories of social
commerce
4. describe, explain and propose the appropriate marketing
communication that could be conducted in various social
commerce models
5. describe how social commerce aids customer relationship
management
6. explain and understand the implementation issues in social

commerce.
Learning Objectives
Define social shopping & discuss its drivers, concept,
participants & benefits.
Describe how do social shoppers use social media as they move
through the consumer decision-making process? Which social
commerce elements (shopping tools) should marketers employ
to meet social shoppers’ needs?
Describe models and components of social shopping .
Define group buying and flash sales
Describe shopping communities & collaborative shopping.
Describe social recommendations
Describe social marketplaces
Definitions, Drivers, Concepts,
and Benefits of Social Shopping
Social shopping is defined as “online shopping with social
media tools and platforms and sharing shopping experiences
with friends.”
Uses key features of social media (e.g., discussion groups,
blogs, reviews, etc.) and uses them before, during, and after

online shopping.
The Drivers of Social Shopping
The large number of people visiting social networks attracts
advertisers.
Changing customers’ shopping habits
The increasing number of recommendations /suggestions made
by friends/others
The pressure from top management to increase effectiveness and
efforts to improve overall efficiency of marketing. Why social
shopping improve efficiency?
More and more using online social shopping features e.g. use
reviews, ratings – thanks to Agoda, booking.com
More people trust reviews particularly from friends and family
members
5
Figure 5.3 Proportion of Consumers Expressing Trust in Media
Sources:

Nielsen Trust in Advertising Survey 2011 (blog.nielsen.com)
Edelman Global Trust Barometer (trust.edelman.com)
Vision Critical Study (U.S. only) (womma.org)
(Strauss & Frost 2014)
http://www.edelman.com/insights/intellectual-property/2014-
%20edelman-trust-%20barometer/about-trust/global-results/
Concepts of Social Shopping
Where Is Social Shopping Done? Social Network, existing EC
site, social marketplace and shopping communities
How? 2 ways company perform social shopping:
Add e-commerce functionalities (e.g., e-catalogs, payment
gateways, shopping carts) to social network sites.
Instagram/Instagram, “shop now” button.
Add social software, apps, and features (e.g., reviews, ratings,
voting, etc.) to existing e-commerce sites.

https://www.facebook.com/pg/LazadaMalaysia/shop/?ref=page_
internal
Why Shoppers Go Social
Communal shopping - method of shopping where consumers
enlist friends and other people they trust to advise them on what
products to shop for.
This results in more confidence in the decisions they make—
whether or not to buy (social proof or a phenomenon known as
the “bandwagon effect”).
Social Commerce Psychology – “harnesses the human capacity
for social learning , i.e. learning from the knowledge and
experience of others we know and/or trust &… profit from
social situation” (Marsden 2009 ).
Social Psychology Theory Applied
The Universal Heuristics of Shopping (Robert Cialdini , 2008),

Shoppers use thin sliced information:
social proof (follow the crowd)
authority (follow the authority)
scarcity (scarce products must be good)
liking (follow those you like)
Consistency & commitment after agreeing
reciprocity (repay favors e.g. get RM10 coupon).
https://www.youtube.com/watch?v=0qelyk_mWBs
Social shopping tools are designed with these influence factors
to facilitate consumer movement through the purchase decision-
making process.
Participants (Who?)
People’s Roles in Social Commerce
Connectors: people with contacts that
introduce people to each other
Salespeople: influence shoppers to buy
Seekers: consumers seek advice
Mavens: recognized, but unofficial experts who can provide
positive or negative recommendations to people who are seeking

advice
Benefits of Social Shopping
Benefits to Buyers
Get super deals via group buying, daily specials
Socialize while shopping and receive social support and rewards
Discover products/services you never knew existed
Interact directly with vendor (brand) representatives easily and
quickly e.g. chat
Benefits of Social Shopping
Benefits to Sellers
Improve overall sales unit productivity - how?
Gain feedback from new customers e.g. rating of products and
sellers
Learn from customers e.g.
https://www.youtube.com/watch?v=1ByDmQICXs4
Increase customer loyalty and trust - why?
Quickly liquidate overstocked or obsolete merchandise e.g.?
Friend recommend friend; influence of ratings and comments;

viral marketing through share/tagging to FB, twitter, etc.
Monitor and magnet – listening to customers’ needs, interacting
with them and creating and communicating value based on
needs.
14
Learning Objectives
commerce tools should marketers employ to meet social
shoppers’ needs?
Describe shopping communities& collaborative shopping.
Describe social recommendations & marketplaces
Provide examples of other innovative shopping models.
The consumer decision-making process (Tuten)
Problem recognition

Information search
Alternative evaluation
Purchase
Post-purchase evaluation
Stage 1: Problem recognition
Problem recognition is facilitated by several social commerce
tools:
Social ads on social networking sites
Shared endorsements from friends posted in activity streams
Curated images and lists on sites like Pinterest
Location-based promotions (e.g., Yelp)

Participatory commerce (e.g., Threadless, Betabrand)
Betabrand crowdsources product design using social media, an
approach called participatory commerce.
One success story is its “dress yoga pants” which solve the
problem women face when dashing from work to yoga class!
Credit: iStock.com /Dragonimages
Stage 1: Problem recognition
Stage 2: Information search
Information search, ZMOT, is facilitated by several social
commerce tools:
Comments and conversations throughout social channels
Ratings and reviews posted on sites (e.g., Yelp, Zagat,
Citysearch)
Product and pricing information tagged to image posts
Social search queries on social network sites
Social sharing of wish lists and gift registries
Conversational commerce (chatbot services)

The prevalence and availability of information online, including
via social channels, have changed the information search
experience.
Tuten, Tracy (TT) - it would be good to use this if possible. it is
from Google's ZMOT information. Or to reconstruct if that
would be permissable.
The power of ratings and reviews
95% of consumers report having read reviews prior to making a
purchase decision.
66% of consumers read 1–10 reviews before making a purchase.
70% of mobile shoppers are more likely to purchase if the
mobile site includes reviews.
82% seek out negative reviews as an indicator of authenticity.
60% have viewed a review on their smartphone while shopping
in-store.
Transparency in reviews
81% difficult to distinguish what is authentic user content
21% have seen customers be paid or incentivized to post a
positive review

Research found only 1.5% legitimate review! Mostly are
incentivize reviews.
Most people believes reviews from their friends and relatives
Large volume reviews are more believable.
Small volume reviews – user rely on expert reviews.
22
Stage 3: Evaluation of alternatives
Evaluation of alternatives based on certain criteria is facilitated
by several social commerce tools:
Bar code scanning/price comparisons using mobile phone apps –
Amazon price check
Recommendations, testimonials, recommendation agents, and
popularity filters
Ratings and reviews
Stage 4: Purchase
Purchase, FMOT, is facilitated by several social commerce
tools:
Social shopping malls (e.g. Lazada, Shoppee)
Shop within network options (e.g., Facebook Buy, InstaShop,
Snapchat Deeplinks)

Social Bookmarking Sites (Pinterest, Wanelo)
Group buys (e.g. Groupon)
Conversational commerce (chatbot services)
Stage 5: Post-purchase evaluation
Post-purchase evaluation, SMOT, is facilitated by several social
commerce tools:
Comments posted on social network sites
Request for help or comment to brand on social network sites
Participation in loyalty program
Submission of ratings and reviews on retailer website
Reviews and product experiences posted on blogs
Learning Objectives
commerce elements should marketers employ to meet social
shoppers’ needs?

The Major Models of Social Shopping
& Innovative models
27
Components in a Social Shopping Site
Visual Sharing. Photos, videos, and images enable shoppers to
visually share the product.
Online discussions. Ratings, reviews, interactions,
recommendations, blogging, and comments facilitate
discussions regarding features and benefits of products.
How to use products. These demonstrate, via videos, blogs, and
step-by-step instructions, how to use products.
Guides. Guides are created by user-generated content (UGC).
The users can be experienced consumers, experts, or employees.
Shopping Mechanism: Shop button

Learning Objectives

shoppers’ needs?
Describe shopping communities, shopping clubs, &
collaborative shopping.
Group Buying
Group buying model describes a group of people who come
together to get a quantity discount e.g. Deals Malaysia,
Groupon
Group buying in China take on the culture from physical
collaborative buying
https://vimeo.com/8619105
Very competitive – Gaopeng, Meituan, Tencents, Taobao
https://www.youtube.com/watch?v=UvWU8-NDUWY
Why Groupon closed its group buying channel?
2000 group buying companies in China
33

Crowdsourcing – getting the numbers
34
Deal Purchasing
Deal Purchases are Flash Sales & Daily Deals
e.g. Catch of the Day, Groupon
Daily Deals are limited time offer in one city e.g. Big Sale
Why is it possible for the merchant to sell cheap in flash
sales/daily deals?
https://www.catchoftheday.com.au/

http://deals.bigsale.com.my/
Learning Objectives
shoppers’ needs?
Online Social Shopping Communities
Like minded people share, discuss & help each other in their
shopping. Not necessary to have a shopping mechanism.
Common Features in Shopping Communities
User forums: Discussion, comments, ratings, likes, voting, etc

Galleries: image, videos, products by hosting companies for
discussion e.g. items in Polyvore (now Klook)
Idea boards: crowdsourcing e.g. sets in Polyvore
Q&A
Examples of Shopping Communities
Polyvore (polyvore.com) now replaced by
https://shoplook.io/home
https://vimeo.com/7800846
Lowyat.net – technological products
Polyvore (now shoplook)
User/Merchant create set (crowdsourcing) including celebrity
like Lady Gaga
Set get evaluated (crowdsourcing)
Encourage social shopping
20 million visitors, 2.2 million items, 3 million sets
Also include interior design

https://shoplook.io/home
https://www.lowyat.net/
Collaborative Shopping
Using IBM software, shoppers can invite friend to shop together
in real-time. Two shoppers are synchronized in all they do.
Watch video https://www.youtube.com/watch?v=HIp4S4zTzMk
Learning Objectives
participants and benefits.
Define group buying and flash sales.
Describe social recommendations & marketplaces.

Recommendations sites
Customer ratings and reviews. found on product (or service)
review sites (e.g., yelp.com, viewpoints.com, reevoo)
Customer testimonials. Customer experiences are typically
published on vendors’ sites, and on third party sites such as
TripAdvisor.
Conversational marketing. People communicate via e-mail,
blog, live chat, discussion groups, and tweets. Monitoring
conversations may yield rich data for market research and
customer service e.g. Dell Monte Food
Video product review. Reviews can be generated by using
videos through communities such as Youtube.
Sponsored reviews. These are written by paid bloggers or
domain experts.
Which zones – Social publishing – yelp, reevoo, youtube,
sponsored review/blogs
Social commerce – customer review and testimonial,
conversational marketing (Del Monte food).
45

https://www.yelp.com/biz/restoran-kin-kin-kuala-
lumpur?osq=Restaurants
Social Recommendations
Recommendations from someone you know
Social Bookmarking: Pinterest – pin boards of recommended
products/services; Wanelo – like Pinterest but focused on
shopholics. For both buyers and sellers.
https://www.youtube.com/watch?v=Z2A2F6rNatA
Personal Social Recommendations: recommend a friend using
Facebook connect - Netflix
Referral programs: Groupon recommend a friend to buy.
booking.com, agoda, etc.
Collaborative filtering: algorithm based on people like you e.g.
Lazada, Netflix. Use filter “people like you” in Reevoo

Social Marketplaces
A many-to-many marketplace that enables buying and selling.
Intermediary that provides infrastructure & procedure for
transactions including display, discovery, interaction,
comparison & payment
Different from shopping community which focus on discussion
helping the shoppers to share/solve problems
E.g.
Lazada, Shoppee, Ebay
craigslist.org – classified ads
us.fotolia.com – trade photos and image
flipsy.com – trade anything but using buy back model
Week 5
Chapter 4
Marketing Communications
in Social Media
(Owned and Paid Media)
1-2

Unit objectives
businesses
commerce
commerce models
management
commerce.
Learning Objectives
List five promotional mix in Marketing Communications
Explain the ways brands utilize social networking communities
for branding and promotion. What characteristics do brand fans
exhibit?
List and define the six social media promotion steps.
Explain how to select social platforms to achieve campaign

objectives.
Compare and contrast the essentials of owned, paid and earned
media.
Explain how to use owned social media channels for Press
Release
Explain the paid media i.e. advertising formats for social media.
Opening Case: Johnson & Johnson Uses New Media Marketing
The Problem
JNJ is a healthcare, medical devices & diagnostic company.
With high Internet and mobile usage, it is important for
companies to use online communication tools to reach, promote
and support its customers
Opening Case: Johnson & Johnson
Using Internet Media Channels
JNJ News, JNJ cares blog, JNJ Health Channel (Youtube), JNJ
#howloveworks & Facebook account “caring for the world, one

person at a time”
J&J donated $1 to the Global Fund to Fight Aids for every
person who shared on social media (retweeting, pinning, etc.)
mashable.com/2013/06/10/share-red-campaign
Mobile Advertising Campaigns
Johnson & Johnson ACUVUE campaign with “Saving Momo”,
theme pack & Win Live Messenger (WLM).
Johnson & Johnson’s Zyrtec and iPhone 2.0 , a weather widget
(The Weather Channel –TWC) with banner adv.
https://www.youtube.com/user/JNJhealth

Opening Case: Johnson & Johnson
JNJ # 1 in customer engagement, e.g. 300,000 Theme Pack
downloads and 200,000 game plays of Saving Momo (2007).
TWC remained the number one (3M) download for iPhone users
in the Apple Store (2009). 625M likes.
ROI in reputation e.g. “YouTube provides an excellent metric,
including views over time, trends, most popular videos, even
viewer retention rates.” Viral impact on brand
Lessons Learned
The opening case illustrates JNJ uses several social media tools
& sites to increase its customers' awareness, positive attitude
(interest, desire), and trial of its brands
JNJ was very success in their marketing communications in
building SC, SP, SE leading to SC.
Marketing Communications: 5 Promotional mix
Public relations - “Building good relations with the company’s
various publics by obtaining favorable publicity” e.g. JNJ

Health Channel
Advertising- “Any paid form of non-personal presentation and
promotion” Facebook or LinkedIn ad, Google AdWords,
promoted Tweets, ad sponsored content in mobile phone; JNJ
TWC & Momo
Sales promotion -“Short-term incentives to encourage purchase”
e.g. Lazada 5th B’day sale in Lazada’s fan page; JNJ TWC
Direct marketing –”Direct connections with carefully targeted
individual consumers, to both obtain an immediate response”
e.g. targeted social ads; behavioural targeting; collaborative
filtering
Personal selling – “Personal interactions between a customer
and the firm’s sales force for the purpose of making sales and
building customer relationships.” e.g. virtual agents/assistants
using chat/chatbot
Market communications is how the company convey their
brands and market offering
Which zones are these? PR – SC, SE, Adv & Sales P- SP & SE,
DM & PS – SC &SE
11
Social presence: Brands as relationship nodes

Brands create a brand profile/persona within social
communities. Brand acts as a node in the network’s social graph
e.g. JnJ
The fan base (friends/followers) is an indicator of the brand’s
success in establishing a known presence within a community.
Travelocity Gnome
Friendliness, Adventurous
Brand promise: Excitement, adventure
Aspiration – travel round the world
Character – magical, enchanting, fairy tale
57% say they are more likely to buy from brands they’ve
friended
86% of social media users have friended a brand
25% of people want a two-way dialogue with the brand.
75% of social media users report buying something they heard
about on social media
12
Brand’s social media character/Persona
What are the brand’s core values? Make diversity & inclusion
how we work every day (J&J)
What social objects illustrate the values? E.g. Gnome

What has the brand promised? BMW: “The Ultimate Driving
Machine”
What are the aspirational attributes? Love for family or the
world (J&J)
What traits are associated with the brand? E.g. generosity (J&J)
What opportunities/benefits exist? E.g. Incentives, promotion
What stories bring the brand to life? E.g. J&J stories
https://twitter.com/roaminggnome?lang=en
Travelocity
Friendliness, Adventurous
Object Gnome
Brand promise: Excitement, adventure
Aspiration – Love and care for family
Character – magical, enchanting, fairy tale
13
Figure 6.2 Why people friend brands on social media
14

Figure 6.3 Why people unfriend brands
Less Megaphone (company broadcast posts), More Magnet (firm
posts that invite consumer engagement), and
More Monitor (posts that reflect listening and responding to
consumer conversations).
According to the report, 95% of brands are stuck in “broadcast”
mode, using social channels as a megaphone. The top reason
people give for unfollowing a brand in social media is too many
promotional messages.
Fewer than 40% of the brands studied ever asked questions of
their followers or responded to their follower’s comments to the
brand (Monitor). Only 2% of brands consistently responded to
customers’ posts. Not only is this approach less effective, it can
drive brand followers away.
15
Characteristics of social fans
Random House’s Figment is an example of an owned social
community; it targets teens who love to read and write fan

fiction. Fans who define their own individual identities at least
in part by their membership in a fandom share five key
characteristics:
1. Emotional engagement: the object is meaningful in the
emotional life of the fan. For example, members of Figment see
fan fiction as a part of their
self-concept and their membership in the social community as
part of their social identity.
2. Self-identification: the fan personally and publicly identifies
with like-minded fans. Figment members call themselves
“figgies” and use #figgies when
interacting on social media channels other than the Figment
community platform.
3. Cultural competence: the fan has a critical understanding of
the object, its history, and its meaning beyond its basic
functionality. Figgies are fan
fiction enthusiasts who know the development of the genre, the
stories of successful fan fiction authors, and more.
4. Auxiliary consumption: the fan collects and consumes related
items and experiences beyond the basic object. For figgies,
items related to their favorite
books, movies, and celebrities are desirable. Figgies might
attend fan fiction conventions, going in costume!
5. Production: the fan becomes involved in the production of
content related to the object. Figgies post their fan fiction

stories on Figment where other
fans can read, critique, and contribute to the stories.
Level of engagement makes a big difference in terms of the
buying decision process. One study specifically measured the
value of being a brand’s Facebook
fan. It found that people spend about $72 more on a product for
which they have a social network affiliation than for one they
do not. Fans are also 28%
more likely than non-fans to continue using a brand, and 41%
more likely to recommend a fanned versus non-fanned product
to a friend.36 Fans in the study
also said they felt connected to their brands.
16
Emotional engagement
1
Self-identification
2
Cultural competence
3
Auxiliary consumption

4
Production
5
Characteristics of brand community engagement
Active community management e.g. mix of megaphone, magnet
and monitor
Content mission, quality, and storytelling consistent with brand

character
Engagement and community relationship building – emphasize
on magnet
Collaboration with influencers
Learning Objectives
List five promotional mix in owned and paid media
exhibit?
objectives.
media.
Release
Getting Started with
Social Media Promotions
Listening to Customer

1. What proportion of their target markets is aware of the
company’s brands and individual products (attention)?
2. Are the attitudes of the markets positive or negative toward
these brands (attitudes: desire, interest)?
3. What proportion of the market purchases the products and
how frequently do they make repeat purchases (behaviour)?
Use SM dashboards https://biznology.com/2014/04/25-social-
media-listening-aids-to-increase-your-hearing/
e.g. HootSuite; Radian6; Klout, etc
Marketing objectives and social media
Increase
awareness
Influence
desire

Encourage
trial
Facilitate
purchase
Cement
brand loyalty
Recover
from service failures

Six Social Media Promotion Steps and Example
Initiation
Initiation
Formulation

STRATEGY
Implementation
Assessment
Performance
Improvement
Listening & set overall mktg comm. objectives
/activities
SM Activities
Awareness (sharing viral video)
Sick Puppies (Australian band) YouTube “Free Hugs Campaign”
- 75 million views.
https://www.youtube.com/watch?v=vr3x_RRJdd4
Attitude: Interest and Desire (crowdsourcing)
Dunkin’ Donuts Facebook campaign to design a new donut,
Prize $1,200 free donuts, 90,000 entries, 3X increase in
Facebook fan base, positive conversation: 44 % regarding the
promotion, 38 % discussing great taste & 20 % expressing love
for the brand. http://wave.wavemetrix.com/content/dunkin-
donuts-uses-social-media-drive-positive-brand-engagement-
00107
Behaviour (trail, purchase): Ticketmaster social shopping for
cinema tickets. Use SN login, book ticket. Friends will know
where you sit & may reserve the seat next to you. 33% increase

traffic.
Sick puppies Get 10K for world peace
22
SNS Platforms
• Social networks general services
• Commercial and professional social networks
• Enterprise social networks
• Multimedia sharing sites (e.g., YouTube) and photos (e.g.,
Flickr)
• Social bookmarking (Pinterest)
• Virtual worlds and massively multiplayer online games
(MMOGs)
• Social games in networks (e.g., Zynga, Electronic Arts)
How to select which platform for your promotion?
Selecting the SM platform/community
(Tuten)
Consider this list of community characteristics when evaluating
the desirability of a community target:
What is the community’s focus (to determine relevance)?
How many active users are involved in the community

How active are the top users on the site?
How many comments on average are generated for each new
submission?
How many votes are required to earn front page status on the
site?
Are stories on the site’s front page recent? How rapid is story
turnover?
Are there limitations for branded content in the community’s
Terms of Service?
What have others said about the social news site?
24-6
Copyright © 2013 Pearson Education, Inc. publishing as
Prentice Hall
Microblog posts can be useful for reminder communications and
ensuring top-of-mind awareness, but they can also provide
valuable links, direct traffic, and build credibility and
reputation.
24
Learning Objectives

exhibit?
objectives.
media.
Release
Owned, Paid, & Earned Social Media
e.g. Facebook fan page, JNJ News, JNJ Health Channel
e.g. Facebook ads, sponsored blogs, Google Adword
e.g. users’ engagement e.g. sharings, ratings, videos,
recommendations, participation, etc.
26

Figure 4.3 Owned, Paid, and Earned Media Are All Content
Driven
Source: Strauss and Frost (2014). Used with permission.
Social Media Promotions
28-1
Earned Media
Mostly Owned & Earned Media
Mostly Owned & Paid Media
Mostly Owned & Paid Media
28
Owned Media Content
Prentice Hall
29-6
Characterize content in terms of its originality & substance

according to a value ladder.
Flagship content – authority-building content. Seminal pieces of
work that shape the way people think e.g. what is Web 2.0
Pillar content – typically educational content that readers use
over time, save, & share e.g. JNJ health channel
Authority-building content – original content that positions the
sponsoring entity as a authority e.g. JNJ Cares
Filler content – information that people copy from other sources
https://www.facebook.com/pg/careinspirescare/videos/?ref=page
_internal
Types of Pillar & Flagship Content
Learning Objectives
exhibit?

objectives.
media.
Release
Making Press Relations Social Media Friendly
How to include image, videos & text info in SM friendly
manner?
Include sharing tools
Headlines < 55 chars for mobile phone & easy retweeting
Include YouTube video link, nearly every SN recognize
Include link to SoundCloud audio
https://soundcloud.com/cspenn/rethink-robotics-release
Include link to Photo galleries e.g. Flickr or Facebook
Integrated social discussions using common plugins like
Facebook Comments, Disqus, Livefyre, or other systems
Include contact information
Entire press release is embedded inside a marketing information
system – who has engaged (share, comment, like, etc.) e.g. SM
Dashbd
Example:

http://mktg.shiftcomm.com/socialmediapressreleasetemplate?_g
a=1.43155109.1659141824.1490342359#sthash.urhaMTwy.dpbs
Figure 4.4 Social Media Press Release
Source: Shift Communications at
shiftcomm.com/2012/12/social-media-press-release-2-0
(accessed August 2014). Used with permission.
Social media optimization (SMO) is a process that makes it
more likely for content on a specific social media platform to be
more visible and linkable in online communities.
34-6
Prentice Hall
34
Learning Objectives

exhibit?
objectives.
media.
Release
Social network advertising (social ads)
Online advertising that focuses on social networking sites
Types of Social Network Advertising
Direct advertising that is based on your network of friends e.g.
collaborative filtering (e.g. Lazada) or social logins (e.g.
Netflix).
36

Figure 4.2 Facebook Ad for a Gong Concert
Facebook search profile:
Live in the United States and within 50 miles of Reno,Nevada
Eighteen years of age or older
Have the following interests in their profiles: Buddhism,Deepak
Chopra, meditating, metaphysics, …
Returned 2,520 targeted profiles
Facebook Advertisement
https://www.youtube.com/watch?v=57iPb3fptPE
Cost – which is the cheapest paid advert
Survey from existing customers which SN they use. Assume the
same for prospect.
Detect conversation about a brand
37
Figure 6.5 Advertising options on social networks
Figure 6.5 Advertising options on social networks

Learning Objectives
exhibit?
objectives.
media.
Release
*
Presented by: Dr Paul Yeow
Social Commerce Strategic Planning

Taken from
Chapter 10: Social Commerce (Turban et al. 2016) and
Chapter 13: Electronic Commerce – A Managerial and Social
Network Perspectice (Turban et al. 2015)
*
Why study SC strategy Before we study social commerce
models, we need to understand how SC Strategy is developed
(in which the models fit).Learning Outcomes2. identify, analyse
and critically assess the suitability of various social commerce
models and strategies for various e-businesses
*
Key Concepts
Definition & importance of SC strategy
Strategy Initiation
Strategy Formulation
SC Implementation
SC Strategy Assessment & Performance Management
Note: These are addressed according to sequence

*
Need for Strategy
Strategy—Broad-based formula for how a business going to
compete. It consists of goals & set of plans to achieve them.
Social Commerce strategy (SC strategy)
The formulation and execution of a vision (an idea) of how to
do business using social media tools.
Why does a company need an SC strategy?Fast changes in
business- opportunities & threats can change quickly. 5 years
close down w/o SCMay be too costly not to have one
What do you think of the opportunities for SC?
Particularly of Social Customers in which ½ of the population
are below 30.
*
*
OpportunitiesConsumers can provide feedback on product
(service) designVendors get free word-of-mouth marketing
Increased website traffic, which increases revenue and sales

(Starbuck & Netflix case studies)See
http://barnraisersllc.com/2010/10/33-case-studies-prove-social-
media-roi/
*
The Strategy-Performance CycleSC Strategy involves
Create goals and objectives that express the organizational
mission
Create the strategy and make plans to attain the goals and
objectives
Implement, set performance metrics and monitor the
performance, then analyze the difference between the two
Develop a corrective strategy
*
Figure 10.1 The Strategy-Performance Model
*
eB Strategy Alignment

Strategy of entire org.
SC Strategy
Functional Strategy
(Marketing)
Objectives
SC Models/Strategy
Implementation Plan
Performance Measures
SC strategy must be aligned to organization’s business, mktg &
IT strategy.
Business Plan
*
The SC Strategic Planning Process
*
Step 1: Strategy Initiation
Organization examines itself and its environment to determines
SC opportunities and goalsFirst step is to review the micro &
macro business environment.Company Analysis: company

vision, mission, value proposition, goals, core competencies,
strengths, weaknesses, customers, target market, partners,
etc.Industry Analysis: which industry, who are the competitors,
what current practices of selling & buying, what SC strategies
are used, competitors’ performance, etc. Competitive Analysis:
Compare company with competitors: SWOT analysis.
*
Business Environment
*
Figure 10.2 Porter’s Five Forces Model
*
*

SWOT Diagram
https://www.youtube.com/watch?v=EIzNF0gl_bQ
Which category is Voov partnering with Namewee to have a
competition?
Company Analysis
Industry & Porter’s Analysis
Weakness Opportunity
*
*
Specific outcomes from the strategy initiation phase
include:End results: A set of goals for SC (in which
strategies/plans need to be developed):Company analysis
(vision, business strategies, customers, etc.) Competitor &
industry analysisMacro-environment analysisPorter’s
Competitive Forces ModelSWOT Analysis
*
Marketing objectives & social media

*
Examples of SC GoalsSC Models (Strategy)Possible SC
GoalsSocial shoppingIncrease sales/revenue acquire new
customers, increase customer experience, go globalMarketing
communicationIncrease brand awareness, increase viral
marketing, increase customer engagement, reduce customer
acquisition costSocial CRM and customer serviceIncrease
customer satisfaction, increase customer trust and loyalty,
increase sellers’ reputation, improve public relationsSocial
enterprise (Enterprise 2.0)Enable better recruiting, facilitate
problem solving and idea generation, facilitate collaboration,
improve efficiency, optimize workforceCrowdsourcingIncrease
innovation and collaboration, customer co-creation, generate
new business modelsEntertainment and gamingIncrease users’
satisfaction, provide for cross selling, increase awareness,
increase advertising incomeSocial engagement/reputation
managementIncrease brand awareness, improve public relations,
influence customers to visit website to buy/take action
*

Step 2: Strategy FormulationStrategy formulation
The development of strategies to exploit opportunities and
manage threats in the business environment in light of corporate
strengths and weaknessesCome out with Business Plans (SC
Business Models) to achieve the goals (from Step 1). This
includes a list of SC initiatives to be developed.
*
Specific activities and outcomes from the strategy formulation
phase include:Cost-benefit analysis – value proposition &
ROISC models (SC initiatives/apps/services, SN platform,
activities, & technologies)Risk analysis, assessment, and
managementBusiness plan
*
Cost-BenefitNeed to provide economic feasibility of the
identified opportunity.It is difficult to justify SC investment
due to many intangible variablesMethods used for
analysis:Value analysis approachTangible cost-benefits

*
A Value Analysis Approach (Value proposition)
How the new eB application adds value to customer &
company? Can include intangible costs & benefits.
Several ideas to measure value can be used.
Cost-Benefit
*
Value Exchange Model – components
Adapted from Tuunanen (2010)
Value Facilitating
Exchange
Social Commerce Site
Desired
Benefits

Desired
Benefits
Customer
Company
*
Customer Investment (Coursework.info, 2003)
(Note: This is not exhaustive.Which are related to SC)
DescriptionKey wordsExplanationAcquisition Physical cost
Psychological cost
Transaction cost Collection, unpacking, cleaning, returning
Search, thinking , selecting and comparing
Purchase Price, Booking fees, delivery &
installationConsumption Physical/mental effortTo consume
serviceDisposal Product
Service Size related, recycling, resell, fees
Can be difficult i.e. changing banksAssociation Relationship
Personal association Engaging the company and community.
Receipt of information, provision of information Memory
Attitudes
Perception
Expectation

Emotions Previous knowledge, trust, positive attitude
Not clean slates – some preconceived ideas, past
experienceRisk Uncertainty Probability of desired outcome
Psychological cost of Acquisition
Physical and mental effort of Consumption
Disposal – recycling, resell
Association – Social Community
Memory – Brand perception
Risk – Social Commerce – User ratings, recommendations.
*
*
Customer Desired Benefits and Outcomes (Holbrook, 1999)
(Note: This is not exhaustive, which are related to SC) Type of
ValueExplanations intrinsic value
extrinsic value products ability to do something
product desired for own sake self oriented value
other oriented value exclusive use
buy for others’ use psychological benefitsreputation building
(5Vs – Vision, Validation, Vindication, Vulnerability, Vanity)
Motivations for participation in Social Media (Affinity, Utility,
Altruism, Curiosity, Contact, Validation, 7 Social Currency)

Universal Heuristic of Buyerscost savingsreduce price
savings from purchase
*
Material (e.g. Raw material for production)People (e.g. clerks,
officers)Infrastructure (e.g. Buildings, Servers, Electricity,
Website)Processes (e.g. business procedures)Communication
(e.g. Internet connection)
Supplier Investment
What investment can be reduced in Voov?
People – marketing people to acquire new members
*
*
Transactional Equity ($)value from transactions that allows it to
pay for its investments (a/r, commissions)Relationship
Equityrelationships between customers and suppliers have a
valueSocietal Equitygenerated by engaging in activities that
give something back to the community e.g. Corporate Social
ResponsibilityOrganisational EquityInformation and knowledge
that are hard to imitate or can be only mimicked at a high cost
Supplier Desired Benefits

Which benefits relates to SC?
Relationship equity – customer’s affinity towards a brand.
Organization equity
*
*
Value for EmployeesBeing treated respectfully (Malley,
2008)Involved in decision making (Malley, 2008)Meaningful
work (Malley, 2008)Excellent compensation opportunities
(Malley, 2008)Continued training and development (Malley,
2008)Value for InvestorsHigh returnsStrong revenue
growthAttractive profit margin
Supplier Desired Benefits
Enterprise social Network is most effective to increase value for
employees
*
*
Tangible cost-benefits
Cost-BenefitMeasureable tangible costs & benefits e.g.
measures in financial statement.E.g. Return on Investment: A

ratio of resources required & benefits generated by an SC
project. Includes only quantifiable items (cost of resources,
computed monetary savings, increase in revenue, etc.)
Not so relevant to SC. Conversion could be many factors. Only
1% is due to social media particularly social shopping tools e.g.
ratings
*
*
Figure 1.3 The Major Dimensions of Social Commerce
Social Commerce Models
You can use SC zones
as model
*
Table 5.1 Mapping objectives with tactics
Activities, SNS, Tools & Tech
Which Zone?
Social Community – Build brand awarenessSocial Publishing
Model – Viral MarketingSocial Commerce – reviews and

ratingSocial Commerce – Group dealsSocial Community
*
*
Risk AnalysisSC risk
The likelihood that a negative outcome will occur in the course
of developing and operating an SC strategyISSUES TO
CONSIDER DURING STRATEGY FORMULATIONSocial
Media FraudMultimedia liability (e.g., libel, slander, invasion
of privacy…)Negative sentimentComputer virus attackLeak of
sensitive information
*
*
Risk AnalysisIdentify risks: strategic (wrong directions),
financial (lack money & poor budgeting) & operational risks
(security & privacy issues).Assess potential damage if
occur.Contingency plan to mitigate risk.Risk Analysis

*
Business PlanA written document that identifies the company’s
goals and outlines how the company intends to achieve those
goals.Combine the outcomes of first 2 phases, e.g. goals
(derived from company, customer and competitor analysis,
macro forces, SWOT), value propositions & ROI, cost-benefits,
SC models (SC activies/apps/services, SNS &
tools/technologies), & risks analysis, estimated resource
required, Gant Chart and performance measures (see
assignment)
*
Step 3: Strategy Implementation
The development of detailed and short-term plans for carrying
out the projects agreed on in SFProject team to implement
according to formulated strategy (Step 2). Undertake a pilot
project (help discover problems)Implementing SC Strategy
includes:Use SC development processRequire redesign of
existing business processesCompany should integrate SC with
existing Marketing Communication Channel

*
Specific activities and outcomes from strategy implementation
phase include:Project planningResource allocationProject
managementPilot ProjectActual Implementation of Project
*
Step 4: Strategy Assessment & Performance Management
(Why?)
The continuous evaluation of progress toward the organization’s
goals, resulting in corrective action and, if necessary, strategy
reformulationFind out if SC project achieves its goals.
Corrective steps might be requiredInnovations: Could change
models Go back to strategy planning, formulation or
implementation
*
The eB Strategic Planning Process

*
Metrics, Measurements
metric
A specific, measurable standard against which actual
performance is compared measurement
Describing the metrics e.g. revenue growth metrics -
measurements include total dollars, percentage change over
time, percentage growth as compared to that of the industry.
14-*
*
*
Metric must link to objectives
*
Figure 5.7 Social Media Measurement Areas

*
*
Social Media
Analytics and Sentiment AnalysisTools for Mining Social
Media Activities Sentiment Analysis and Web 2.0Sentiment
analysis* (opinion mining*)Video: “Social Sentiment: Are You
Listening?” at youtube.com/watch?v=YGlhCCwYVh4Social
Media Dashboards – Radian6, HootSuite
*
For 50 top tools for social media monitoring
http://www.socialmediatoday.com/content/50-top-tools-social-
media-monitoring-analytics-and-management
Particularly of Social Customers in which ½ of the population
are below 30.
*
*

Weakness Opportunity
*
Psychological cost of Acquisition
Physical and mental effort of Consumption
Disposal – recycling, resell
Association – Social Community
Memory – Brand perception
Risk – Social Commerce – User ratings, recommendations.
*
People – marketing people to acquire new members
*
Relationship equity – customer’s affinity towards a brand.
Organization equity
*
Enterprise social Network is most effective to increase value for
employees
*
Not so relevant to SC. Conversion could be many factors. Only
1% is due to social media particularly social shopping tools e.g.
ratings
*Social Community – Build brand awarenessSocial Publishing
Model – Viral MarketingSocial Commerce – reviews and
ratingSocial Commerce – Group dealsSocial Community
*

*
*
*
Chapter 11 (Turban)
Chapter 5 (Tuten)
Implementing
Social Commerce Systems
1-2
Unit objectives
businesses
commerce
commerce models

management
commerce.
Learning Objectives
Describe what is a social commerce/media marketing tactical
plan and how does it support the execution of a strategy?
Describe the major issues in the social commerce
implementation landscape.
Discuss the security and fraud protection issues in social
commerce.
Describe ethics & legal issues e.g. privacy, copyright &
cyberbullying
Discuss the major employee-related implementation issues
ranging from wasting time to participation, and the related
guidelines and policies.
Discuss organizational impacts including transformation to
social business.
Opening Case: Domino’s Employees Post Vulgar Videos on

YouTube
The Problem (The Incident)
2 employees created 5 prank videos that went viral on YouTube
https://www.youtube.com/watch?v=xaNuE3DsJHM&list=RDOh
BmWxQpedI&index=6
The videos showed a variety of acts of food contamination by
employees
Six hours after being posted, the videos were featured on the
consumer advocacy site Consumerist
Even though the videos were removed, they continued to
damage the Domino’s brand, with many stores rapidly losing
business
Opening Case: Domino’s Employees Post Vulgar Videos on
YouTube
The

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