Social Media and Consumer Decision Process

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Consumer-generated content supported through social media is a mixture of fact and opinion, impression and sentiment, founded and unfounded tidbits, experiences, and even rumor (Blackshaw & Nazzaro, 2006). In travel and tourism, past research has focused attention on the socio-psychological aspects of social media use. Not surprisingly, travel-related virtual communities attracted the attention of tourism researchers early on. Virtual tourist communities, where tourists can exchange opinions and experiences on topics of common interests, have been around at least since the late 1990s, and several researchers have investigated their roles and impacts in the context of decision processes.

2.4 Social media and consumer decision process

The consumer decision process model represents a road map of consumers’ minds and captures the activities that occur when decisions are made in a schematic format, showing how different internal and external forces interact to affect how consumers think, evaluate, and act (Norjaya &Wan Jooria, 2012). As the model shows, consumers typically go through seven major stages when making decisions: need recognition, search for information, pre-purchase evaluation, pre-purchase, consumption, post-consumption evaluation, and divestment.

However, the Internet has had a major impact on consumer information search behavior.

Consumers become active participants instead of receiving messages and stimuli from

marketers. Traditional marketing transfer the messages from business to consumers; while the Internet makes the messages transferred from business to consumers.

Consumers belong or admire different online groups generally and those groups are able to change their purchasing decisions behavior (Solomon, 2010). According to Evans (2009) joint decision-making is defined as, consumers are taken their decisions within the environment around them such as environment of family, friends, and coworkers. In a traditional way, consumers make their purchase decisions based on information that they

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received through mass media (e.g. advertising, newspaper, television comment), but nowadays, online social networks can have power to affect consumers’ purchase decision (East, Wright & Vanhuele, 2008). Stelzner (2011) reported that 88% of respondents agreed that social media generated exposure for their businesses, 72% noted that social media increased the flow of traffic onto their social networking sites and 43% correlated social media with increased sales. It is worthy to note that 62% of respondents reported that social media improved search rankings of their products (Stelzner, 2011).

Consumers are able to search for the information they need and share their own experiences about products or services with other consumers. This fact (sharing opinions with others regarding previous experiences with products or services) is one of the reasons why social media influences purchasing decisions. Consumers are also buying based on

recommendations from social media (Forbes & Vespoli, 2013). 81% of people say that posts by their friends on social media influence their purchases (Peneycad, 2013). According to several information sources, consumers are 71% more likely to purchase based on social media referrals; out of 53% of consumers who said they use Twitter to recommend companies or products in their Tweets, 48% bought that product or service (SproutSocial, 2010); Twitter is the number 1 online channel for influencing purchasing decisions

surrounding electronics (Mashable, 2012); 15,100,000 consumers go to social media channels before making purchase decisions (Knowledge Networks, 2012); 7. 74% of consumers rely on social networks to guide purchase decisions (SproutSocial); 58% of Facebook users expect offers, events or promotions when they become fans (Hubspot); Facebook is the most

effective platform to get consumers talking about products (SproutSocial); 79% of consumers like a Facebook company page because it offers discounts and incentives; 38% 13 to 80 year olds in the U.S. said their purchasing decisions were influenced by social media (Knowledge

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Networks); 81% of US respondents indicated that friends’ social media posts directly influenced their purchase decision.

As of June 2011, there were 213,000,000 fans of Facebook Pages (Mashable); 32.5%

of women say they’re influenced by special offers on Facebook and 29% on Twitter (Business2Community, 2012); 78% of respondents said that companies’ social media posts impact their purchases; 70% of active online adult social networkers shop online, 12% more likely than the average adult internet user (Nielsen, 2011); 20. 44% of social media savvy women said their trusted/favorite blogger influences their purchasing decision. On a different study, 72% of consumers trust online reviews as much as personal recommendations. This means that 72% of people trust complete strangers just as much as people they know when it comes to making a purchase decision (Peneycad, 2013).

Fauser (2011) conducted a research study regarding the impact of social media on touch points during the consumer’s purchase decision journey. Key points resulting from this research were:

- Consumers felt that information sharing, collaboration and relationship building was necessary to support ongoing communication

- Social media marketing allowed organizations the opportunity to be in the position to offer additional sources of information regarding product benefits, product features and provide real time feedback to consumers.

- Social networks, particularly Facebook were found to be most suitable

information sharing platform at the beginning of the consumer purchase decision as many consumers relied on social recommendations

- Many consumers used Facebook reviews and ratings (“likes”) as the means to seek recommendations, peer advice and find product information.

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The relationship between social media and consumer decision-making present that social media affects advertising attitudes, brand attitudes, and purchasing intentions of consumer. It will not necessarily affect consumer’s decision-making, but might possess a mediating effect (Taining, 2012). Therefore, social media can build brand attitudes that affect buying behavior. Consumers have influence and can facilitate the acceptance of a brand in virtual market places through social media (Mangold & Faulds, 2009). Social networks were also considered the most influential platforms in terms of social media as it served as an “all-purpose” medium to engage with consumers at all stages of the consumer decision journey (Fauser, 2011).