The Impact of Social Media Marketing Medium Toward Purchase Intention and Brand Loyalty Among Generation Y

Procedia - Social and Behavioral Sciences 148 ( 2014 ) 177 – 185
Available online at www.sciencedirect.com
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1877-0428 © 2014 Published by Elsevier Ltd. This is an open access article under the CC BY-NC-ND license
(http://creativecommons.org/licenses/by-nc-nd/3.0/).
Selection and peer-review under responsibility of the 2nd International Conference on Strategic Innovative Marketing.
doi: 10.1016/j.sbspro.2014.07.032
ICSIM
The Impact of Social Media Marketing Medium Toward Purchase
Intention and Brand Loyalty Among Generation Y
Bamini KPD Balakrishnan*, Mohd Irwan Dahnil, Wong Jiunn Yi
School of Business and Economics, Universiti Malaysia Sabah, 88400 Malaysia
Abstract
Social media has become the modus operandi of the 21st century. Building on the foundation of Web 2.0, social media
applications have facilitated unprecedented growth in human interaction in modern times. This study attempts to study the
impact of social media marketing medium toward brand loyalty and purchase intention in Generation Y. Surveys are
conducted randomly and questionnaire distributed to undergraduate students of Malaysian universities. Two Hundred
questionnaires were distributed with 75 percent response rate. Two propositions and three hypotheses were developed and
tested using mean and regression analysis. The result indicated that the online marketing communications, specifically, E-
WOM, online communities and online advertisement are effective in promoting brand loyalty and product purchase intention
through company website and social media platforms. These finding indicate to marketing managers that social media
marketing medium has become an important marketing tool to reach emerging younger generation consumers. It also
indicates that cyber world play an important role in modern marketing, enabling marketers to reach customers faster and more
efficiently. This research provides a guideline for global brand players in considering applying social media marketing
activities to promote their product, and brand.
© 2014 Published by Elsevier Ltd.
Selection and/or peer-review under responsibility of The 2nd International Conference on Strategic Innovative Marketing.
Keywords: Brand Loyalty; purchase intention; E-WOM; online advertisement; online communities
* Corresponding author. Tel.: [phone]; fax: [phone].
E-mail address: [e-mail]
1. Introduction
Notably, social media usage is being increasingly embraced by Generation Y “Boomerang Kids” (Beresford
Research, 2009; Kaplan & Haenlein, 2010) The world has changed dramatically since the dawn of the Internet,
moving from one where a destination could create a web page and use it in the same fashion as one might an
online brochure; to one where users generate their own content. The study of social media in the context of
© 2014 Published by Elsevier Ltd. This is an open access article under the CC BY-NC-ND license
(http://creativecommons.org/licenses/by-nc-nd/3.0/).
Selection and peer-review under responsibility of the 2nd International Conference on Strategic Innovative Marketing.

178 Bamini KPD Balakrishnan et al. / Procedia - Social and Behavioral Sciences 148 ( 2014 ) 177 – 185
destination entities is evolving as researchers seek to better understand what travellers expect and how they
behave in the environment of Web 2.0. In effect, our platform for sharing has shifted from one where individuals
meet primarily face-to-face to one where people meet online using technology.
Thus social media becomes a hub for market intelligence as marketers begin to understand consumer’s
purchasing behaviour and gain insight as to why consumers feel the way that they do about certain brands
(Rockendorf, 2011). These opportunities allow the marketer to create dialogue with the consumer, fine tune the
marketing message and maintain the brand’s presence in online market places (Evans and McKee, 2010).
This article examines the role of online advertisement, online communities, and E-wom influencing
consumer’s brand loyalty and intentions to purchase. The remainder of the paper is organized as follows. In
section 2 there will be literature review, section 3 describes the theoretical framework highlighting research
questions and hypotheses, section 4 explains the research methodologies used in the study followed by
presentation of results and analysis. Finally, the paper is concluded with a discussion, limitation of the study and
description of future work in Section 5.
2. Literature review
Word of Mouth is the powerful tool to influence people and also can influence their buying behavior. This
can be proved according to (Richins & Root-Shaffer, 1998) stated that Word of Mouth has been shown to play
major role for customers’ buying decisions. According to Hennig-Thurau et al. (2004, 39) define online Word of
Mouth as being: “ Any positive or negative statement made by potential, actual, or former customers about the
product or company which is made available to a multitude of people and institutions via the internet”. While as
consumers are increasingly using the Internet and social media tools such as Facebook, Twitter, Blog, Flickr, and
so on. According to Cheung et al. (2008) more and more consumers use Web 2.0 tools such as online discussion
forums, consumer review sites, weblogs, and social network sites to exchange product information. Online Word
of Mouth can provide the opportunity to consumers to read other consumers’ consumption opinions and
experiences as well as write contributions by themselves.
Forum are online communities formed around a specific interest (Pitta and Fowler, 2005; 266) and are usually
divided into specific topic areas. For the product information, they can post their opinion whether they satisfied
after they consume the product. Within each area, users can start forum threads about different topics, and these
threads can continues for years, allowing newcomers to read the previous communication within the forum and
learn from wider knowledge base (Pitta and Fowler, 2005; 265).
Online advertisement works very quickly given the fact that the day that one gets started is the same day that
results manifest. There is basically neither waiting period nor long startup process. Once an entrepreneur is ready
to get started, he/she can very easily launch a successful advertisement promotion on a number of channels.
Loyalty is a core dimension of brand equity. Aaker (1991, p. 39) defines brand loyalty as the attachment that
a customer has to a brand. Grembler and Brown (1996) describe different levels of loyalty. Behavioural loyalty is
linked to consumer behaviour in the marketplace that can be indicated by number of repeated purchases (Keller
1998) or commitment to rebuy the brand as a primary choice (Oliver 1997, 1999). Cognitive loyalty which means
that a brand comes up first in a consumers’ mind, when the need to make a purchase decision arises, that is the
consumers’ first choice.
While purchase intention referred to the subjective judgment by the consumers that is reflected after general
evaluation to buy products or services (Hsu, 1987; Dodds et al., 1991; Blackwell et al., 2001 and Shao et al,
2004). There is several meaning from the statement, which is: (1) consumer willingness to consider buying, (2)
buying intention in the future, (3) decision repurchase. Other than that, purchase intentions refer to the degree of
perceptual conviction of a customer to purchase a particular product (or service).
2.1 The Relationship Between Brand Loyalty and Online Word of Mouth (E-WOM)
Shi Nia, stated “brand loyalty exerts a decreasing incremental effect on positive eWOM intention. In addition,

179Bamini KPD Balakrishnan et al. / Procedia - Social and Behavioral Sciences 148 ( 2014 ) 177 – 185
satisfaction has an increasing incremental effect on brand loyalty. The linear relationship proposed in the model
is also supported by the results. Community commitment is confirmed to have a linear and positive effect on
brand loyalty”.
2.2 Brand Loyalty and Online Advertising
Anita Agrawal and Siddharth, “advertising becomes an excessively important aspect for producing brand
loyalties. The internet gives the chance to the e-marketer to increase sales by capitalizing on brand loyalist of
other companies by advertising and creating relations on other loyalist eccentric websites (cited in Leland
Harden, & Bob Heyman, 2009: 196). The volume of revenue expenditure for such internet advertisement is
burgeoning every year.
2.3 Brand Loyalty and Online Communities
As online communities continue to grow in media market, Niels Kornum stated, “the analysis shows that
online brand communities are able to build brand loyalty. The process of brand loyalty creation involves several
variables amongst which are brand attachment and community commitment. Community members‘commitment
to the community results in additional attachment to the brand around which the community is centered and
ultimately leads to repurchase intention and positive word of mouth. Another variable, identification with the
community, is found to be a precursor of community commitment and further has an indirect effect on brand
attachment through psychological sense of brand community”.
2.4 Purchase Intention and E-WOM
E-WOM has a significant effect on purchase intentions regardless of the type of virtual communities.
Explained Tseng, Kuo, and Chen in their study, which also stated that, “E-WOM was found to play a very
important role on purchase intentions. Furthermore, this study found that positive E-WOM is positively related to
purchase intentions and has a greater effect on purchase intentions than ads. The findings suggest that firms
should encourage members to share their knowledge or experience rather than just posting ads, especially in non-
transaction virtual communities. In addition, low-involvement ads have negative effects in virtual communities,
so firms should design high-involvement ads, such as virtual props, blogs, and rich media, to attract the attention
of potential customers”.
2.5 Purchase Intention and Online Advertising
Mohammed and Alkubise in their study among the Jordanian university students that stated, “With the
increased adoption ad fission of the Internet, World Wide Web is becoming gradually a standard advertisement
platform. The Web is offering business advertisement world with more rich media tools, interactive services, and
global reach. In an effort to explore the factors that affect online advertisement effectiveness, this paper
investigate the factors that influence online advertisement and hence the purchasing intention among Jordanian
university students. These findings can help business understand what matters more for a young country of
consumer in a developing country context. Thus, business can develop more effective online advertisement
campaigns”.
2.6 Purchase Intention and Online Communities
“Online social networking refers to the socialization activities that occur in the online environment when
Internet users group together to form online relationship,” said Haron’s and Razzaque’s in their study. The
emergence of these virtual communities provides platforms for online consumers to share and exchange ideas,