Term Paper

On
Customer Loyalty Through Social Media

Prepared for
Shanto Banik
Assistant Professor
Department of Marketing
University of Chittagong

Prepared by
Md. Ataur Rahman
ID No: 11304088
Session: 2010-2011
4th Year BBA
Department of Marketing
University of Chittagong

Date of Submission: August 8, 2016

 CONTENTS
Abstract.........................................................................................................................................................3
Introduction...................................................................................................................................................4
Literature Review.........................................................................................................................................5
Customer’s Perception..................................................................................................................................6
Customers Perceived Valve & Implication..................................................................................................6
Example........................................................................................................................................................6
Social Media.................................................................................................................................................8
Social Media Efforts & Presence..................................................................................................................8
CUSTOMER SATISFACTION...................................................................................................................9
Definition......................................................................................................................................................9
Factors Form Buyers Expectation................................................................................................................9
Customer Satisfaction & Profit.....................................................................................................................9
Monitoring Satisfaction..............................................................................................................................10
The concept of Customer Satisfaction........................................................................................................10
Product and Service Quality.......................................................................................................................11
Maximizing customer lifetime value..........................................................................................................11
Customer Profitability................................................................................................................................12
Measuring Customer Lifetime Value.........................................................................................................12
Cultivating customer relationships.............................................................................................................13
The Relational Benefits Approach..............................................................................................................13
Social Benefits............................................................................................................................................14
Confidence Benefits....................................................................................................................................14
Functional Benefits.....................................................................................................................................15
Special Treatment Benefits.........................................................................................................................15
Hedonic Benefits........................................................................................................................................16
Customer Databases and Database Marketing...........................................................................................16
Downside of Database Marketing and CRM..............................................................................................16
Branding.....................................................................................................................................................17
Brand Positioning.......................................................................................................................................17
Brand Loyalty.............................................................................................................................................18
Building Loyalty........................................................................................................................................18
Process Of Building Brand Loyalty............................................................................................................19
Customer-Based Brand Equity...................................................................................................................20
E-Business..................................................................................................................................................21
Social network services..............................................................................................................................21
Facebook.....................................................................................................................................................21
Irc-galleria...................................................................................................................................................22
Kuvake.net..................................................................................................................................................22
Blogging.....................................................................................................................................................22
Microblogging: Twitter..............................................................................................................................22
Lookbook.nu (fashion blogging)................................................................................................................22
RSS feed.....................................................................................................................................................23
Flickr...........................................................................................................................................................23
Youtube.......................................................................................................................................................23
Virtual worlds.............................................................................................................................................24
Second Life.................................................................................................................................................24
Del.icio.us and other social bookmarking sites..........................................................................................25
Discussion forums......................................................................................................................................25
Social Media Marketing.............................................................................................................................25
Social Media Consumers............................................................................................................................26
Social Media and Online Sales...................................................................................................................26

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Loyalty........................................................................................................................................................27
Customer Loyalty and Social Media..........................................................................................................27
Social media marketing mix.......................................................................................................................29
1.Product.....................................................................................................................................................29
2.Price.........................................................................................................................................................29
3.Place.........................................................................................................................................................29
4. Promotion...............................................................................................................................................30
5.People......................................................................................................................................................30
6.Physical evidence.....................................................................................................................................30
7.Process.....................................................................................................................................................31
MODELS FOR SOCIAL MEDIA MARKETING.....................................................................................31
CREF, the new 4 Ps....................................................................................................................................31
Collaboration..............................................................................................................................................31
Revenue model...........................................................................................................................................32
Experience..................................................................................................................................................32
Findability...................................................................................................................................................33
Styles of collaborative innovation..............................................................................................................34
Word –of-mouth marketing........................................................................................................................34
Social Media of word –of-mouth marketing..............................................................................................35
Opinion Leadership....................................................................................................................................35
Diffusion of Innovation..............................................................................................................................35
Social Influence and Size of Networks.......................................................................................................36
Weak Ties...................................................................................................................................................36
Case Study Analysis...................................................................................................................................36
Background.................................................................................................................................................37
Social Media Strategy Details....................................................................................................................38
Fiesta Movement Site.................................................................................................................................38
Twitter, YouTube and Flickr......................................................................................................................39
Facebook.....................................................................................................................................................40
Results.........................................................................................................................................................41
Additional Components..............................................................................................................................41
Analysis/Conclusions.................................................................................................................................42
Social Media Engagement IS Advertising.............................................................................................44
STRATEGIES............................................................................................................................................44
Champion Your Own Efforts......................................................................................................................44
Custom Platform, Custom Voice – With Consistent............................................................................44
Explore Multiple Social Platforms – and Innovate.....................................................................................44
The Explosive Potential of User-Generated Content..................................................................................45
Improve products or services......................................................................................................................45
Manage your reputation..............................................................................................................................45
Stay Ahead in Competition.........................................................................................................................46
Acting Intelligently.....................................................................................................................................47
Techniques for Building Customer Loyalty with Social Media.................................................................47
Keep your word..........................................................................................................................................47
Listen and respond......................................................................................................................................47
Be consistent...............................................................................................................................................48
Accept criticism..........................................................................................................................................48
Be committed and caring............................................................................................................................48
Results (Survey)..........................................................................................................................................52
CONCLUSION...........................................................................................................................................56
REFERENCES:..........................................................................................................................................57

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Abstract

All brands need instant-recognition visibility to thrive, and developing a loyal customer
base is essential as our engagement options expand and attention spans are whittled
down. If a business lacks a strategy to establish not just brand presence and loyalty but
consistency, it’s not going to succeed – it’s that simple.

Social media is a defining factor in brand perception through the eyes of your target
audience. As I mentioned in our 8 Key Points in E-Commerce & Social Marketing post,
Americans now spend upwards of 5.6 hours a day online, with 3 or more hours dedicated
specifically to social networks. With this nearly- constant online engagement,
opportunities to establish brand loyalty are virtually endless – but a widespread strategy
is key. . The mission of this study is to emphasize on the relationship of those users who
use social media, then the effect of these relations in brand community on brand trust,
finally its effects on brand loyalty. Therefore, this paper will illustrate the impact of
impressive factors on brand loyalty in social media.

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Introduction

Today, companies face their toughest competition ever. Moving from a product and
sales philosophy to a holistic marketing philosophy, however, gives them a better
chance of outperforming the competition. And the cornerstone of a well-conceived
marketing orientation is strong customer relationships. In this chapter, we discuss how
companies can win customer loyalty and improve profits by doing a better job of meet-
ing or exceeding customer expectations. We also discuss the use of database marketing
for customer relationship management.

As it is commonly understood, social media have an influenced on societies as one of this

modern world’s phenomenon and as the most controversial applications in virtual
communities and network. It should be said that the world is getting smaller with
increasing popularity of social networks and may establish close relation between people.
Social networks enable consumers to utilize and take the advantages of the technology of
the overlapped online social markets. Furthermore, social media could have dramatic
effects on marketing culture such as advertising, marketing strategies and purchasing
habits.

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Literature Review
Social media provides an environment where researchers can research. For example, such
media provide an opportunity for users to engage in connection and relation through
various ways sending email, immediate message, and participating in communities,
weblogs and social media (Gold Smith,2006). Consumers usually trust their friends who
like them are users than those who are dealing with marketing and selling products.
The survey suggests that Facebook, as a culmination of social media, has over 955million
active users who sign in it every 30 days. Half of the users are signing in systems daily.
Users devoted one-third of their time to online social media (Lang, 2010). According to
(Hagel and Armstrong, 1997; Kaplan and Haenlein, 2010), regarding the popularity of the
virtual community and the capability of providing e-commerce and connecting people to
each other, some scholars and researchers in industrial scopes encourage businessman to
connect social media and to receive benefits of it if there are tendency to survive.
Social Media is a new marketing tool that allows you to get to know your customers and
prospects in ways that were previously not possible. This information and knowledge
must be paid for with output of respect, trustworthiness, and honesty. Social Media is not
a fad, but I also think it’s just the beginning of the marketing revolution – not the
end. (Marjorie Clayman – Clayman Advertising, Inc.)
Social media consists of various user-driven (inbound marketing) channels (e.g.,
Facebook, Twitter, blogs, YouTube).  These channels represent a stark difference from
the advertiser-driven (outbound marketing) push model.  As the principal owner of the
customer relationship in the firm,  typically, the marketing department is responsible for
managing these social media channels.  Although some may argue that the customer
relationship is “everyone’s” responsibility in the firm, the overarching responsibility rests
with the marketing department as the champion for the customer. (Cheryl
Burgess – Blue Focus Marketing).
Social media is today’s most transparent, engaging and interactive form of public
relations. It combines the true grit of real time content with the beauty of authentic peer-
to-peer communication. Lisa Buyer – The Buyer Group
Social media is digital content and interaction that is created by and between people. Sam
Decker – Mass Relevanc
Social media is communication channels or tools used to store, aggregate, share, discuss
or deliver information within online communities. The focus is on interaction and
relationships, not the almighty dollar. Angie Schottmuller –Interactive Artisan

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Customer’s Perception
Customers tend to be value-maximizers, within the bounds of search costs and limited
knowledge, mobility, and income. They estimate which offer will deliver the most
perceived value and act on it. Whether the offer lives up to expecta- tion affects
customer satisfaction and the probability that the customer will purchase the product
again.

Customers Perceived Valve & Implication

Customer perceived value (CPV) is the difference between the prospective cus-
tomer’s evaluation of all the benefits and all the costs of an offering and the perceived
alternatives.
Total customer value is the perceived monetary value of the bundle of economic,
functional, and psychological benefits customers expect from a given market offering
because of the products, services, personnel, and image involved. Total customer
cost is the perceived bundle of costs that customers expect to incur in evaluating,
obtaining, using, and disposing of the given market offering, including monetary,
time, energy, and psychic costs.

Example
Suppose the buyer for a residential construction company wants to buy a trac- tor
from either Caterpillar or Komatsu. After evaluating the two tractors, he
decides that Caterpillar has greater product benefits, based on perceived reliability,
durability, performance, and resale value. He also decides that Caterpillar’s person-
nel are more knowledgeable and perceives that the company will provide better
services, such as maintenance. Finally, he places higher value on Caterpillar’s corpo-
rate image. He adds up all the benefits from these four sources—product, services,
personnel, and image—and perceives Caterpillar as delivering greater customer.

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Figure: Determinants of Customer-Perceived Value

Customer
perceived
value

Total Total
cudtomer customer
benefit cost

Product Monertary
benifit cost

Services Time cost

benefit

Personnel Energy
benefit cost

Image Psychologi
benefit cal cost

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Implications

First, the marketer must assess the total customer benefit and total customer cost
associated with each competitor’s offer.
Second, Oliver defines loyalty as “A deeply held commitment to re-buy or re-patronize
a preferred product or service in the future despite situational influences and marketing
efforts having the potential to cause switching behavior.

Social Media
This section head over the online networking angle in computerized showcasing, and
distinguishes its potential outcomes for the organization. The general meaning of social
networking as indicated by Kaplan and Haenlein (2009, 2010), is that, "online networking
is a gathering of Internet-built applications that manufacture with respect to the
ideological and mechanical establishments of Web 2.0, and that permit the creation and
trade of User required. Peoples are using Facebook, Twitter, LinkedIn, YouTube,
Instagram, Pinterest and MySpace. The main three are Facebook, Blogger and Twitter
(Nielsen 2012).
As Brogan (2010, 39) states, social media is a two-way web. Kaplan and Haenlein (2010,
59) define social media as internet applications that allow users to create and exchange
content while Koskela, Koskinen and Lankinen (2007, 20-25) define them as collectivism
in networks.
Social media combine what is needed for a company to succeed in the present day:
openness, sharing, peering and acting globally (Tapscott & Williams 2006, 30).
Information has become an asset, and different from tangible assets, information has more
value according to how many people have access to it (Sullivan 2001, 112). As
Salmenkivi and Nyman (2007, 78) acknowledge, “it is not who you know, it is what you
know”.

Social Media Efforts & Presence

social media efforts and presence to be known to its customers. JetBlue maintains several
social media accounts including Twitter, Facebook, YouTube, as well as Google Plus and
today is known as one of the first companies to use social media for customer service.

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Although JetBlue maintains various social media channels, they only provide customer
service with customers using their Facebook and Twitter accounts.
Social Media is a real-time interaction space in which JetBlue is able to create, share, and
exchange information and ideas.” Social media offers up real-time spontaneous
unsolicited information. Customers can share freely, for example, they can talk about us
rather than to us but we can easily gather that info. It is unfiltered feedback which is
pretty unique.”

CUSTOMER SATISFACTION
Definition
Satisfaction is a person’s feelings of pleasure or disappointment that result from
comparing a product’s perceived performance (or outcome) to expectations. If the
performance falls short of expectations, the customer is dissatisfied. If performance
matches expectations, the customer is satisfied; if it exceeds expectations, the

customer is highly satisfied or delighted.8 Customer assess- ments of product

performance depend on many factors, especially the type of loyalty relationship the
customer has with the brand.

Factors Form Buyers Expectation

Buyers form their expectations from past buying experience; friends’ and associ- ates’
advice; and marketers’ and competitors’ information and promises. If marketers raise
expectations too high, the buyer is likely to be disappointed. However, if the
company sets expectations too low, it won’t attract enough buyers (although it will

satisfy those who do buy).10 Some of today’s most successful companies are raising
expectations and delivering performance to match. Korean automaker Kia has been
successful in the U.S. market by offering low-priced, high-quality cars reliable enough
to be backed by 10-year warranties.

Customer Satisfaction & Profit

High customer satisfaction is not the ultimate goal. If the company increases
customer satisfaction by lowering its price or increasing its services, the result may
be lower profits. The company might be able to increase its profitability by means

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other than increased satisfaction (for example, by improving manufactur- ing
processes). Also, the company has many stakeholders, including employees,
dealers, suppliers, and stockholders. Spending more to increase customer satisfaction
might divert funds from increasing the satisfaction of other “partners.” Ultimately,
the company must try to deliver a high level of customer satisfaction subject to deliv-
ering acceptable levels of satisfaction to the other stakeholders, given its total
resources.

Monitoring Satisfaction
A highly satisfied customer generally stays loyal longer, buys more as the firm
introduces new products and upgrades existing products, talks favorably to others
about the firm and its products, pays less attention to competing brands and is less
sensitive to price, offers product or service ideas to the firm. Greater customer
satisfaction has also been linked to higher stock-market returns and lower market
risk. When customers rate their satisfaction with an element of the firm’s
performance—say, delivery—they may vary in how they define good performance.

The concept of Customer Satisfaction

Customer satisfaction is incorporated in the conceptual model, because in many studies
it proved to be an important determinant of customer loyalty as will become clear later on.
Just as customer loyalty, customer satisfaction takes two forms in the field of this study.
First, customer satisfaction toward a specific tour operator can be defined as the
contentment of the customer with respect to his or her prior experience with a given
firm (Anderson & Srinivan, 2003). Second, customer e-satisfaction can be described as
the contentment of the customer with respect to his or her prior experience with a given
firm operating in an online environment (Anderson & Srinivan, 2003). According to
Heskett et al. (1994), customers are satisfied when the service delivered meets their
needs. It would be even better, if the service delivery exceeds customers
expectations. therefore, it can also be described as the difference between customer
expectations and the delivered service(Fach, 2000). In other words, customer

satisfaction is the result of customersಬ perception ofthe value they receive in a

relationship (Hallowell. 1996).

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Product and Service Quality
Satisfaction will also depend on product and service quality. : Quality (or grade) is the
totality of features and charac- teristics of a product or service that bear on its ability
to satisfy stated or implied needs. The seller has delivered quality whenever the
product or service meets or exceeds the customers’ expectations. It is important to
distinguish between conformance quality and performance quality. Total quality is
everyone’s job, just as marketing is everyone’s job. Marketers play six roles in
helping their companies define and deliver high- quality goods and services to target
customers.
 First, they bear the major responsibility for correctly identifying customers’
needs and requirements.
 Second, they must commu- nicate customer expectations properly to product
designers.
 Third, they must be sure that orders are filled correctly and on time.
 Fourth, they must provide customers with proper instructions, training, and
technical assistance.
 Fifth, they must stay in touch with customers after the sale to ensure
ongoing satisfaction.
 Sixth, they must gather customer ideas for product and service improvements
and convey them to the appro- priate departments. When marketers do all
this, they’re making substantial contribu- tions to product and service quality,
customer satisfaction, customer profitability, and company profitability.

Maximizing customer lifetime value

Every firm loses money on some of its customers. The well-known 20–80 rule says that
the top 20% of the customers often generates 80% or more of the firm’s profits. The
largest customers don’t always yield the most profit, because these cus- tomers can
demand considerable service and receive the deepest discounts. The small- est
customers pay full price and receive minimal service, but transaction costs reduce their
profitability. The midsize customers who receive good service and pay nearly full price
are often the most profitable.

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Customer Profitability
A profitable customer is a person, household, or company that over time yields a
revenue stream that exceeds by an acceptable amount the company’s cost stream for
attracting, selling, and servicing that customer.
Customer profitability analysis (CPA) is best conducted with an accounting technique
called Activity-Based Costing (ABC). The company estimates all revenue coming
from the customer, less all costs.

Measuring Customer Lifetime Value

Customer lifetime value (CLV) describes the net pres- ent value of the stream of
future profits expected over the customer’s lifetime pur- chases. Many methods exist
to measure customer lifetime value.
Customer Loyalty
According to Winer (2001), because customers have more choice today and the targeted
customers are more valuable, customer service must receive a high priority. Turban
(2002) believe that customer service can be defined as the activities designed to enhance
the level of customer satisfaction before, during, or after a purchase. Walsh and Godfrey
(2000) argue that successful customer service leads to improved customer satisfaction,
which creates a positive pull factor. Walsh and Godfrey (2000) elaborate further that this
positive pull factor can be described as creating a sense of familiarity and commitment,
which gives the customer little reason to shop elsewhere. With the advent
of Web 2.0, the customer service experience has changed drastically.
Traditionally, customer service has been primarily comprised of communication channels
such as telephone or email although these channels have proven to be somewhat
inefficient. In 2008, Forrester Research asked customers why they had an aversion to
using call centers to solve their problems. According to Greenberg (2010), it was found
that routing errors, poor knowledge management capabilities, and substandard customer
data access were all primary reasons why customers felt this way. Geierhos (2011)
elaborates further by explaining these traditional communication channels are time
consuming and error prone, and this process can lead to the loss of clients

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Cultivating customer relationships
Customer relationship man- agement (CRM) is the process of carefully managing
detailed information about individual customers and all customer “touch points” to
maximize customer loyalty. A customer touch point is any occasion on which a
customer encounters the brand and product—from actual experience to personal
or mass communications to casual observation. Peppers and Rogers outline a four-
step framework for one-to-one mar- keting that can be adapted to CRM marketing as
follows- Identify your prospects and customers.
1. Identify your prospects and customers.
2. Differentiate customers in terms of (1) their needs and (2) their value to your
company.3.
3. Interact with individual customers to improve your knowledge about their
individual needs and to build stronger relationships.
4. 4.Customize products, services, and messages to each customer.

The Relational Benefits Approach

In this study the relational benefits approach was used, which indicates the importance
of benefits for both customers and companies to continue their relationship in the
long run. Positive outcomes of customer loyalty are already mentioned above,
however, to create a long-term relationship also the customer must possess relational
benefits. In other words, there has been a shift in the literature from a business point of

view to the customerಬs point of view. Many different types of relational benefits have

already been investigated (Gwinner et al., 1998; Hennig-Thurau et al., 2002). For this
research, the most appropriate variables are chosen; those relational benefits through
social media of which it seems plausible to have a significant effect on customer loyalty.

Customers who are in a relationship with an organization would like to receive a

satisfactory core service. By developing a long-term relationship with a service business,
customers will have extra benefits next to the core service. According to Gwinner et al.
(1998), these type of benefits are called relational benefits. Hennig-Thurau et al. (2002)
define relational benefits as benefits customers likely receive as a result of having

cultivated a long-term relationship with a service providerರ. Literature shows that there

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are several types of relational benefits. Researchers do not always use the same
benefits in their research and in some cases relational benefits are adapted or
combined. Gwinner et al. (1998) have found significant relationships between
relational benefits and customer loyalty, customer satisfaction and word of mouth.

Social Benefits
The first type of benefits often used in research are social benefits customers receive
from a service. Gwinner et al. (1998) define social benefits as a customers need for social
bonding and dealing with someone familiar. This type of benefit covers the
emotional side of relationships and is about personal recognition of customers by
employees and friendships between them (Yen & Gwinner, 2003). It includes the joy that
comes with a close relationship with a salesperson (Reynolds & Beatty, 1999). Many
customers receive social benefits of having a relationship with a particular service
provider, although it seems more common in situations where there is much personal
interaction. However, social media are new online environments that might allow
personal interaction. Social benefits seem important to incorporate in the conceptual
model, since the need for social bonding comes very close with the concept of social
media where people come together to interact with each other.

Confidence Benefits
Another type of relational benefits often employed in research are confidence benefits.
Confidence benefits are defined by Gwinner et al. (1998) as the customers desire for
reduced risks, reliability, and integrity of the company they are engaging with in a
relationship. It includes trust and confidence in an organization and the feeling of
comfort and security about a company (Gwinner et al., 1998). According to Yen &
Gwinner (2003), confidence benefits are the most important type of relational benefits
in face-to-face encounters regardless the type of service. Furthermore, confidence
benefits seems to be an important variable in the e-business environment according to
Su et al. (2009). Su et al. argue that customers are concerned about trusting
online businesses. Furthermore, customers perceive personal communication as a
more reliable source than impersonal communication (Hennig-Thurau et al., 2002),
which may lead to distrust in the information given through social media by tour
operators. Therefore, confidence benefits seem important to incorporate in the model.

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Functional Benefits
Thirdly, functional benefits are designated as relational benefits. This type of benefits
covers several aspects in the literature. According to Reynolds & Beatty (1999),
functional benefits encompass confidence and special treatment benefits. These type of
benefits are already included separately in the theoretical model of this research.
However, also items referring to knowledge are often included in functional benefits.
Parra-López et al. (2011), Paul et al. (2009) and Wang & Fesenmaier (2004) indicate
the existence of the knowledge aspect of this type of benefits. As Wang & Fesenmaier
point out, members of communities are looking for functional benefits when they search
online to fulfill specific needs. These specific needs may be related to information
gathering which helps in decision-making processes. Since the knowledge aspect is not
included in any of the other types of benefits, the functional benefits in this study will
cover this knowledge aspect. Though, it will not cover confidence and special
treatment benefits in this research as the latter variables are treated separately.
Moreover, confidence and special treatment benefits are variables originally applied by
Gwinner et al. (1998) and later used by many other researchers as well, for example by
Kim (2009), Lee et al. (2008), Ruiz-Molina et al. (2008) and Chang & Chen (2007).

Special Treatment Benefits

Fourth, special treatment benefits will be included in the theoretical model of this
research. This type of benefits is about special deals and treatment which is
unavailable to non- relational customers (Yen & Gwinner, 2003). These benefits
include price breaks, faster service and individualized additional services (Hennig-
Thurau et al., 2002; Kim, 2009; Lee et al., 2008). Special treatment benefits can be
utilized by firms to reward loyal customers and to extend the core service (Lee et al.,
2008). There are already many examples of this being applied in online environments
including social media, which is the reason to incorporate this variable in the conceptual
model.

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Hedonic Benefits
A type of benefits which is little used in the literature, are hedonic benefits. Wang &
Fesenmaier (2004) argue that one must also take into account experiential aspects when
it comes to consumer information searching, because people also pursue enjoyment
and entertainment. According to the hedonic perspective, consumers are searching for
pleasure in their activities. The online network environment of travel communities is
able to bring amusement, fun, enjoyment and entertainment to people (Wang &
Fesenmaier, 2004). Hedonic benefits are the final relational benefits variable included in
the conceptual model of this study, because it is expected that social media are often used
for fun.

Customer Databases and Database Marketing

Marketers must know their customers. . A customer database is an organized
collection of comprehensive information about individual customers or prospects that
is current, accessible, and actionable for such marketing purposes as lead generation,
lead qualification, sale of a product or service, or maintenance of customer relationships.
Database marketing is the process of building, maintaining, and using customer
databases and other databases (products, suppliers, resellers) to make contact, facilitate
transactions, and build customer relationships.

A business database should contain past purchases of business customers; past

volumes, prices, and profits; buyer team member names (and their ages, birthdays,
hobbies, and favorite foods); status of current contracts; an estimate of the supplier’s
share of the customer’s business; competitive suppliers; assessment of competitive
strengths and weaknesses in selling.

Downside of Database Marketing and CRM

Four problems can prevent a firm from effectively using database marketing for CRM.
The first is the large investment in computer hardware, database software, analytical
programs, communication links, and skilled personnel as well as the difficulty in col-
lecting the right data during all company interactions with customers. The second
problem is the difficulty of getting everyone in the company to be customer oriented
and use the available information for CRM rather than carrying on traditional

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transaction marketing. The third problem is that not all customers want an ongoing
relationship with a company and may resent having their personal data col- lected and
stored. A fourth problem is that the assumptions behind CRM may not always hold
true.

Branding
Kotler et al., (2013) states in their book that brands are more than names and images.
They speak to the purchaser's discernments and sentiments about the item and its
execution, so marks really exist in the personalities of the clients. Consequently,
compelling and effective brands have high brand value, which mean the brand has a
positive differential impact on clients. It is additionally a measure of the brand's capacity
to catch customer inclination and dependability. In that capacity, organizations are
precisely building and overseeing brands. Organizations, for example, Coca-Cola,
Disney, and Gucci have made a brand, that is more significant than the genuine item or
administration they deliver. Marks that have the most noteworthy piece of the pie don't
have it in view of exceptional profits or solid administration alone, but since shoppers feel
that they pick up some extraordinary esteem through the brand
(Martin & Brown, 1990).

Brand Positioning
Brand positioning elaborates everything that differentiate one brand from the other,
basically it means it is a point of difference, it is a contrast between what you do a
product vs what you do to the mind of the consumer, a well positioned brand is that which
is considered best in some way by the consumer in agreement with positioning may not
be permanent, many times brands need to be repositioned, a broader scope of it will
elaborate you what the brand will do and what it will not do it will also help for your
brand vision for 5 to 7 years, it investigates the real image of the brand as it exists in the
mind of the consumer, it also supports new brands launches, to manage brand extensions
and in line with umbrella brand, sub brand and single product brand, it is used by brand
managers as a reference guide for internal use and for deciding the dos and don’ts for the
brand, where as marketing managers use it, to understand the competition, it is also used
by marketing directors to manage a category or portfolio, brand positioning statement
(USP), the foot print, bulls eye, key(MARS), brand pyramid, brand finger print,

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positioning ladder(McDonalds) and brand key(Unilever) are different names for it
(Nunnally & Bernstein, 1994).

Brand Loyalty
On one hand brand loyalty occurs when a person get the same product or service
repeatedly from the same source them from other suppliers in marketing view it is a
consumers commitment for using the same brand continuously, in line with brand loyalty
is more than simple repurchasing, true brand loyalty exists through relative attitude
towards the brand, like if you are a brand loyal fan of company X, you will buy company
X product in response to company Y product no matter company Y product is cheaper or
of high quality (Rangaswamy, Burke & Oliva, 1993).

Building Loyalty
Companies that want to form strong customer bonds need to attend to a number of
different considerations.These are-
• Create superior products, services, and experiences for the target market.
• Get cross-departmental participation in planning and managing the customer
satisfaction and retention process.
• Integrate the “voice of the customer” to capture stated and unstated needs or
requirements in all business decisions.
• Organize and make accessible a database of information on individual customer needs,
prefer- ences, contacts, purchase frequency, and satisfaction.
• Make it easy for customers to reach appropriate company personnel and express their
needs, perceptions, and complaints.
• Assess potential of frequency programs and club marketing programs.

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Process Of Building Brand Loyalty
Building brand loyalty is a process as follows like

Social media is defined as “a group of internet-based applications that build on the

technological foundations of web 2.0, and that allow the creation and exchange of user-
generated content (Kaplan, Haenlein, 2010), business or e-commerce may refer to social
media as “consumer-generated media (CGM)”. A common thread running through all
definitions of social media is a blending of technology and social interaction for the co-
creation of value.
Brand community: brand community may have a particular interest in around a particular
brand. For instance, these brand communities provide a social structure for marketing
communication between brand ambassador and customers and have impressive effect on
customer’s loyalty and commitment (Muniz and O’ Guinn, 2001). The foremost features
that members of such communities share each other consisting creating meaning and
talking about it, according to (Mac Alexander et al, 2002). This is analyzed practically-
conceptually to achieve dimensions and constituted factors of such communities.
Corresponding to social media, consumers of brand communities for participating this
have their own motivation. All brands are characterized by a sense of individual
availability, either who person is or have a sense of belonging to which group to fulfill the
social and psychological needs (Elliot and Wattanasu Wan). What is more, there is a
notable tendency to support and to enhance the power of brand communities by
companies which are familiar with the benefits of online brand society.
_Marketing activities in social media: marketing in social media as a process in which
provides an environment (websites) where individuals and companies can converse and

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where companies can promote their products and services online to develop relationship
with customers.
The relationship between customer satisfaction and product: customer satisfaction will
have a significant impact on the present and future life of an organization. Asatisfacted
customer functions as a speaker for advertising company and grabs the attention of
everyone to products or services of company (Shen et al, 2000).
The relationship between customer satisfaction and brand loyalty: practically the obtained
outcomes illustrates the relationship between the consent of customer and loyalty initiate
with product, then followed by the relationship between brand and product and finally
reach its peak by brand. Recent research found evidence that customer’s satisfaction and
brand loyalty has emphasized on brand than products.
Relationship between customer and corporation: Karvana (et al, 1991) defined marketing
as having relationship with customers. In fact, the efficient practical mission of market-
oriented corporations is to develop relationship towards customers. The market-based
researches reveal that market-orientation embrace customer’s commitment toward the
service of organization or brand (Kohli, Jaworski, 1994).
Brand trust and brand loyalty: according to (Schau et al, 2009), there is a theoretical
agreement among researches that includes a fundamental result of creation and an
increase of brand communities, customer experience in brand communities scopes and
establish customer’s commitment toward brand.
The outcomes of this research reveal that social media are efficient and significant in
imagination, reinforcing relationship and network between entrepreneurs and
customers.Habibi (et al, 2014) in his study, “the role of brand community and society
participation in creating brand trust in social media” illustrates that brand community and
social media have much in common with each other. Social media provide an ideal
environment for creating brand community.

Customer-Based Brand Equity

Keller (2003) shows in his exploration that a solid brand might be fabricated by utilizing
the client based brand value (CBBE) display as help. This model gives a benchmark to
organizations to survey their brand-building exertions. As per the model, it includes four
steps: firstly, securing the correct brand personality; also, making the fitting brand
significance through solid, remarkable and great brand affiliations; thirdly, choosing

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constructive, open brand reactions; and fourthly, building brand association with clients
that have extreme and dynamic unwaveringness. To attain these four steps, brand needs to
secure six brand-building squares: brand remarkable quality, brand execution, brand
symbolism, brand judgments, brand sentiments, and brand reverberation. The
accompanying delineates how steps and pieces influence one another.Brand reverberation
happens after the greater parts of the other brand-building squares are created (Keller
2003).

E-Business
With a specific end goal to comprehend plan of action of Design with Benefits it is
critical to characterize the term e-business. It alludes to online transactions: offering
merchandise and administrations on the Internet, either in one transaction or about
whether with a continuous membership cost. Online retail firms purchase items and
exchange them on the web. Utilizing conventional transportation techniques conveys
physical items and advanced items, for example, programming and music, might be
conveyed through the Internet. (Strauss & Frost 2001). Which has gain the popularity
among the Pakistani users, it also shows that other foreign investor interested in Pakistani
markets because it belongs to Rocket Internet is one of the largest E commerce focused
venture capital firms and starter incubators founded in 2007 gained visibility through
eBay, linked in and Facebook etc.

Social network services

Social network services are developed for the purposes of networking and maintaining
relationships. Already in 2007, 25% of internet users visited social networking sites
regularly (Li & Bernoff 2008, 42). Cross-commenting and cross-linking between social
network services can create a fertile ground for advertising (Bruns 2008, 313).

Facebook
From 6 million users in 2006, the amount of Facebook users has grown exponentially to
500 million in 2010 and it has become the world‟s largest social network site (Wortham
2010, B8). The site has become popular
also among companies: As stated earlier in this thesis 72% of Fortune 500 companies
have their own Facebook fan pages.

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Irc-galleria
Irc-galleria is Finland‟s biggest network service. Basic services for companies are free,
but extra space for photos, additional banner advertisement and unique layout can be
bought (Salmenkivi & Nyman 2007, 122-123). The average age of a user is
approximately 22 years and 70% of Finnish teens and young adults visit the site monthly.
The site has 450 000 users.

Kuvake.net
Kuvake.net is a Finnish networking service that has 110 000 registered users. A survey
made by TNS Gallup shows that an average user spends 17 minutes a day on this site.
The average age of the users of Kuvake.net is 19 years.

Blogging
The Blog Herald has estimated that there were already 200 million blogs in 2006 and that
the number has been growing rapidly since then (Salmenkivi & Nyman 2007, 149). Blogs
are regularly updated webpages that have focus on particular topics with a possibility for
the readers to comment and share their opinions on the topic.

Microblogging: Twitter
Microblogging is a type of blogging activity, where the blogs consist of only 140
characters. As with social network sites, having followers is important; the most followed
person at the moment of writing the thesis is the musician Lady Gaga with over 7 million
followers on Twitter. Twitter has become the most popular of microblogging sites with
175 million users.

Lookbook.nu (fashion blogging)

Fashion blogs are blogs that are themed around the fashion industry, clothes and style.
“Lookbooking” is common among fashion bloggers and it means taking photos of oneself
wearing clothes in particular theme, for instance a certain clothes line or brand. Fashion
bloggers usually blog because of personal reasons. The company cannot force the blogger
to write anything about them, and indeed if the company tries to do so, it might turn out to
be bad publicity to the company. Because of this, fashion blogs tend to be considered
more trustworthy than the company‟s web pages or own reviews, so it is crucial to have
good relations with the bloggers.

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RSS feed
RSS feed in social media is often used to summarize a blog post so that fans will be
notified when something new is posted on the blog (Weber 2007, 119; Otala & Pöysti
2008; 32). RSS feed helps the company‟s fans in findability especially if posts are
infrequent (Salmenkivi & Nyman 2007; 170).

Flickr
Flickr is a popular photo-sharing website that is owned by the internet service provider
Yahoo!. The company states on its blog that there are over 5 billion photos on the site
(Sheppard 2010). The site is often used to embed photos on blogs and other social media.
Many companies have photos of their premises as well as products on Flickr (Nyman &
Salmenkivi, 180).

Youtube
Youtube is a popular video-sharing site owned by Google Inc. Some music videos and
artists have gathered several hundred million views, and even some home videos have
collected similar numbers of viewers. Many of these videos have been circulated through
different social media channels to become “memes”, a certai Youtube offers a great base
for different types of viral marketing, where a certain message is passed on to friends via
social media until it finally has several tens of thousands of receivers (Solomon, Marshall
& Stuart 2008, 384). One successful example is Blendtec, which has made a series of
videos named “Will it blend?”. The idea is to use a blender to blend household items,
electronics and so on to demonstrate the power of the blender. (Weber 2007, 187-189).
The videos have had over 140 million viewers in Youtube.n type of viral marketing.
Youtube offers a great base for different types of viral marketing, where a certain
message is passed on to friends via social media until it finally has several tens of
thousands of receivers (Solomon, Marshall & Stuart 2008, 384). One successful example
is Blendtec, which has made a series of videos named “Will it blend?”. The idea is to use
a blender to blend household
items, electronics and so on to demonstrate the power of the blender. (Weber 2007, 187-
189). The videos have had over 140 million viewers in Youtube.

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Virtual worlds
Nyman and Salmenkivi (2007, 205-211) state that in 2010, companies will spend over 3
billion dollars on advertising in games. Many companies have observed that marketing
inside games will be more valuable than marketing in other media. Gamers are receptive
to branding inside games because it makes the game world seem more lifelike and games
and virtual worlds cover a large field of potential customers. For instance, th e virtual
world, World of Warcraft, had over 9 million users already in year 2007.

Second Life
Nowadays, several video games have advertisements embedded in them. These can be,
for example, a billboard in the game world. This is also possible in the virtual world
Second Life, where for instance, the clothing store, American apparel, has had a
storefront. (Megerian 2007).The creator of Second Life Philip Rosendale (2010) states in
the company blog that during the two first quarters of 2010, there were over 800,000
users who logged in to the game several times a month. Company X has not been visible
in this media either, but it sees the potential in the media (Megerian 2007).
Digg, Reddit, Mixx and other social news-sharing sites

Users of social news-sharing sites vary from several thousand to several million
depending on the platform. The idea is that users post links to the site containing
interesting news and other users can vote for the news. The most voted appear on the
front page gathering even more readers. Polls tell about consumer opinions; if negative
news about the company gathers a lot of attention, there is a need to find a way to quickly
respond to it (Nyman & Salmenkivi 2007, 248).

There have been a lot of discussions about the worth of Digg and other social news-
sharing sites. While in 2009 Digg had 18 million unique visitors in the USA, in
November 2010 the number had decreased to 5 million and there have been claims that
news sharers have moved to another popular social media, Twitter.

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Del.icio.us and other social bookmarking sites
Social bookmarking is similar to social news-sharing. While news-sharing sites center on
news and blogs, social bookmarking sites can have all kinds of websites included.
Del.icio.us and
Stumble upon are some of the most popular ones, although several more exist. Social
bookmarking and social news-sharing sites, due to their similarity, can have same
websites on them. As an example of the number of user of this type of media, Stumble
upon has over 12 million members (Stumble upon user statistics 2010).

Discussion forums
There are millions of discussion forums on the internet, either general or for specific
purposes. Companies can also have their own support forums for users to discuss the
products and assist each other on problems with the help of experts from the company
(Evans 2008, 201).

Social Media Marketing

According to Khan and Khan (2012) "a broad range of businesses from small owner
operations to large multi-national corporations are now including new media and social
network marketing and communications as a key element of their marketing and
promotional strategy" (p. 3). Social media is the most cost effective and easy to use
platform to communicate and share information about brands, businesses, new products
and services, events and anything else, (Khan and Khan, p. 4). Khan and Khan (2012)
state that, "this information gets passed on by a company's followers to their followers,
creating a multiplier effect which increases audience,"
Social media networking allows customers and potential customers to take the initiative
and market between themselves. This creates a dynamic ecosystem that incubates and
nurtures relationships between people and the content they create and share (Khan and
Khan). They communicate with one another about the benefits or otherwise of particular
products, sharing experiences - good or bad - and even posting their own advertisements
for the products and services they liked (and, importantly, those they did not) ("Strategic
Direction," 2012,). Social media has allowed customers to talk about what they want,
need, like, and do not like in real time, creating an opportunity for businesses to tap into
this data and connect on a personal level ("Strategic Direction," 2012,).

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According to Sashi (2012) "the interactive nature of social media (its ability to establish
conversations among individuals, firms in communities of sellers and customers, and
involve customers in content generation and value creation) has excited practitioners with
its potential to better serve customers and satisfy their needs". Sashi states that"the
evolution of the internet and in particular the emergence of social media with its enhanced
ability to facilitate interaction between buyers and sellers has captured the interest of
managers seeking to better understand and serve their buyers using these technologies and
tools". The overwhelming interest in adopting this strategic approach can be due in part to
its ability to increase measurements of success for a company. Deglado-Ballester and
Munuera-Aleman (2001) believe brand loyalty generates from: "a substantial entry barrier
to competitors, an increase in the firm's ability to respond to competitive threats, greater
sales and revenue, and a customer base less sensitive to the marketing efforts of
competitors"

Social Media Consumers

According to Greenberg (2010) social consumers "expect information to be available to
them on demand and at the same time have the tools and the desire to share and socialize
that information with their trusted peers - whether they actually know them or not" (p.
411). Social consumers require transparency and authenticity from their peers and the
companies they choose to deal with (Greenberg, 2010, p. 411).
Khan and Khan (2012) state that the social media demographic consists of "your
customers, your friends, your family, your workers, your constituents, your shareholders,
and, like it or not, you" (p. 4). Social consumers feel compelled to share information with
peers they might never have met, but who are "someone like them"

Social Media and Online Sales

Robert Wollan, managing director of Accenture's CRM practice says, "companies that
aren't at least monitoring social media, let alone participating, have a real blind spot as to
what is really driving consumer purchase decisions" (Henschen, 2012,). "Customers want
new and easy ways to interact with companies in a new business dynamic, including
through social media," says Gene Alvarez, research VP at Gartner (Huber, 2011). This
expectation makes it a necessity for companies to incorporate social media into their
marketing strategies.

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According to Sousa (2012) "traditional market segmentation does not provide enough
intelligence on the links between people and what they are likely to buy. The process of
selling to customers by isolating them from their social groups ignores that people want
the buying process to be a social process" (p. 165). Christian Hernandez, head of
international business development at Facebook says, "Purchasing decisions have always
been influenced by friends' opinions, but the social web offers much greater opportunity
for retailers to tap into this" (Smith,2011)
According to Smith, (2011) product and service reviews in the social media space are of
growing importance because audiences have the ability to engage and use these reviews
as a key aspect to their purchasing decisions (p. 19). Nick Sharples, director of corporate
communications, Sony Europe says, "Third-party endorsements are increasingly
important because people like to see what other ordinary people have said about
products" (Smith, 2011, 20). As consumers become increasingly happy to make
purchasing decisions within the social arena, brands are given the opportunity to
capitalize on the social media and e-commerce excitement. According to Huber (2011) by
2015, companies will make half of their online sales from social media and mobile
applications.

Loyalty
Loyalty evokes a strong sense of emotion in human beings and is one of the pillars
that support successful relationships. Business relationships between brand and
customer are no different. When a consumer feels loyalty to a particular brand or
product, they tend to stay lifelong supporters and champions of the brand. They
promote the product to their peers and continue to look forward to and purchase newer
models, editions, etc

Customer Loyalty and Social Media

One issue marketers run into when attempting to strengthen brand loyalty is
communicating why the customer should be loyal to the organization’s mission,
services, and products. Social media is a competitive edge that often needs brand
advocates to ramp up their marketing strategy to stand above the rest. It’s important to
analyze how to maintain a customer base, while continuing to foster brand’s reach.
Customers can be engaged by employing following steps to ensure brand loyalty.

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1.Reward Testimonials: People want to feel appreciated and the best way to show them
appreciation is to reward. Current customers can help the organization with customer
acquisition strategythrough their positive testimonials, so make customers feel
appreciated for their contribution. It can be accomplished by running a photo/video
contest, or simply support them through a social media channel. Also, consider the
promotional benefit B2B testimonials perform. For example, environmentally-focused
companies want to provide testimonials to companies in the sustainability industry
because it helps showcase their commitment to the environment.
2.Returning Customers: For customers who have purchased a product and/or service,
treat them to a discount on their next purchase. This not only demonstrates your
gratitude, but lets them know they are a valued customer. Target this
discount/promotion to returning customers on your social media platforms, and ask
them to ‘Like’ or ‘Follow’ you before claiming the offer if they haven’t already done
so.
3.Customer Service Program: In order to guarantee your customers are happy campers,
it’s important to have a customer service strategy in place to address concerns and
complaints. This is extremely crucial when monitoring negative comments on social
media networks. Don’t ignore the problem in hopes that it will go away. Rather, take an
immediate, direct approach to each customer’s concern. This will position the
company as a brand that cares about their customer’s satisfaction.
4.Unique Value Proposition: People want to know what makes you stand out. In other
words, why should customers pick your company over a competitor? Therefore, it’s
necessary that your company develops a UVP that reaches the targeted audience, and
communicates why you’re worth their investment and time.
.Competitors: Find out what shared or potential customers are saying about the
competitors. By performing a competitor analysis report, one can avoid common
pitfalls, and situate the brand as a thought leader in the industry. The common saying:
“Learn from others’ mistakes” is significant in cultivating relationships with current and
potential customers.

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Social media marketing mix
Chaffey and Smith (2008, 50; 74-75) use the extended marketing mix as a base for their
“remix” of the marketing mix model.

1.Product
The concept of product has shifted from a physical item or service to include
experiencing the brand with, for example, training, testing, installing and servicing. These
extensions of the product can be delivered online. An extended product influences the
quality of the product, and quality can be highlighted with customer comments,
guarantees and money-back offers. Internet marketing can also add to the online value
proposition, showing how to take advantage of being online. These include ease, speed
and cheapness of buying online. (Chaffey & Smith 2008, 56-64).

2.Price
Price models have changed because of the internet and new buying models. Name-your-
price, Pay-Per-View, licenses and bundling are examples of different purchase options for
digital products. For physical products pricing has become more complex because of
commoditization and selectable price packages, discounts, included or excluded
guarantees, refund policies, cancellation terms and so on. Price transparency due to price
comparison sites also puts pressure to reduce prices. (Chaffey & Smith 2008, 64-69).

3.Place
Place in term of the internet is equivalent to distribution and place of purchase. In internet
marketing it is important to have links from relevant sites to the company‟s site, having
an effect on both place and promotion. New distribution models have altered other
aspects of marketing, such as intermediation, where the customer contacts the supplier
directly and affiliation, where customers act as sales people. (Chaffey & Smith 2008, 68-
71).

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4. Promotion
According to Chaffey and Smith (2008, 71-73), there are ten different communication
tools – advertising, selling, sales promotion, PR, sponsorship, direct mail, exhibitions,
merchandizing, packaging and word-of-mouth – all of which can be used to create
dynamic online marketing. These tools can be used in six ways:

Mix: Ideal mix of different communication tools to acquire target customers

Integration: Integrating both online and offline communications
Creativity: Exploiting possibilities offered by the internet
Interaction: Communicating with the customer to expand the experience
Globalization: Global audience
Resourcing: Resources in design, maintenance and customer service

These tools can bring both opportunities and challenges, and they can enrich promotion.
(Chaffey & Smith 2008, 71-77).

5.People
In internet marketing customer service has become “customer self-service”. Services can
be automated and many companies use e-mail notifications, FAQs and on-site search
engines. Automated services help to keep the costs low and reduce expensive interaction
with the staff, while still giving the customer the choice of contact. (Chaffey & Smith
2008, 78-81).

6.Physical evidence
People buying from the internet observe digital evidences for reassurance. Websites with
broken windows or spelling mistakes can drive away potential customers. A simple
website with refund and privacy policies and security icons are examples of good
physical evidence of a trustworthy online store. Online physical evidence can also be
integrated with the offline world, for example printable discount coupons for the concrete
stores of the company. (Chaffey & Smith 2008, 82-83).

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7.Process
Processes are internal and external actions that are necessary to run a business. In an
online store these can include such actions as after order placement including notification
to the customer, change in stock and so on. Optimizing processes reduces the need for
people involved in the process and therefore it minimizes the costs. Processes continue
also after the sale with feedback collection and after sales services. While good processes
aid the sales, bad processes can both harm the brand and terminate sales. (Chaffey &
Smith 2008).

MODELS FOR SOCIAL MEDIA MARKETING

CREF, the new 4 Ps
Sami Salmenkivi has created a model to replace the 4 Ps in internet marketing. The CREF
model consist of Collaboration, Revenue model, Experience and Findability. The model
is useful when marketing especially in social media. (Salmenkivi & Nyman 2007).

The idea behind the CREF model is that it does not need to have a huge amount of capital
involved. Modest investment in the beginning means modest losses in case of failure, or
the investment can turn into a success. Contribution with social media is essential,
because the area of social media is in constant shift and networking will help in deciding
new directions of marketing. (Salmenkivi & Nyman 2007, 289).

Collaboration
Collaboration is to replace promotion in 4 Ps. The idea is that traditional marketing will
turn into two way marketing and the customers will share their ideas with the company.
There are several ways to enhance collaboration, for instance by following discussions on
forums or blogs, or by paying attention to what kinds of comments are written about the
company‟s products and giving suggestions to the readers or other requesting fans to
make their own commercial on Youtube. Crowdsourcing is important, because customers
do not only consume, they are the producers, the marketers and the R&D department.
(Salmenkivi & Nyman 2007, 217). Interaction with the customers can also build the
image and brand of the company (Juslén 2009, 80).

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Crowdsourcing can be divided into four categories: knowledge, action, decision and
information. In knowledge the customer can give his thoughts about new innovations and
ideas. In action the customer can be involved in product development or shooting
commercials for the company, but also contributing by himself as a content provider, for
example, for Wikipedia. In decision the customers get to decide on features of the new
products. One example is Lego‟s affinity pyramid where the most passionate customers
from Lego Club have been taken into the development of new products, thus saving the
company from bankruptcy (Strollery, 2009). Finally, in information the customers share
their opinions in evaluations, such as TripAdvisor in Facebook, or polls, like Digg.com.
(Salmenkivi & Nyman 2007, 217; 248).

Revenue model
The revenue model substitutes price in the 4 Ps model. The meaning of price has lost
significance for several reasons. People have more money so the interest in price has
changed to different aspects, for example to ecology of the product. There is no place for
“average priced” products anymore. People either search for “über-products” where the
focus is directed to experience, quality and marketing. In contrast there are cheap,
generic, brandless products, where findability is the key factor. With search engines and
price comparison sites it is more important to get listed at the top of the search engine
result pages than to compete with minimal differences in price. (Salmenkivi & Nyman
2007, 250-256).
Since social media are usually free, revenue models need to be different. Examples of this
are virtual worlds with virtual goods or a company that gives free products to bloggers to
write about. If the blogger does like the product, it can turn out to be a great investment,
but if the product is bad, bad publicity can arise. (Salmenkivi & Nyman 2007, 262-263).
In internet marketing, giving free content can also be a profitable long-term strategy.
While some users only take what is free, others will also become interested in what else is
offered and be willing to pay for it (Juslén 2009, 282-283).

Experience
Experience compensates for product in the marketing mix. It is not only the product, it is
the experience the customer has when he buys it. Apple uses this method with its
products: there is a unique design for the product and the packaging, marketing and

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quality are involved in the process and even the stores are designed to enlarge the
experience. Apple‟s iPod is more expensive than its competitors‟ products and it has even
fewer features than cheaper mp3 players, but because of strong brand and the experience
that is tied to the product, it keeps itself on top of the sales statistics. (Salmenkivi &
Nyman 2007, 264-267).
Brands are vital part of experience especially when marketing in social media. The bolder
the marketing campaign is the more attention it will get. With social
media, unlike traditional media, there is the possibility to interact with customers and let
them be part of the experience; linking the site is not enough to make an impression, there
has to be an incentive for consumers to add value (Schwatz 2000, 91). All topics can be
made popular with interactive marketing in social media, for example instead of talking
about electricity the marketing can concentrate on global warming and the ecology of the
product. (Salmenkivi & Nyman 2007, 268-272).

Findability
Because consumer behavior is changing, it is more important to be findable than to find a
fixed place in the Internet; findability is thus replacing place in the marketing mix model.
The desired knowledge has to be in the right place at the right time. In 2007 Web and
mobile tracking did a research that found that 93 % of Finns use search engines.
(Salmenkivi & Nyman 2007, 17; 23; 280). Attention needs to be paid to which search
engines are most popular and how to get listed on them. Despite there being thousands of
search engines on the internet, over 90% of all searches are made by the 12 largest search
engines, including Google and Yahoo! (Ash & Lambert 2001, 140).
Being among the top searches helps in findability: as mentioned earlier in this thesis,
social media are ranked high on search engines. Social media are crucial in findability;
via networking and learning to use social bookmarking and social news sharing sites it is
easy to increase findability. (Salmenkivi & Nyman 2007, 278-279). Juslén (2009, 136-
137) adds that to increase findability it is important to create content that users want to
share with others. Usage of multiple social media channels and cross-linking them can
also add findability.

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Styles of collaborative innovation
According to Amy Shuen (2008, 133-134), social media and web 2.0 have changed
innovation from competitive to collaborative action. Earlier companies competed in
capturing marketing with innovative technologies while nowadays collaborative users
have become one of the most important assets. Collaboration can ensue between users,
between companies and between users and a company. Figure 2 illustrates the two-by-
two table of innovation between different combinations of participants.

Word –of-mouth marketing

WOMM has traditionally been defined as an informal, person-to-person communication
between a perceived non-commercial communicator and a receiver regarding a brand, a
product or a service (Okazaki). But now, WOMM is not limited to person-to-person
communication between a non-commercial communicator and receiver; brands and the
people who represent those brands have the opportunity to communicate directly and
personally with consumers. Successful WOMM in this new environment depends on the
transformation from persuasion-oriented, sales- objective oriented “hype” to relevant and
useful information that helps build value within the social network (Kozinets et al.).
social media is considered a new platform for WOMM, departing from traditional face-
to- face interaction, it still involves interpersonal communication with perhaps an even
higher standard for truthful engagement. Social media conversations between consumers
and brands are not sales pitches, but rather open, honest and transparent interactions to
help develop relationships and encourage brand loyalty (Jantsch).
Brands need to recognize the new context in which WOMM is occurring and learn to
properly engage targeted publics in such a way that balances relationship-building,
product promotion, and sales pitching. Additionally, brands need to understand the role
and influence of a new classification of opinion leaders and influentials within these
social networks. It is by properly leveraging relationships and engaging social network
influentials to spread brand messages through content sharing, re-tweeting, and
commenting to encourage purchasing behaviors, that social media strategies can be
considered successful.

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Social Media of word –of-mouth marketing
Social media is transforming the way the public and brands interact. social media is
redefining what we consider successful word-of-mouth marketing. Marketing has
evolved from a transactional orientation to one that is based on relationships and
community-building (Kozinets et al.). It is only after a brand has built a sufficient level
of trust within the community through content sharing and engagement, should they
market to their social network (Jantsch).
In order to encourage product purchase, brands must activate their loyal fans/followers
and encourage their audience, influentials in particular, to complete the marketing
“meaning manufacture” of the products they are selling (McCracken).
In order to understand social media’s impact on commercial marketing efforts it is
important to review the elements that define it, namely interpersonal influence, opinion
leadership and diffusion of innovation theories. The literature has firmly established the
importance of interpersonal communication, and in particular the role of opinion leaders,
in the diffusion of ideas, information and innovation within social networks (Schenk and
Dobler; Valente; Katz and Lazarsfeld).

Opinion Leadership
Opinion leaders have been found to exhibit higher levels of social activity and
gregariousness within their social networks. They display competence, credibility,
authority and self-confidence and extensively use media (Schenk and Dobler). The
classic opinion leader concept refers to influence within homogenous small groups, as
people tend to trust those with whom they share similar characteristics (Schenk and
Dobler) Opinion leaders’ influence is direct and derives from their informal status as
individuals who are highly informed, respected, or simply “connected.”

Diffusion of Innovation
The diffusion of innovation theory is based on the process by which a few members of a
social system initially adopt an innovation (like purchasing a product or embracing a
brand), then over time more individuals adopt, until all members have done so (Valente).
The theory contains four classifications of adopters: (1) early adopters; (2) early majority;
(3) late majority; (4) laggards.

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There are more than 3 million active fan pages on Facebook, with about half coming
from businesses. Additionally, more than 20 million people become fans of Facebook
pages every day (Facebook.com). A Facebook fan page allows brands to create pages
dedicated to promoting their brand messages while encouraging activity from fans and
non-fans alike. Facebook users can easily post comments and links on the fan page along
with any brand-created content.

Social Influence and Size of Networks

brand like Starbucks or Ford on Facebook or re-tweet a Twitter post based on what their
“friends” are interpersonal influence is the tendency to conform to the expectations of
others. Individuals are motivated to adopt behaviors by a desire to enhance self-image by
association with a reference group or to achieve a reward or avoid a punishment.

Weak Ties
As brands continue to infiltrate relations within social networks, the “self-interested
logics” of the market may undermine the “sharing/caring” communal ideal and threaten
the traditional social contract of the group. Interaction with these brands in terms of
adding content, providing comments and spreading messages therefore causes tension for
the individual engaged and makes them less likely to share content with their strong ties
(Kozinets et al.). Therefore, individuals with many weak ties are best placed to diffuse a
difficult innovation like a marketing message. Adoption of a difficult innovation requires
a higher threshold of adopters before a global cascade occurs and the diffusion is
considered successful (Granovetter). Individuals with many weak ties and strength of
personality function as bridges between weakly tied social networks (Schenk and
Dobler). Thus, a Facebook user with numerous weakly connected “friends” may be more
apt to share a message about Starbucks or send their network a link to join a Facebook
fan page. These individuals are ideal for disseminating brand information and helping to
complete the meaning manufacture for brand messages.

Case Study Analysis

What follows is an analysis of the strategies of branded social media campaigns that
attempt to leverage interpersonal influence and the two-step flow of information to
encourage brand loyalty and increase product sales. The case studies include Ford’s

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campaign to introduce the new Ford Fiesta, Chevy’s user-generated “Create Your Own
Ad” to promote the 2007 Chevy Tahoe, and Starbucks’ use of innovative social media
strategies to engage with consumers including the development of the user-generated
suggestion site MyStarbucksIdea.

A significant portion of the research and commentary collected for each analysis has
come from relevant blogs. Although these blogs are representative of the author’s
opinion, there is growing recognition of the legitimacy of blogs, especially concerning
social media. Many blogs are ahead of mainstream media in terms of breaking stories in
their own industry (Kent) and for an industry that is changing so rapidly, blogs are an
appropriate medium to collect and analyze information and opinion about the success of
various social media strategies.
Ford Fiesta Movement
In late April 2009, Ford unveiled a campaign to generate excitement and support for the
launch of the Ford Fiesta to be sold starting in the summer of 2010. Ford had not been a
player in the small car market since discontinuing the Ford Fiesta in 1997 and at a time
when consumers were spending less and more apt to respond well to a small, fuel-
efficient vehicle, the Fiesta was seemingly well-positioned to generate substantial
interest. However, a successful and profitable new car launch would be a difficult given
the economic challenges faced by many of Ford’s potential customers.
Ford has developed a dynamic social media presence under the direction of Scott Monty,
head of social media at Ford. Monty has transformed the way Ford has approached their
communication and marketing strategy and it is with this digitally innovative approach
that the Fiesta Movement was expected to be “one of the most visible, informative social
media experiments in the automotive world” (McCracken).

Background
The Fiesta Movement began with Ford giving 100 company-selected “agents” from all
over the United States a new European-style Ford Fiesta to drive for six months. Ford
assigned each agent a monthly mission to complete after which they were expected to
record their adventures and opinions of the Fiesta in a series of blog posts, tweets and
videos. The themes of each mission were travel, adventure, social activism, technology,

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style, design and entertainment. The agents’ stories were documented using Twitter,
Facebook, Flickr and YouTube.

The agents were selected based on their potential as “culture creators.” Meaning each
one was already a proven YouTube storyteller in their own right and could earn a fan
community on their own. The Fiesta Movement missions would allow these individuals
(and married couples) to experience situations they wouldn’t normally get to document;
adding to their online narratives and creating value in their communities (McCracken).
Each agent demonstrated a strong presence on the web, an ability to craft a compelling
story through video, and an inclination for adventure.

Social Media Strategy Details

The Fiesta Movement used a combination of Twitter, Facebook, YouTube, Flickr, blogs,
and a website dedicated to Fiesta Movement agent profiles, updates and information.
Each platform included integration with the others through links, feeds or sharable
“chicklets” prompting users.
to share, comment on or follow the Fiesta Movement via their preferred social network or
information stream.

Fiesta Movement Site

The Fiesta Movement site is the main platform through which potential consumers can
follow the activities of the 100 Fiesta agents. The site includes a live feed of all updates
embedded from where they came from (e.g. YouTube video, Flickr photograph, tweet).
Although content can be uploaded, updated and stored in different social networking
sites, the Fiesta Movement site consolidates everything in one place. The site also
includes detailed profiles of each agent featuring a short, pithy, self-description, as well
as links to their blog and profiles in YouTube, Not only can potential consumers search
for content based on its creator, but they can also explore content based on its mission
classification: travel, adventure, social activism, technology, style, design and
entertainment. The mission examples below are from entertainment and technology.
For Brittani Taylor’s Parody Hilarity mission, she is challenged to parody a popular
movie, record it and post it to YouTube. The video opens with a graphic of the Ford
Fiesta and an introduction from Brittani explaining that she will be re-creating a scene

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from the film “Where the Wild Things Are.” The production is obviously homemade,
with amateur costumes and Brittani’s friends in the supporting roles. However, it is
expertly edited together which is evidence of Brittani’s online video savvy. The short
video ends with a shot of Brittani asking her viewers to check out all her Ford Fiesta
adventures and make comments on the content.

Twitter, YouTube and Flickr

If the Fiesta Movement site was the backbone of this social media campaign, then
Twitter, YouTube and Flickr were the legs. The mission content added to each of these
sites was then shared, embedded, posted across agent blogs and the Fiesta Movement site
live feed. Twitter was the catalyst for information sharing, however comments were also
collected directly on each agent’s content on YouTube and Flickr.
The Fiesta Movement included a number of Twitter names and hashtags, allowing
consumers to follow @FiestaMovement or @FordFiestaAsk for agent updates and
answers to submitted questions. Consumers were also able to follow the hashtags
#fiestamovement #fiestaAsk to read additional content related to the Movement. The
Twitter hashtags allowed users to follow tagged information designated by the “#” sign,
rather than just following an individual account.
The “Ask a Driver” portion of the website allowed users to ask a Fiesta-related question
to one of eight featured agents. Each question was classified with a #quality, #design,
#tech, #drive or #fun hashtag depending on its content.

Each agent also maintained their own Twitter accounts where they answered questions,
linked to information about their missions, and interacted with other agents and fans.
Although these were seemingly personal accounts, it was made clear that each individual
was communicating as a Fiesta agent.

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Facebook
The @FordFiesta Twitter stream was also integrated with the Fiesta Movement fan page
on Facebook. The fan page offers a platform for “fans” and Fiesta Movement staff to
share Fiesta- related content with each other, post opinions and generate excitement for
the launch of the vehicle in the summer of 2010. The content is representative of the
free-spirit, adventurous, fun “persona” of the Fiesta itself and its potential drivers.

However, the fun nature is also balanced with useful consumer information such as the
announcement telling consumers they are now able to order a Fiesta.

Additionally, there is an active exchange of information as questions and comments are

addressed directly by Ford Communications staff.

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Results
From April to October 2009, the world got to experience firsthand what it was like to
drive a Ford Fiesta through the videos, pictures and tweets of 100 social media savvy
“culture creators.” During the six months of the active campaign, the agents’ videos were
viewed 6.5 million times on YouTube, their Flickr slideshows perused by 740,000 people
and their Twitter updates reached approximately 3.7 million people. Over the course of
the campaign Ford identified over 100,000 “handraisers” who expressed interest in the
car, as well as secured 6,000 sales reservations – half of which were from customers who
had never owed a Ford in the past. These reservations were made well in advance of the
Fiesta’s actual release date in the summer of 2010 (Ford.com).
Additionally, these videos, pictures, tweets and blog posts generated during the campaign
will remain on these websites, blogs and in search engines into the future, and will
continue to be read on later dates. Unlike paid media, which disappears the minute you
stop paying the fees, earned media such as this continues to be seen by millions long after
the initial date of posting.

Additional Components
As a complement to the Fiesta Movement-created online content, the news media and
blogosphere picked up on the popularity and “buzz” about the campaign and many
drafted their own discussions of Ford, the Fiesta and the Fiesta Movement. From January
2009 to December 2009 a Google search of news stories produced 266 mentions – with
December experiencing the greatest number at 34 mentions. Within the blogosphere, a
Google search from the same time period produced 6,640 unique blog mentions.

Motivated by the growing popularity of the Fiesta Movement and its agents, Ford
designed a tweet-up of Fiesta enthusiasts at the Palladium in West Hollywood.
According to the social media glossary at Socialbrite.com, a “tweet-up” is an organized
or impromptu gathering of people who use Twitter, or in this case people who are fans of
the Fiesta Movement and the Ford Fiesta. The purpose of the tweet-up was to honor the
Fiesta Movement’s favorite agents (as voted on by fans) and to show off the North
American model of the Fiesta before its official reveal at the L.A. Auto Show months
later.

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The tweet-up attracted 1,149 fans, agents and Twitter friends, making it the world’s
largest tweet-up. The event even set a Guinness World Record for the most attendees at a
tweet-up ever documented. It is most likely that this event incited the peak in news
stories in December 2009.

Due to the excitement and awareness built by the first six months of the Fiesta
Movement, Ford decided to create a second edition Fiesta movement beginning in
February 2010. The second edition is designed in a similar fashion as the first, with
agents completing various missions over a limited amount of time, except instead of 100
individuals or married couples, there are just 20 teams of agents. The first edition of the
Fiesta Movement was about developing awareness, while the second edition is about
increasing concrete purchasing decisions as the Fiesta’s official launch dates approaches
(Motortrend.com).

Analysis/Conclusions
Because at the time this case study was written the Ford Fiesta had not yet been officially
launched and initial sales figures not available, it is not evident yet if the Fiesta
Movement social media campaign was truly successful in a sales sense (other than the
6,000 sales reservations). However, it is evident that the first edition of the Movement
created substantial excitement and awareness of the brand, which according to Connie
Fontaine, Ford brand content and alliances manager, was its purpose (Motortrend.com).
Additionally, many social media campaigns are designed to promote awareness and
brand recognition but never follow through on the increased interest that is generated.
Ford shows a departure from the status quo with the introduction of events like the tweet-
up and second edition Fiesta Movement. The company has developed a way to sustain
relationships developed with consumers until the official launch of the vehicle when Ford
hopes their fans will turn their excitement and loyalty into spending. Because the Fiesta
is a “new” product for Ford the brand did not have a historically loyal following (apart
from Ford loyals). By hand-selecting or “buying” loyal fans (the agents in this case)
Ford was able to help encourage consumers with higher adoption thresholds to develop a
relationship with the brand. However, the Fiesta Movement is seemingly a paradox
between “real people with real experiences” and pre-determined representatives of the
Fiesta’s target demographic assigned pre-packaged, brand-specific missions that “real”

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consumers probably wouldn’t encounter as an owner of a Ford Fiesta. The selection of
the agents, while representative of the Fiesta’s target demographic, were not
representative of the population in general as they were selected based on “characteristics
of online social vibrancy” including active accounts on Twitter, YouTube and Facebook
(comment from Scott Monty, (Collier)). But, Ford managed to temper the sense of
“unreal” by instructing each agent to provide “100%
honest feedback” including both positive and negative reviews. The agents were not
expected to necessarily persuade potential consumers to buy a Fiesta, but rather provide
useful and entertaining information to enhance their own online reputation and build
loyalty around the brand that would eventually lead to sales. Successful WOMM through
social media depends on the communicator’s ability to balance promoting brand
messages with maintaining a positive reputation among their weakly-tied social network
of fans, followers and even critics, by providing honest, engaging, useful information
(Kozinets et al.).
Many companies are wary to engage in social media and online WOMM because they are
afraid they will lose total control of their message (Maddock and Viton). WOMM in
social media allows for the free exchange of messages among group members who each
add their own value
and meaning to the message as they pass it along, many times altering its original
meaning. Ford understood this concept, and although the Fiesta Movement was formed
by messages created by “real people with real experiences,” those messages were guided
by basic campaign pillars and reinforced major brand characteristics of high quality,
technologically innovative, well-designed, and fun to drive. These characteristics were
present in the nature of the missions each driver was assigned to complete and in the
categorization of their videos, pictures, blog posts and tweets.
Because most consumers are resistant to marketers who clearly and directly seek to
influence their attitudes and purchasing behaviors, Ford developed a creative way to
unsuspectingly force- feed their brand messages to consumers in the form of transparent
peer word-of-mouth marketing. In this way Ford turned its brand into an enabler of
cultural production that is interesting and fun so that the marketer is working with
contemporary culture instead of against it (McCracken).

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Social Media Engagement IS Advertising
Social media is a defining factor in brand perception through the eyes of your target
audience. As I mentioned in our 8 Key Points in E-Commerce & Social Marketing
post. . If a business lacks a strategy to establish not just brand presence and loyalty but
consistency, it’s not going to succeed – it’s that simple.
Direct reader engagement through social media is one key solution in not only
developing a new relationship between marketing and readership, but to establish an
exchange of information on both sides of the publish button. Polls, contests, giveaways
and user-generated content initiatives are reflex methods brands should be actively
testing across social platforms to offset reader fatigue from more traditional advertising
strategies.

STRATEGIES
Champion Your Own Efforts
There has never been a better time for a brand to trumpet its socially responsible efforts,
resulting in a halo effect for the company. Establish your brand through a compassionate
lens, partnering with charities, philanthropic organizations and beyond, and wear those
associations on your marketing sleeve. Utilize socially-conscious hashtags users can
regularly return to and even share as a means of measuring your brand’s dedication to the
greater good.

Custom Platform, Custom Voice – With Consistent

Audience interact differently on Twitter than on Facebook, Instagram and so on, and
engagement triggers vary across platforms.While remaining true to core brand values
&ideals and a consistent message, it’s important to strategically format tour social
media marketing to fit the particular platform while furthering your brand’s narrative.

Explore Multiple Social Platforms – and Innovate

Developing new tricks and methodologies are essential for survival in the social media
wars, and consistently kinetic advertising evolution is a must. A Facebook account alone
isn’t going to cut it – building a community around your brand requires an engaged
readership, and keeping up with the social media Joneses requires its own dedicated
effort.
Explore emerging social media platforms in addition to the tried and true, and experiment
with new opportunities. If your business doesn’t have dedicated accounts in FB, Twitter,

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Pinterest, Instagram or even Snapchat and beyond, you’re already behind in the game –
take a moment to register new accounts, and begin developing strategy immediately.
The Explosive Potential of User-Generated Content
Whatever service or product your business provides, if it’s worth its weight in binary
code, it’s possible to turn casual readers into vocal supporters. Only some will be
driven by an evangelistic fever to promote your brand, but engaging your audience
is absolutely essential – as is inspiring them to do your work for you.
We can now instantly communicate with others whether they are in the same city, the
same country, or halfway around the world. Before social media became the buzzword
of today, companies found it challenging to gather feedback about their products,
services and brand. Most of the time, companies didn’t know how customers felt,
especially if they weren’t happy. It’s definitely a different story today, with the
Internet and social media, anyone can express their opinion about anything, making it
much easier for companies to gain feedback from customers. Whether it’s a comment
posted on a company’sFacebook page, a hashtag on Twitter, or a picture posted on
Pinterest orInstagram, customers can now express their pleasure or displeasure at any
time. This is extremely valuable.

Improve products or services

To be successful on social media a companys hould follow this- Build and maintain
strong relationships. Social media makes it easier than ever to develop strong
relationships with your customers. It not only gives your business a platform to keep
customers up-to-date with the happenings of your company, but it also allows you
to humanize your brand and give it some personality. With this, you are able to develop
relationships with your customers which they will notice and appreciate. They want to
be able to connect with your company and be heard. By listening to what customers
have to say, you can address any issues they may have and possibly turn a negative
experience into a positive one.

Manage your reputation

The Internet is great for sharing information instantly but this can also be a bad thing.
Negative information about your company (even if it’s not true) can spread like
wildfire and quickly destroy your company’s image. Luckily, social media can help

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you address both positive and negative comments. Be sure to thank or reward people
who step up and say great things about your company and brand. Not only does this
make the person feel great that they are being recognized but it will encourage others to
voice their support as well. When it comes to negative comments, the worst thing you
can do is ignore them. Remember Lulu lemon and their transparent yoga pants? At
first, they were ignoring comments by posting on their social media accounts about
unrelated topics. This only made customers angrier that the company wasn’t
acknowledging their complaints. What you should do instead is address negative
comments as soon as possible. This will allow you to take action and solve the issue
which will make those customers happy. Ignoring them will only make them feel like
you don’t care about their business, which could make them switch over to your
competitors.

Stay Ahead in Competition

We’ve discussed how listening to what your customers have to say online about your
brand can help improve products or services, relationships, and your reputation, but you
can also gain excellent information about your competitors. For example, if a competitor
has come out with a new product or has implemented a new marketing technique that
seems to be successful, you can use this to help improve your company’s own
strategies. Also, if you see complaints about a particular issue, this can help to
prevent your company from making the same mistakes. As you can see, listening to
what you customers have to say about your brand and company is extremely important
in order to stick out from the crowd. If you don’t, customers will feel ignored and you
risk losing them to your competitors. Come out on top by investing in a social media
listening strategy that will give you great insights on what your customers are thinking.
You have probably heard over and over again that the notion of “loyalty” has all but
disappeared in the past few years. With an abundance of options to choose from, little
seems to be truly effective in retaining current customers and turning them into brand
loyalists. Is all hope truly lost, or is there a secret recipe that can keep your guests
coming back? As a matter of fact, there is and it’s called social media intelligence.
So what does this business buzzword mean? It’s knowing what your customers
want and providing it consistently across your locations. Marketers and operations
managers ask themselves ‘what do customers want’ everyday. The smart ones use a

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social media listening tool to learn what their customers actually say they want in real-
time.

Acting Intelligently
Social media intelligence can be used to remedy a variety issues in any business. A
certain hotel chain got comments from guests that the complimentary Internet provided
in the rooms was too slow and unreliable. While it was possible to improve the Wi-Fi
quality by switching providers, managers were uncertain if the issue warranted such a
hefty investment. So what did they do? You guessed it. They turned to social media
intelligence. Majority of the guests in that particular hotel location cared more about
the great location and the killer breakfast buffet. Still, there were those who minded
the Internet and threatened not to return. The manager then came up with a cost-
effective solution based on the social media feedback – provide reliable high speed
Internet for a small fee. A few weeks after the decision, complaints about “weak
signal” and unreliability virtually stopped, and the flow of regulars
increased.Remember loyalty is rooted in exceptional service. It is essential to provide
superb service and address your guests’ concerns – but first you have to know what
those are. Just don’t do it alone, find a tool that fits your team’s needs.

Techniques for Building Customer Loyalty with Social Media

Social media connects you directly with customers and provides a venue for building
customer loyalty. Remember that there’s more to social media than a post here and a
tweet there. Keep these five tips in mind when it comes to social media.

Keep your word

Keep your promises. Yet what often happens is that companies get so caught up in
offering exclusive discounts and offers in an exchange for a “like” on their page that
they forget to deliver. But the great deals that were promised aren’t delivered.
Companies promise to tweet “you don't want to miss this” news, but their tweets are
few and far between. Loyal customers feel betrayed, and they start looking elsewhere.
Make your social media accounts – and the promises you make on them – a priority.

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Listen and respond
Ignoring a question, complaint or concern from a customer via a social media site is
like not returning a voicemail left by a customer. Eventually that customer gives up –
and probably tells a number of his/her friends about the bad customer service he/she
received. When you have a social media presence, you create another way for
customers to interact with you. Treat complements, questions, complaints and concerns
the same way you would if they were sent via email or phone.

Be consistent
Think of your social media presence the same way. Why should customers trust you if
you post updates or tweet inconsistently? Is your latest blog entry six weeks old?
Inconsistency presents itself as a lack of caring and a lack of commitment. Don’t get
dumped; be consistent.

Accept criticism
When you enter the world of social media, you enter the world of “putting yourself
out there.” Sure, customers can email you or call you with their criticism, but the whole
wide world doesn’t see it. When a customer leaves a less-than- glowing remark or
review, your initial response will most likely be one of defensiveness. Tell a co-worker,
write your response on a sticky note and tear it up, close your door and have your
rant, whatever it takes. But whatever you do, don’t get emotional on the social media
site.

Be committed and caring

With social media, you have the chance to show people how much you love your
business and your customers. You get to show your passion! You get to show you’re
committed and that you care. Yet while social media is a revolution in our ability to
connect with customers, both one on one and on a bigger scale, successfully improving
customer loyalty through social media requires a different approach than standard
brick and mortar strategies. Nothing replaces world class products and great customer
service. But they’re not enough either. Here are six strategies to keep in mind that
will kick your word of mouth marketing to the next level. Make it easy to follow you:
Social media can provide direct access to your most valued customers. It’s important

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that you give customers an easy means to connect with you on different networks.
Prominently display your social account icons on your website, and install an easy
sharing app for all your content. List your accounts on your collateral, in email
signatures, newsletters, and anywhere else that your customers are likely to encounter
your brand.
Make it easy to find you: Make sure to use your brand name, or as close as possible,
on the major networks and list your company name and URL in your social media
account descriptions. Sounds simple, but so many businesses miss this step when
setting up accounts. Getting the right infrastructure in place goes a long way to helping
you build your social following.
Reach out to your existing customers and contacts: Getting connected with as many
customers as possible is the first step in using social as an effective loyalty tool. Before
you start buying advertising and worrying about tips and tricks for attracting likes and
followers, make sure you’re proactively using your existing network to get established.
Offer high value content that shows your expertise, including social media
exclusives: Use great content to demonstrate your knowledge, products, and unique
value proposition. Social gives you an unusual ability to do that through short bytes,
video, images, and more. Diverse content types help you establish a foothold on
different networks.
Gear that content directly to your customers: But the most important factor is
that your content is targeted specifically at your customers. Don’t write for your
industry peers or your colleagues. Conduct market research and find out what problems
are urgently facing your market and offer content that helps educate, inform, and inspire
them. The more valuable your content is, the more it will help deepen your
relationships over time. It will also help create the context to convert customers into
brand advocates, encouraging them to share your content with their friends, family,
and colleagues.
Actively engage with your customers: Many companies talk about the importance of
doing social media. The key to powerful business-to-customer social relations is that
you need to change your mindset from “doing social” to actually “being social.” Don’t
just constantly push content out to your users, no matter how valuable. Take the time
to really have a conversation. Are you responding to comments that are left for you?
Thanking people for retweets and sharing other people’s content is good social

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etiquette. By being social, you create the kind of persona that goes “beyond a brand”
and allows people to make a genuine connection.
Quickly address customer service concerns: We’re now in an age where one of the
fastest ways to get customer ervice concerns addressed is through public complaining.
Any number of businesses can tell you about the potential impact of dissatisfied
customers taking to Twitter, Facebook, and YouTube with their complaints. Use
customer concerns to build loyalty, with that customer and with the audience that’s
watching.
Embrace a transparent approach: Acknowledge every complaint and work to address
it quickly. Adhere to your policies, but do your best to find a resolution that satisfies
everyone. Don’t be afraid to approach problems in a spirit of transparency, and instead
focus on your commitment to resolving issues when they do arise.
Develop special promotions and contests: Customers have a choice to engage with you
through a number of channels. Social presents a unique opportunity to “meet your
customers where they already are.” You never want your social media activities to
feel like an interruption; instead, you want to capture people’s attention and get them to
engage. Exclusive promotions and contests are a great way to do that in a format that’s
optimized for social. Country Outfitters’ ongoing Facebook promotion is a great
example: each week, they present a new panel of cowboy boots. Followers are asked to
like and share the boots; everyone who does is entered for a weekly drawing and
someone wins a pair. At last count, they were up to over 5 million followers.
Know your metrics: Is social media really contributing to your customer loyalty
efforts? The only way to know is to measure it. Initially, this can feel difficult to
quantify, but it’s all about identifying the right metrics. Hoot suite developed a
particularly useful white paper on this issue. Specific customer metrics can include
looking at the following on a per customer basis: brand mentions, web visits, referrals,
and time on site. If these are increasing on the average, that’s a good sign your social
efforts are yielding results. You can also look at specific processes to evaluate the
impact of social, including customer recruitment, resolving service concerns, and
cancellations. If the time and money spent and customers lost are decreasing, you’re on
the right track.Smart entrepreneurs approach social interactions with a customer
oriented, value creation mindset and look for opportunities to create genuine
engagement.

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After consumers have purchased their desired product, the amount of satisfaction the
consumer feels will determine whether or not the consumer makes a repeat purchase of
the same product with the same company. According to Howard 1989, consumers are
more likely to recall an advertisement of a company if they have a favorable attitude
towards the company. Consumers also tend to have selective attention and only have a
certain amount of cognitive capacity to hold memories about advertisements (Yoo 2008).
Companies need to make sure their customers are as knowledgeable about their products
as possible to ensure they are satisfied with their purchases to keep them coming back to
their company
An attitude a consumer receives from an advertisement could be through a verbal or
visual message. However, if an advertisement does not already correlate with the
consumer’s beliefs and values, the advertisement will most likely be rejected (Sutherland
1993).
Since technology is becoming more advanced every year and advertisements are showing
up online more than ever, online marketing is becoming a part of the marketing plan for
many businesses. Online marketing is becoming more popular and posing a threat to
traditional marketing tactics, including, but not limited to: newspapers, magazines, radio,
and television (Kassaye 2007). However, companies need to keep in mind their efforts
through search marketing and online marketing are more about results than it should be
about having the most advanced technology (Pingel 2005). If companies are basing their
strategies on implementing their advertisements through the most advanced technology
and no one is responding, the company needs to re-evaluate their strategy techniques.
A company’s website, as a form of online marketing, can affect the way a consumer
perceives the brand of a company. The creativity, amount of information, and the ease of
navigation weigh heavily in the mind of a consumer; along with what type of product the
consumer is searching (Lepkowska-White and Eifler 2008). However, the creativity and
design are less important in regards to the measure of how the website relates to the
preferences of the target market (Kassaye 2007). The amount of information provided
through online marketing could be helpful to consumers lacking knowledge, but could
also be overbearing to a consumer looking for a specific product with limited time. Social
media can be a positive form of advertising for a company since it is essentially free
advertising to the consumers who have the same social media site. According to Lee,
Jarvinen and Sutherland, Facebook and Twitter are the two most popular social media
sites and as of March 13, 2010, Facebook has been recognized by Hitwise as the most

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visited website, surpassing Google. With Facebook being so popular and so well-known
to consumers, it is no surprise that social media can reach a vast majority of people that
normally would not be able to be reached with previous marketing techniques (Evans
2011). Since social media is so popular, word of mouth can be a positive or negative
characteristic of social media. Consumers have a variety of separate communities
through social media sites and word of a positive or negative representation of a
company or a product could travel faster than expected (Weber 2007). Social media
creates awareness and can be tracked by reviews and comments of a specific message
(Evans 2011).
The amount of consumers who consider themselves to be a “fan” of a company’s social
media site can also be tracked and can be beneficial to a company’s target market
strategy (Funk 2011). Consumers can follow their favorite companies on social media
sites, such as Facebook and Twitter, as a way to stay informed of the latest products and
other news regarding the company. Social media allows consumers to participate and
become interactive with a company’s social media site, which permits consumers to feel
a sense of equality between themselves and the company (Evans 2011).
The ability to create a relationship with a consumer is essential for a company to
maintain for many years, if not for a life time. One of the objectives for a company’s
online marketing and social media strategy should be to maintain a relationship with its
customers (Chang 2009).
Another important aspect companies need to address is to differentiate their products or
services away from the competition and showcase the features and benefits their products
display over the competition (Czerniawski and Maloney 1999). Showing how one
product is better than another product will allow consumers to gain knowledge of the
benefits of the product with the possibility of relating their needs to the features of the
product. . However, with social media still relatively new to the business market, the
effectiveness of promotions through social media in hopes of brand loyalty still remains
unanswered.
Two types of research were conducted by Fallon in order to make conclusions regarding
the brand loyalty of customers due to the social media sites of businesses.
 The first research method consisted of an online survey. The participants for the
survey included 500 randomly selected undergraduate students.

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 The second research method was through face-to-face interviews. Ten companies in
the La Crosse, Wisconsin community were selected due to the fact they obtained a
Facebook social media site.

Results (Survey)
When analyzing the data from the online survey, 59 out of the 63 participants had one or
more active social media sites, so the rest of the data is based on those 59 participants.
Results are shown in the graph- 14
Participants of the online survey were given three choices: food (specifically while at the
grocery store), retail (department stores and/or superstores), and pharmaceuticals (over-
the-counter medications). As shown in Figure 3, from those three industries, 76% of the
respondents said they were brand loyal to retail stores and 61% of the respondents said
they were brand loyal to the food industry. According to Mueller 2011, companies should
update their social media sites at least once a day. Most of the companies interviewed
were only updating their social media sites a couple of times a week. These companies
should consider updating their accounts more consistently in order to gain more exposure
to their target markets. When asking consumers whether they believed themselves to be
brand loyal, most consumers only thought of themselves to be brand loyal some of the
time. Very few of the respondents claimed they were always brand loyal to one specific
product or store over another product or store.

A graph can be repredented here-

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Nielsen’s (2012: 10) survey showed that social ads were influencing purchasing behavior,
for example, social media when making purchases in the clothing and fashion sector
influenced 58 percent of respondents. Naturally, marketers need to move to where they
can interact with the consumers, which nowadays involves the Internet more and more.
The results of this study shows that advantageous campaigns on social media are the most
significant drivers of brand loyalty followed by relevancy of the content, popularity of the

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content among friends, and appearing on different social media platforms and providing
applications. First of all, companies that want to run effective social media campaigns
should take into consideration the benefits, values, advantages they offer to the consumers
in their campaigns, what makes the consumers more likely to become loyal to their
brands.
Relevancy is the second most important factor affecting brand loyalty; therefore,
companies have to keep themselves updated about what customers are interested in, their
activities, and current perspectives in life. Companies may conduct qualitative research or
observations to understand the lifestyle of their customers and transfer this knowledge on
social media platforms. Finally, the popularity of the content among friends also increases
brand loyalty of the consumers. Impact of word-of-mouth in marketing is non-negligible,
especially in online environments (Gruen at al., 2006).

This study was conducted in response to recent utilization of social media to increase
consumer loyalty to a brand through a variety of tactics, tools, and strategies. Recently,
social media marketing has become a growing trend among professionals in the
marketing and public relations industries. Since the majority of case studies involved
vague aspects regarding social media as a tool and the effects it has on consumers, it was
essential to gather data from experts in the marketing and public relations fields regarding
their opinions on successful social media marketing. To find more information on the
current tactics, tools, and strategies being utilized by professionals, experts from these
fields were interviewed based on a single questionnaire designed to answer the following
questions are find as follows-
The literature reflects this popular theme. "Social media is the most cost effective and
easy to use platform to communicate and share information about brands, businesses, new
products and services, events and anything else" (Khan and Khan).
The literature includes customer service as a tool to increase consumer loyalty to a brand.
Sashi states that, "the evolution of the internet and in particular the emergence of social
media with its enhanced ability to facilitate interaction between buyers and sellers has
captured the interest of managers seeking to better understand and serve their buyers
using these technologies and tools". The literature stresses these strategic aspects as well
to effectively managing a brand. "The more effectively a company responds to complaints
and positive feedback posted online, the more quickly they will demonstrate that they

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care about the consumers concerns, leaving customers happy and feeling as if they made
a contribution to the brand" (Handley, 2012, p. 24).
The literature also demonstrates how the transparency elicited through social media has a
direct effect on consumer's loyalty to a brand through the purchasing of their products.
"Product and service reviews in the social media space are of growing importance
because audiences have the ability to engage and use these reviews as a key aspect to
their purchasing decisions" (Smith, 2011, p. 19).
The literature provides a pattern of measurements often used within the marketing and
public relations fields to gain further insight into success. "Brand loyalty generates from:
a substantial entry barrier to competitors, an increase in the firm's ability to respond to
competitive threats, greater sales and revenue, and a customer base less sensitive to the
marketing efforts of competitors" (Delgado-Ballester and Munuera-Aleman, 2001, p.
1238).

CONCLUSION
It is concluded from this research that the digital media is playing a key role in creating
brand royalty since advertising it has changed from traditional to digital, so, there is a
much scope available in this area. As it is very much clear from the research that
consumer interest is increasing in this type of marketing platform most of the companies
in Pakistan, especially big companies like (Coca-Cola, Unilever, P&G, Gucci) have
successfully created their brand image and brand association by engaging various
activities of digital media.
In today’s world digital media is important because it is cost effective, develop more
awareness and also the queries put forward by the consumers are answered by the
companies quickly. Through digital media companies constantly improve themselves and
try to create a good image about the product. Digital media is growing in Pakistan as the
number of people using Internet is on the rise. Keeping this in view companies can
increase their customer base and build upon the loyalty that is there among their existing
customers.

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Customer Loyalty Through Social Media

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