Università di Modena e Reggio Emilia
DIPARTIMENTO DI STUDI LINGUISTICI E CULTURALI
Corso di Laurea Magistrale in
LANGUAGES FOR COMMUNICATION IN INTERNATIONAL ENTERPRISES AND ORGANISATIONS
Omnichannel buying behaviour and the new role of social media as social distribution channels. A study on luxury goods.
Il comportamento d’acquisto omni-channel e il nuovo ruolo dei social media come canali di distribuzione. Uno studio sui beni di lusso.
Prova finale di:
Lorene Windal
Relatore:
Giovanna Galli
Correlatore:
Donatella Malavasi
Academic Year 2018-2019
Riassunto
La tesi riguarda gli ultimi sviluppi che hanno completamente modificato il mondo del commercio al dettaglio: l’introduzione delle strategie omni-channel e come vengono adottate nel settore di lusso.
Effettivamente, l’industria del lusso è definita come una prospettiva interessante dato che la sua esclusività e la sua superiorità ne limitano l’accessibilità e i principi di marketing che lo caratterizzano sono totalmente differenti dall’approccio tradizionale.
Due aziende di lusso sono state prese in considerazione per analizzare come entrambe hanno adattato le loro strategie a questa nuova tendenza. Nonostante queste due imprese mirano a conservare la loro immagine di esclusività e di lusso, entrambe adottano un approccio diverso. La prima è la famosa marca italiana Gucci che è recentemente riuscita a modernizzare la sua identità eppure ha applicato un programma omni-channel con successo. La seconda è la marca tradizionale francese Hermès che ha incontrato più difficoltà dato che rifiuta di entrare nel mondo digitale.
Il lavoro è stato suddiviso in cinque capitoli. Nel primo, l’origine di Internet e la storia dei social media sono presentate visto che questi due concetti costituiscono parte integrante della strategia omni-channel. Inoltre, aiuta a capire l’ascesa dei social media nel marketing e come le piattaforme influenzino gli utenti. Il secondo capitolo tratta della nozione del comportamento omni-channel e punta a presentare un quadro d’insieme sui consumatori, a seguito della diffusione e dell’utilizzo della rete sia nella raccolta delle informazioni sia nel processo d’acquisto. Oltre a ciò, dato che il buying journey degli omni-shoppers avviene su una grande varietà di canali online, é anche essenziale descriverne caratteristiche; diffusione e modus operandi.
Il terzo capitolo si focalizza sul lusso e i principi di marketing specifici per questo settore particolare, che richiede approcci specifici e che fatica ad allinearsi ad un contesto omni-channel, destinato in origine a beni e mercati di massa.
Inoltre, il capitolo quattro descrive la metodologia utilizzata per effettuare l’analisi comparativa tra Gucci e Hermès. Innanzitutto, la loro presenza online è studiata ed interpretata, e le strategie simili su questi canali sono sottolineate. In seguito, le strategie adottate dalle due aziende sono state spiegate; indagando il grado di corrispondenza ad un approccio omni-channel e l’impatto sui risultati economici.
Infine, le conclusioni sono focalizzate sul confronto degli approcci delle due marche di lusso e sui risultati emergenti dall’analisi comparativa.
Abstract
This thesis is about the latest development which has completely altered the retailing landscape - the introduction of omnichannel strategies and how those are adopted in the luxury sector. As a matter of fact, the luxury industry is an interesting perspective since its exclusive and superior nature limits its accessibility and its marketing principles are completely different than the traditional approach.
Two luxury firms were taken into account in order to study how they have both adapted their strategy to this new trend. Even though these two firms aim at preserving their image of exclusivity and luxury, they both adopt a different approach. The first one is the famous Italian brand Gucci which has recently managed to modernise its identity and has also successfully implemented an omnichannel programme. The second one is the traditional French label Hermès and has encountered more difficulties since it refuses to embrace the digital world.
The research is divided into five chapters. In the first one, the roots of Internet and the history of social media are presented since these two concepts are an integral part of omnichannel strategies.
Moreover, it helps to better understand the rise of social media in marketing and how these platforms generally influence users. The second chapter refers to the notion of omnichannel buying behaviour and aims at presenting an overview of how customers’ behaviour has been altered by such perspective. Furthermore, as omnishoppers’ buying journey takes place on a wide variety of channels, it is essential to describe the various online channels that are available nowadays.
The third chapter focuses on luxury and the marketing principles specific to this particular sector.
Indeed, the luxury industry may not adopt a traditional marketing approach due to its inaccessible nature. This part also explains the various difficulties faced by luxury brands when they decide to adapt to an omnichannel environment.
Furthermore, chapter four describes the methodology used in order to conduct the comparative analysis between Gucci and Hermès. Firstly, their online presence is studied and interpreted, and similar strategies on these channels are also highlighted. Then, the strategies adopted by the two firms are explained, specifying the degree to which it corresponds to an omnichannel approach and how it positively impacts economic results.
Lastly, the conclusions regarding the two luxury brands’ approaches are drawn and are also extended to the luxury sector in general. In other words, this part discusses the results of the comparative analysis.
Resumen
Esta tesis trata sobre el último desarrollo que ha cambiado completamente el mundo del comercio minorista, es decir, la introducción de las estrategias omnicanales y cómo se adoptan en el sector del lujo. De hecho, la industria del lujo es una perspectiva interesante ya que su naturaleza exclusiva y superior limita su accesibilidad y sus principios de marketing son completamente diferentes al enfoque tradicional.
Se tienen en cuenta dos empresas de lujo para analizar cómo han adaptado su estrategia a esta nueva tendencia. Aunque esta dos compañías principalmente aspiran a preservar su imagen de exclusividad y de lujo, ambas no siguen las mismas pautas. La primera empresa es la famosa marca italiana Gucci, que recientemente ha conseguido modernizar su identidad y también ha puesto en marcha un programa omnicanal con éxito. La segunda es la marca francesa tradicional Hermès, que ha conocido más dificultades dado que rechaza abrazar el mundo digital.
Este estudio se divide en cinco capítulos. En el primero, se presentan las raíces de Internet y la historia de las redes sociales, ya que estos dos conceptos son una parte esencial de las estrategias omnicanales. Además, ayuda a entender el ascenso de las redes sociales en el ámbito del marketing y cómo estas plataformas influyen en los usuarios de manera general. El segundo capítulo se refiere a la noción de comportamiento de compra omnicanal y tiene el objetivo de presentar cómo esta perspectiva ha cambiado el comportamiento de compra de los consumidores. Dado que el ciclo de compra de los omnishoppers tiene lugar en una amplia variedad de canales, es también esencial describir los diversos canales que actualmente están disponibles.
El capítulo tres se centra en el lujo y en los principios de marketing específicos de este sector en particular. De hecho, la industria del lujo no puede adoptar una estrategia de marketing tradicional debido a su naturaleza inaccesible. Esta parte también explica las varias dificultades que encuentran las marcas de lujo al adaptarse a un ambiente omnicanal.
Además, el capítulo cuatro describe la metodología utilizada para llevar a cabo el análisis comparativo entre Gucci y Hermès. En primer lugar, se examina y se interpreta la presencia en línea de las dos y se resaltan las tácticas similares en estas plataformas. En segundo lugar, se explican las estrategias que ambas empresas han adoptado, especificando hasta qué grado corresponden a un
enfoque omnicanal. También se tiene en cuenta en qué modo tienen un impacto positivo en los resultados económicos.
Finalmente, se sacan las conclusiones en relación al comportamiento de las dos marcas de lujo y se extienden al sector de lujo en general. Dicho de otra manera, esta parte discute los resultados del análisis comparativo.
TABLE OF CONTENTS
Riassunto Abstract Resumen
Introduction ……….. 1
Chapter 1: The Rise of Social Media in Marketing ………... 4
1.1. Internet and Web 2.0. ……….. 4
1.2. Social Media Marketing ……….. 6
1.3. The Most Influential Social Networking Sites ……….. 10
1.3.1. Facebook ………. 12
1.3.2. Instagram ……… 14
1.3.3. Twitter ………..16
Chapter 2: Omnichannel Buying Behaviour ……… 18
2.1. Consumer Buying Behaviour ……… 18
2.2. Online Commerce Channels ……….. 20
2.2.1. E-Commerce ……….. 20
2.2.2. Social Commerce ……… 23
2.2.2.1. Facebook Social Commerce ……… 26
2.2.2.2. Instagram Social Commerce ……… 27
2.2.2.3. Twitter Social Commerce ……… 28
2.2.3. M-Commerce ……….. 29
2.3. Omnichannel Buying Behaviour ……….. 31
Chapter 3: Luxury Fashion Brands in an Omnichannel Environment ……… 39
3.1. What is Luxury? ……… 39
3.2. Luxury Consumption Behaviour ……….. 41
3.3. Evolution of Luxury Fashion Marketing ……….. 45
3.4. Luxury Brands in an Omnichannel Environment ……… 51
Chapter 4: Methodology and Analysis ……… 57
4.1. Methodology ……… 57
4.2. Case 1: Gucci ……… 58
4.2.1. Presentation of the Firm ………. 58
4.2.2. Online Presence of the Brand ………. 59
4.2.2.1. Website ……… 60
4.2.2.2. App ……….. 63
4.2.2.3. Facebook ……….. 64
4.2.2.4. Instagram ………. 69
4.2.2.5. Twitter ……….. 74
4.2.2.6. Similar Strategies on Platforms ……….. 77
4.2.3. Gucci’s Omnichannel Strategy ……….. 79
4.2.4. Economic Consequences ……… 83
4.2.5. Conclusion ……….. 86
4.3. Case 2: Hermès ……….. 87
4.3.1. Presentation of the Firm ………. 87
4.3.2. Online Presence of the Brand ………. 87
4.3.2.1. Website ……… 88
4.3.2.2. Facebook ……….. 92
4.3.2.3. Instagram ………. 97
4.3.2.4. Twitter ……… 103
4.3.2.5. Similar Strategies on Platforms ………. 106
4.3.3. Hermès’ strategy ……….. 107
4.3.4. Economic Consequences ……….. 112
4.3.5. Conclusion ……… 114
Chapter 5: Conclusions ……… 115
References ……….. 122
INTRODUCTION
This dissertation is about the growing importance of omnichannel strategies in the fashion industry.
As a matter of fact, this approach certainly is the future of retail, but is also already adopted by some companies. An omnichannel strategy may be defined as a form of retailing which allows customers to shop across a wide variety of channels anywhere and at any time and is mainly aimed at providing them with a seamless shopping experience. Therefore, the absence of barriers is the basis of such approach. Moreover, users, who have become more active since the introduction of Web 2.0, now expect a personalised customer service which is perfectly tailored to their changing needs and preferences.
This appears to be an excellent opportunity for the fashion industry since it would allow companies to reach new customer segments such as millenials who are constantly connected and look for experience-driven shopping journeys. As a consequence, once firms have understood their customers’ new behaviours, these should be able to increase their revenue in a considerable way.
In this thesis, the analysis of how such an approach is implemented will be applied to the luxury industry since it represents an important challenge for this sector in particular. Indeed, even though luxury is hard to define, its essence is characterised by exclusivity, authenticity and scarcity. In the digital era where any distance with consumers is reduced, it is quite hard for those companies to avoid being considered as ‘masstige’, that is to say, producing luxury goods that are intended for the mass market.
The main objective of this dissertation is to identify the most important factors of omnichannel strategies and study how these should be adopted for an effective implementation. That is why a comparative analysis was carried out between two luxury firms - Gucci and Hermès. These two companies were chosen because they both belong to the luxury sector, but also because they differ in how they have adapted to an omnichannel environment. Even though they both aim at preserving their exclusive nature, the first firm, Gucci, has managed to perfectly adopt an omnichannel strategy by embracing all its characteristics, while the second one, Hermès, encounters some difficulties to do so.
First of all, chapter one is focused on the rise of social media in marketing. Social media is an essential part of the omnichannel approach as brands’ online presence must be consolidated in order to send a consistent message on all platforms. In order to better understand the importance of such platforms, the origin and evolution of Internet are explained until the introduction of Web 2.0, which corresponds to a radical change in users’ online behaviours since it has enabled them to become more active and engage in social interactions. The concept of Social Media Marketing is also defined, while the history of social media is presented to highlight its strong influence on a company’s image due to electronic word-of-mouth and online feedbacks. Social media activities are also linked to Customer Relationships Management which aim at attracting and retaining customers’ attention so as to win their loyalty. Finally, the most influential social networking sites - namely Facebook, Instagram and Twitter - and their typical features are described.
The second chapter introduces the notion of omnichannel buying behaviour and the various online sales channels related to social media. First of all, the five stages of the traditional consumer buying behaviour are carefully explained and followed by how customers are influenced in their purchases.
Subsequently, the various online commerce channels are presented, which represent an integral part of the omnichannel approach. Therefore, the various types of e-commerce are explained as well as its important growth thanks to its numerous advantages such as, among others, the absence of geographical or time limit, or the possibility to access all products in one market place for example.
E-commerce is constantly evolving and has led to the creation of social commerce and m- commerce. The former refers to a form of commerce in which social media assist with buying and selling products. It is also considered to be an important online channel since it allows not only the creation of communities, but also the exchange of information between users. The latter refers to mobile commerce which increasingly gains importance due to its convenience. The final part of this chapter focuses on the changes in the retailing landscape due to the combination of online and offline channels. As a consequence, it has led to the concept of omnichannel buying behaviour which is based on the absence of barriers between channels since consumers now switch from one channel to another during their shopping journey. In order to better understand how consumers buy and behave in this new environment, it is necessary to focus on the various categories of customers and their buying process.
Furthermore, the third chapter studies how luxury fashion brands face the challenge of implementing an omnichannel strategy. A definition of luxury is firstly given and is followed by the
presentation of the luxury continuum containing three different levels. Then, the luxury consumption behaviour is explained by underlining the main reasons behind consumers’ decisions.
The most important one is to satisfy the need to boost their ego and create a favourable social image to impress all the other members of their social groups. Four categories of consumers are also identified in the luxury sector with their respective characteristics. Moreover, it is essential to address the evolution of luxury marketing since it does not include the rules of traditional marketing, but rather creates its own principles. As a matter of fact, the luxury industry faces a dilemma by refusing to become ‘masstige’ and therefore tries to preserve a social distance with consumers. Finally, the challenge faced by luxury brands when evolving in an omnichannel environment is analysed. Due to the combination of online and offline channels, it is of prime importance that luxury companies consolidate their online presence in order to reach new customer segments and then, they must proceed to the integration of online channels into brick-and-mortar stores so as to satisfy the needs of all types of omnishoppers and enhance their overall experience.
Moreover, chapter four presents the methodology used to carry out the practical analysis of two cases - Gucci and Hermès. Firstly, the online presence of both firms is taken into account and is divided into various parts - namely website, app, and the three most influential social networking platforms, Facebook, Instagram and Twitter. Secondly, the similarities in the two firms’ social media plan are presented, if there are any. A general presentation of the two companies’ business strategies is followed by the economic consequences resulting from their choices regarding the omnichannel challenge and a brief conclusion.
Lastly, the fifth chapter contains the conclusions and implications for both firms, demonstrating why an omnichannel approach might be an essential tool to attract more customers’ segments and gain their loyalty. Focusing on millenials might appear to be a good start since their behaviour is cross-generational and will have an influence on other generations. Moreover, companies adopting such strategy increase their revenue at a higher rate than firms which do not.
CHAPTER 1
The Rise of Social Media in Marketing
1.1. Internet and Web 2.0
The Internet is ‘at once a world-wide broadcasting capability, a mechanism for information dissemination, and a medium for collaboration and interaction between individuals and their computers without regard for geographic location’ (Leiner et al., 1999, p.22).
The influence of the Internet is not limited to computer technologies as it also allows people to share information, exchange ideas and to accomplish electronic commerce. Thus, it is obvious that this means of communication has completely changed the way humans interact, but it also appears to be an excellent opportunity for companies. Indeed, firms have been able to expand and sell worldwide in a quick and easy way, meaning it has positively contributed to their international growth.
The forerunner of Internet is considered to be the Advanced Research Projects Agency Network (ARPANET) in the 1960s by a U.S. Government Agency. Its primary function was ‘to link computers at Pentagon-funded research institutions over telephone lines’ (Featherly, n.d). This purpose was primarily more academic, but rapidly became more military as, at the height of the Cold War, military commanders needed to possess a computer communications system with no central core that could be destroyed by enemies (Featherly, n.d.).
Therefore, computer engineers had to understand how to allow different machines to communicate over long distances (Strickland, 2011). That is why the creation of a packet-switched network is an essential step. Indeed, in this system, information is broken down into small pieces to reach its final destination and is then reassembled by the receiving computer. This was made possible thanks to the use of some protocols, and the two most important ones are Transmission Control Protocol (TCP), which collected and reassembled the packets of data, and Internet Protocol (IP), which guaranteed that the information had reached the right end destination. Both were developed by Robert Khan and Vinton Cerf. This way, Arpanet was able to be connected to other networks.
However, the most important step remains the creation of the World Wide Web in 1989 by Tim Berners-Lee (World Wide Web Foundation, n.d.). The World Wide Web is a ‘system of interlinked hypertext documents accessed via the Internet. With a web browser, one can view web pages that may contain text, images, videos, and other multimedia and navigate between them via hyperlinks’ (Choudhury, 2014, p.8096).
The first generation of World Wide Web was coined ‘Web 1.0’ and its role might be defined as passive and static since its first objective was restricted to the distribution of information (Choudhury, 2014). In other words, the web was considered as a newspaper that users might only read. In fact, users could exchange opinions and comments between them, but were not allowed to interact with the website, namely the web was only limited to an indirect communication.
However, the introduction of direct communication on the Web appeared at the birth of the Social Web, also called ’Web 2.0’ by Tim O’Reilly at a conference in 2004. Without any doubt, this marked the beginning of a new era as this second generation of Web has enabled users to share content - such as texts, videos, images, etc. -, to actively participate in various activities and engage in social interactions with larger groups. Given that Web 2.0 is partly user-centric, users are frequently asked to express their personal opinions and come to like this virtual socialisation.
According to O’Reilly,
One characteristic feature of Web 2.0 is the collaborative content creation and modification, which appears as a turning point for the World Wide Web. As a matter of fact, in Web 1.0, content was exclusively posted by experts and users could only read it, while in Web 2.0, users have become actors and able to generate content (Choudhury, 2014). Nonetheless, critics might highlight the inevitable lack of credibility of ‘Web 2.0’ since users could easily modify and create content online, which appears hard to control. In this era of Web, not only did Wikis emerge, namely websites in which users may participate in content generation, but so did an increasing number of social
Web 2.0 is the business revolution in the computer industry caused by the move to the internet as platform, and an attempt to understand the rules for success on that new platform. Chief among those rules is this: Build applications that harness network effects to get better the more people use them (quoted in Choudhury, 2014, p.8097).
networking platforms mainly to share and communicate like Facebook, Twitter, LinkedIn, or Youtube for example.
1.2. Social Media Marketing
The advent of Internet and the development of new technologies have brought about radical changes in human communication. Indeed, in 2000, various social media and social networking platforms emerged to ease interactions between people sharing similar interests. As a consequence, this has inevitably impacted organisations too. Actually, a significant number of small, medium and large companies are nowadays using these recent technological tools in order to carry out marketing activities.
Social media marketing (SMM), which has become the most popular and effective tool of marketing, might be defined as follows:
From the definition, this field is closely related to social networks, which are interactive platforms through which people can easily access information, discuss with one another and share ideas and opinions.
The notion of social media is strongly related to sociology as it was underlined by Durkheim and Tonnies (Big History, 2010). Indeed, such platforms might lead to the creation of social groups formed by members who share values and beliefs and are able to communicate with a higher number of people.
It might be important to make a distinction between social media and social networking, which are two different concepts. On the one hand, the first category is used to share information, ideas or other content with a broad audience and is referred to as a communication system (Schauer, 2015).
They encompass, for example, blogs, videos, and photo-sharing. On the other hand, the second one refers to a two-way direct communication in which conversations are essential and to an 'act of engagement as people with common interests build relationships through a sense of
the utilisation of social media technologies, channels and software to create, communicate, deliver, and exchange offerings that have value for an organisation and its stakeholders. (Tuten and Solomon, 2018, p.21)
community’ (Edosomwan et al., 2011) on social platforms such as Facebook, Instagram and Twitter, only to name the most popular ones.
The origin of social media might be traced back to the 1950s when the phenomenon of phone phreaking began through which phreaks hacked into corporate unused voice mailboxes to host the first blogs and podcasts (Edosomwan et al., 2011). The 60s also played a crucial role as the public saw the advent of email in this decade.
The following important step is the birth of the Bulletin Board System (BBS) in 1978 which allowed users to upload and download softwares, read news and exchange messages and was to be 'accessed via a modem through a telephone line’ (Edosomwan et al., 2011). Even though its flexibility was limited by the technology of that time, it is considered to be the first platform through which users could interact with each other.
However, the platform which is closer to current social media websites is said to be Usenet, created in 1979 by Tom Truscott and Jim Ellis, where users could read and writes articles and subscribe to newsgroups that matched their personal interests (Hosch, 2008). Further developments led to the introduction of the WELL (Whole Earth ‘Lectronic Link) in the 1980s by Stewart Brand and Larry Brilliant, one of the oldest virtual communities (Edosomwan et al., 2011).
Another significant step in the history of social media is when Randy Conrads, the former Boeing Manager, launched classmates.com in 1995. The website helped people finding their old schoolmates (Classmates, 2015). Basic actions such as the creation of a profile or the access to other members’ profile were free, while for a modest fee, Classmate + members could also communicate with their peers. However, it did not survive the arrival of Facebook, made accessible to the public in 2006.
Nonetheless, the very first social networking platform is considered to be Six Degrees, named after the theory of ‘Six degrees of separation’ which states that people in the world are connected to one another by no more than six degrees of separation. This niche social site where users can interact was created by Andrew Weinreich in 1997 and was the first attempt to map relationships, creating lists of friends, family members and acquaintances. Moreover, people could create a profile, invite friends, organise groups and check other users’ profile (Shah, 2016). Although it counted about 3, 5
million registered users, the platform was sold for $125 million in 2010 and completely shut down in 2001 because of its limited growth due to a lack of people having access to the Internet.
Nevertheless, as it is illustrated in the following figure, the revolution of the 2000s really boosted the emergence of social media (Jasra, 2010; Allen, 2017). Many social networking sites flourished in that decade, and among the most important ones, we might find Facebook, Instagram, and Twitter, which will all be described in the following section.
It is obvious that the growing influence of social media is not only restricted to human interactions, but is also exerted on models and strategies of traditional marketing. Thus, the central role of social media in marketing activities must be highlighted as companies can use these new tools in order to market products and services at a minimal cost (Edosomwan et al., 2011).
First of all, social media play an essential role in engaging consumers and enhancing customer relationships since they are presented as new channels for a firm to interact with its current and potential customers (Venciūtè, 2018). As a consequence, marketers need to perfectly understand customers by studying their demographic data, attitudes on social media and preferences, for example (Paswan, 2018). The importance of social media is obvious, especially in the international consumer-targeting context.
Figure 1: History of Social Media, November 2010. (Source: https://www.webanalyticsworld.net/
2010/11/history-of-social-media-infographic.html)
Therefore, social media marketing activities may not be separated from customer relationships management (CRM) activities due to the increasing interactivity between firms and consumers and between consumers and consumers on social media.
CRM is defined as
In other words, it might be explained as the practices and activities an organisation must follow in order to attract and retain customers, so it primarily serves to enhance the customer’s entire experience (Hargrave, 2019) aiming at winning their loyalty. This crucial relationship is not only based on an optimal communication between the firm and customers, but also on an analysis of customers’ behaviours.
In 2010, Greenberg coined Social CRM, referring to CRM 2.0., which he defines as
This definition proves that this new strategy includes both customers transactions and interactions.
Indeed, the focus is not only on firm-customer relationships, but also on customer-to-customer exchanges. As consumers have become active users and have been in command of markets, companies have been in the obligation to adapt their old strategies.
Since the emergence of social media was the starting point of this transformation, the concept of social customers has consequently appeared. They trust their peers on the Internet, demand information to be available and are constantly connected through the Internet or their mobile
the management of the dual creation of value, the intelligent use of data and technology, the acquisition of customer knowledge and the diffusion of this knowledge to the appropriate stakeholders, the development of appropriate (long- term) relationships with specific customers or customer groups and the
integration of processes across the many areas of the firm and across the network of firms that collaborate to generate customer value (Boulding et al, 2005, p.157)
the integration of traditional customer-facing activities including processes, systems, and technologies with emergent social media applications to engage customers in collaborative conversations and enhance customer relationships.
(quoted in Venciūtè, 2018, p.137)
devices. Therefore, transparency is the key word to refer to this new type of customers. Indeed, they expect authenticity from their peers and the companies they deal with (Greenberg, 2010). As a result, they will become loyal to the company and actually act as advocates of the brand.
It is undeniable that the management of customer relationships positively impacts the performance of the company. Consequently, CRM activities must be taken into consideration when defining social media marketing plans.
Secondly, social media ease information dissemination as companies, through these social channels, create virtual communities where feedbacks and opinions products and services are exchanged between consumers and information can be easily found. As there is a strong sense of trust among the community, this action has an immediate impact on consumers’ purchase and post-purchase behaviour.
Finally, it is of prime importance to emphasise the role of social media in the management of brand image and brand reputation. According to Breeze (2013, p.13), a company’s image refers to ‘the social consensus as to how a company is perceived’. From the definition, consumers, and especially social media users, exert a direct influence on the brand building process as their reviews of the various products and services offered by the company will affect other consumers’ buying decisions. Moreover, social media websites help building a good reputation for firms and companies may even reinforce their brand name (Edosomwan et al., 2011). For example, firms might use these websites to correct misunderstandings or reduce negative talks applying basic rules such as transparency and authenticity. Additionally, companies who strengthen their online presence will appear as more approachable and people-friendly. In this case, consumers might be interested in buying their products and consequently join the brand community.
1.3. The Most Influential Social Networking Sites
Nowadays, social media occupy an essential position in human interactions as they dramatically changed our way of communication not only with our peers, but also with companies. Indeed, as it was explained here above, companies should consider social media and social networking platforms as cost-effective tools to be included in their marketing strategies. Generally, firms use these
websites to market their products or to engage in a direct communication with their customers in order to create a virtual community, enhancing their own performance.
To underline the importance of social media in our current society, figure 2 shows that the number of social media users does not seem to decrease over the years, but on the contrary, continues to increase. It means that companies, now being able to reach an increasing number of potential customers, may easily increase their sales.
Figure 2: Social Media Users over time, January 2019. (Source: https://wearesocial.com/global- digital-report-2019)
Figure 3: Social Platforms: Active User Accounts, January 2019. (Source: https://
wearesocial.com/global-digital-report-2019)
Another important data might be the ranking of the most influential social networking sites which is given by figure 3. Only taking into account the social networks indicated in orange on the graph, it is not really surprising to see that Facebook occupies the first position, while the second most important platform is Youtube, then appears Instagram at the third rank. Finally, Twitter ranks eighth.
1.3.1. Facebook
Facebook was launched in February 2004 by Mark Zuckerberg when he was a student at Harvard.
At first, it was only restricted to Harvard students, then extended to high school students in 2005 and finally became accessible to everyone being at least thirteen years old in 2006 (Greiner et al., 2019).
On the platform, users may create a personal profile, add new friends, exchange messages, photos and comments and join common interest groups. In 2004, it introduces ‘the Wall’, an area of a user’s profile where friends could post public messages, which was later changed in 2011 into the
‘Timeline', showing one’s posts in a chronological order. In 2009, the iconic ‘like’ button was created (Greiner et al., 2019).
Facebook has become increasingly popular and it was claimed that more people visited it than any other website in 2010 (Edosomwan et al., 2011). In 2012, Facebook decided to buy the famous photo-sharing app, Instagram for $1 billion in order to send a message of stability and growth (Hill, 2012; Luckerson, 2016). About this purchase, Zuckerberg claimed that ‘providing the best photo sharing experience is one reason why so many people love Facebook and we knew it would be worth bringing these two companies together’ (quoted in Kottasova, 2014). However, some rumours spread on the reason behind the purchase saying that the network was suffering from a decline in popularity. Other platforms were purchased by the social network as WhatsApp, counting 450 millions users at that time (Kottasova, 2014), or Facebook Messenger, among other ones.
However, at the beginning of 2018, a terrible crisis hit Facebook on its privacy policy as it was involved in a scandal with Cambridge Analytica where more than ’50 million Facebook profiles were harvested’ (Osborne, 2018). It emerged that Cambridge Analytica, a political data company, had been using Facebook to collect users’ data in order to influence voters’ intentions, especially in the 2016 US presidential election and in the Brexit vote (Griffin, 2018). As a consequence, the
platform had to adapt its then-current privacy policy by restricting developers’ access to user data.
Moreover, the platform promised not to collect important data from users’ smartphones and will not allow apps to access personal information such as religious beliefs or political preferences (Schroepfer, 2018).
Still, in 2018, Facebook counted more than 2 billion users and appeared to be the first social network to be used in 129 countries (Coëffé, 2018). Between 2018 and 2019, there was an increase of 9.6% in users on the platform as it is illustrated in figure 4, proving that Facebook remains the top social network.
An interesting feature is the possibility to create a Facebook business page, helping companies to reach specific target audiences. It is highly recommended for companies to post regularly without bombarding users’ newsfeeds (Parsons, 2013), and to vary the nature of posts from videos or photos to sharing positive opinions about products or the organisation in general.
As a matter of fact, the page should have intriguing content which mainly consists in product- related posts. In this case, firms might give information on products and ask users to share their experience. Most companies also post an increasing number of photos and videos which both represent a new way of distributing ‘advertising content beyond traditional sources’ (Parsons, 2013, p.35). The Facebook official page should also contain basic information about the firm, such as its
Figure 4: Facebook Monthly Active Users over Time, January 2019. (Source: https://
wearesocial.com/global-digital-report-2019)
scope, location, and some contact information, but most importantly, it must include a link to its website as it might induce potential customers to learn more about the company and maybe to finalise their journey by purchasing a product.
A difficulty that inevitably arises is to catch the consumer’s attention and maintain it. That is why enterprises should appear as user-friendly and easily approachable on the platform. Another possibility to maintain contact with users and get them involved is by offering coupons (Parsons, 2013).
As well as posting content on their wall, companies may decided to create a Facebook ad campaign at an affordable price. Through these adverts, they might reach their target audience based on a wide variety of factors, such as location, gender, age or interests (Bearne, 2015).
1.3.2. Instagram
Instagram is undoubtedly the most influential social platform nowadays as it constantly updates its features for private and business profiles. Instagram, which is ‘a combination of the words ‘instant’
and ‘telegram’’ (Huey et al., 2014, p.3), is a free photo-sharing application that enables users to take pictures, select and apply a filter and finally share the photo with their followers on the platform.
Figure 5: Instagram hits 1 billion monthly users, up from 800M in September, June 2018. (Source:
https://techcrunch.com/2018/06/20/instagram-1-billion-users/?
guccounter=1&guce_referrer_us=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_cs=R 9ad2uTJXgbX-_dteAeIVw)
The app was launched in October 2010 by Kevin Systrom and Mike Kreiger and was bought by Facebook in 2012 (see section 1.3.1.). It was a tremendous success as its growth was instantaneous.
Indeed, from figure 5, this rise is undeniable and in 2018, the platform hit 1 billion monthly users.
This website enables companies to enter in a relationship with users. Indeed, on the platform, contact can be maintained by using the tag (@username) and the famous hashtag (#keywords). The username will redirect users to the profile of the person or company tagged, while clicking on a hashtag provides a direct access to all the photos posted on the platform bearing the same keyword (Huey et al., 2014).
As on Facebook, companies may share, like and comment in order to involve consumers in a direct relationship. In fact, if a firm is more active on the platform by responding to comments, the relationships with followers might end up enhanced as they are interested in having a direct interaction with the company (Lee, 2018).
In 2016, the platform introduced Instagram Stories, which enables users to post photos or videos lasting up to 15 seconds that will be available for 24 hours in their ‘story’ under the form of a slideshow (Instagram, 2016). This feature makes it possible for users to directly respond to the story posted and increases therefore the level of interaction between them, but unlike regular posts, there is not the possibility to like the post. If a company shares stories regularly, it will encourage users to follow the company and interact with it as the firm will be considered as approachable and transparent. Moreover, stories might be extremely useful for marketing research by posting polls and questions at which followers must answer so that marketers better understand their needs and desires.
Additionally, influencers and celebrities are increasingly active and popular on this platform. Their followers are very loyal and completely trust their opinions and feedbacks on products. By forming a partnership with these influential personalities, companies may consequently gain more customers.
In 2018, the latest tool introduced on the app was Instagram TV and was defined by the company itself as a way to ‘bring audiences closer to the creators they love’ (Instagram, 2018). Actually, since Instagram is seen as an innovative social networking platform, it decided to follow the global
tendency according to which people, especially younger audiences, now abandon the TV to watch more digital videos. In this case, unlike Instagram sorties, the videos can last one hour, allowing companies to show other dimensions of their business without having to respect a time limit.
However, by analysing the actual preferences of users, a few of them use this feature, except if the company states it has recently published on Instagram TV.
What makes Instagram so successful is that it is entirely based on visual content which, not only provides efficient marketing tools, but is also a central characteristic of the Internet. Generally, users prefer photos, images and videos rather than spending time reading long texts (Guynn, 2018). The adage ‘a picture is worth a thousand words’ perfectly suits the current use of the Internet as users have the opportunity to access any information, any photo or text in a second. In other words, their mode of communicating and searching for information is now easier and more rapid.
1.3.3. Twitter
Twitter was created in 2006 by Jack Dorsey and Evan Williams and, as it is demonstrated in figure 6, counts today about 330 million monthly active users (Twitter, 2019). On 23 April 2019, Twitter officially announced it will not communicate the evolution of this data, as the company prefers to measure the daily active usage.
Figure 6: Number of monthly active Twitter users worldwide from 1st quarter 2010 to 1st quarter 2019 (in millions), Statista. (Source: https://www.statista.com/statistics/282087/number-of-
monthly-active-twitter-users/)
However, after its creation, it immediately gained popularity as it offered several options for microblogging, but also because it was used by mainly celebrities. The Oxford dictionary defines microblogging as ‘the activity or practice of making short, frequent posts to a microblog’.
Consequently, Twitter is considered as a social media platform on which users make short and frequent posts.
One of the characteristic features of Twitter is that the so-called ‘tweets’ must not exceed a total of 140 letters. This limit was later extended to 280 characters, but it did not have a significant impact on the length of tweets. In others words, users tweet more, but not necessarily longer (Kastrenakes, 2018). A tweet can be created, replied to or even retweeted which means that a user decides to share the content published by another person by sharing it on its own profile. It is also possible to direct a tweet to a particular person or company by using the symbol ‘@‘.
Twitter has an important marketing potential as it offers quite a wide variety of opportunities for businesses. It is obvious that, as on the other platforms, companies must carefully chose the content that appears on their profile. Firstly, pinned tweets are essential as they stay static on the top of the company’s profile (Jackson, 2016). In this way, firms can promote an ad campaign, gain visibility on the platform and consequently increase their popularity.
Secondly, as on Instagram, hashtags play a fundamental role since they give the possibility to find all the relevant content related to this keyword. In this case, hashtags allow users to find a particular tweet about some specific companies.
Finally, companies can make use of Twitter Ads, which is similar to Facebook ad campaigns, by creating tailored ads to their goals. It offers a new way of expanding their influence and connecting with targeted audiences. Additionally, the service does not require a minimum budget, even though Twitter advises to start by investing $30/day to reach audiences (Twitter for Business, 2019).
Since the birth of all these social media and social networking platforms, companies have been provide with a wide range of opportunities which might dramatically change the face of trade and consumption. Indeed, without any doubt, the use of such websites exerts a significant impact on the consumer’s buying behaviour.
CHAPTER 2
Omnichannel Buying Behaviour
2.1. Consumer Buying Behaviour
The Business Dictionary defines consumer buying behaviour as ‘the process by which individuals search for, select, purchase, use and dispose of goods and services, in satisfaction of their needs and wants’. In other words, this concept refers to the decision-making of consumers as to how, where, when and what they buy.
The following figure illustrates the five different stages of the consumer decision-making process.
First, consumers have to recognise the existence of a problem and to identify their unsatisfied needs that will lead them to make buying decisions. This feeling of dissatisfaction may be triggered by an external environment, or internally by the buyer itself (Ertemel & Ammoura, 2017). As some needs appear to be more complex than others and will require more sophisticated solutions, the buyer will look for information.
The second step refers to the research of information about the product that consumers can find through a wide variety of sources, such as commercial channels - advertisements or sales persons -, public channels - newspaper, radio, magazines - as well as experiential channels - recommendations or previous experiences (Prachi, n.d.).
Then, consumers need to evaluate the various alternatives that are available on the market, which can be considered as an extension of the previous step. On the basis of the knowledge gathered during their research, buyers will the choose the option that best satisfy their needs and wants.
Figure 7: Marketing Theories - Explaining the Consumer Decision Making Process. (Source:
https://www.professionalacademy.com/blogs-and-advice/marketing-theories---explaining-the- consumer-decision-making-process)
However, the transition from the second stage to the third one might happen several times until consumers select the option that seems to meet their demands at best.
The fourth step is the actual purchase of the product that will satisfy customers after having drawn conclusions, while the last one is called post-purchase evaluation. This review is a key element both for companies and consumers. As a matter of fact, if clients are satisfied with the product because it has met their own expectations, they might positively influence other potential customers as they will give a positive review. This provides an excellent opportunity for companies to increase their sales. On the contrary, a negative feedback on the product might also induce future potential consumers not to buy the good (Professional Academy, 2016).
The whole decision making process is generally affected by personal, psychological, social and cultural factors. First of all, personal characteristics, such as occupation, age, economic conditions and lifestyle play an important role in influencing buying tendencies. Indeed, the nature of the job consumers have affects their buying decisions as, for example, low level workers will not buy suits and ties (Prachi, n.d.). Furthermore, an individual’s buying tendency is directly proportional to his income.
Second of all, the effects of psychological characteristics, like emotions or beliefs, on consumer buying behaviour are not to be neglected. As a matter of fact, among these, perception might be the most important one as it makes consumers examine the quality of the product. However, this creates a situation in which all consumers feeling the same need will not buy the same good as they perceive information in a different way.
Furthermore, humans are social animals, meaning that they are constantly looking for opportunities to create a dialogue and consequently to establish relationships. In other words, the role of social factors in influencing buying decisions is decisive. Throughout their life, people are influenced by some reference groups such as family or friends (Prachi, n.d.), while in this case, consumers will rely on virtual communities.
Finally, culture determines our way of communicating, understanding information and behaving. As a consequence, the set of beliefs and values people develop from their personal background will inevitably exert a significant influence on their decisions.
It appears essential for marketers to perfectly understand how consumers buy and behave, and social media should be considered as a fundamental tool to access such information.
2.2. Online Commerce Channels
2.2.1. E-Commerce
‘E-commerce’ is an abbreviation of electronic commerce and refers to the activity of buying and selling products and services on the Internet (Rouse et al., 2019; Ecommerce Guide, 2019). Due to its phenomenal growth in the last decade, this practice is now a usual way to shop among consumers and generally ‘provides them with more information, more choices and more ways to buy’ (Lakshmi, 2016, p.61). Moreover, this new form of offering products enables companies to increase their sales and expand more easily, not only at a national, but also at an international level.
Some claim that the first product ever bought online was weed on ARPANET, the forerunner of the Internet. However, this transaction lacked some essential features that characterise e-commerce, such as the illegality of the transaction and the absence of an online payment. On 11 August 1994, Phil Brandeberg purchased a CD of Sting, Ten Summoner’s Tales, on a website called NetMarket for a total of $12,48 plus shipping which he paid by credit card (Fesseden, 2015; Ecommerce guide, 2019). This is considered to be the first legitimate online transaction as it is defined today and marks ‘the birth of marketing via the internet’ (Ariguzo et al., 2006, p.240).
There are four types of e-commerce that are categorised according to the parties involved in the transaction (Ecommerce guide, 2019).
1) B2B: Business-to-business e-commerce refers to the ‘electronic exchange of products and services between businesses’ (Rouse et al., 2019). In 2004, UNCTAD, the United Nations Conference on Trade and Development, claimed this segment was the ‘largest of all e- commerce activity’ (Ariguzo et al., 2006). It is important to highlight that this type of e- commerce was also intended to facilitate the exchange of information in the business world.
2) B2C: Business-to-consumer e-commerce is what society actually most identifies as e- commerce and is defined as retailing. It refers to situations in which business directly sell products or services to the end user. This segment offers a wide variety of opportunities for companies. Indeed, through the use of this channel, firms might acquire new customers
through the gathering of information, gain international exposure and may even be considered as a cost-saving activity (Ariguzo et al., 2006).
3) C2B: Consumer-to-business e-commerce appears to be the ‘opposite of the traditional B2C model’ (Rouse et al., 2019) which is nowadays mostly considered to be e-commerce. Perfect examples of this type of e-commerce are platforms like Fotolia or Google Video through which anyone may sell digital content, such as videos, images or photos, to companies.
Google AdSense works in the same way.
4) C2C: Consumer-to-consumer e-commerce refers to commercial activities though which
‘consumers trade products, services and information with each other online’ (Rouse et al., 2019). An example of a C2C platform is eBay which is mostly defined as an online marketplace where consumer-to-consumer sales take place.
In the digital era, there is little doubt regarding the growth of e-commerce.
Figure 8: Retail e-commerce sales worldwide from 2014 to 2021 (in billion U.S. dollars), Statista.
(Source: https://www.statista.com/statistics/379046/worldwide-retail-e-commerce-sales/)
This figure shows that, in 2017, the amount of online sales was estimated at 2.3 trillion dollars and this number is expected to grow to 4.8 trillion in 2019. In other words, it confirms that online shopping is among the most popular online activities. In fact, since the 90s, with the introduction of websites such as Amazon and eBay which has considerably boosted the e-commerce sector, its growth has not shown signs of slowing down.
There are several reasons why people turn to online shopping nowadays. First, it does not set any geographical or time limit (Engg Expo, 2017). Indeed, it increases not only the number of potential customers for businesses, but also the possibilities for customers to find the perfect product without being limited by a geographical zone. As for the time limit, online shopping is not restricted to opening hours as in a brick-and-mortar shop, and websites can be accessed by customers 24 hours a day and 7 days a week.
In addition, consumers have an easy access to all the products to satisfy their needs in one single marketplace, which is the Internet. In this way, they eventually save time by avoiding to drive to several shops in order to find the desired good. Actually, customers remain beyond their screens during all the purchase process as payment is directly made online and the activity is usually concluded by a delivery of the product to their house or apartment.
However, e-commerce also reduces costs for companies. Since they are able to present their product range online, they do not need to focus on a physical store or rental fees. Moreover, they might exploit online resources, including social media, in order to advertise their new collection of products as they have a much lower cost compared to traditional advertising (Engg Expo, 2017).
An important point is that enterprises must know how to use e-commerce efficiently in order to increase their sales. That is why it is crucial for these to understand their customer’s needs and wants through surveys for example. The company website must have a quick load time, be easy to use and offer quick and secure methods of payment because what essentially matters in the case of e-commerce is the customer experience (Cotton, 2019). A complicated online experience might lead customers to stop their purchase and abandon their shopping cart. As a consequence, the fundamental goal of companies, when creating their website, is to focus on its easiness and efficiency.
E-commerce has a major impact on business and social networks due to their interrelated relationship and influence on one another. That is why, nowadays, an increasing number of companies adopt a more social-oriented approach regarding their e-commerce activity, giving rise to the so-called social commerce.
2.2.2. Social Commerce
Social commerce is thought to be an evolution of e-commerce, which is due to the increased popularity of social media sites, and can be defined as the
The main difference between e-commerce and social commerce is the involvement of social elements. In other words, there has been a shift from a product-centric approach developed in traditional e-commerce to a consumer-centric environment. Indeed, thanks to the Web 2.0 revolution, customers have now become co-creators of online content and actively participate in activities and this new role has been consolidated with the advent of social media.
In fact, the traditional model of e-commerce based on information presented on websites is no longer sufficient to generate sales as consumers’ behaviour is also influenced by opinions and feedbacks provided by their friends and family. Since the rise of social media, consumers have begun to hold the market power and companies have had to adapt their traditional e-commerce operations to this new social dimension by adopting new ways to engage such active customers and to create online communities through strong relationships (Linda, 2010).
It is therefore obvious that social interaction and commercial activities form the essence of social commerce. Firstly, from a business point of view, social media facilitates the creation of online communities where users may freely exchange information and opinions about products and services offered by a specific brand. This trusted online environment will significantly impact sales through positive or negative feedbacks posted by members of the community. It has been proven that customers tend to buy products which have been recommended by other users (Linda, 2010). In other words, consumers’ buying decisions and behaviour are shaped by peers’ previous experiences with the brand.
use of social media, in the context of e-commerce, to assist with buying and selling products and services online. It evokes the fusion of two big digital trends:
e-commerce and social media (Linda, 2010, p.2213).
Moreover, the power of word of mouth on social networking platforms is undeniable and also affects customers’ attitude. According to Linda (2010, p.2216), ‘an average consumer mentions specific brands more than 90 times per week in conversations with family, friends and co-workers’.
Nielsen 2012 report states that 92% of consumers believe suggestions from friends and family more than advertising, while 74% of people are aware that word of mouth affects their buying decisions.
That is to say that there has been a shift in consumers’ information sources from marketers to peers as they now principally rely on others consumers’s opinions to gather information and make a thoughtful decisions.
Word-of-mouth marketing activities also offer opportunities to companies regarding the enhancement of brand awareness and reputation at a minimum cost. Indeed, if customers are satisfied by the purchase of a product from a particular brand, they usually tend to share their positive experience online and offline which directly increases the number of visitors on a company’s website. Therefore, firms must try to accept that consumers now, at least partially, control their brands (Linda, 2010).
The second characteristic of social commerce is the introduction of commercial activities in a social context. It is thus required that social media activities and posts include commercial connotations.
0 25 50 75 100
Friends and Family Other online users Word of mouth Word-of-Mouth Marketing Statistics
Figure 9: Word-of-mouth Marketing Statistics (Nielsen Report), created by Windal, L. (Source:
https://www.bigcommerce.com/blog/word-of-mouth-marketing/#word-of-mouth-marketing- statistics)
This way, businesses are allowed to do commerce within a community that is already established (Huang et al., 2012).
Companies need to analyse not only their already existing e-commerce activities, but also their current social media presence. Consequently, they can decide to establish a successful social commerce strategy by adding commercial features to their social network platforms, or introducing social features to their e-commerce website as they must imperatively take advantage of social networking opportunities (Liang et al., 2011).
This social commerce activity allows users to directly purchase an item on the social networking platform without being automatically redirected to the firm’s website and is therefore different from social media marketing.
Figure 10 demonstrates that in 2017, social media users mainly purchased through a Facebook post.
Instagram arrives in second position, with only 8.6% As this field is a quite recent development of Figure 10: Social media platform on which social media users in the United States last made a purchase directly from a social media post as of October 2017, Statista. (Source: https://
www.statista.com/statistics/250909/brand-engagement-of-us-online-shoppers-on-pinterest-and- facebook/)
e-commerce, it has sense that 34,6% of respondents have not bought anything from social media yet.
However, as the use of social media is exponentially growing (see section 2.3.), social commerce is considered to be the future of e-commerce and must be developed in an efficient way to completely satisfy consumers’ expectations.
2.2.2.1. Facebook Social Commerce
As Facebook counts more than 2 billion of users, the platform appears to be among the most interesting resources for businesses which aim at developing a successful social commerce strategy.
The first retail transaction through Facebook was claimed by 1-800 Flowers, a company specialised in floral and gourmet foods gifts. In July 2009, it sold a ‘Slice of Life’ bouquet of flowers for the price of $34,99 directly from their Facebook business page (Bustos, 2009; Marsden, 2011).
Consequently, the social networking platform had to further exploit its business potential and introduced the ‘buy’ button in July 2014, enabling companies to directly sell their products to customers, without leaving the social network (Facebook business, 2014). This step marks an important shift in the history of f-commerce as it offers to businesses another channel through which customers may buy products and services. This buy button clearly establishes a direct connection between the customer and the retailer and is visible from adverts on the desktop and mobile Facebook version (Gibbs, 2014).
In October 2016, the social network introduced ‘Marketplace’, in the US, the UK, Australia and New Zealand, which was then extended to Europe in 2017. At first, this virtual marketplace was designed to enable users to discover, buy and sell products within their local community (Facebook Newsroom, 2016). The list of products offered to users is determined geographically so that users first see products that are available in their geographical area. Later, in 2018, they introduced new features using Artificial Intelligence for price suggestions and product categorisations, which are principally meant to facilitate business transactions between buyers and sellers. Finally, Facebook reinforced the feeling of trust, essential in social commerce, within its marketplace community by making it possible for users to rate buyers and sellers.
Another important feature that Facebook offers to companies which adopt f-commerce is the possibility to add a shop section on the firm’s Facebook business page, allowing them to list their products and to directly communicate with customers. The catalogue of products, which might also be shared on the Facebook marketplace, is not limited, meaning the company can upload as many items as it wishes. It is also possible to organise the goods in various categories to facilitate the experience of customers. Furthermore, through the shop page, the company might get insights on its performance and see the number of views, clicks and purchases of each of its products (Facebook business, n.d.). Thus, it appears to be another way to understand consumers’ preferences, buying intentions and behaviours.
2.2.2.2. Instagram Social Commerce
Instagram might be the most promising social networking platform in terms of social commerce as it is mainly based on visual content. That is why the photo-sharing app has the most commercial potential for fashion brands for example.
In 2015, Instagram introduced the 'buy now’ button on the platform and in 2016, companies were able to put product tags on their posts so that customers could directly see more details about the product such as its price, and have an access to the company’s website through a hyperlink in order to eventually confirm their buying intention by a purchase (Boyle, n.d.). Similarly, the company then introduced product stickers in Stories. All this evolution appeared to be successful as, according to Instagram, there are now ‘130 million users tapping to reveal product tags in shopping posts each month’ (Instagram internal data, February 2019).
The latest development in the shopping experience on Instagram was the ‘checkout’ option, launched in March 2019. Instagram described this new step as the possibility ‘to experience the pleasure of shopping versus the chore of buying’ (Instagram Business Team, 2019). It was aimed at enhancing shopping experience by making it more convenient and simple.
This recent shift is considered to be a new source of revenue for companies (Hern, 2019). With this new feature, customers are able to directly buy from brands without leaving the platform. As a matter of fact, when customers tap on a product from a post, they have the possibility to click on the
‘Checkout on Instagram’ button and then, select for example the size and colour they prefer. The final step is the payment that is also made without leaving Instagram. In addition, Instagram sends
