Effect Of Digital Synergy On Consumer Patronage Of Products

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Effect Of Digital Synergy On Consumer Patronage Of Products


Abstract


The purpose of this study was to investigate the Effect of Digital Synergy on Consumer Patronage of Products. The research was conducted in the perception of consumers (in Finland), which was aimed to explain the impacts of social media on different stages in their decision making process, by finding out how consumers perceive social media as a tool in validating of the purchase decisions. 108 semi-structured interviews were conducted for the research study, and 62 (%) of the respondents were female, and 38 (%) were male. The results from the qualitative study were used to analyse the research questions and derive conclusions. The findings of the research revealed that consumers in Finland are actively utlilizing social media platforms as an effective tool for validating their purchase decisions; however, consumers are deemed to be inactive in sharing their word of mouth to others with the available social media platform. This work will shed light on how successful advertising can keep businesses going even in the midst of a tough competition.


Chapter One


Introduction

1.1 Background of the Study

Customer satisfaction has long been recognized in marketing thought and practice as a central concept as well as an important goal of all business activities (Anderson, Fornell, and Lehmann 1994). In fact, there are at least two different conceptualizations of customer satisfaction, one is transaction-specific and other is cumulative. Transaction- specific satisfaction provides specific diagnostic information about a particular product or service encounter (Lam et al. 2004). In contrast, cumulative customer satisfaction is an overall evaluation based on the total purchase and consumption experiences with a product or service overtime (Anderson, Fornell, and Lehmann 1994), which is more fundamental and useful than transaction – specific consumer satisfaction in predicting a consumer’s subsequent behavior and a firm’s past, present and future performance. There are several media advertisements which are influencing Gen Y customers in making a purchase decision. Almost everyone grows up in the world which is flooded with the mass media e.g. television, advertising, films, videos, billboards, magazines, movies, music, newspapers, and internet. Besides making up over 40 per cent of the country’s population, Nigerians aged 30 and below are the ones who will shape the country’s social, economic and political landscape in the future Nigerian Communication and Multimedia Commission (NCMCIn Africa alone, there are about 660 million people in Gen Y category, which is also known as the millennial generation.

Worldwide, the Gen Y population is estimated at 2 billion. The sheer size of the Gen Y population and their spending power require companies, producers, marketers and advertisers to reconsider their business and marketing models. The distinct characteristics of this generation call for social and political entities to revisit their existing approaches.We are in a very dynamic and complex world. The business environment is becoming sophisticated day by day and as such, decision-making is becoming more and more challenging and risky. Business organizations are failing due to poor decisions. Investors are losing their money and are unhappy. They are being discouraged and this is quite unhealthy to the economy. In some other instances, organizations are springing up in great numbers; some are successful in the marketing of their products and services, while others are still akin to the barber’s chair syndrome where all is motion but no movement; struggling to reach their target audience. Consumers are also faced with the challenge of choice making due to indecisiveness, skepticism, indifference and confusion which are among the key sales killers in business world. Advertising is any paid form of non-personal communication about an organization or its product to a target audience through a mass/broadcast medium by an identified sponsor. It should be observed that for any promotional activity to be called advertisement it must be paid for. In the real sense, it is the method used by companies for creating awareness of their products, as well as making new products known to the new and potential consumers. This thesis however, centers on the impact of advertising on the sales volume of a product. This work will shed light on how digital synergy can really affect a consumer’s buying decisions in a growing economy like that of Nigeria and how successful advertising can keep businesses going even in the midst a tough competition.

More so, advertising as a promotional tool also tends to remind, reassure and influence the decisions of the consumers because an advertisement itself enlightens, educates, and persuades consumers on their acceptability of the product offering. Advertisement in such a media as print (newspaper, magazines, billboards, flyers) or broadcast (radio, television) typically consist of pictures, headlines, information about the product and occasionally a response coupon. Broadcast advertisement on the other hand consists of an audio or video narrative that can range from 15seconds spots to longer segments known as infomercials, which generally last 30 to 60 minutes. (Busari 2002)


1.2 Statement of the Problem

Consumer perception challenge is the first and greatest hurdle that advertisers must cross. Perception guides all activities of the consumer from the people he associates with to the product he buys. In the business world, it has always been what people say about a product or service and not what the marketer says. Especially in this Gen Y consumer, marketing and advertisement has taken a different dimension from what it use to be to personified approach, it is against this backdrop that the researcher intends to investigate the effect of digital synergy on consumers patronage of products.


1.3 Objective of the Study

The main objective of this study is to ascertain the effect of digital synergy on consumers patronage of products, but specific objectives include:

  1. To investigate the impact of digital synergy on consumer choice of product patronage
  2. To investigate the role of digital advertising on choice of the consumer
  3. To ascertain if there is any relationship between digital synergy and consumers patronage of a product in Nigeria
  4. To investigate the effect of digital synergy on the sales volume of an organization

1.4 Research Question

For the successful completion of the study, the following research questions were formulated by the researcher;

  1. Does digital synergy has any impact on consumers choice of product patronage?
  2. Does digital advertising play any role on the choice of consumer?
  3. Is there any relationship between digital synergy and consumers patronage of a product?
  4. Does digital synergy has any effect on the sales volume of an organization?

1.5 Significance of the Study

It is believed that at the completion of the study, the findings will be of great importance to the marketing manager in formulation of policy that will enhanced effective implementation of marketing strategy which will aid increase in sales volume, the study will also be useful to the sales promotion team as the study seek to explore the effectiveness of digital synergy in relation to sales volume, the study will also be of importance to researcher who intend to embark on a similar study as the study will serve as a reference point to them, finally, the study will be of great importance to the marketing profession as the study will contribute to the pool of existing literature in the subject matter


1.6 Scope and Limitation of the Study

The scope of the study covers effect of digital synergy on consumers patronage of products, but in the cause of the study, there were some factors which militate against the scope of the study;

a) Availability of Research Material:

The research material available to the researcher is insufficient, thereby limiting the study

b) Time:

The time frame allocated to the study does not enhance wider coverage as the researcher has to combine other academic activities and examinations with the study.

c) Finance:

The finance available for the research work does not allow for wider coverage as resources are very limited as the researcher has other academic bills to cover.


1.7 Definition of Terms

Digital synergy

Digital Synergy is a premier virtual digital marketing agency successfully serving clients all across the country. Since 1997, we’ve delivered web marketing solutions for all types of businesses and markets, and we always ensure that our clients receive the best in digital marketing services.

Marketing

Marketing is the study and management of exchange relationships. Marketing is used to create, keep and satisfy the customer. With the customer as the focus of its activities, it can be concluded that Marketing is one of the premier components of Business Management – the other being Innovation

Sales volume

Sales volume is the number of units sold within a reporting period. This figure is monitored by investors to see if a business is expanding or contracting. Within a business, sales volume may be monitored at the level of the product, product line, customer, subsidiary, or sales region


1.8 Organization of the Study

This research work is organized in five chapters, for easy understanding, as follows

  • Chapter one is concern with the introduction, which consist of the (overview, of the study), statement of problem, objectives of the study, research question, significance or the study, research methodology, definition of terms and historical background of the study.
  • Chapter two highlight the theoretical framework on which the study its based, thus the review of related literature.
  • Chapter three deals on the research design and methodology adopted in the study.
  • Chapter four concentrate on the data collection and analysis and presentation of finding.
  • Chapter five gives summary, conclusion, and recommendations made of the study.

Chapter Five


Conclusion

5.1 Introduction

The motive of the research was triggered by personal interest in how consumer patronage has changed in the Digital Age, in particular with social media. The amount of information available to us increases in each new day, as a result, we are overwhelmingly exposed and attained to different aspects of information via the Social Web. The accessibility and transparency that social media offers has led changes in how consumers position themselves in today’s market, in which it is inevitable and necessary for companies to equip with a new marketing mindset. The central gravity of the research was to explain why, when, and how social media has impacted on consumer decision making process both in theory and in practice.

There is a generous amount of reports relating to social media marketing which are primarily aimed to help businesses benefit from this marketing trend. Oftentimes, businesses assume that they are on the right track in the new marketing era, for instance engaging customers by creating a Facebook page; in fact, customers may not share the same picture as businesses may have.

Therefore, the research was carried out in the perception of consumers (in Finland), which was aimed to explain the impacts of social media on different stages in their decision making process, by finding out how consumers perceive social media in the entire process.

Additionally, the research, perhaprs, could help company to gain new insights from this perspective and to identify potential pitfalls and opportunities via social media, for instance to develop appropriate ways to tab into the decision making process at the right time or to have a better understanding of why their social media marketing campaigns may not be executing as they would have anticipated.

Essentially, the theoretical framework of this research was built upon consumer buying model and the changes social media has predominately brought to marketing. The five stages in the buying model served as a basis of the logical order of how the survey was carried out and the theories in social media provided guideines on which set of questions would grasp the research questions.

The following chapter presents the conclusions drawn from the research findings. Nontheless, further discussions and limitations are outline and deliberated.


5.2 Conclusion

The objective of the research was to to explain why, when, and how social media has impacted on consumer decision making process. Research questions were designed to narrow down the subject and to help the researcher to identify the explanations of the issue. The three research questions for this thesis were as follow:

  1. How do consumers attend, process, and select the information before a purchase?
  2. What are the differences between marketing on social media and through mass media?
  3. What are the changes social media has brought to consumers in different stages of their decision making?

To begin with, social media has brought profound changes to both consumers and businesses, the findings of this research are consistent with the theories presented in the theoretical framework, Chapter 2 to 4. The collected data from the survey is elaborated in association with the presented theories in Chapter 6 Data Analysis of the research.
In terms of the first research question, th five-stage decision making model has provided a systematic approach in outlining the general stages that consumers engage in all purchase, while the information process theory addresses an indepth perspective of how information is in used of throughout the course of decision making.

The aforementioned theories and the data analysis of the research have both proven that, no matter it is in association with social media or mass media, consumers are highly selective in attending, process, and selecting the information before a purchase takes place. Information exposure is highly selective in the initial stage of information, because consumers have the selections of information source, in which determinates the type of information that consumer will be exposed to. To be noted, personal attitude is a crucial factor which underlines during the course of information acquisition and evaluation. As a result, not ony judgments regarding products or services are presumably based, but also it is an vital determinant of the information consumers will seek out, in which it eventually affects the extent of the information reception.

At the essence, all platforms available on social media have offered a two-way communication flow, which is highlighted theoretically and practically. Consequesntly, this principle feature of social media has created a new landscape in supporting the socialization of information, and has forced marketers to give up what they old mindset in dealing with mass media marketing. As the collected feedbacks from the individuals, it has emphasized that, in particular with social media, consumers are able to access to customer experiences and word of mouth, in which supasses the marketing and advertising mumbo-jumbo or polished slogans.

In other words, marketing via social media is more about creating high-quality contents that are consumer relevant (Drury 2008), instead of being a brash product placement. Moreover, marketing through social media focuses on building relationships between consumers and companies. The research findings have shown that the position of the consumer in the new marketing approach is the centralized gravity, because consumers are empowered. As many respondents have reflected that social media has provided a more effective platforms to communicate with one another and with the company.

Finally the core objective of the entire research was to find out the changes that social media has brought to consumers in each stage of their decision making process. According to the findingd, social media still cannot be considered as a powerful tool to trigger a purchase in Finland, whereas individuals have reflected that mass media still remains a certain influence in gaining awreness, for instance discounts available in stores, or a good deal. Social media has considered as a powerful tool in getting relevant information, while mass media creates awareness of certain discounts or promotions.

In theory, information exposure through mass media is considered as a passive process as individuals are exposed and receiving information unconsciously. However, when consumers seek out information initiatively, it is perceived as an active process. In the research findings, consumers play an active role in the course of information acquisition because of the accessibility and availability of information on social media platforms.

The accessibility and transparency of information that social media has offered to consumers have been indicated throughout the entire research. Consumers are able to access to relevant information not only in a great range but also in a faster speed, which mass media consumes more time in searching information. In contrary, contents are not in control and monitored, thus the chance of getting fasle and nonfactual information which the consumers have shown concern of. In terms of a business context, marketers have to be aware of the bad mouth on social media, because it can be spread virally and led to a damage to brand’s reputation.

The research finding has revealed the current situation concerning consumers’ post purchase behavior in Finland. Many individuals have noticed and agreed that with social media, they are able to voice out their opinions and to communicate with other consumers and with the company more effectively. However, again, many of them have felt not encouraged to voice out their feedbacks and to pass along their comments to peers, friends, or family members via social media. In responding to the purchase validation tool (Evans 2008), the reason why social media has added value to today’s marketing is by bridging up the post-purchase word of mouth with the consideration stage of the consumer decision process, which has extended purchase funnel. Specifically, due to the word of mouth and user-generated contents on social media, the ”talks” are able to generate an experiential data for prospects; however, the findings have shown that the word of mouth would be insufficient for the influence because of unwillingness to share the information via social media. In the perspective of marketers, this pitfall may serve as a bottleneck in association with marketing via social media; thus, marketers should identify the reason of this particular negative feelings among consumers and initiate consumers to participate in the conversations.

Social media has altered the communication model which it uesd to be in mass media (see Smith and Zook 2011), instead of having companies deliever messages to the public all times, social media has fostered a web communications between customers and opinion leaders in which spins around the brand; consequesntly, this particular new communication flow has built interactivity and communities among all users, which the effects of it has penetrated in every stage of the decision making process. This influence has been reflected from the collected opinions (see Appendix 3).

To conclude, from the findings of this research, it can be observed that consumers in Finland are actively utlilizing social media platforms as a tool in validating of the purchase decisions; however, consumers are deemed to be inactive in sharing their word of mouth to others with the available social media platforms. The consistency in the gathered data and time-hornoured theories relating to consumer behavior and contemporary frameworks regarding social media marketing, it has suggested that the essence of consumer behavior still remains the same even after the advent of social media, in which individuals have to go through the all the stages before a purchase, instead of straight to the purchase decision once a thought of purchase being triggered.


5.3 Further study

Considering the limited time and scope of this research, many theories related to the subject were covered but in a rather general perspective so as to provide a big picture for the readers. Therefore, if further research could be conducted, then an in-depth survey should be carried out in tackling the research objective.

It would be undoubtely useful and interesting to have a case company as a reference of the research. By studying the case company, it may offer a comparison between what company thinks it is working out, and what does its consumers actually perceive. Would the result reflect a diverse perception from two different parties in regards of social media and decision making process? The results could help company to gain an evident insights and to identify actual tactics to tackle the situation.

Since research has revealed that consumers do not feel encouraged to generate the word of mouth through social media, and this indications may imply that marketers would have to carry out certain actions in order to provoke these conversations. Therefore, a furture research can be conducted based on this perspective in investigating the reasons associating with this particular feeling and how it could be altered in order to utilize social media as an effective purchase validation tool.

Nonetheless, if further research could be conducted for companies , then theories could be implied more accurately, because some of the theories are proposed and developed in aiming to help companies to gain a better postion in the transition from the traditional marketing approach to the new marketing mindset. In that case, findings and conclusions could be drawn without vagueness.


5.4 Limitation

Despite the fact that theories were approved by findings from survey and the research is able to provide a certain degree of new insights in relating to the current situation, limitations may still exist.

In the foregoing chapter the above findings cannot represent all individuals across Nigeria as a whole, due to the decision making process involves psychological factors which may result in different behavioral actions. Also, regarding the summarization of question 31 in the survey, it may result in the lack of objectivity because the researcher may only highlight the comments according to the researcher’s intention.


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