Impact of social media on Consumers Buying Behavior

A Research Paper Presented to the

Faculty of School of Business and Information Technology

La Consolacion College Bacolod

In Partial Fulfillment in the course of

Marketing Research

Renzy Marie Cuajao

Carl Mark Escander

John Carl Gonzales

Kent Macalalag

Ma. Charisse Vagelidad

April 2020
 Introduction

Social media has become an indispensable tool for consumers online in

this day and age. It’s no surprise that all kinds of businesses have turned to

social media to find and connect with their target market. The figures don’t lie

either: consumers are 71% more likely to make a purchase based on social

media referrals.  Millennials are considered as the generation that spends most

of their time online, 47% of their purchases are influenced by social media. They

are also 1.6 times more likely to use digital channels to learn about new

products. This puts social media platforms in a prime position for executing

effective digital marketing campaigns. (Rob Fitgeral, 2019)

Consumer behavior is the study of individuals and organizations and how

they select and use products and services. It is mainly concerned with

psychology, motivations, and behavior. (kith Smith, 2016). According to Aleh

barysevich, Due to the rise of online shopping and the amount of time people

spend on social media, social media impacts consumer buying decisions.

Consumers who are influenced by social media are four times more likely to

spend more on purchases. There are four ways in which social media has a

direct influence on purchase decisions: Social media and online shopping

shortened the customer journey; Social media amplified the impact of social

proof or word-of-mouth; Social media influencer marketing is one of the most

effective ways to reach your audience; Stories and ephemeral content are a new

way to connect to your audience.

 According to Ena Fejzagic, (lecturer at LIGS University) Today’s buying

behavior is often called online decision making. It is characterized by, among

other things, information overload. Modern consumers are bombarded with

thousands of pieces of information every single day over the Internet, and their

attention span has deteriorated rapidly. Social media works well with most

groups but especially with millennia’s. The Deloitte report found that 47 percent

of millennia’s are influenced in their purchases by social media, compared to 19

percent for all other age groups.

Business owners can even encourage people to use social media while

shopping by including social media in their point-of-sale marketing. If people

know they can find out about specials on social media, they’ll go check it out.

This report adds to a growing volume of research that shows the value of social

media. Social media influences shopping behavior in all age groups, but

especially the important younger and Hispanic populations. Business owners

need to work to refine their social media marketing strategies so they can get the

boost in sales that some of the stores in the data set did. (Peter Roesler, 2015).

We conduct this study to research analytically the role of social media in

consumers' decision-making processes. And to examine how social media

marketing will affect the final consumer behavior among person who mostly use

social media websites and also to find out the forcasted relationship among

various social media marketing activities, customer activities and behavior of the

consumer. We are motivated to do a research to face the challenge in solving the

unsolves problems and to lessen our curiosity about new things.

Statement of the problem

This study aims to determine the impact of social media on the consumers

buying behavior in Bacolod City.

Specifically, it seeks to answer the following questions:

1. What is the extent of impact of impact of social media on the consumers

buying behavior in Bacolod City when taken collectively and grouped

according to age and sex?

2. Is there a significant difference in the extent of impact of impact of social

media on the consumers buying behavior in Bacolod City when grouped

and compared according to age and sex?

Hypothesis

There is no significant difference in the extent of impact of social media on

the consumers buying behavior in Bacolod City when grouped according to age

and sex.

Framework

This is study will be anchored on the concepts of Constantinides (2004) on

the factors that affects consumers buying decision. These factors were classified

as Design Factors, Information Factors, Product Factors, Psychological Factors,

and Cultural Factors.

Information Factors, consumers will be willing to buy online if variety of

products and information are provided sufficiently. Also, offers, warranties and
guarantees that are provided along with products will encourage consumers to

shop online (Limayem et al., 2000). Design Factors, usually consumers are

affected by the design characteristics of a web page. If the website is well

designed and frequently updated, consumers will be more attracted to buy

online. In addition, the way of designing is affected by detailed information

provided about several products and the display of sites' themes (e.g., colours,

icons, links, images…). Psychological Factors are factors affect consumers'

attitude towards online buying.

For instance, if consumers build a trust on a website, they will be willing to

buy online comfortably and reduce uncertainty towards a product. Moreover,

consumers may be influenced by their friends and relatives who affect their

attitudes to use SM. Lastly, Cultural Factors, consumers can be affected by other

cultures in choosing and making decisions about certain products. Also, it can

affect consumers' lifestyle in interacting and communicating with new

technologies (Pookulangara and Koesler, 2011).

The most common SM that are mostly used by consumers for different

purposes are: Facebook, Twitter and Instagram. A study of Miller (2010) has

found out that over 11 million consumers use more than 70% of many SM to

purchase different products and services, to provide rich information about

certain product and to share comments with other consumers (Miller and

Lammas, 2010). Facebook has more than 6 million consumers who registered to

buy and share information about products (Scott, 2013). A study showed that

60% of Facebook users say that they are more able to recommend a product or
service to their friends after following that brand on SM (Parson, 2013).

Facebook has reached 51% of users who buy different products through it

(Kunkel, 2013).

Twitter has recorded 800,000 followers who showed their appreciation to

the provided services about the products. The same study has indicated that

written blogs has increased from 54% to 77% in two years, and watching several

videos related to different products has increased from 32% in 2006 to 83% in

2008 (Miller and Lammas, 2010). Another study indicated that 79% of Twitter

users say they are more able to recommend a product or service to their friends

after following that brand on SM (Parson, 2013). Also, 64% of users use Twitter

to buy different products (Kunkel, 2013). Instagram is spreading widely in the

recent two years because of active users who share and upload different kind of

photos.

Based on the activities provided by users who use Instagram, the results

showed more than 16 billion photos were shared among users (Krieger, 2012).

Phil Gonzalez, the founder of Instagrammers (Instagram users) was interviewed

to recognize the increasing of Instagram users. He stated in the interview that

number of users who login into Instagram increased in less than two years to 100

million users in more than 60 countries around the world. (Gonzalez, 2013).

Because of the new adoption of Instagram, there is a lack of information about

the use of Instagram as a tool in online purchasing.

The following diagram illustrates the overall process of changing

consumers' buying behavior which is resulted from the interaction among Social
Media, products and consumers decisions. The following matrix model illustrates

the overall process of changing consumers' buying behavior which is resulted

from the interaction among social media, products and consumers decisions.

Consumers in Bacolod City

Factors

Information
Design
Psychological
Cultural

Impact of social media on Consumers

Buying Behavior

Figure 1. Schematic Diagram

Scope of the Study

The study covered the consumers in Bacolod city that use social media

platforms to select the products or services with the age range of 18yrs old to 25

years old. And knowing the information about the impact of social media on their

buying decision.

Definition of Terms
Social media- a digital tool that allows users to quickly create and share content

with the public. Social media encompasses a wide range of websites and apps.

Consumers- are people or organizations that purchase products or services. The

term also refers to hiring goods and services. They are humans or other

economic entities that use a good or service.

Buying behavior- a decision and acts people undertake to buy products or

services for individual or group use. It’s synonymous with the term “consumer

buying behavior,” which often applies to individual customers in contrast to

businesses.

Significance of the Study

We conduct this study to acquire knowledge and understanding about the Impact

of social media on consumers buying behavior and helps marketers understand

what influences consumers' buying decisions.