E-commerce on social media
The design of websites is increasingly incorporating social cues like helpfulness and familiarity, especially in e-commerce websites with the primary objective of facilitating the exchange relationship (Adapa, 2008). This draws on the assumption that social cues in websites evoke a social response from the visitors of the websites, which in turn leads to enjoyment. As a result, users have a tendency to patronize exciting, entertaining and stimulating websites.
Studies affirm that lack of product touch and interaction with organizational representatives may inhibit the acceptance of and positive attitudes toward e-commerce (Ahasanul, Khatib, & Shameem, 2009). High levels of interactions with e-commerce commodities and organizational representatives may increase positive attitudes towards electronic commerce, which in turn plays an integral role in influencing the decisions to use e-commerce systems. E-commerce surveys conducted in 2009 reported that online shoppers have a preference of an interactive online shopping experience because they considered it more informative (Mehdi, 2011).
This implies that online shoppers are likely to make a purchase from a website that has interactive components incorporated in the form of social cues. This research paper discusses the effects of social media on Australia e-commerce. The Pervasive effects of Social Media on Australian E-Commerce A study by Wakefield et al (2011) reported the inclusion of social clues in a website leads to greater beliefs regarding their user intentions, enjoyment, perceived usefulness, and perceived ease of use.
The inference from this view is that social media tends to make the website friendly, informative and helpful, which increases the likelihood that such users will make a purchase from that website. The study by Wakefield et al (2011) further stated that website socialness tends to evoke an effective social response from the users of e-commerce websites. This is because users associate website social clues with life-like attributes such as friendliness, informative, usefulness, helpfulness, politeness and intelligence.
The fundamental assertion is that user’s perception of website’s sociability is a core element in approach used in explaining and predicting behavioral intentions in electronic commerce (Dunt & Harper, 2002). As an analogy, users liken the inclusion of social media in the e-commerce websites to digital representatives. E-commerce websites having immense social cues establish efficiencies for business enterprises through a reduction of ambiguity and enhancing continuing relationships with customers, suppliers and business partners.
It is apparent that websites embedded with social cues create a social response from the users of the e-commerce website leading to high levels of enjoyment when using the site because they believe that social cues in websites are enjoyable, adventurous and exciting (Wakefield et al. , 2011). There is a positive correlation between enjoyable website experience and higher intentions of using the site, which in turn increases their personal connection with the online retailers.
Such personal connections offer a valuable opportunity that online retailers can use to establish sustainable competitive advantage. Wakefield et al (2011) asserts that electronic retailers aiming at enhancing consumer attention and purchasing must evaluate the social aspects of the internet. Social Media Eliminates Barriers to Personal Interaction The current software and hardware used for personal interaction with online retailing websites target simultaneous group of online shoppers instead of the individual.
This is a significant barrier to personal communication eliminated by the inclusion of social media in the web retailing sites (Town, 1999). Irrespective of the shopping motivation, shopping behavior does not necessarily translate to a pleasant shopping experience or the purchasing behavior. This is a typical characteristic of web retailing sites lacking the social aspects in their design. Fennech & Tino (2010) asserts that the ultimate role played by the incorporation of social media in web retailing sites is that it leads to high levels of customer retail satisfaction at an individual level.
This draws on the view that the shopping orientation of an individual is the significant determinant of the environment selected to engage in the shopping activity and their overall retail satisfaction (Tino & O’Cass, 2001). A study by Tino & O’Cass (2001), to examine the constructs that affect internet users’ adoption of web retailing and their perception towards product types bought via the web, indicated that attitude towards electronic retailing and perceived usefulness played an integral role in influencing the adoption of web retailing. The study indicated that favorable attitude resulted in high adoption of web retailing, while unfavorable attitudes resulted in under-utilization of web retailing frameworks. Tino & O’Cass (2001) pointed out that lack of personal communication and interaction is the key determinant that differentiates between favorable and unfavorable attitudes, which implies that web retailing sites devoid of personal communication tools reported low levels of customer retail satisfaction.
It is apparent that social media plays an integral role in eliminating barriers to personal interaction in web retailing sites, which in turn helps in increasing user retailing satisfaction. In addition, social media plays an integral role in building trust of web retailing among internet users, this is because users place greater significance on interpersonal influence from sources like peer groups when making such a decision (Sujana, 2011).
The basic inference from this observation is that the incorporation of social media in electronic commerce helps in eliminating barriers to personal interaction and communication, which in turn increases the utilization of electronic commerce among Australian internet users. As such, online retailers can incorporate social media in their retailing sites to build trust from the potential internet shoppers. Social media has the potential of increasing the number of web shoppers, generating repeat purchases and fostering positive attitudes towards the use of online retailing in Australia.
Tino & O’Cass (2001) asserts that social media is a key driver for the adoption of web retailing and eliminating the potential barriers associated with the utilization of web retailing. Therefore, online retailers can make use of social media to establish and increases their market share in the online environment because social media is a perfect tool for enhance online visibility. Social media presents a new retailing opportunity that online marketers can use to influence attitudes and usefulness of their retailing sites (Stephens, 2010).
Social Media and electronic word-of-mouth (eWOM) According to Mira & Youn (2009), word-of-mouth is an instance of interpersonal communication relating to commodities and products between consumers. Mira & Youn (2009) considers word-of-mouth as the most influential source information for consumers because consumers have a high level of trust towards their peer consumers than the trust they have for advertisers and marketers (Sia et al. , 2009). Word-of-mouth is not dependent on marketers selling intentions’, implying that consumers consider such information credible and trustworthy.
Research studies affirm the influential nature of word-of-mouth on consumers’ decisions and purchasing behaviors. WOM is increasingly becoming significant with the advent of the internet, taking numerous forms such as product review websites, brands’ websites, personal blogs and social networking sites. The increase in eWOM platforms has facilitated consumer communication in terms of product-related information. A study by Mira & Youn (2010) pointed out that the various eWOM platforms played an integral role in influencing consumers’ purchasing decisions.
The ongoing growth of blog sites and social networking impose significant effects on brands and their respective marketing. It is increasingly becoming apparent that consumers are researching products and brands via social networking sites such as Facebook and Google+, which reach a significant percentage of internet users. The impacts of social media can take place in three perspectives including product ratings and review, publicity of customer experiences, and constant innovation (Rafaeli & Raban, 2005).
Most aspects of electronic word-of-mouth take the form of social media such as discussion boards and other online communication platforms. Studies affirm that that electronic word-of-mouth plays an integral role in influencing the adoption and use of commodities and services, which implies that eWOM influences consumer behavior of web retailers. It is increasingly becoming apparent that eWOM is becoming a significant component of the marketing mix because they determine the buying decisions adopted by online consumers (Joey, 2002).
The fundamental argument is that social media, through eWOM, plays a vital role in the establishment of a computer-mediated environment, whereby the purchasing decisions of consumers depend on the perceived quality of information they get. When consumers get the information that meet seems to meet their needs and requirements, they are willing to criticize the product/service value basing on the criteria for the purchasing decision (Dunt & Harper, 2002). This implies that online markers have to determine the customers’ insight of information quality on the internet, which helps in assessing their potential purchasing behavior.
Marketers can make use of social media to manipulate variables of information quality such as timeliness, accuracy, relevance and comprehensiveness (Dholakia & Chiang, 2003). The usefulness of information imposes significant impacts on consumers’ decision to adopt information gathered from online communities. Information usefulness depends on credibility and quality of information. As such, online consumer forums are increasingly becoming important to consumers because the information gathered from such social online communities are from peer consumers and devoid of marketers’ intentions (Chang & Sturt, 2004).
Comprehensiveness of information gathered from online communities tend to increase the pervasive nature of social media on electronic commerce. Mira & Youn (2011) asserts that the social media era has imposed significant changes in relation to product reviews and ratings. Previously, product reviews and ratings were a reserve for publishers such as Consumer Reports and CNET magazines (Andrews et al. , 2007). The paradigm shift currently includes social media users engaging in constant product reviews and ratings.
It is vital to note that, in social media, there is no storage of product ratings and reviews on retailers’ website. The second impact of social media is the publicity of consumer experiences (Andrews et al. , 2007). In social media, consumer experiences are a core driver of most of brand conversations, which certainly imposes significant impacts on the brand reputations of retailers. Social media and blog sites impose significant effects on the marketing of brands. In fact, social media provides an avenue for mass-market advertising over the internet (Chang & Sturt, 2004).
A good marketing approach does not only incorporate mass marketing, but also seek ways to communicate with customers via social media platforms such as Facebook, Twitter and other blogging platforms by creating an engaging content for social media users to interact with both the retailers and among themselves (Dholakia & Chiang, 2003). The eWOM trend imposes significant implications on marketing strategies. This is because effective online market is increasingly depending on social influence, with conventional marketing losing its significance and increasingly becoming ineffective.
Australian marketers have to appreciate that they have no control on their online brands. This is because people will discuss the brand without involving the marketers, who cannot the circulation of negative comments on the various social media platforms (Chang & Sturt, 2004). However, Australian marketers can embark on maximizing the probability of distributing good conversations relating to a product. Australian online marketers are increasingly adopting this strategy.
Effective marketing strategies in the wake of social commerce require smart vital techniques for increasing the distribution of positive comments about a brand or product. With the internet increasingly becoming social, it is imperative that online stores in Australia adopt social media integration in their electronic commerce websites to foster member engagement and product discovery (Andrews et al. , 2007). Social Commerce Social commerce refers to the use of social media platforms in the context of electronic commerce, with the primary objective of enhancing online buying and selling.
Social commerce entails an integration of two digital trends including electronic commerce and social media. Electronic commerce depends on web-based communities and effective web-based communication, which has a significant effect on online visibility and sales. Web-based communication has the potential of changing corporate advertising, nature of community sponsorship strategies and the business model. Social media emerges as the most powerful tool for online communication.
In the present digital economy, setting up an online store and waiting for potential customers is not adequate (Chang & Sturt, 2004). Online retail outlets have to adopt a proactive approach by seeking ways to engage consumers, establish relationships and form online communities. The difference between social commerce and conventional e-commerce is the incorporation of social elements in the online business model. Social commerce entails features such as consumer ratings and reviews, referrals, social shopping platforms, user recommendations and online communities.
These social features play an integral role in the creation of a trusted environment whereby people generate content relating to the referral and sale of commodities using customer feedback, reviews, ratings and testimonials (Cheung et al. , 2008). The key drivers of social commerce include electronic business opportunities, online communities and the emergence of internet technologies such as web 2. 0. The core characteristics of social commerce include gathering of collective intelligence, viral marketing, market disruption, and a platform for participation.
Gathering collective intelligence implies that the competitive advantage of social commerce websites depends on the critical mass of retailers and consumers (Andrews et al. , 2007). The key towards attaining online market dominance is the network effects derived from user contributions. In relation to the aspect of viral marketing, it is apparent that social commerce relies significantly on word-of-mouth marketing, which takes place when customers promote a commodity via their positive experiences with the product.
Therefore, branded communities can establish long lasting relationships and deeper affinity with their customers. Most social commerce websites are instances of phenomenal networks characterized by democratic participation, whereby people generate what other people want on an equal platform. Social commerce websites such as Facebook integrates numerous social media tools like sharing of photos and blogs, to provide users with an avenue through which they can express their opinions and preferences. Such websites also serve the role of a central communication hub for social networks.