Social Media in the UK - MA Dissertation

THE EVALUATION OF SOCIAL MEDIA EFFECTS ON
MARKETING COMMUNICATIONS: THE UK CONSUMERS’
PERSPECTIVE

GIEDRIUS IVANAUSKAS

04051311

MA INTERNATIONAL BUSINESS AND MARKETING

2009

THE EVALUATION OF SOCIAL MEDIA EFFECTS ON
MARKETING COMMUNICATIONS: THE UK CONSUMERS’
PERSPECTIVE

GIEDRIUS IVANAUSKAS

A dissertation submitted in partial fulfillment of the requirement of London Metropolitan
University for the degree of Master of Arts (International Business and Marketing)

LONDOND METROPOLITAN UNIVERSITY

2009

Acknowledgments

This dissertation could not have seen the light of day without the support, help and assistance of
the people listed below:

A special thank you goes to all Web 2.0 citizens who everyday inspires and guides me
throughout the labyrinths of social media.

I am especially thankful to my family and my friends who supported my dreams and never let
me give up and kept me going forward. I dedicate this work to my beloved grandmother, who
passed away during this period.

I am very grateful to everyone who has made an input on this project and supported me through
all the ups and downs - sharing their thoughts and knowledge. Without them it would have been
impossible to make this dissertation happen.

Declaration of Authorship

I certify that the work presented here is, to the best of my knowledge and belief, original and
the result of my own investigations, except as acknowledged, and has not been submitted,
either in part or whole, for a degree at this or any other University.

________________________

Giedrius Ivanauskas

Abstract

Purpose – The evaluation of Social Media as affective marketing communications tool and
channel. To identify the UK consumers‟ profile and its preferences in terms of channels and
tools.

Design/methodology/approach – The quantitative research was conducted by arranging
consumer survey among social media users. The deductive logic was used to verify the
hypothesis.

Findings – The general UK consumer profiles were identified. The hypotheses were proven that
social media can be a valuable tool and channel for marketing communications.

Research limitations/implications – The research was designed to test only the users of social
media properties. Even though, it gathered the needed data to help marketers in their search for
suitable tools when marketing in social media environment.

Originality/value – The conducted study added the knowledge to the indicated information gap
in academic literature regarding the social media usage for marketing campaigns from the
consumer perspective. It defined the main social media tools and tested the consumer perceptions
about the possible practices.

Keywords – Social media, Web 2.0, Social Media Marketing, Marketing Communications,
Consumer behavior.

Content

Acknowledgments........................................................................................................................... 3

Declaration of Authorship............................................................................................................... 4

Abstract ........................................................................................................................................... 5

Content ............................................................................................................................................ 6

Figures and Tables .......................................................................................................................... 8

Chapter 1: Introduction ................................................................................................................... 9

1.1 Introduction and Motivation............................................................................................. 9

1.2 Aims & Objectives of the research ............................................................................... 10

1.3 Statement of Hypotheses ................................................................................................ 11

1.4 The outline of Thesis (following the introduction) ....................................................... 13

Capter 2 : Literature review .......................................................................................................... 14

2.1 Introduction to changing media and communications landscape................................... 14

2.2 Social media and Web 2.0 .............................................................................................. 18

2.2.1 Social media ................................................................................................................. 18

2.2.2 “Web 2.0” .............................................................................................................. 23

2.3 Consumer 2.0 - “Web 2.0 citizens” ................................................................................ 37

Chapter 3: Procedures and Methodology...................................................................................... 44

3.1 Description and justification of the methods.................................................................. 44

3.2 Research design .............................................................................................................. 45

3.2.1 Research procedure ................................................................................................. 45

3.2.2 Primary and secondary data .................................................................................... 46

3.2.3 The Questionnaire design ....................................................................................... 47

3.2.4 Target population and Sampling design ................................................................. 48

3.2.5 Reliability and Validity ........................................................................................... 50

3.2.5 Fieldwork ................................................................................................................ 51

Chapter 4: Data analysis and results ............................................................................................. 52

4.1 The consumer profile of Web 2.0 Citizen in the UK ..................................................... 52

4.1.2 Where and How are they using Social Media Properties? ..................................... 54

4.2 The thechonographic profiles of the UK social media users ......................................... 56

2.3 The influence of Social Media on the UK consumers and “Traditional” media............ 63

Chapter 5: Findings & Conclusion ............................................................................................... 67

5.1 General findings ............................................................................................................. 67

5.2 Conclusion and Further Implications of the Study ........................................................ 69

References and Bibliography ........................................................................................................ 71

Appendixes ................................................................................................................................... 80

Figures and Tables

Table 2.1. The Concepts of online interactivity.
Table 2.2. Bloggers‟ motivations.
Table 2.3. Online community needs

Figure 2.1. Internet Users Growth in the World between 200 and 2008.
Figure 2.2Changing distribution of the message.
Figure 2.3. Micro Interactions
Figure 2.4. Clustered overview of Web 2.0 applications
Figure 2.5. Types of Bloggers
Figure 2.6. Content posted on social network
Figure 2.7. Extrinsic value.
Figure 2.8 Most visited websites
Figure 2.9. The closed loop of needs.
Figure 2.10 Uncontroled marketing stimuli – Web 2.0.
Figure 2.11 The new drivers of value.
Figure 2.12. Participation model of a Web 2.0 service
Figure 3.1. The activities list of the project
Figure 4.1 The sex of the social media users in the UK
Figure 4.2 The age groups of the social media users in the UK
Figure 4.3 The social media users by income.
Figure 4.4 Most popular Social media properties in the UK
Figure 4.5 Where are you using social media properties?
Figure 4.6 Time spent on SMP (a week) in the UK
Figure 4.7 Time spent on SMP (a week) in the US
Figure 4.8 Technographic profile of Web 2.0 Citizens in the UK
Figure 4.10 The SMP used by “Creators”.
Figure 4.11 The SMP used by “Joiners”.
Figure 4.12 The content preferred by “Joiners”.
Figure 4.13 The obstacles to interact on SMP (“Joiners”).
Figure 4.14 The content preferred by “Spectators”.
Figure 4.15 The reasons for engagements “Spectators” vs “Joiners”.
Figure 4.17 The reasons for engagements “Collectors” vs “Critics”.
Figure 4.19 The SMP used by “Collectors”.

Chapter 1: Introduction

1.1 Introduction and Motivation

Technological development has been seen as one of the main factors effecting company‟s
processes and profitability in the last century. The birth of the Internet and its success in
changing our society has been largely researched in various subjects and defined in various
terms. But as year‟s passes by the Internet evolves and creates new rules for companies
interacting and doing business with their costumers and partners. The new applications and
services are being developed and offered in order to catch up with changing information society
define new concepts of doing business. In the last few years the terms of Web 2.0 and Social
Media has emerged as the definitions for second generation of web based services and
communities that emphasize online collaboration, networking and user created content
(Eikelman et al, 2008). According to Strategy Analytics report (2007), Social media users will
exceed 1 billion by 2012. The enormous growth of Social networks (MySpace, Facebook, BeBo)
Blogs, Wikis and consumers‟ participation in these platforms forces companies to reevaluate
their business strategies. The recent investments by leading companies like Microsoft (240
millions in Facebook) and Google (900 millions in MySpace) in social networks gives a clear
signal that company‟s presence in dialogue with consumer gains a new meaning in terms of
communication strategy. Nevertheless, there is a clear shortage of academic literature which
defines the Social media environment and Web 2.0 applications. Moreover, it is not clear what
applications and how they should be used by the company in order to make these
communications more valuable. Finally this subject is not enough researched in different
environments. The most of the rare academic literature and professional insights are dedicated to
US market and there are no findings presented how consumers perceive company‟s initiatives to
influence their private space on the net in the UK. Therefore, this research project will
summarize Social Media and Web 2.0 definitions; will evaluate the influence of different types
of Web 2.0 applications on the consumer in terms of communication interactivity; and will
analyze the general patterns of the consumer‟s perception about the differences between Social
Media and Traditional Media in the UK market.

The interest in the topic was influenced by 3 years‟ personal engagement with social media
platforms. The participation in various virtual communities, conferences and seminars led to the
huge motivation to test the existing knowledge and increase it.

1.2 Aims & Objectives of the research

According to Constantinides and Fountain (2008) in order to enable Social Media Properties
(SMP) to integrate into corporate commercial strategy, these areas must be researched in greater
depth: the effects of Web 2.0 applications on consumer behavior, differences between exiting
Web 2.0 applications effectiveness and their relationship with traditional mediums. As this study
concentrates particularly on the marketing communication strategies the two main aims are
identified below, followed by the objectives of the research:

Aim 1 - To determine the Social Media environment and indentify the UK consumer profile:

 To define the main changes brought by social media in marketing
communications environment
 To identify “Who” are the users of SMP in the UK?
 To identify “What” SMP are they using?
 To identify “Where” and “How” are they using SMP?

Aim 2 - To evaluate the SMP effectiveness as marketing communication tool and channel:

 To verify if the interactions through SMP could result in positive
outcomes for the company.
 To verify if different SMP have to be used for different
communication purposes.
 To verify if SMP could be a valuable channel in changing
consumer‟s attitudes towards the company
 To verify if communications through SMP triggers the positive
word of mouth.
 To verify the level of involvement needed by the company in order
maintain positive relationship with consumer
 To verify if different type of consumers use different type of
mediums

1.3 Statement of Hypotheses

In order to achieve the “Aim 2” several hypotheses must be tested:

Hypothesis 1 - The interactions through Web 2.0 applications generate different outcomes for
the company.

H0 : There is significant relationship between Social Media Properties used and the
actions taken after the interaction.

H1 : There is no significant relationship between Social Media Properties used and the
actions taken after the interaction

Hypothesis 2 - Different Web 2.0 applications can serve different marketing communication
goals.

H0 : There is a significant relationship between the Social Media Properties used and
communications wanted by the consumer.

H1 : There is no significant relationship between the Social Media Properties used and
communications wanted by the consumer.

Hypothesis 3 - There is a significant relationship between the influence on the consumer‘s
attitudes and the SMP used to engage with consumer.

H0 : There is a significant relationship between the Social Media Properties and attitudes
changed by the company and by the consumer.

H1 : There is no significant relationship between the Social Media Properties and
attitudes changed by the company and by the consumer.

Hypothesis 4 - The initiatives to communicate through SMP triggers the positive word of mouth.

H0 : There is a significant relationship between the initiators of interaction with the
creation of positive word of mouth about the company.

H1 : There is no significant relationship between the initiators of interaction with the
creation of positive word of mouth about the company.

Hypothesis 5 – The consumer wants the company to start the conversation if he/she likes Social
media platforms as a marketing medium

H0 : There is a significant relationship between the initiators of interaction and media
channel preferred by the consumer.

H1 : There is no significant relationship between the initiators of interaction and media
channel chosen by the consumer.

Hypothesis 6 - There is a significant relationship between technographics (―Creator‖, ―Joiner‖
and etc.) of the consumer and the channel which he/she consumes.

H0 : There is a significant relationship between the technographics of the consumer and
the preferred media channel chosen.

H1 : There is a significant relationship between the technographics of the consumer and
the preferred media channel chosen.

1.4 The outline of Thesis (following the introduction)

Chapter 2 presents the literature review. It is divided into three main themes: 1) Changing media
landscape; 2) Social Media and Web 2.0 tools 3) Web 2.0 citizens. Each of the themes
summarises the findings in the literature review and defines the background for the quantitative
research.

Chapter 3 outlines the research methodology, applied techniques and procedures undertaken. It
also explains how the research was planned and implemented. The thorough description of
research design is also presented in this chapter.

Chapter 4 outlines the main data gathered in the research and summarizes result. Accordingly to
the research aims, the whole chapter is divided into three main sub-chapters that analyze data
according to every aim.

Chapter 5 indicates the findings that were linked to the insights gained in Chapter 2, and final
conclusions. It ties together what has been learned according to the set study aim and the main
research question. The limitations and implications of the study are also presented in this chapter.

Capter 2 : Literature review

2.1 Introduction to changing media and communications landscape

The last century was a gold age for the media development. The new technologies as Telephone,
Radio and Television have changed people‟s lives forever. The new ways of communications
have been successfully adopted and become a norm. The last decade of the century brought the
new innovative technology – Internet. As predicted by Newman (1991) Internet:
Altered the meaning of geographic distance.

Allowed the huge increase in the volume of communication.

Provided the possibility of increasing the speed of communication.

Provided opportunities for interactive communication.

Allowed forms of communication that was previously separate to overlap and interconnect.

Grieco and Holmes (1999) (citied in Combe et al, 2003) identifies three powerful features of
Internet:
1. Disintermediation or the removal of brokers by allowing direct communication across spatial and
sociometric distance;

2. Asynchronicyty of the removal of temporality as a barrier to communications;

3. Oculacy or the ability to communicate messages through images.

According to Hermeking (2006) The global spread of modern technology, including information
and communication technology (ICT), is commonly regarded both as an indicator of the
postmodern era of globalization and as the very precondition for that era of intensive worldwide
interactions of people and exchanges of goods, services, information, and capital. Hoffman
(Hoffman et al., 1995) argues that the popularity of the WWW as a commercial medium (in
contrast to other networks on the Internet) is due to its ability to facilitate global sharing of
information and resources, and its potential to provide an efficient channel for advertising,
marketing, and even direct distribution of certain goods and information services.

In the recent years Internet witnessed amazing growth, according to Internet Consumption
Report (Soumukil, 2008) the 21% (1,407,724,920) of the world population (6,676,120,288) are
internet consumers. Most of them live in well developed regions as North America where
internet penetration is as high as (73.1%), Australia (57.0%) and Europe (47.7%). Peters (1998)
suggest that no other technological innovation has captured the imagination of users with the
speed and impact of the Internet (Graph 1).

Figure 2.1. Internet Users Growth in the World between 200 and 2008.

Source: Internet World Stats 2008 - http://www.internetworldstats.com/images/world2008growth.png

According to Linda Peters (1998), the “Web” presents a fundamentally different environment –
both as a medium and as a market – from traditional communication channels perspective. It

creates the Marketspace – a virtual realm where products and services exist as digital information
and can be delivered through information-based channels (Rayport and Svikola, 1994). The
companies and consumers quickly adopted the new concept of the new interactive world for their
own benefits. These interactive channels allowed companies to reach new markets or have a
grater influence in the existing one‟s (i.e. example media companies transferred their news
papers in order reach new audiences) and the consumers had an opportunity to save time and
money by communicating, looking for information or buying product and services online. The
concept of interactivity has been extensively researched in advertising and marketing literature
and was summarized by Johnson (Johnson et al, 2006) (Appendix 1.1).

According to Liu & Shrum (2002) emergence of new media (Internet), brought new models of
interactivity: user-to-user and user–to-message. Contemplating about user-to-user interactivity Ha
and James (1998) suggested that “the more communication in a computer-mediated environment
resembles interpersonal communication, the more interactive the communication is‖. Steuer (1992)
defined users-to-message interaction as follows: ―the extent to which users can participate in
modifying the form and content of a mediated environment in real time‖. Lee (2005) summarized
the main components of online interactivity (Table 1).

Table 1.1. The Concepts of online interactivity.

Source: Lee (2005)

Commercial online services and the introduction of the Web have created the potential for a
mass interactive dialogue between exchange parties (Peters, 1998). The world have witnessed
the evolution of a universal interconnected network of audio, video, and electronic text
communications that blurred the distinction between interpersonal and mass communication and
between public and private communication (Neuman, 2003). The new market space changed the
behavior of the people and the communication models. The shift is then from a “one (firm)-to-
many (consumers)” model of communication to the “many-to-many” model where contribution
to the medium and the message may come from both directions (Hoffman and Novak, 1996).
Chaffey (Dave Chaffey et al., 2007) argues that such kind of communications allows mass
customization and personalization and the messages send trough Internet can be targeted more
effectively. Moreover, the Web is changing the traditional marketing communications
concepts as the consumers can go all the way from awareness to interest to desire to action
(AIDA Framework), all within the same medium and within the same session (Economist,
2008a). Peters (1998) suggests four main changes in communication model compare the new and
old media:
1. Communication style - tend to have little or no time lag between the giving, receiving and responding
aspects of communication between the parties.

2. Social presence - or perceived personalness, the feeling that communication exchanges are sociable, warm,
personal, sensitive and active.

3. Control of contact - Early research into the willingness of consumers to utilize technology in shopping
behavior concludes that the ability to control the pace and presentation of product information has the
strongest influence on willingness to engage in computer-mediated marketing activity (Carson et al., 1996).

4. Content – The content can be customised either by users or by senders. Where users are able to control the
content, or presentation, of the message it is said to be interactive.

Andrew L. Shapiro (1999) argues that the emergence of new, digital technologies signals ia a
potentially radical shift of who is in control of information, experience and resources. One of the
key features of the new electronic communication media is the ability of consumers to control
both contact and content (Peters, 1998). Sohn and Lackenby (2002) suggest that individual‟s
participation in social communication processes is the crucial factor for increasing the perceived
interactivity of the Internet (citied in Stafford and Ronald, 2005). Moreover, according to

Normann and Ramirez (1994) the consumers become co-producers, because the value is
constantly created in interaction with many different players, including consumers, suppliers,
employees and managers. As a result, marketers are losing control over the communication
messages their trying to deliver to their consumers.

According to Gatarski and Lundkvist (1998) when communication, in the meaning of sharing
information, meets interactivity, it creates not simple massages but forms two-way
conversations. These conversations can be applied in production as implementation of mutual
ideas (consumer‟s and producers‟) in order to create new enjoyable products or services.

2.2 Social media and Web 2.0

2.2.1 Social media

The real power of people can be noticed in the new revolutionized media channel – social media.
According to Mayfield (2008) social media is best understood as a group of new kinds of online
media, which share most or all of the following characteristics:
Participation & Engagement: social media encourages contributions and feedback from everyone who is
interested. It blurs the line between media and audience.
Openness: most social media services are open to feedback and participation. They encourage voting,
comments and the sharing of information. There are rarely any barriers to accessing and making use of
content – password-protected content is frowned on.
Conversation: whereas traditional media is about „broadcast‟ (content transmitted or distributed to an
audience) social media is better seen as a two-way conversation.
Community: social media allows communities to form quickly and communicate effectively. Communities
share common interests, such as a love of photography, a political issue or a favourite TV show.
Connectedness: Most kinds of social media thrive on their connectedness, making use of links to other
sites, resources and people.

Drury (2008) suggests that when analyzing social media marketers too often concentrates on the
“media” factor, when “social” element is the key, because marketing within social media is about
building a relationship and conversation with the audience, where the simple message delivery is
changed by ongoing exchange of perceptions and ideas between company and the consumer.

Haven (2008) suggests that social media key elements are not entirely new as features of sharing,
connecting, opining, broadcasting and creating has been long in our lives, but there are several
characteristics of new technologies and behaviors that set them apart from the past:
Reach — Historically, audiences for the common person have been limited: a tribe, family, friends,
neighbors, or the local community. Today's technologies provide scale and enable anyone to reach a global
audience.

Accessibility — The means of production for most media used to lie in the hands of enterprises with
unlimited resources (financial or human). Today's technologies for media creation are available to anyone
at little or no cost.

Usability — The means of production typically required specialized skills and training, both technically
and creatively. Today's technologies simplify those processes, or in some cases reinvent them, so anyone
can create and operate the means of production.

Transparency — People, especially Americans, historically kept personal information to themselves and
had a general distrust of authority (enterprises, government, etc.). Today, people are willing to share
anything about themselves (interests, location, family situations, health condition, etc.) in a public venue,
and today's technologies make that both possible and purposeful.

Recency — When people did have the means of production and distribution in the past (albeit limited), the
time lag between communications was typically long (days, weeks, or even months). It was a limitation of
the technology or system in which it operated. Today's technologies enable instantaneous responses and
dialog where only the participant determines the delay in response.

The interactivity gains a new meaning when it is applied through Web 2.0 platforms and
Social media channels as dialogue between consumer and company becomes much more active
and interactive. As summarized in the media landscape analysis the past decade was all about
two-way communication‟s and interaction‟s models. Most of the marketing academics (Kotler,
2003; Pettit and Brassington, 2005) recognized the importance of creating two-way marketing
channels between consumer and company for brand building, CRM, sales (and etc). Social
media, itself, does not change this idea, but redefines interactivity and takes it to another level.
Armano (2008a) argues that social media goes beyond the interactive marketing which is
facilitated by computer-human interaction, and introduces human-to-human interaction enabled
by technology (Appendix 2.1). The main difference is that the companies instead of pushing the
content (i.e. automated e-mail‟s) through online channels empower people to engage and interact
with other people and produce new content about the company (blogging, commenting, social
networking and etc.). Free production of content and voluntary distribution is the key elements
of the social media. Meadows-Klue (2008) suggests that in social media marketing engagement
replaces interruption; diversity and self-expression replace conformism and unity; the media of
the masses replace mass media; granular insights and rich data replaces generalization and
conversations in marketing replace control.

Another major change from the marketing perspective is the shift from persuasion to influence.
Past decades marketing practitioners were using the communication mix in order to “attack”
consumers with pervasive messages to make them buy goods and services offered, but in the age
where 25 percent of search results on Google for the world‟s 20 largest brands links to
consumer-generated content (Nielsen Buzz Metrics, 2007), to do this is too late, not practical or
impossible, as the messages are already floating out there. According to Mitchell (2008) this
process is facilitated by the change of information flows from “top down” (B2C) to “bottom up”
(C2B) what redefines marketing environment as marketers do not own the message anymore
(Figure 2.2, Apendix 2.2). Armano (2008) suggests that people can be divided in different
grouping according their “strength” as the massagers (Apedix 2.3)

Figure 2.2 Changing distribution of the message.
Source: Bowman and Willis (2003).

The User Generated Content (UGC) can become influential message of the consumer to the
consumer (C2C) about the company and therefore should be carefully monitored. In fact, the
content is the new message in social media channels. According to Eikelmann (Eikelmann et al,
2008) the best marketers can do in this environment is to try to engage with the consumers
through social media in order influence these messages. Drury (2008) suggests that instead of
sending simple messages, marketers should provide the content which would be relevant for
consumers and would generate conversations among them. Therefore, influence will become a
standard measurement in Marketing 2.0 (Dowdell, 2008). As blogger and social media strategist
Douma (2008) put it: “The age of persuasion is over. Welcome to the age of influence.”

Marketers are forced to look for alternative communication strategies to market in the social
media environment, because advertising clutter, growing advertising literacy and changing
consumer behaviour drives down the return on investment (Biegel, 2008; Constantinides and
Fountain, 2008). These strategies have to consider the increasing fragmentation in the markets

what may shift the rules of targeting into behavioral marketing favor. (Meadows-Klue, 2008).
David Armano suggests that micro interactions and “Permission marketing / Unconventional
marketing” (Godin, 1999) should be the right strategy to approach the consumer in the new
media world (Figure 2.3).

Figure 2.3. Micro Interactions
Source: David Armano (2008b)

Micro strategies are more valuable in fragmented media environment, as they generate more
precise consumer insight and as a result are better targeted. According to Godin (2008)
unconventional marketing principals are effective because it considers the needs and wants of the
people and listens to them. Therefore it aims to build a more in-depth and lasting customer
relationship based on loyalty and trust (Masterson, 2007).

Viral and Word of Mouth marketing principals are the essentials in social media. This medium
provides a platform for Web 2.0 applications and tools, which works as enablers in order to
increase reach and speed of the messages. According to Lockhorn (2007) word of mouth
campaigns can take off very quietly through niche communities and can be powerfully
persuasive, or conversely result in an astonishing backlash. It should be closely monitored by
marketers as various researches (RazorFish, 2008; Internet Consumption Report, 2008) shows

that people make purchasing decisions according what they here form other people about the
products or services.

2.2.2 “Web 2.0”

Social media and Web 2.0 are two terms which are often used interchangeably in the marketing
literature, even though they are not entirely the same. From the marketing perspective, the Web
2.0 should be perceived as the new tools for the marketing communication mix and facilitator
and enabler of social media. The Web 2.0 term was introduced by Tim O‟Reilly in 2004, it has
originated from talks about social software and the communities surrounding these applications.
According Tim O‟Reilly (Tim O‟Reilly, 2007) “the companies that survived the dotcom boom
had something in common;” these companies realized that the “Web” is much more useful for
delivering service than being used just as a platform for “packaged” products (i.e. software).
Constantinides and Fountain (2008) defined Web 2.0 as follows:

―Web 2.0 is a collection of open-source, interactive and user-controlled online applications expanding the
experiences, knowledge and market power of the users as participants in business and social processes. Web 2.0
applications support the creation of informal users ‘ networks facilitating the flow of ideas and knowledge by
allowing the efficient generation, dissemination, sharing and editing / refining of informational content .”

Hoegg (Hoegg et al, 2005) suggests that Web 2.0 is “the philosophy of mutually maximizing
collective intelligence and added value for each participant by formalized and dynamic
information sharing and creation‖.

Both definitions share similar concepts of maximizing the collective intelligence, self-regulating
community, network effect, transparency of the information creation and sharing process, but the
key element in these terms is the user. From technological perspective, there are not many
changes in the Web 2.0 compared to Web 1.0 applications; the real value is created by people
not only using this social software but participating in the creation process of it (by creating
and editing the new content or even in some cases modifying the application itself). According to

Constantinides and Fountain (2008), the key innovative elements typifying this new family of
web applications can be summarized as three main principles:

1. Focus on simple, service-based open-source solutions in the form of online applications.
2. Continuous and incremental application development requiring the participation and interaction of users
in new ways: not only ‗consuming‘ but also contributing, reviewing and editing content.
3. New service-based business models and new opportunities for reaching small individual customers with
low-volume products.

As Web 2.0 applications are still in the development stage, the grouping of them varies
according to the purpose and field of the research. Hoegg (Hoegg et al, 2005) groups web 2.0
applications according the services they provide (Figure 2.4).

Figure 2.4. Clustered overview of Web 2.0 applications
Source: Hoegg (Hoegg et al, 2005)

Constantinides and Fountain (2008) classifies them into 5 broad types according their nature:
1. “Blogs: Short for Web logs: online journals, the most known and fastest-growing category of Web 2.0
applications. Blogs are often combined with Podcasts, that is, digital audio or video that can be streamed
or downloaded to portable devices. Examples: http://gizmodo.com, http://www.boingboing.net,
http://www. hufﬁngtonpost.com

2. Social networks: applications allowing users to build personal websites accessible to other users for
exchange of personal content and communication. Examples: http://www.myspace.com,
http://www.facebook.com, www.hyves.nl, http://www.ning.com/
3. (Content) Communities: Websites organising and sharing particular types of content. Examples are
applications of Video sharing: http://video.google.com, www.youtube.com, http://etsylove.ning.com,
Photos sharing: http://www.ﬂickr.com, Social Bookmarking: www.digg.com, http://del.icio.us and
Publicly Edited Encyclopedias (Wikis): www. wikipedia.org, http://en.citizendium.org/wiki/Main_Page
4. Forums/bulleting boards: sites for exchanging ideas and information usually around special interests
Examples: www.epinions.com, www.personaldemocracy.com, http://www.python.org.
5. Content aggregators: applications allowing users to fully customise the web content they wish to access.
These sites make use of a technique known as Real Simple Syndication or Rich Site Summary (RSS).
Examples http://uk.my.yahoo.com/, http://www. google.com/ig, http://www.netvibes.com/.”

Tim O‟Reilly (2005) argues that “Web 2.0 doesn't have a hard boundary, but rather, a
gravitational core which could be visualized as a set of principles and practices that tie together
a veritable solar system of sites that demonstrate some or all of those principles, at a varying
distance from that core” (Appendix 2.4). Therefore it is difficult to classify the Web 2.0 into the
precise groupings, because the applications are interrelated and most of the time a few Web 2.0
features works on one platform. The mixture of Web 2.0 applications working under one site are
known as “Mash-ups”. According to Mayfield (2008) ―this combination of two or more pieces of
content (or software, or websites) is one of the phenomena in social media that make it at once
so exciting, fast-moving and sometimes bewildering‖. But even more important feature of Web
2.0 applications is the adaptability in the different platforms. Social applications are becoming
more and more popular on mobile devices (Phones, iPods (via podcasts)). In fact, according to
BBC News (2008) one of the reasons the Internet usage on the mobile devices is increasing -
Web 2.0 applications. According to Drury (2008) social media applications has an ability to
bring “Head” (Professional) and “Tail” (UGC) content together in all the formats (audio, video ,
text). As more and more professionally edited websites incorporates social media content some
companies (i.e. Joost) are trying to apply Web 2.0 principals (live participation) for even bigger
media platforms as TV. These applications are being tested in the Internet TV and in the near
future have a good chance to redefine TV experience completely. All theses changes open new
opportunities for integrated marketing campaigns, where marketers are enabled to reach larger
audiences of consumers at all their touch points with mediated world at one-stop shop.

Hoegg (Hoegg et al, 2005) suggests that various kinds of web 2.0 services offer different
participation possibilities for users. Therefore, it is important to analyze each Web 2.0
application type in depth.

Blogs and blogging

Web Logs (commonly knows as Blogs), according to Tredinnick (2006), are arguably the
“oldest” Web 2.0 applications and have been in the web space since mid 1990‟s. Constantinides
and Fountain (2008) states that it is the most know and fastest-growing category of Web 2.0
applications. According to McCann report (2008), 184 million people World Wide have started a
blog and 346 million read blogs, which means that 77% of active Internet users read blogs.
Furthermore, 17.8 m have read a blog and around 4.3 m have created their own blog in the UK
(McCann, 2008). The most recent Technorati research (2008) confirms this phenomenon as they
tracked blogs in 81 languages from 66 countries around the world, it suggest that blogging have
made a major influence on media ecosystem as bloggers are collectively creating almost one
million posts every day and have representation in all top-10 web site lists across all key
categories.

In general a “Blog” is a Web site, usually maintained by an individual with regular entries of
commentary, descriptions of events, or other material such as graphics or video where entries are
commonly displayed in reverse-chronological order and has permalinks (Daily Blog Tips, 2008),
but Pomerantz and Stutzman (2006) argues that for every blog author and consumer, the precise
understanding of a blog‟s use is different, therefore it is difficult to define its true meaning.
Dearstyne (2005) summarized the definitions and blogging opportunities provided by major
companies:

―Microsoft defines blogs as frequently updated personal web journals that can dramatically help both
small and large companies communicate their product messages. They increase people's ability to share
ideas and information exponentiallv, and on a worldwide scale.
Accenture says blogs are an interactive website that allows the owner to publish ideas and information.
Users can read and evaluate material and add new content, creating a conversation that spans lime zones
and continents.

Technorati. a blog search engine and measurement firm, calls blogs a personal journal on the web and
says the power of weblogs is that they allow millions of people to easily publish their ideas and millions
more to comment on them. The firm further describes blogs as a fluid, dynamic medium, more akin to a
"conversation" than to a library.
Harvard Law School weighs in with a definition of blogs as a hierarchy of text, images, media objects, and
data, arranged chronologically, that can be viewed in an HTML browser. The center of the hierarchy is a
sequence of weblog posts each with a title, link, and description. The school's Internet policy slates that a
weblog gives one a publication where ideas can stand without interference.‖

According to Antony Mayfield (2008), the most
important features of the blogs are Linking,
Trackbacks, Comments and Subscription (RSS)
which allow companies to engage with their
stakeholders and facilitates conversations between
them. Theses are the main qualities of the blogs
that differentiate them from personal websites.
There are hundreds of different type of blogs, but
bloggers, in general, are divided in three broad
segments – personal, professional and corporate
Figure 2.5. Types of Bloggers
(Techonrati, 2008). Source: Technorati (2008)

According to Technorati report (2008), as Blogosphere grows in size and influence the lines
between what is a blog and what is a mainstream media site become less clear as larger blogs are
taking the characteristics of mainstream sites and mainstream sites are incorporating styles and
formats from the Blogosphere (95% of the top 100 US newspapers have reporter blogs), but it is
clear that amazing growth of blogs and blogging open new opportunities for marketers. Huang
(Huang al., 2007) suggests that one of the biggest opportunities provided for marketers by blogs,
that there is no longer a scarcity of media, but an even more fractural media space. Hardly
reachable segments of the market become easy to reach and target with the help of social media
and blogging. They open doors to untapped markets which could be quite profitable for the
companies if approached correctly. The responsiveness of the medium (blogs) is another key
benefit for the marketers. Blogging provides great opportunities for the companies to converse

and influence their stakeholders (internally and externally). According to Awareness report
(2008), 53 % of surveyed companies in US are planning to use this tool in order to improve their
internal communication, knowledge sharing and collaboration within the organization.
Companies can use blogs to promote increased communications between peers and to allow a
forum to emerge in which „„employees can talk back to their bosses‟‟, because individuals trust
more in blogs written by the executives and employees as opposed to an official corporate blog
or website (Vara, 2006). According to Wyld (2008) blogs can enable their executives to be
viewed as „„real‟‟ people and leaders. Although, companies have to be careful and introduce
guidelines or code of practice to manage conversations derived from blogs as “silly talks”
between/by employees can damage the corporate brand. Joshua L. Cox (Cox, et al., 2008) offers
to follow 9 rules for internal corporate blogging:

1. Have a consistent and authentic first-person voice.
2. Allow comments but monitor them.
3. Be honest and transparent.
4. Add value.
5. Identify information sources.
6. Welcome feedback and issue corrections.
7. Respect your audience.
8. Protect confidential and/or proprietary information.
9. Use appropriate disclaimers and publish a ‗‗terms of use‘‘ policy.

Even more exiting opportunities for marketing professionals derive from external
communications via blogs, as blogs can help the organization to develop and maintain stronger
relationships and brand loyalty with its customers, generate consumer insights. Li and Bernoff
(2008) go even further; they suggest that blogging can increase ROI on the Advertising, PR,
Customer Support and Research value. According to Maltoni (2008) blogs provide a real
opportunity for marketers to speak with their customers and not to “shout” at them as it is often
the case in mainstream media. It is clearly important to join on-line conversation with the
customers, as these conversations are developed with or without company interference anyway,
as four in five bloggers post brand or product reviews, with 37% posting them frequently
(Technorati Blogosphere report, 2008). The companies have to learn the lesson of Dell and

approach their brand advocates in the best possible manner. Cox (Cox et al., 2008) suggest three
basic rules for companies dealing with bloggers outside the company:

1. Be aware. Corporate managers should find and monitor influential blogs related to their companies and
industries.
2. Engage. Establish relationships with independent bloggers when possible.
3. Respond quickly and appropriately.

The internet guru Seth Godin (2004) remarked that good blogs work when they are based on:
candor, urgency, timeliness, pithiness, controversy and utility. Armano (2008) groups these
features to 4 C‟s of blogging (Appendix 2.5). Furthermore, Huang (Huang al., 2007) identified
the main techniques how to manage brand communications according to various blogging
motivations.

Table 2.2. Bloggers‟ motivations.
Source: Huang (Huang al., 2007)

At the moment amongst the marketers there is ongoing discussion about importance of another
form of blogging – micro blogging. Twitter, Plurk and other companies provide the technology

based on short massages, limited to 140 symbols or less. The key difference and importance of
this medium for marketers is – speed. The biggest names of the blogosphere (Godin, 2008;
Armano, 2008,) suggested that micro-blogging is a new phenomenon and should be carefully
monitored in order to be used as a successful marketing tool. The article by Mossberg (2008) in
Wall Street Journal suggests that Twitter can be a great resource for fast information.
Surprisingly, The US President Elect Barack Obama has tried these means of communication for
his election campaign where he is “followed” by 141 823 people. The Razorfish report (2008)
suggested that with time-shifting, information overload permanent connectivity and the
proliferation of communication channels, consumers are moving towards shorter micro-
interactions provided by Twitter and similar applications. Therefore immediacy, simplicity,
voyeurism and constant communication should be considered in the marketing era

Social networks

The amazing recent growth of social networking sites is one of the main phenomenon‟s driving
social web. According to McCann report (2008) there are estimated 272 m users world-wide,
from whom over 10 millions are using social networks in the UK. As there is no single definition
for this phenomenon Stroud (2007) summarized the available definitions from various
organizations researching this field:

McKinsey - Social networking refers to systems that allow members of a specific site to learn about other members‘
skills, talents, knowledge or preferences.

Pew/Internet - A social networking site is an online location where a user can create a profile and build a personal
network that connects him or her to other users.

Wikipedia - A social network service focuses on the building and verification of online social networks for
communities of people who share interests and activities, or who are interested in exploring the interests and
activities of others. It provides various ways for users to interact - chat, messaging, email, video, file sharing,
blogging and discussion groups.

According to McCann (2008) social networks have evolved into platforms which organize users‟
internet experience where users are posting variety of content (text, photos and video) and it is
aiming to become the one stop shop for all internet needs (Figure 2.6).

Figure 2.6. Content posted on social network
Source: McCann (2008)

It becomes quite feasible as some of the platforms opens up to the third parties developers in
order to keep the users on the one site.

The social networks like www.myspace.com, www.facebook.com, www.bebo.com, has
generated an interest amongst marketers as they provide an opportunity to reach millions of
active users, who passionately share their personal information and are willing to converse on the
net. Moreover, the features of social networks present an opportunity to create brand
communities and interact with them online. Marketers are discovering that community can get a
company‟s message across faster and more authentically than traditional media ever could
(Razorfish, 2008). According to Awareness report (2008) 46 % of the surveyed companies have
already used social networking as a successful tool to build and promote brands, improve
collaboration and communication, and increase consumer engagement. Stroud (2007)

summarized the main ways in which companies can exploit social networking in order to achieve
their goals:

Work with and use the functionality of the large generic sites (Facebook, MySpace and etc.)
Create company or brand-specific sites.
Provide content to generic sites.
Imbed social networking functionality with the company‘ s existing online presence.
Advertise on the generic sites.

Even though, Stroud (2007) suggests that the final alternative is to do nothing which may be the
most appropriate strategy, but should only be used following a careful evaluation of the
alternatives.

There are general tools offered by social networks to make every encounter more interactive.
According to Razorfish report (2008) the best and most successful sites from Flickr to Facebook
to Nike all provide the similar tools within the sites to support their members‟ abilities to connect
with one another and engage with each other directly by providing a continuum of ways to
interact:

Low-level: rating, poking, tagging, commenting, subscribing
Mid-level: writing statuses, twittering, playing games, adding widgets, uploading photos
High-level: making videos, writing blog posts and reviews
Expert-level: moderating groups and message boards, creating applications, running feeder businesses on
the social network‘s ―economy‖

Even though, social networking is mostly considered among B2C companies, it could be a
valuable tool to create strong bonds with other stakeholders as business partners and employees.
But those skeptical about social networking‘s value to business argue that ―networking‖ can
easily turn into ―not-working‖ and damage the relationships between the parts (MessageLabs,
2007). Moreover, the companies have to be careful since social networks can also be a source of
damaging publicity (Economist, 2008b), but it is another reason for the organization to have the
presence in social networks as it gives a chance to influence such activities.

Content Communities

Websites organizing and sharing particular types of content are called content communities.
These communities most of the time has all social networking features, but are developed to
share a particular type of content (Constantinides and Fountain, 2008):

Video sharing: www.youtube.com ;
Photos sharing: http://www.ﬂickr.com;
Social Bookmarking (Tags): http://del.icio.us;
Publicly Edited Encyclopedias (Wikis): www.wikipedia.org.

According to McCann (2008) these sites are one of the most visited sites on the Internet
attracting millions of user all around the world (estimated 394m world wide). From 15m active
users within the UK, 8.7m shared the photo and 5,7m uploaded the video. The content
communities as other Web 2.0 applications and services are highly depending on the size of
the supporting community and is a classic example of network effect. According to
Pew/Internet report (2008) one of the factors that plays a big role in the growth of video site
usage is that there are more videos on sites like YouTube now than there were a year ago.
According to Hoegg (Hoegg et al, 2005) the intrinsic value of Web 2.0 communities itself is very
limited, but the content or the value generated through the supporting community can be
internalized and represents the value of the community itself as the quality of the content
improves and the service gains more relevance when more users participate, what attracts even
more users (Figure 2.7).

Figure 2.7. Extrinsic value.
Source: Hoegg (Hoegg et al, 2005)

Even though, the content communities attract large volumes of users, marketers have been
struggling to find the needed tools to monetize these networks. Viral marketing concepts has
been successfully adopted on this type of Web 2.0 applications, but the examples of success like
“Lonelygirl15” or Barack Obama (Yes We Can video) are rare exceptions rather than a general
practice. According to Razorfish (2008) advertising can be a road to riches for some content
communities, but in general it is not a very powerful tool and community builders are going to
have to find other ways to get a return out of their social investment.

Content aggregators and Widgets

According to Constantinides and Fountain (2008) content aggregators are the applications
allowing users to fully customize the web content they wish to access and are based on Real
Simple Syndication or Rich Site Summary (RSS) technologies (http://uk.my.yahoo.com/,
http://www.google.com/ig, http://www.netvibes.com/). McCann report (2008) suggests that RSS
(Really Simple Syndication) is a key technology in social media as it connects users to content
and moves content into a variety of platforms. Consumers prefer using multiple destinations, and
then aggregating media and services, via simple tools like RSS, into a highly personalized view
of their digital world (Razorfish, 2008). The applications or websites based on these technologies
had a major effect on social web development. It may seem like a trivial piece of functionality

now, but it was effectively the device that turned weblogs from an ease-of-publishing
phenomenon into a conversational mess of overlapping communities (O‟Reilly, 2007).

Widgets and applications had a huge influence on social web growth too. According to Razorfish
report (2008) widgets provide the purest glimpse into the new, improved networked future where
people will select, personalize, share and consume Web services wherever and whenever they
choose. McCann (2008) suggests that widgets and applications should be used to create a
genuine consumer benefit and drive engagement.

With 4,7m users in the UK (McCann, 2008) content aggregators and widgets still lack the
needed awareness about their functionality and possible opportunities provided by them. Even
though, marketers have to monitor carefully the user‟s activity in these applications in order to
generate knowledge of how to use them in the best possible manor for marketing purposes.

Forums, bulleting boards and reviews

The sites for exchanging ideas and information usually around special interests are another
growing phenomenon on the internet (Constantinides and Fountain, 2008). Comparison, review,
ranking and other opinion spreading sites are infused by Web 2.0 technologies and are
experiencing the re-birth.

The editorial reviews of Web 1.0 era are changed by user generated reviews in Web 2.0.
According to Razorfish, 2008 the large majority of consumers (61%) rely on user reviews for
product information and research, with a much smaller group (15%) preferring editorial reviews.

The sites like www.ebay.com , www.amazon.com would have never reached such highs if not
the successful development of consumer review/feedback strategies and technologies. The Web
2.0 brought a greater transparency to these sites generating a bigger interest for content
contributors (recognition need) and the trust amongst the consumers.

This type of social media sites have a huge influence
on consumer‟s purchasing behavior as most of them
are developed for exactly this purpose – to help
making the right purchasing decision. According to
Internet consumption report (Soumokil, 2008) such
type of content is really welcomed by customers as
64 % of internet users desires “user ratings/reviews”
and 59 % is looking for “product or price
comparison tools” on the net (Figure 2.8 ). From the
marketers perspective such sites provide a direct
opportunity to influence the consumer‟s purchasing
choice. Carefully developed social strategy could
affect the talks about their brands and services.
Finding and influencing the opinion leaders on such
networks could be a key objective in communication
strategy.
Figure 2.8 Most visited websites

Source: Soumokil (2008).

2.3 Consumer 2.0 - “Web 2.0 citizens”

―As powerful as it is technology is just enabler and it‘s the technology in the hands of almost
always connected people that make it so powerful‖
(Blume, 1996; citied in Li and Bernoff, 2008)

A decade ago Raaij (1998) identified that social and technological developments will create new
options and possibilities for consumers and will bring some real changes for marketing
managers. For the past 18 years the active discussions have taken place in marketing literature
analyzing the relationship of postmodern marketing, semantic web, interactivity, tribes and
changing consumer behavior (Raaij, 1998; Flart et al, 1995; Cova 1997; Constantinedes, 2004;
Simmons, 2008), but only today the discussed thoughts embrace their real meaning. The mass
acceptance of the Web as social medium is the biggest recent change in internet behavior which
allows the postmodern marketing concepts to flourish (Razorfish, 2008). These changes in
postmodern marketing era are mostly driven by the new consumers. Digital natives, Millennials,
Generation Y it just a few names often met in marketing literature, describing the new generation
of tech-savvy, success driven, self-confident, independent but community-minded people
(Deloitte, 2005). According to Tapscott (2008,) that it is the first global generation ever which is
smarter, quicker and more tolerant of diversity than their predecessors. Millennials never
experienced life without computers and are just a click away from the world any minute. The
reverse accumulation of knowledge is typical for them - the younger they are, the more they
know (Deloitte, 2005). Tapscott (2008) identifies eight norms that define Net Geners:
They value freedom and choice in everything they do.
They love to customise and personalise.
They scrutinise everything.
They demand integrity and openness, including when deciding what to buy and where to work.
They want entertainment and play in their work and education, as well as their social life.
They love to collaborate.
They expect everything to happen fast.
They expect constant innovation.

Moreover, Deloitte (2005) suggest that Generation Y is impatient, needs the flexibility and space
to explore, wants to produce something worthwhile and seeks to make a difference in order to be
rewarded with a respect. This generation fits well the description of postmodern consumer which
lacks the commitment to grand projects and seeks different experiences, and is willing to see
oneself as a (marketable) object in the different situations s/he encounters in order to make each
a supremely exciting and enjoyable experience (Flrat et al., 1995)

Even though, they are not the only ones affecting the marketing environment. So called “digital
immigrants” (Palfrey and Gasser, 2008) or fast adapters of the technology arguably might have
even bigger influence on the on going changes in marketing as they are aware about the changing
situation and they have a power, knowledge and resources to influence this phenomenon. As
both of these consumer groups are very important for marketers they could be grouped under one
term of - Web 2.0 Citizens.

Web 2.0 Citizens worries marketers as their consumption patterns and the perception of the value
are evolving and the old marketing models are not working on them. Wipperman (Trendbureo,
2008) argues that the Maslow‘s pyramid of needs is changed with the closed loop (a feedback
loop) where in the process that is never completed self-actualization remains the individual‘s
basic motivation and is increasingly coming to the means of self-optimization (Figure 2.9).

Figure 2.9. The closed loop of needs.
Source: Trendbureo (2008)

The changing needs affects buying behavior what makes it difficult for marketers to target the
consumer, especially when the new consumer takes the initiative for transactions, at the place
and time they want, what has considerable consequences for the distribution of goods and
services (Raaij, 1998). Easily satisfied psychological and safety needs moves the postmodern
consumer onto the search for social and self-actualizing experiences. The consumption becomes
a way for individuals to creatively appropriate and construct self-images that allow them to
become more desirable or likeable in various social contexts (Dawes and Brown, 2000;
Goulding, 2003). Constantinides and Fountain (2008) argues that in social web era consumer
preferences and decisions are based on new inputs provided by parties beyond the control of
online marketers: peer reviews, referrals, blogs, tagging, social networks, online forums and
other forms of user-generated content uncontrollable by the marketers. These content creating
people are keen in building online communities, in order to satisfy their social, self-esteem and
self-actualization needs. According to Kim (2000) (cited in Bowman and Willis, 2003) the
hierarchy of needs differ between offline and online communities (Figure 2.10)

Table 2.3: Online community needs
Source: Bowman and Willis (2003)

In the post-modernity period which encourages a move away from individualism towards a
search for more social bonds, these communities tend to reorganize themselves into neo-tribes,
networks of people gathering homogeneously together for social interaction, often around
consumption and brands (Simmons, 2008). From the marketers perspective it is very important
to consider tribal relationships as it may be a powerful tool in building loyalty and trust among
the consumers. Even though neo-tribes and brand communities are two different concepts they
share very similar features and often are very related to each other. According to Cova and Cova
(2002) the main differences are that the brand communities are explicitly commercial whereas
tribes are not, furthermore, brand communities are concerned about relationship between brand
and consumer, whereas tribes – relationship between consumers. Muniz and O‟Guinn (2001)
(citied in Ouwersloot and Odekerken-Schroeder, 2008) describes a brand community as a
specialized, non-geographically bound community that is based on a structured set of social
relations among admirers of a brand. Mairinger (2008) suggests that:

The brand community is not just formed around a brand; it creates the brand.
The brand community is not just formed around a product; it is part of the product.

Therefore, the creation and development of brand communities is one of the most important
tasks of the marketer as it can guarantee the company success in the long term. According to
Mairinger (2008) brand communities can add real experiences and emotion to the brand, reach
the long tail, address both individualism and collectivity needs and replace the celebrity
endorsers with community brand advocates. Considering that 49 % of people made a purchase
based on friends recommendations on social media property (Razorfish, 2008), social media can
be viewed as an important channel and tool to interact, manage and enable these brand
communities.

Communication process

Changing consumers requires different communication approach from marketers. According to
Tapscott (2008) Web 2.0 citizens do not accept the one-way communication approach because
they have been immersed in two-way communication from childhood or their growing
frustration with traditional communication approaches has reached the maximum limit.
This media literacy evolved into digital media literacy and let the audience to manage and select
their own exposure to marketing messages (Meadows-Klue, 2008). Therefore, a power shift can
be observed from the sender (advertiser) to the receiver (consumer) where communication
obtains a service-oriented (experience creating) rather than a persuasive role (Raaij, 1998). Flrat
(Flrat et al., 1995) argues that in emerging postmodernity the consumer may be finding the
potential to become a participant in the customization of his/her world by immersing her/himself
as an object into the world of objects, instead of trying to maintain a position that is privileged to
and detached from the objects. Therefore, marketing has to include the consumer not as a target
for products but as producer of experience. Creating and sharing positive experiences
becomes more important than just sending simple messages to the consumer. Constantinides
and Fountain (2008) argues that changing communications has to consider the new factors
influencing the decision making process of the consumer (online uncontrollable marketing
factors) (Figure 2.10).

Figure 2.10 Uncontroled marketing stimuli – Web 2.0.
Source: Constantinides and Fountain (2008)

Changing customer‟s perception of value affects the communication process as it is difficult to
create suitable value proposition and target the consumer. Lawer and Knox (2006) identifies the

Figure 2.11. The new drivers of value.
Source: Lawer and Knox (2006)

new drivers of value (Figure 2.11) which has to be considered when planning communication
strategy. Moreover, as the lines between consumers and producers disappear the value is gained
trough completely different experiences where consumer becomes a producer – prosumer.
Creativity and co-creation engages consumer, especially when it happens in neo-tribes or brand
communities where the consumer can share the experience with others. As a result, the service
or product itself can be modified in order to enable the consumer to take a part in co-creation
process and guarantee a positive word of mouth for the company. Lawer (2006) proposes eight
styles of company-consumer value co-creation (Appendix 7). From the social media perspective,
the people could be divided in 6 social technographic profiles according to their participation
level (Li and Bernoff, 2008):

"Creators" - Publish a blog/website; upload created videos/music; write articles or stories and post them;
"Critics" - Post ratings/reviews; comment on blogs and forums; contribute to articles or wikis;
"Collectors" - Use RSS feeds, add tags to web pages or photos;
"Joiners" - Maintain a profile/ an account on social media site (Social network, Content community);
"Spectators" - Read blogs or customer reviews, watch video or listen to audio (podcasts);
―Inactives‖ – None of these activities.

It is important to understand how social technologies are being adopted by the company‟s
costumers as according to consumer‟s profile the social strategy could be adopted (Li and
Bernoff, 2008). Especially, marketers should be concerned about “Creators” as they are most
likely to be the trend setters / brand evangelists (opinion leaders). Hoegg (Hoegg et al., 2006)
summarized the participation model of a Web 2.0 (Figure 12).

Figure 2.12. Participation model of a Web 2.0 service
Source Hoegg (Hoegg et al., 2006)

Chapter 3: Procedures and Methodology

3.1 Description and justification of the methods

There are two general types of the research approaches: scientific and ethnographic. According
to Maylor and Blackmon (2005) the scientific (or objective) approach is more concerned with
understanding the general patterns of people‟s, organisations‟ and social systems‟ behaviour as
an opposite to ethnographic (subjective) approach which is analyzing practises more than
theories in greater depth and more at individual level. Moreover, the scientific studies are based
on deductive logic and focused on testing theories and then arriving to the new knowledge rather
than creating the knowledge in the process of the research (inductive).

This research can be considered as a theory-led scientific study, since the main objective of this
research is to verify a set of theories that describe “what” is changing in the marketing
communications environment and analyze consumer‟s behavior according to these hypotheses.
It could be viewed as knowledge verifying study and an extension of similar researches done in
the USA market. Even though it is considered to be scientific research there are some
appearances of ethnographic inductive logic. Maylor and Blackmon (2005) suggests that some
times when there is scarcity of data it may be an acceptable to use two research approaches in
one study. Sometimes it may not be possible to develop any hypothesis at all, if it is being
investigated for the first time as there are no previous data is available (Bhojanna, 2007).
Therefore in this study, because the research subject is relatively new, the literature review was
dedicated not to generate hypothesis, but to build-up the theory itself and to prove that in
changing media landscape there are new marketing communication tools and channels requiring
greater consideration and that chosen hypothesis are valid. Furthermore, the findings in the
literature review were adopted in data analysis.

The main reason why the scientific paradigm for this study has been chosen is its cooperation
with quantitative methods of the research. The quantitative research strategies are used to count

and measure the data in order to answer the questions “what”, “where”, “how”, “how many: and
“how much” as an opposition to qualitative research questions “why” and “how”. There is a
debate going on whether qualitative or quantitative research is better, but according to Maylor
and Blackmon (2005) both qualitative and quantitative research have their advantages and
disadvantages and are used for different purposes.

The success of the quantitative study is based on the validity of the data and statistical
significance of the results that could be generalized. Therefore, appropriate data had to be
collected and processed. According to Maylor and Blackmon (2005) a suitable way to verify the
research hypotheses and capture opinions, behaviors, attitudes and facts is doing a survey. In a
result, according to sample size and time frame the self-administrated online questionnaire
method was chosen for conducting the survey. In the short time frame it is considered to be one
of the best tool‟s to gather large amounts of valid data.

3.2 Research design

3.2.1 Research procedure

In order to guarantee successful implementation of the research project the Gantt‟s Chart was
drawn to identify the main tasks and the time frame (days) assigned for them (Graph 1).

Figure 3.1. The activities list of the project

Studying and Personal Experience

Desk study (Secondary data analysis)

Prime literature
review

In-depth literature review

Writing

Designing the Questionnaire

Pilot Survey Survey

Analyzing the data and
presenting the findings

June July August September October November December January

Figure 3.1. Research procedure in Grants chart.

3.2.2 Primary and secondary data

Malhotra and Birks (2003), states that an appropriate data collection method contributes to the
successfulness of research project. There are two types of data: primary data collected in the
process of the study by the researcher; and secondary data – which have been already collected
and analyzed by others (Ghauri et al, 1991). Both sources of data should be used to achieve
efficiency and effective research objective. The secondary data provides an ability to save time
and money, therefore it has to be analyzes first before the collection of the new material. The

primary data have to be collected as well, as the secondary data may not always provide the
needed answer to all research quesions (Ghauri, 1991).
In order to answer the research questions the primary and secondary data were used in this study.
First of all, to discuss the reasoning behind the hypothesis literature review was performed which
analyzed secondary data. The data was collected from various academics‟ and practitioners‟
sources. Because of the scarcity of data in the academic literature some of the most valuable
information was gained through the community of marketing bloggers and research reports by
individual companies. The academic articles and research papers, books, published case studies,
academic and industrial magazines or solitary articles where used to generate a broader view on
the subject.

In order to answer the main research question and to test the hypothesis proposed in the
introduction the primary data was collected through the web survey (self-administrated
questionnaire were used). It enabled researcher to apply statistical analysis methods for the
study.

3.2.3 The Questionnaire design

According Easterby-Smith (1991) within the short time frame and limited resources a self-
administrated questionnaire is the most appropriate method to collect data for research. Maylor
and Blackmon (2005) suggest that in order to gather appropriate data with a questionnaire, the
design and planning are the vital parts. In order to produce a reliable questionnaire and minimize
biases in the research, the designer has to consider three areas main issues: the wording of the
questions, the appropriate categorization of variables and the general appearance of the
questionnaire (Sekaran, 2003; Appnedix 3.1). Therefore the wording of the questionnaire was
constructed considering the similar consumer surveys in the US market (Cone, 2008, Technorati,
2008, Razorfish, 2008, Forecaster, 2008). The simple commonly used expressions and terms
were used in order not to confuse respondents. The general appearance of the questionnaire was
selected from pre-designed themes for thesis type surveys suggested by the web portal providing
the surveying services (Surveygizmo.com)

In this research, the Questionnaire consisted of 4 sections. The questions in the first section (Q 1-
3) were designed to gather general socio-demographic data about the respondents. The second
section (4-8) of the questionnaire was determined to define the general consumers profile in the
UK. The third section of the of the questionnaire (Q 9-16) was designed to test the Consumer -
Web 2.0 applications - Company relationship. The fourth section of the questionnaire was aimed
at comparison of social media and traditional media (Q 17-19). In order to gather necessary data
different types of questions were chosen. The closed-ended question was mostly used in this
research in order to gather defined answers. Even though, in some questions the combination of
closed-ended and open-ended question were used in order to leave a possibility for respondents
to identify additional concerns. Moreover, Likert scale questions were used to test some
commonly known statements about the social media and gather the data about consumers
attitudes and behaviors.

3.2.4 Target population and Sampling design

According to Maylor and Blackmon (2005) the choice of the sample and correct sampling
methods are one of the key factors in gathering valid and measurable data for the research.
Malholtra (2003) suggests the five steps for sampling design:
define the target population,
determine the sampling frame,
select the sampling frame,
determine the sample size
execute the sampling process.

The target population was chosen considering the objectives of this research. As a result, only
the people who have ever used Social Media properties were considered as possible respondents.
Moreover, due to limited data about the total number of social media users in the UK, and short
time frame and the budget, only the Londoners were considered for the research. The biggest
social networking website Facebook.com which represents almost all Web 2.0 features in one

site was chosen to do the research. It created the sample frame as Facebook does not represent all
social media users in the UK, even though, according to the Hitwise (2008) Facebook.com is the
second most visited website in the UK and as there are no better alternatives it can be taken as a
yardstick of social media users for this research. According to Facebook.com, there are around 8
millions UK users registered to the Facebook.com, from which 3 240 961 are identified as
Londoners (almost a half of all population of London!). This sample frame was used to define
the sample size needed to collect appropriate and valid data for the research. According to
Maylor and Blackmon (2005) if there is an accurate sampling frame and the probability sampling
methods are employed there is a better chance to reduce the sampling error. Therefore,
probability simple random sampling method was applied in this study. Since each research is
distinctive, sample size can be subject to each study unique population, data collection tool and
objectives (Malhotra and Birks, 2003). In order to represent the target population (Web 2.0
Citizens) sample size of 100 respondents was chosen.

3.2.4 The Pilot Study

In order to conduct reliable and valid research the Pilot study has to be performed before the
actual research. According to Malhotra and Birks (2003) the completion of the pilot study will
lead to the identification of problems that are likely to arise with the questionnaire. Moreover,
Veal (1997) suggests that the purpose of pilot survey is to check the following problems:
1. Questionnaire wording
2. Questionnaire sequencing
3. Questionnaire layout
4. Familiarity with respondents
5. Test fieldwork
6. Train and test fieldworks
7. Estimate response rate
8. Estimate interview e.g. Time
9. Test analysis procedure

Therefore, the Pilot study was preformed a month before the starting date of the real survey. As
Chisnall (1997) suggests, the arbitrary size of a pilot survey is often taken at about 10 percent of
the main survey. As the chosen sample size was 100 people, to the pilot study was sent to 10
random respondents on the London Network on Facebook.com and left for one week in order to
get needed response. Four respondents have completed the survey in two weeks time, and just
three of them filled it correctly, it suggested the possible response rate of 40 % (a bit lower than
expected). Nevertheless, two of the respondents have replied the message sent with the survey
link and commented on the survey. According to theses comments questionnaire was reduced to
19 questions (from 25) and the wording was adjusted to some of the questions as some of the
terms used was unfamiliar for the respondents.

3.2.5 Reliability and Validity

As the questionnaire is a highly structured data collection tools, limiting the powers of the
researcher, the design of questionnaire should include three characteristics (Bhojanna, 2007):

1. Validity: validity is the most critical criterion and indicates the degree to which an

instrument measures what it is supposed to measure. Validity can also be thought

of as utility.

2. Reliability: reliability means, measuring instrument should provide consistent results,

even if it is measured repeatedly.

3. Practicality: measuring instrument must be economical and easy to use by the

researcher. That means, researcher must be able to measure what he intends to

measure.

ANOVA analysis was used as the main tools to test hypothesis. According to Maylor and
Blackmon (2005) this type of analysis guarantees the reliability and practicality. 5 % of
reliability coefficient was used to test the data for single and two factor analyses. The P and F
values were used as the main determinants of the significance of the data.

3.2.5 Fieldwork

As mentioned earlier, the survey was conducted on social networking site Facebook.com. After
completion of the pilot study it was decided to run the survey for 3 weeks period, due to
considered possibility that some of the respondents might not be checking their accounts or
messages very often. According to the suggested response rate (40%) by the pilot survey, 400
messages with the survey link were sent to random members of London Network with the intent
to receive 101 filled surveys. The random selection was facilitated by Facebook as there is a
feature allowing to see and contact randomly sorted members of your network
(Settings>Account settings > Netwroks>London). 101 responses have been received, from which
48 males and 53 females.

Chapter 4: Data analysis and results

4.1 The consumer profile of Web 2.0 Citizen in the UK

In order to achieve the “Aim 1” and create a general consumer profile of SMP in the UK, the
answers to the questionnaire were analyzed. The first question was designed in order to find out
the dominating sex on the UK social media properties. As it seen in the Figure 4.1 the sex
distribution among users is very similar, but female users outweigh the males in the UK.

Figure 4.1 The sex of the social media users in the UK

As shown in the Figure 4.2 the respondents from 25 - 34 age group where most keen in
participating in the survey followed by 15 -24 year olds. It is possible to make an assumption that
theses two groups are the main users of SMP, even though it can not be stated for certain as the

Figure 4.2 The age groups of the social media users in the UK

results might be affected by the survey distribution method.

According to the survey results the majority people using social media properties are on the
middle income or less, as most of them falls into the £10 000 – 25 000 group or under (Figure
4.3). Even though 20 % percents of respondents, have claimed about receiving £25 000 – 45 000
a year, what means that there are a few different segments in the market.

Figure 4.3 The social media users by income.

4.1.1 What Social Media Properties are they using?

The most popular type of social media property amongst UK users is “Content communities”
(30%). Not so far behind goes “Social Networking” (26%) and “Blogs” (22%). According to the
survey results “Micro Blogs” still have not found its users, with just 6 % of all respondents using
it. Surprisingly, “Opinion networks” are not very popular among UK users (5%) as on another

Figure 4.4 Most popular Social media properties in the UK

hand “Content aggregators” are finding their way to success (11%).

The research results complement the McCann (2008) findings. Even though, McCann report
(2008) stated that blogs and blogging are the main sites used by almost all Internet users within
the UK, according to this research it might not be necessarily true. But as the subject of the
research and determinations differ, the outcomes of the research might be different as well.

4.1.2 Where and How are they using Social Media Properties?
It possible to make an assumption that social media has spread into the main daily routines as
97% of all respondents are using it “At home” and 44 % using it “At work”. 15% of all
respondents are using these applications or sites “On the go”, what means that social media gains
popularity on different platforms. Another interesting fact is that according to survey results 38%
of people using SMP “On the go” use social networks on these platforms (mobile phones, iPods),
what partly confirms previous statement made in the literature review (Web 2.0 applications has
an influence on the development of other platforms).

Figure 4.5 Where are you using social media properties?

The research results suggests that people using SMP in the UK are spending slightly more time
compare to US users, as 33 % are spending 1–3 hours a week and 32 % are spending 4-6 hours a
week (compare to 34.87 % and 20.76 % in the US). Even more surprising is that almost 10% of

respondents are spending more than 20 hours and only 5% are spending less than an hour a week
on social media properties.

Figure 4.7 Time spent on SMP (a week) in the US
Figure 4.6 Time spent on SMP (a week) in the UK Source: Razorfish (2008)

Most of Web 2.0 citizens consider themselves as “Joiners” (42%), from what the assumption can
be made that social media is still quite new trend for most of the people in the UK market.
Nevertheless, surprisingly almost 17% from all respondents state that they have crated the
content on SMP what means that there are quite a few very active users in the UK.

Figure 4.8 Technographic profile of Web 2.0 Citizens in the UK

Comparing to the similar research (Li and Bernoff, 2008) in the US (Appendix 4.1) even though
the research approach was different the similarities can be found in the usage patterns, as
“Joiners” and “Spectators” are leaders in the technographic ladder in both countries.

According to the research results in general consumers prefers UGC (27%) rather than company
provided content (15%), but most of them see no difference (31%) between them or wants a
mixture of both (27%) (Appendix 4.2). Friends‟ recommendations (42%) have the biggest
influence on the decision to interact with the company (Appendix 4.3). Furthermore, 76% of all
respondents indentify the relevance of the content and frequency (46%) as the main reasons to
stay engaged with the company (Appendix 4.4). Moreover, the 73% of the respondents‟ states
that personal satisfaction (52%) and personal development are the important reasons to stay
engaged in the conversation (Appendix 4.5). According to survey, the interactions in social
media with the company generate new interactions and recommendations (Appendix 4.6). The
results suggest, that the shortage of time and privacy concerns is the biggest obstacles to interact
with the company (Appendix 4.7). Nevertheless, all these features still differ among various
consumer groups.

4.2 The thechonographic profiles of the UK social media users

Creators
As was mentioned in the literature review the “Creators” group should be in the biggest interest
of marketers as they are most likely to spread the word of mouth (wom). According to the
research results 72% of “Creators” prefers to interact with user generated, but 22% prefers a
mixed content (Compny and UGC). Also, marketers have to take in to the account that 50% of
the “Creators” are likely to make a first step towards interaction with the company, as another
40% will wait for the company‟s initiative. Moreover, 58% percent from all “Creators” would
recommend the company to their peers, what partly confirms the earlier statement about the
wom.

Figure 4.9 Mostly likely actions after the interaction with the company on SMP by “Creators”.
The “Creators” are most likely to use blogs (33%) as they way of interaction with social media.
17% of creators are using micro blogs and content aggregators. Surprisingly, just 11% of this
group has stated that they use social networks as their main SMP and none of the respondents
have mentioned opinion networks.

Figure 4.10 The SMP used by “Creators”.

Joiners
The biggest group of the Web 2.0 Citizens on the net is “Joiners”. It should be in a particular
interest of marketing professionals as they could be a target for the mass messages on the social
web. Not surprisingly 37% of “Joiners” are spending their time on content community sites and
35% are social networks as their main SMP.

Figure 4.11 The SMP used by “Joiners”.

Figure 4.12 The content preferred by “Joiners”.

“Joiners” are mostly interested in mixed content (34%) and 33% state that there is no difference
who provides the content. As a result, the assumption can be made that “Joiners” are vulnerable
to company‟s communications on the SMP as this group is busy consuming without particular
interest about the kin of the content. Moreover, 34% prefer company‟s initiative to make a first
step in conversation and just 22 % are willing to look for the interactions themselves, while the
influence from peers are the most important power pushing to interaction (44%). On the other
hand privacy (21%), poor content (17%) and time (26%) are the main obstacles stopping the
“Joiners” from interacting on SMP. Marketers should be concerned how to overcome these
problems, especially by improving the quality of the content.

Figure 4.13 The obstacles to interact on SMP (“Joiners”).

Spectators
Similarly to “Joiners”, the “Spectators” are most likely to be found on content communities
(29%) and social networking (33%) sites. 17% of “Spectators” enjoys interacting with
blogosphere and quite surprisingly 17% are active users of opinion networks, from what the
assumption can be drawn that “Spectators” are keen into the research process. (i.e. researching
the product reviews).

Figure 4.14 The content preferred by “Spectators”.

As can be seen from the Figure 4.14 there is even smaller difference in terms of content
distributor for the “Spectators” (42% states – No difference). Nevertheless, the UGC and a
mixture of the distributors are quite favorable by them. Moreover, recommendations have a
major impact on them, as 67% state that they would try to interact with the company if their
friends would recommend doing so (21% Myself, 12% Company). In order to keep the
“Spectators” engaged the company has to consider the factors mentioned in the Figure 4.15, as
can be seen the “Spectators” are more likely to consider all factors equally rather than “Joiners”.


Critics
Even though the “Critics” amount for a small percentage of all Web 2.0 Citizens, they are quite
important for marketers because “Critics” are most interested in mixed (40%) and company
content (30%). Moreover, 60 % of this group states that they are willing to see the company
initiating the interactions with them.


Interestingly, the favorite SMP amongst “Critics” are blogs (40%) and content aggregators
(30%), followed by micro blogs (20%). Critics are heavy users (40% states, that using SMP 20
hours or more) and assumptions can be made that “Critics” are likely to interact more than other
groups from technographic ladder, except “Creators”.


In order to catch the attention and stay engaged with the “Critics” company has to consider the
factors show in the Figure above (4.17), wich are quite similar for another technographich group
of “Collectors”.

Collectors
Similarly to “Critics”, the “Collectors” likes to interact with company provided content (29%) or
see no difference (71%) with which type of content to interact with (no other responses!). As
found in the literature review, that the content is the new message, therefore, in order to
successfully interact/communicate with “Collectors” marketers has to consider the reasons why
are they using SMP (Figure 4.18) and provide suitable content accordingly.


The “Collectors” are using content communities (29%) and content aggregators (29%) as their
bridge to social media world. Therefore, marketers considering opportunity to approach the
“Collectors” should actively participate on these platforms.

Figure 4.19 The SMP used by “Collectors”.

2.3 The influence of Social Media on the UK consumers and
“Traditional” media

In order to answer the “Aim 2” of the research and to evaluate the influence of Web 2.0
applications 6 hypothesis were tested. The “Hypothesis 1” was intended to demonstrate that the
interactions through Web 2.0 applications generate positive outcomes for the company. The
usage of Social Media Porperties (Q5) was compared with the consumer actions after the
interaction with the company (Q15).
H0 : There is significant relationship between Social Media Properties used and the actions taken after the
interaction.
H1 : There is no significant relationship between Social Media Properties used and the actions taken after
the interaction

The single factor ANOVA analysis results showed (Appendix 4.8) that there is a significant
relationship between the answers (even though quite small as p value is close to 0,05). As a
result the second (H1) hypothesis was deducted and the assumption was made that there is a
relationship between different SMP used and the positive outcomes after interaction, but it is
quite small. Even though, as F>F crit (7.807202 > 2.71089), there is a very strong relationship

Social Media in the UK - MA Dissertation

Social Media in the UK - MA Dissertation

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