Social Networking Relationships

Social Networking Relation

1.0 Introduction

“Social networking is really recommendation between people about the things that they are interested in and they like… this has stimulated people’s attention in terms of the importance of public relation. The people who are going on these sites didn’t want to be monetised, they didn’t want to be advertised to, so again editorial communication is so powerful, they would rather be communities that can exchange views that are untarnished.” - Sir Martin Sorrell

Social media is a global phenomenon in which old demographics no longer apply. Conversations happen at the click of a button. New communities are born every day and brands need to be involved; in the first instance to listen, and then to participate. Social media is booming.

Every day new statistics, white papers and articles appear discussing its continued growth. Independent market analyst Datamonitor (2008) has revealed how quickly the number of people participating in online social networking is growing: the United Kingdom currently leads Europe, in terms of membership, and is expected to reach 27 million users - a threefold increase on today's figures - by 2012 (www.datamonitor.com).

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“Social networking sites are the reality television of the Internet,” said Jon Gibs (Senior Director of Media, Nielsen//NetRatings). “The content is relatively inexpensive for publishers to produce, and social networking is not a fad that will disappear. If anything, it will become more ingrained in mainstream sites, just as reality TV programming has become ubiquitous in network programming,” Gibs continued (www.acnielsen.com). “However, again like reality programming, the concept of ‘reality’ alone, or in this case ‘social networking,’ is not enough. In this competitive marketplace, sites also have to provide consumers with distinct content they can identify with.”

A new survey reveals that almost 50 percent of attorneys are members of online social networks and over 40 percent of attorneys believe professional networking has the potential to change the business and practice of law over the next five years. “Online professional networking is a growing area of importance in the legal industry,” said Ralph Calistri, Chief Executive Officer of Martindale Hubbell and senior vice president of Global Client Development at LexisNexis. “As we develop a global network for the legal community through Martindale-Hubbell, objective research such as this survey by Leader Networks serves as an important way for us to listen to clients and guide our efforts.”

Table: United States: Top 10 Social Networking Sites (March 2008)

Source: AC Nielsen

The Internet has broadened the area of word of mouth influences from interpersonal communication among acquaintances to online communication to general public (e.g. posting reviews). Harrison-Walker (2001) defined word of mouth as “informal person-to-person communication between a perceived non-commercial communicator and a receiver regarding a brand, a product, an organization, or a service.” Marketing practitioners try to encourage such “informal” communication in a positive manner, and several approaches such as “viral marketing” (Wilson 2000) and “buzz marketing” (Rosen 2000) have been developed.

Facebook was created in February 2004 by Mark Zuckerberg, a student at Harvard University. According to Zuckerberg, “The idea for the website was motivated by a social need at Harvard to be able to identify people in other residential houses” (Moyle, 2004). Today Facebook has more than 7.5 million registered members at over 2,000 U.S. colleges and is the seventh-most-popular site on the entire Web with respect to total page views (Cassidy, 2006).

Social networking sites are online spaces that allow individuals to present themselves, articulate their social networks, and establish or maintain connections with others. These sites can be oriented towards work-related contexts (e.g. LinkedIn.com), romantic relationship initiation, or connecting those with shared interests such as music or politics (e.g. MySpace.com). Users may use the sites’ communication tools to interact with those they know from offline contexts, such as school, or they may use the sites to meet new people.

The way in which these sites allow for new connections to be made between individuals has resulted in proposed legislation which would bar libraries and schools to block minors’ access to social networking sites such as MySpace and Facebook (McCullagh, 2006). MySpace in particular has generated public concern due to its large member base -- 78 million registered accounts according to one source (Wright, 2006) - many of whom are teenagers.

There is little academic work examining online social networks. A 2005 survey of academic community members found that 90% of the undergraduates participated in a social network community, primarily Facebook, MySpace, and Friendster, and that many of them disclosed personal information such as email address (Stutzman, 2006). In her ethnographic work examining self-presentation and social connections among Friendster users, boyd (2004) notes that users have a variety of motivations for using the site, including connecting with old friends, meeting new acquaintances, dating, and furthering professional networks.

In one of the few pieces to examine this new breed of online fora, Donath and boyd (2004) point out that one of the chief hallmarks of these sites is that links between individuals are mutual, public, unnuanced and decontextualized. In the sites that Donath and boyd examine, public displays of connections serve to warrant, or signal the reliability of, one’s identity claims. Social networking sites are distinguished from the first wave of virtual community sites in that they allow for both maintenance of existing social ties and formation of new connections.

A hallmark of the early research on computer-mediated communication and virtual communities in particular is the assumption that individuals using these systems would be connecting with those outside their pre-existing social group or location, liberating individuals to form communities around shared interests, as opposed to shared geography (Wellman et al., 1996).

However, some online community researchers have explored how online communities present opportunities for people in a common offline community to extend their interaction. Such a theme is articulated by Wellman et al. (1996), who note that “Although CSSNs [computer supported social networks] do transcend time and space, not all ties are either totally on-line or off-line. Much on-line contact is between people who see each other in person and live locally” (p.222).

1.1 Research Question

This research studies the importance of social networking sites and aims to identify how motivations for using social networking sites influence the degree of interaction and the generation of word-of-mouth. Next, in order to study use patterns of social networking sites between users in United Kingdom and to explore the relationship between the degree of interaction and the generation of word-of-mouth, the following questions are generated.

• Why / how often do people use social networking sites?

• Are social networking sites users generating word-of-mouth? If so, what makes users generate word-of-mouth?

• Do the motivations of using social networking sites influence on the degree of interaction or on the generation of word-of-mouth?

H₁ - Exploring the relationship between the purpose of using social networking sites and the degree of users’ interaction

H₂ - Exploring the relationship between the purpose of using social networking sites and the generation of word-of-mouth

H₃ - Exploring the relationship between the degree of users’ interaction and the generation of word-of-mouth in social networking sites

Main Research Question: How effective are motivations for using social networking sites influencing degree of interaction and word of mouth in United Kingdom?

At the same time, the growing importance of word-of-mouth on social networking sites is understood and discussed by both marketing practitioners and academics, and online word-of-mouth communication is considered as a new marketing tool (Kozinets, 1999; Croteau, 2006; Peattie, 2007; McKinsey Quarterly, 2007).

Due to the similar characteristics between social networking sites and word-of-mouth communication, namely, relationship and interaction among people, a number of researchers tried to find out the connection between online communities and word-of-mouth, then, came up with various ways to measure word-of-mouth in the virtual world (Kozinets, 2002; Godes et al, 2005; Dwyer, 2007).

In addition, after their introduction, social networking sites brought in a new organisational framework for online communities. According to Boyd and Ellison (2008), early online communities were constructed as ‘communities of interest’, but social networking sites these days are constructed as personal. In other words, social networking sites are centred around people rather than topics or ‘topical hierarchies’.

2.0 Literature Review

2.1 General Overview

The study of personal influence and the idea that there are certain people who are especially influential over others has fascinated researchers, practitioners, and the general public for more than 60 years. Variously named in academic and popular circles, these people have been called opinion leaders (Katz & Lazarsfeld, 1955), early adopters (Rogers, 1962/2003), influential (Weimann, 1994), and Influential Americans® (Keller & Berry, 2003), while the process of personal influence has been linked to, or synonymous with, various phenomena such as compliance gaining (strategic attempts to seek compliance from others in interpersonal settings; Wilson, 2002), the diffusion of innovations (how ideas spread in a culture; Rogers, 1962/2003), buzz (contagious word-of-mouth commentary about products, services, brands, and ideas; Walker, 2004), and tipping points (the point at which an idea, behavior, or product “tips,” crossing a threshold from being a minor phenomenon to a wild epidemic; Gladwell, 2000).

Numerous organizations, for-profit and not-for-profit, in an assortment of industries (consumer products, fashion, health care, law, higher education, etc.) have sought to capitalize on a renewed awareness and interest in the influential role that informal conversation and relational networks play internally to an organization (e.g., in terms of sharing knowledge within and across organizational units; Cross & Parker, 2004; May & Zorn, 2002) and especially to external audiences (e.g., in the case of viral and buzz marketing).

Thus, although the power of stimulating word-of-mouth and relational networks has been known for some time (Arndt, 1967; Whyte, 1954), a more recent phenomenon is when certain firms seek to consciously engineer buzz in relational networks (Balter & Butman, 2005; Dye, 2000; Godin, 2001; Ozcan, 2004; Rosen, 2000;Walker, 2004).

For example, some firms (such as Big Fat Inc.) pay people to go out and talk up a brand, either in face-toface or online settings, where the fact that they are employed by a marketing agency is not disclosed (a form of “undercover” marketing). Other firms (such as BzzAgent, Inc.) actively recruit volunteers who willingly participate in a campaign by going out and buzzing the product or service (oftentimes in exchange for points that can be redeemed for prizes or the knowledge that they are the first among their peers to have access to a new product) and then report back to the buzz marketing company their own and others’ feedback about the product (the company then compiles and analyzes these various reports from the field and presents them to the client). Still others (e.g., Proctor & Gamble’s Tremor program) form an extensive network of carefully selected teenagers to create buzz among peers for their clients’ brands and products (Wells, 2004).

These distinct kinds of organizational marketing practices have raised a number of ethical concerns, some more than others. In addition to whether or not the institutional identity of the agent is disclosed, whether or not the person buzzing the brand is doing so for some form of compensation, and whether or not agents involve minors younger than age 13 (Wells, 2004), a significant concern is that through buzz marketing marketers are better able to infiltrate everyday conversations and relationships (Walker, 2004), which might be regarded as further instantiation of corporate colonization of the lifeworld (Deetz, 1992).

With traditional forms of marketing and advertising efforts, consumer audiences can “tune out” or “turn off” the advertising. However, what happens when the marketing is your friend or family member, in online and offline conversations? Is society increasingly falling prey to the “commercialization of chit-chat?”(Walker, 2004). Although these concerns are not new— for example, marketing to known others has been well-documented and critiqued in terms of Tupperware parties (Frenzen & Davis, 1990; Taylor, 1978) and multilevel marketing companies (Biggart, 1989; Carl, 2004; Fitzpatrick & Reynolds, 1997)—the fact that increasing numbers of well-known, mainstream organizations seek to amplify buzz in social networks has elevated the concern (Vranica, 2005).

2.2 Word of mouth

Word-of-mouth has grown in popularity over the past several years as a marketing and research medium (BzzAgent, 2005). Marketers seeking to find new methods for reaching customers and communicating with them have wondered if word-of-mouth could provide a potential solution to the dwindling return of traditional marketing platforms. Since the beginning of organized marketing programs, marketers viewed word-of-mouth as an incredibly valuable, yet uncontrollable, result of effective marketing practices.

Many marketers have implemented plans to fool word of mouth into occurring, seeding the marketplace with shills (paid actors talking up products and services). They found the results effective but extremely risky, since consumers didn’t like being deceived. In recent years, a number of companies have formed, seeking to harness the power of authentic word of mouth (BzzAgent, 2005). By organizing real consumers, they train them to share their honest opinions more effectively.

Defining word of mouth can be tricky, especially in light of the Internet and recent emergence of buzz marketing firms. According to Buttle’s (1998) review of marketing research, Arndt (1967) discussed word of mouth as face-to-face communication about a brand, product, or service between people who are perceived as not having connections to a commercial entity. Bone’s (1992) definition is similar though she noted that word of mouth could be a group phenomenon:

“An exchange of comments, thoughts, and ideas among two or more individuals in which none of the individuals represent a marketing source” (p. 579).

Stern (1994) distinguished word of mouth from advertising in that word of mouth is face-to-face, interactive, ephemeral, spontaneous, and does not include such features as clever turns of phrases or jingles. Buttle (1998), however, found these definitions unsatisfactory because (a) Word of mouth can include talk about an organization (in addition to a brand, product, or service), (b) it can be electronically mediated (such as cell phone, chat rooms, e-mail, Web sites, “tell-a-friend” hyperlinks, etc.), and (c) more and more companies may offer incentives or rewards for consumers to spread word of mouth or make referrals (e.g., to refer friends and family members for a company’s services). Buttle concluded that currently the only distinguishing feature of word of mouth may be that “word of mouth is uttered by sources that are assumed by receivers to be independent of corporate influence” (p. 243).

In contrast to traditional word of mouth marketing research, research on buzz marketing is still in its infancy. Verlegh, Verkerk, Tuk, and Smidts (2004) mentioned, but did not study, buzz marketers in their experimental research on whether or not financial incentives used when stimulating customer referrals alter the meaning of the situation such that consumers would perceive the word of mouth episode to be “persuasive” rather than just friendly, peer advice.

Thomas (2004) represented an early conceptual piece on buzz marketing where it was defined as the “amplification of initial marketing efforts by third parties through their passive or active influence” (p. 64). An early empirical study that applied insights from existing word of mouth and social network research from a firm’s perspective was conducted by Godes and Mayzlin (2004).

Abundant research demonstrates that word of mouth (WOM) is one of the most influential channels of communication in the marketplace. The reasons for WOM's power are evident: word of mouth is seen as more credible than marketer initiated communications because it is perceived as having passed through the unbiased filter of "people like me." At a time of declining trust in institutions, research shows that its influence is growing stronger. In a recent national survey (Harris Interactive, 2006a), U.S. consumers were asked which information sources they find useful when deciding which products to buy in four common product categories.

WOM and "recommendations from friends/family/people at work/school" were by far the most influential sources for fast food, cold medicine, and breakfast cereal. For personal computers, a highly technical category, we saw a strong reliance on expert advice in the form of product reviews and websites, followed by WOM as the next most useful. The consumer marketplace in which any enterprise operates is a complex, dynamic system.

A study found that disinterested, ill-prepared and unwelcoming salespeople lead to more lost business and bad word-of-mouth than any other management challenge in retailing. "There are a variety of different triggers for having a bad shopping experience, including things like parking or how well the store is organized. Some of those things retailers can do something about and some of them they can't. But frankly, a very important part of the retail experience is the interaction with the sales associate," says Wharton marketing professor Stephen J. Hoch, director of the Baker Initiative.

In a telephone survey of 1,000 shoppers who were asked about their most recent retail experience, 33% reported they had been unable to find a salesperson to help them. Many of these shoppers were so annoyed by this one problem that they said they would not return to the store. According to the Wharton analysis, sales associates who are missing in action cost American retailers six percent of their customers. Add to that the 25% of consumers reporting they were ignored outright by sales associates - no greeting, no smile, not even eye contact (Arndt, 1967; Aaker et al, 1996; Reingen and Kernan, 1986).

This lack of engagement turned off three percent of customers to the point where they said they would permanently stay way from the store in which they encountered this behaviour. Hoch remains puzzled by sales associates who retreat from potential customers. "You would think that if these sales associates are spending the whole day interacting with people, they would be a lot happier in their own life if they were friendly. Instead, they pull into their shell (Brown and Reingen, 1987).

What's wrong with saying, 'Hi, how are you doing?'" According to Paula Courtney, president of the Verde Group, survey respondents were not frustrated by sales associates who seemed overworked or outmanned by shoppers. It's the "conscious ignoring" that irritates them, she says. "Customers would walk into a store and the store representative would see them and continue to put items on the shelf or watch the cash register or do administrative work - absolutely ignoring the fact that an actual person was in the store (Cox, 1963, cited in Brown at el, 2007)."

In the above example, the degree of interaction was bad with consumers at a particular retail outlet. This provided bad word of mouth and hampered long term sustainability for the retailer. In other words, this forms the central part of the dissertation that degree of interaction and word of mouth are slightly interrelated.

2.3 Motives of Social networking

British anthropologist Robin Dunbar estimates that humans can only maintain stable relationships with around 150 people. That number refers to significant relationships like those in a family or tribe and other purposeful groups. Yet in today's over-informed digital business world, where bloated data moves at the speed of thought, it's not who you know that really counts, but who knows you (Kozinets, 1999; Boyd and Ellison, 2008).

Professional online social networking tools are invaluable in creating personal brand equity and raising awareness about who you are, especially beyond your 150 closest friends (BBC News, 2005). Online social networking software enables you to find quality people who may not be familiar with you, or with your organization, and creates an opportunity to connect with them and sell them on your opportunities (Boyd and Ellison, 2008). They may be unfamiliar with your company or business, or may not have even been looking for something.

Because you already know someone who knows them, you can feel more comfortable that they are a quality prospect or at least can do some checking around (Boyd and Ellison, 2008). Also, because of that mutual connection, you can more easily overcome cumbersome barriers and begin a relationship with a little more trust and warmth than with a total stranger. Like "Six degrees of Kevin Bacon," social networking sheds light on the contacts you never knew you had. For example, you can contact people in your network to:

• Rekindle old connections

• Maximize value in your weak connections

• Build business relationships with clients or hiring managers

• Find and meet prospective job-seekers

• Grow a referral network

• Heighten your corporate and personal brand

• Make new connections and grow your sphere of influence

• Open doors to future career opportunities, increased pay, or promotions

• Increase visibility, which improves influence and effectiveness internally with your organization as well as externally

Social networking also helps you find new leads for networking into companies to:

• Educate yourself and ask questions about other organizations

• Conduct competitive intelligence on companies, industries, or individuals

• Make fewer cold calls and better prepare for them

• Leverage contacts you already have

With the help of existing literature, Ridings and Gefen (2004) categorised four reasons to join online communities: ‘information exchange’, ‘social support exchange’, ‘friendship, and ‘recreation’. Firstly, people choose to use online communities to access and exchange information. By using online communities, people can access a huge amount of information generated by other users since online community providers offer effective systems or technologies in order to make their users easily exchange, create, request and search information (Hagel and Armstrong, 1997).

The second reason why users participate in online communities is to obtain the social support. Wellman et al (1996) suggested that online communities give emotional support and sociability to their users by giving ‘a sense of belonging’. For instance, Mickelson (1997) gave examples of online communities which focus on recovering social problems such as alcohol and drug addicts in order to explain why the social support can be the motivation of using online communities.

Thirdly, people join online communities to manage relationships. To seek friendship or to generate social capital, which can be defined as the resources gathered through the relationships among people (Coleman, 1988), online community users interact with other users with the aim of establishing and continuing relationships. For example, offline social capital can be generated by means of online tools, especially using social networking sites when people want to expand or keep up their offline relationships. Lastly, recreation is another reason why people experience online communities.

In conclusion, how word-of-mouth affects consumer behaviour can be described by those three factors; tie strength, homophily, and source credibility. As mentioned above, Brown et al (2007) and other researchers (Silverman, 1997; Money et al, 1998; Bansal and Voyer, 2000) explored the nature of word-of-mouth in online communities. Finally, the summary of the research above is compared by Brown et al (2007) as the following Table 1.

Table 1: A Comparison between offline and online social network constructs

Offline

Online

Tie Strength

Definition

The intensity of a social relation between pairs of individuals

The intensity of an interactive and personalised relationship between an individual and a website

Homophily

Definition

The degree to which pairs of individuals are similar in terms of certain attributes

The congruence between a user’s psychological attributes and website content

Source Credibility

Definition

Perceived competence of the individual source providing information

Perceived competence of the website and its membership

Source: Brown et al, 2007, pp. 10 Table 1

Bottom line: It could be seen that different internet users have diverse motives to enter social networking sites. Fulfilment of motives can enhance positive word of mouth and higher degree of interaction of a particular website. As per previous academic literature there have been negligible cases that internet users have entered social networking with out motivations. This forms the foundation of dissertation.

3.0 Research Model

3.1 Research approach

The research strategy we intend to adopt is a combination of multi-methods, of deductive, inductive and exploratory. Quantitative data will be collected throughout the life cycle of the project, from secondary sources: journals, databases, past dissertations, newspapers and magazine articles etc. We propose to use the following secondary databases to conduct quantitative data research:

• Emerald Full text

• Emerald Reviews

• Emerald Abstracts

• Swet Wise

• Reuters Business Insight

• Regional Business News

• Questia Media

Primary research will be conducted, using a closed questionnaire designed to predict average behaviour of children in general (Saunders et al. 2003). The inductive approach takes to account interpretivism or social considerations, which enables to establish the intentions of the respondents more clearly.

Saunders et al (2003) says that data collected using open-ended questions allows individuals more flexibility in answering, which may confirm a hypothesis or other wise. The limitation or disadvantage of this approach is that it is subjective and can only be applied to a limited sample of participants (Saunders et el. 2003).

Exploratory research will be conducted on a pilot group consisting of young internet users (mainly with Orkut profiles) within the age group 15-20 who will participate in a discussion on the following; the influence of motivations for using social networking sites on degree of interaction and word of mouth in United Kingdom.

3.2 Research Design

A research design is a program that guides the investigator in the process of collecting, analyzing and interpreting observations. According to Nachmias & Nachmias (1987) it is logical model of proof that allows the researcher to draw inferences concerning causal relationships among the variables under investigation. Consequently, the appropriate research design will depend on the problem to be investigated (Churchill, 1991), the purpose of the research, the research questions, and the state of the knowledge existing prior to the research plan (Eisenhardt, 1989).

Research methods and data collection, form an elementary part of the research design. Typically, the research methods and the data collection techniques are functions of the purpose of the research design. The purpose of the research may be organized into three groups based on what the researcher is trying to accomplish: explore a new topic, describe social phenomena or explain why something occurs.

The three basic types of research designs are: Exploratory (Case Studies), Descriptive and Casual.

3.2.1 Case Study

The case study approach is the most widely used in management fraternity. A Case study is the collection and presentation of detailed information about a particular participant or small group, frequently including the accounts of subjects themselves. It’s a form of qualitative descriptive research and it deals intensely at an individual or small participant pool, drawing conclusions only about that participant or group and only in that specific context.

This research design is not used to focus on topics such as discovery of a universal, general