| BUS750 ADVANCEd BUSINESS PROJECT |
| Progress Report 2 |
| Semester One |
| IMPACT OF SOCIAL MEDIA ON CONSUMER BUYING BEHAVIOUR IN NEW ZEALAND WINE MARKET. |
| 13499247 |
Student Name: Aakarsha Nair
Tutor: Sam Young
Supervisor: Wendy Olsen
Contents:
1.0. Introduction 3
1.1. Research questions 4
1.2. Research objectives 4
2.0. Literature review 5
3.0. Methodology 7
3.1. Research Philosophy 7
3.2. Research design 7
3.3. Data collection 7
3.3.1. Primary Data 7
3.3.2. Secondary data 10
4.0. Changes of Direction & Constraints 11
5.0. Future Research Task Planning 12
6.0. Reporting on Research Tasks Completed 13
7.0. References: 14
- Introduction
Emergence of Internet is probably the most significant evolution ever occurred in the history of commerce. Social media, another significant evolution that emerged with it, is the advancement based on internet, where it not only promotes user-generated contents, but also diversifies the exposure to the user by enabling them to access those contents to exchange among networks. Over the last few years, this particular technological innovation has radically revolutionized the conventional marketing methods and pushed marketers into a new age (Chuwiruch et al., 2015). Social media is expected to revolutionize the entire pattern and partnership that marketers have with their retailers, distribution networks, customers et cetera in this modern marketing age. Moreover, it is the digital information age where customers are flooded with enormous data quantity. Based upon the arguments revealed from Erevelles et al., (2016), it has been revealed that as companies get around their business and communicates with consumers, it produces a large quantity of digitally “exhaust data” which often gets generated as the by-product of other business activities. Social media platforms, smartphones and electronic applications have made it possible for billions of people worldwide to add to the volume of data available.
While looking at the large amount of campaigns running on social media platforms, e-commerce sites, forums, et cetera., it seems that businesses irrespective of their sizes are shifting their marketing strategies on Internet because of easy to access the target audiences while generating huge potential for them (Mazzarol, 2015). In comparison to this, conventional approaches to mass media marketing such as newspapers and televisions seek to communicate large group of audiences while attracting only a few interested customer (Zai, 2015).
Conventional advertising as it is known has become a matter of past and technology has offered consumers far more choices than they had in the past and formed a digital community where consumers around the world are actively using social media platforms to search and exchange information by discussing consumer goods to coordinating political actions (Chan et al., 2015).
Wine industry is no exception in these circumstances and the use of social media marketing does have impacted its sales. While several wineries have embraced social media marketing, the use of these new tools still poses contradictory reports concerning return-over-investment (ROI). Yet, having a higher degree of confusion and customer uncertainty, wine is an perfect commodity for social media marketing. To eliminate such confusion, wine customers largely rely on friends and experts to help them in making their choices and perceptions. Wine customers have in the past consulted books, magazines et cetera., but the increasing adaptation of social media among masses have enabled them to receive advice from experts, manufacturers and friends to reduce the risk of unsatisfying purchases (Lewis, 2016). Hence, using social media would bring consumers back at the forefront of the business and offers a modern range of tools for advertisers to connect with customers and incorporate them into the products in creative ways (Viana, 2016). Therefore, marketing across social media will be an alternate approach for interfacing with consumers
1.1. Research questions
Question 1
How do customers perceive social media based buying of wine in New Zealand?
Question 2
What are the major factors that motivate the consumers to buy wine through social media?
Customer 3
What are the major changes introduced by social media to consumer buying behaviour at different stages of decision making
1.2. Research objectives
Consumers and companies across the world are more associated with the wider presence of Internet than ever before. Today, internet users have access to hundreds of social media applications and among these, Facebook alone has over 600 million active users, as well as nearly 1.5 million commercial pages with 30 billion contents posted per month (Pontes et al., 2016). Moreover, globally the average time spent on social media per person is approximately 6.9 hours per month. Therefore, recognizing customer behaviour as a broad and relatively general topic, it would be difficult for the researcher to collect, analyse and interpret and summarize all the relevant data and outcomes into one research; hence, the researcher has narrowed the scope in accordance with the decision-making process that is correlated with social media marketing.
Thus, the major objective is to understand how, why and when social media impacts the consumer decision-making and buying behaviour. Besides, it will also help in recognizing opportunities and challenges that businesses face in order to capture and explore the possibilities of the modern marketing age with its impact on the customer behaviour towards the purchase of wine products.
.
- Literature review
Analysis of relevant literature will be carried out after establishing the major concepts involved with this study. The researcher will then discuss upon the relevant per-existing literature concerned with this research area. It will concentrate on the effect of the social media on customer purchasing behaviour in New Zealand with particular reference to wine consumption. Lastly, it will summarize the major outcomes of this analysis to arrive at some common conclusive outcome.
Consumer buying behaviour:
It applies to the “decision-making process” in which people gets engaged into multi-step activities and the decisions are taken to meet their needs and expectations in the marketplace (Pappas, 2016).
Consumer behaviour
Rödiger and Hamm (2015) describe consumer behaviour as the actions displayed by consumers in the searching, purchase, use, evaluation and disposal of the goods and services they expect to meet their needs. It also includes the activities of individuals directly engaged in the purchase, use and disposal of commercial products and services and the “decision making process” that precedes and decides certain acts.
Consumer decision making
Maniatis (2016) defines the “decision-making process” as process consisting of multiple steps which begins before the actual purchase and goes beyond the purchase act. The author further suggested that marketers need to look beyond the different influences on buyers to gain a better understanding of how buyers actually make their purchase decisions.
Customers thinking on social media based promotion of wine
Consumers think social media as an ideal platform where people can generate public comments. People share their perception and experience about using any product or services being served by any company. These things act as an open and fair opinion highlighting the importance and quality of the product (Ashley & Tuten, 2015). The existing relationship between a company and its customer has also seen a dramatic change. Social media took power and influence from the hands of big companies and popular brands, and placed it in the hands of customers. Nowadays, however, customer’s experience a very different circumstances them to quickly express their opinions on various brands, products and services. These opinions act as a review for other users and thus, promote the brand
Social media factors motivating consumers to buy wine
As per Brettel et al., (2015) many companies bet on direct advertising on social media and it is most crucial factor that influences the consumer buying behaviour. Alcohol producing companies are at the front on utilising this platform to influence customers by creating attractive contents on social media. To make it more effective, most of the alcohol producing companies in New Zealand has substantially increased their advertisement budgets to concentrate more on social media networks like Facebook, Instagram and twitter (Cody & Jackson, 2016).
“Pernod Ricard NZ”, a New Zealand based company is significantly increasing its budget for digital marketing by every year since last few years (Niland et al., 2017). To leverage this advantage, several other alcohol producers are also becoming creative with their social media campaigning efforts. The authors also added that in addition to posting funny and clever contents, these brands are also using online contests, giveaways and quick games as a way to add new followers and thus selling more alcohol. Kannan, (2017) took this narrative forward and identified that direct promotion of is not the only way of promoting alcoholic products on social media to influence consumers for buying. Users of these platforms are themselves creating contents to promote wine consumption. The author further added that organizing happy hours, going live while partying and also record their events on Facebook, Snapchat and other platforms by uploading images and videos are slowly becoming a trend and is attracting a lot of people towards it. Social media platforms also showcase alcohol-oriented groups where people can interact virtually to socialize.
Social media changing consumer buying behaviour
The growing use of social media platforms have contributed to a significant shift in the consumer behaviour seeking recognition of the brand and creating correlations regarding brand awareness and purchasing intent (Kumar et al., 2016). Millennial are in majority on social media platforms and are known to be the group that are well connected and spends much of their time on these platforms, with social media affecting 47% of their purchases. These consumer groups use social media as a platform to compare, gain information about products, reviews et cetera and based upon this, their buying behaviours varies (Godey et al., 2016).
As stated by Erkan and Evans, (2016) while choosing any product, customers first acquire understanding and knowledge of the product, then develops favourable or unfavourable feelings towards those products and eventually acts by purchasing and using or rejecting the product. Social media lets people interact with their friends, families and other experts from where people come to know about details linked with each of the product that people do not see very often. Hence, listening anything positive about any product and brand from friends and families helps in developing a trust for the product and thus the consumer gets influenced to buy that product (Akman & Mishra, 2017).
- Methodology
This chapter sets out a blueprint of how exactly the research work will be carried out. This needs to be carefully detailed to ensure the study remain applicable for future research. For this purpose, the entire methodology has been divided into several sub-sections and has been discussed below.
3.1. Research Philosophy
The most critical thing in this section is the topic being explored properly and the research questions were investigated sufficiently. Therefore, the present research is to be carried out from a pragmatic perspective which will help in identifying the most suitable methods that will fit with the research question. The key reason for why it has been chosen for carrying out this research is because of the degree of freedom to perform research using any available, method, and strategies (Locke, 2015). Furthermore, pragmatists will enable the researcher to see the practical implications and actual results as essential components of reality and meaning. Moreover, pragmatism emphasizes not only on pre-existing literatures and approaches. Rather, it also advocated the need for future research to bring more clarity over the issue. Thus this philosophy will enable the researcher with the freedom to choose, use certain tools, techniques and procedures that will best suit with the research needs. In addition, it promotes the use of analysis using mixed method (MM).
3.2. Research design
A mixed-method approach will be adopted for the analysis of data. Here, mixed denotes the use of both, qualitative and quantitative approach to explore and analyse the matter to derive the most for these raw data sources to form a conclusive assumption.
Conducting a mixed analysis will provide a comprehensive view of the circumstances; as opposed to using just qualitative or quantitative analysis. This is precisely why the study design of an MM has been chosen as the researcher assumes that qualitative or quantitative data alone will not be enough to address the research question.
3.3. Data collection
Data collection as defined by Palinkas et al., (2015) is about collecting and measuring data on relevant indicators in a systematic manner that allows the researcher to answer specified research questions, test the proposed hypothesis, and evaluating results. Therefore, as mentioned above, a mixed approach will used for the analysis of data. It implies that both primary and secondary data will be needed for the purpose.
3.3.1. Primary Data
Primary data includes all such data personally collected by the researcher. These data are obtained from first hand sources, using multiple techniques like those of surveys, questionnaire, interviews or experiments (Keusch, 2015). Therefore, to collect primary data, a list of questionnaire containing 10 questions as mentioned below will be used to collected samples from a fixed number of consumers. These questionnaires are created on “SurveyMonkey”, an online questionnaire development tool and can be circulated over Facebook of e-mail IDs of the participant to derive conclusion from it. Finally, these data will be analysed to identify the level of influence exerted by social media in influencing the choice and buying behaviour of customers.
3.3.2. Secondary data
Secondary data accounts for all those pre-existing data that has already been collected by other researchers (Johnston, 2017). Some of the common secondary sources that will be used by the researcher include scholarly articles, research publications, reliable media reports, companies documents et cetera.
- Changes of Direction & Constraints
There are certain considerations/ constraints that are most likely to be faced while performing this research activity. Some common constraints include:
- Time constraint: The timely completion of this research might get affected by the brief period of time available for project analysis and the interruption from other academic work.
- Financial constraint: Being a student, the researcher has no means of earning. Therefore, it would be difficult to gain funds required to travel, acquire secondary sources of data et cetera. However, the researcher plans to do his/her best possible effort to either raise some external funding through sponsorships or collaborations to carry out this research.
- Statistical (Data) constraint: In certain cases like this research involving country specific data, getting relevant data might be difficult at times. These things may affect the findings of the study. Therefore, in some cases, it may be required to reshape the entire research design, objectives and methods to proceed with the research.
- Future Research Task Planning
Till now, the researcher has identified 3 research questions and accordingly literature review and appropriate methodologies have been identified. The researcher has additionally finalised the data collected approach and accordingly a questionnaire has been created to collect and analyse primary data. At this level, the researcher has also identified and discussed several research constraints that might be faced while continuing with this research work. Therefore, the table below shows all such activities that are yet to be done.
| Week | Activity | Time required | Status | Weekly notes |
| Week 8 | Data collection | 1 hour | Still Waiting for the approval | Yet to be started |
| Week 8-9 | Data analysis | 2-3 hours | Same as above | Yet to be started |
| Week 9-10 | Summarising findings of the research | 4 hours | Same as above | It is important to conclude the findings |
| Week 11 | Final report documentation | 2 hours | Same as above | Documentation for the final project and discussion with the supervisor. |
| Week 12 | Suggesting methods to overcome research constraints | 1 hour | Same as above | Asking the supervisor to arrange the meeting for clearing the queries. |
- Reporting on Research Tasks Completed
So far research questions have been identified by the researcher and accordingly literature review and appropriate methodologies have been specified. Additionally, the researcher finalized the data collection methodology and a questionnaire was developed for primary data collection and analysis.
At this point, the researcher has also described and addressed many research constraints that could be faced as this research work continues. The table below shows all such activities that are completed by this time.
| Week | Activity | Time required | Status | Weekly notes |
| Week 1-2 | Identifying research area | 4 hours | Completed | Impact of social media on consumer buying behaviour for wine has been finalised as the research area |
| Week 3-4 | Developing research objectives and question | 5 hours | Completed | All the major objectives and 3 research questions have been framed. |
| Week 5-6 | Literature review | 10 hours | Completed | Sufficient literature review has been done to explore and understand the cause, factors and the impact of the research |
| Week 7-8 | Adopting research methodology | 5 hours | Completed | Mixed analysis has been finalised |
| Week 8-9 | Finalising data collection approaches | 5 hours | Completed | Primary (Questionnaire) and secondary data collection approach has been chosen. |
- References:
Akman, I., & Mishra, A. (2017). Factors influencing consumer intention in social commerce adoption. Information Technology & People.
Ashley, C., & Tuten, T. (2015). Creative strategies in social media marketing: An exploratory study of branded social content and consumer engagement. Psychology & Marketing, 32(1), 15-27.
Brettel, M., Reich, J. C., Gavilanes, J. M., & Flatten, T. C. (2015). What drives advertising success on Facebook? An advertising-effectiveness model: Measuring the effects on sales of “Likes” and other social-network stimuli. Journal of Advertising Research, 55(2), 162-175.
Chan, T. H., Leung, F. F., Tan, P., & David, K. T. (2015). Role of conventional ads in a digital age: effects of internet and conventional advertising on brand awareness and brand desire in China. ” International Journal of Electronic Commerce Studies”, 6(1), 87-98.
Chuwiruch, N., Jhundra-Indra, P., & Boonlua, S. (2015, July). Marketing innovation strategy and marketing performance: a conceptual framework. In Allied Academies International Conference. Academy of Marketing Studies. Proceedings (Vol. 20, No. 2, p. 82). Jordan Whitney Enterprises, Inc.
Cody, K., & Jackson, S. (2016). The contested terrain of alcohol sponsorship of sport in New Zealand. International Review for the Sociology of Sport, 51(4), 375-393.
Erevelles, S., Fukawa, N., & Swayne, L. (2016). Big Data consumer analytics and the transformation of marketing. Journal of Business Research, 69(2), 897-904.
Erkan, I., & Evans, C. (2016). The influence of eWOM in social media on consumers’ purchase intentions: An extended approach to information adoption. Computers in Human Behavior, 61, 47-55.
Godey, B., Manthiou, A., Pederzoli, D., Rokka, J., Aiello, G., Donvito, R., & Singh, R. (2016). Social media marketing efforts of luxury brands: Influence on brand equity and consumer behavior. Journal of business research, 69(12), 5833-5841.
Johnston, M. P. (2017). Secondary data analysis: A method of which the time has come. Qualitative and quantitative methods in libraries, 3(3), 619-626.
Kannan, P. K. (2017). Digital marketing: A framework, review and research agenda. International Journal of Research in Marketing, 34(1), 22-45.
Keusch, F. (2015). Why do people participate in Web surveys? Applying survey participation theory to Internet survey data collection. Management review quarterly, 65(3), 183-216.
Kumar, A., Bezawada, R., Rishika, R., Janakiraman, R., & Kannan, P. K. (2016). From social to sale: The effects of firm-generated content in social media on customer behavior. Journal of Marketing, 80(1), 7-25.
Lewis, N. (2016). Constructing economic objects of governance: The New Zealand wine industry. In Agri-food commodity chains and globalising networks (pp. 117-134). Routledge.
Locke, K. (2015). Pragmatic reflections on a conversation about grounded theory in management and organization studies. Organizational Research Methods, 18(4), 612-619.
Maniatis, P. (2016). Investigating factors influencing consumer decision-making while choosing green products. Journal of Cleaner Production, 132, 215-228.
Mazzarol, T. (2015). SMEs engagement with e-commerce, e-business and e-marketing. Small enterprise research, 22(1), 79-90.
Niland, P., McCreanor, T., Lyons, A. C., & Griffin, C. (2017). Alcohol marketing on social media: young adults engage with alcohol marketing on facebook. Addiction Research & Theory, 25(4), 273-284.
Palinkas, L. A., Horwitz, S. M., Green, C. A., Wisdom, J. P., Duan, N., & Hoagwood, K. (2015). Purposeful sampling for qualitative data collection and analysis in mixed method implementation research. Administration and policy in mental health and mental health services research, 42(5), 533-544.
Pappas, N. (2016). Marketing strategies, perceived risks, and consumer trust in online buying behaviour. Journal of Retailing and Consumer Services, 29, 92-103.
Pontes, H. M., Andreassen, C. S., & Griffiths, M. D. (2016). Portuguese validation of the Bergen Facebook Addiction Scale: an empirical study. International Journal of Mental Health and Addiction, 14(6), 1062-1073.
Rödiger, M., & Hamm, U. (2015). How are organic food prices affecting consumer behaviour? A review. Food Quality and Preference, 43, 10-20.
Viana, N. A. (2016). Digital wine marketing: Social media marketing for the wine industry. In BIO Web of Conferences (Vol. 7, p. 03011). EDP Sciences.
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