Impact of Social Media on Consumer Purchases: A Case Study of Tesco

This research project delves into the influence of social media on consumer purchases, focusing on Tesco as a case study. It explores the evolution of social media, consumer decision-making processes, differences between traditional and social media marketing, and the impact of social media on consumer behavior. The methodology includes research philosophy, approach, design, data collection, and analysis methods. The expected outcome anticipates a significant impact of social media on consumer behavior and purchase decisions.

Research project
1 | P a g e

Table of Contents
Project Title.....................................................................................................................................3
Chapter 1: Introduction/ background to the research area...............................................................3
Chapter 2: Literature review............................................................................................................5
2.1 Introduction................................................................................................................................5
2.2 Decision making process of consumers.....................................................................................5
2.3 Difference between social media marketing and traditional marketing....................................6
2.4 Impact of social media on consumer decision making..............................................................7
Chapter 3: Methodology..................................................................................................................9
3.1 Research philosophy..................................................................................................................9
3.2 Research approach.....................................................................................................................9
3.3 Research design.........................................................................................................................9
3.4 Data collection and analysis method.........................................................................................9
3.5 Timeline of research activities.................................................................................................10
Chapter 4: Expected Outcome.......................................................................................................11
Reference List................................................................................................................................12
2 | P a g e

Project Title: To what extent does social media influence consumers’ purchases? – A case
study of Tesco
Chapter 1: Introduction/ background to the research area
Social media had started out as a platform where people could share their photos and other life
events with their family members and friends; however, this platform has evolved substantially
and has become extremely important for business organizations. Social media now constitutes as
a chief component in the marketing strategies for business organizations, because of the increase
in usage of social media among consumers. Due to the presence of internet, people are more
connected to each other than ever before, and it is the same in the case of consumers and
business organizations. The number of households in Great Britain that have access to internet
has increased from 57 per cent in 2006 to 90 per cent in 2017. More than 73 per cent of the
adults now use internet on the go by using their Smartphones, mobile phones or tablets
(ons.gov.uk, 2018).
A high amount of time is spent by consumers on social networking sites in a month, and various
studies show that the purchasing behavior and decision making process of consumers change die
to the use of social media sites. Business organizations have started understanding the
importance of social media as a marketing tool, and use it to interact with consumers and gain a
competitive advantage (Hajli, 2014). It is important for Tesco to effectively use tools and
techniques related to social media marketing and judging how they influence the pattern of
purchase and decision making among consumers. If Tesco does not understand the impact of
social media on consumer buying behavior, it will result in limited growth prospect and
decreased market share.
The aim of this research is to understand the extent to which the purchases made by consumers
are influenced due to social media, so that appropriate marketing strategies can be implemented
by Tesco for increasing its sales. This research will help Tesco in understanding how they can
increase their sales by using social media sites for influencing the decision making process of
consumers. The main objectives of carrying out this research are:
 To understand the process undertaken by consumers for gathering information and taking
decisions before making a purchase at retail organizations like Tesco.
3 | P a g e

 To understand the differences between marketing through traditional means and social
media.
 To understand the changes that has been brought about by social media in different stages
of decision making process undertaken by consumers.
 To identify different social media marketing strategies that Tesco can implement.
4 | P a g e

Chapter 2: Literature review
2.1 Introduction
There has been a drastic change in the marketing landscape in the last decade. Companies did not
have a direct link to consumers previously, but the emergence of social media has led to changes
in the way interaction takes place between consumers as well as with business organizations.
Customers have a greater and more powerful influence on their peers because of word-of-mouth
and growing use of social media, which has changed the way in which decisions regarding
purchase are taken by consumers.
2.2 Decision making process of consumers
Consumers are the ultimate users of the products that are designed and sold by retail
organizations. Consumers are rarely fully loyal and committed towards a business organization,
but they can be turned into enthusiastic and repeat customers by influencing their decision
making process. The transparency and ease of accessibility of information has significantly
influenced the decision making process of consumers. The comprehensive consumer behavior
model that has been proposed by Engel, Kollat and Blackwell (EKB) has been analysed for
understanding the process undertaken by consumers for gathering information and taking
decisions related to the products that they want to buy. There are five steps involved in the
decision making process of consumers, which include:
Problem recognition – The process of purchase starts with a problem, need or motive that the
consumer has. Problem recognition can be triggered due to both external as well as internal
stimulus. An internal stimulus is triggered when a consumer has a need for something, while
external stimuli can be because of advertisements or discussions.
Searching for information – After identifying the problem, consumers do not buy products
directly, they identify the options that are available and find information regarding it.
5 | P a g e

Figure 1: The EKB decision making model
(Source: Darley et al., 2010)
Evaluating different alternatives – The alternatives that are determined from information search
are then evaluated to find which product will optimally suit their requirements (Jisana, 2014).
Taking final decision – Depending on the evaluation and information that has been obtained; a
final product is selected by consumers for consumption.
Post-purchase decisions – After the product has been consumed, satisfaction or dissatisfaction is
experienced by consumers. If the consumers are satisfied then they consider repurchasing the
product, and if the consumer is dissatisfied, then the entire process is repeated by them.
However, the level of consumer involvement differs for different products and services.
Extensive problem solving is undertaken when customers are highly involved in the purchase
process, and limited involvement is present for a few products in which simple or habitual
decisions are taken by consumers.
2.3 Difference between social media marketing and traditional marketing
Traditional marketing refers to different advertising and promotional campaigns that are being
used by business organizations for years. This includes the use of print ads on magazines and
newspapers, commercials on billboards, radio and TV, and giving flyers. Conversely, social
media marketing is a form of digital marketing in which business organizations attract consumer
attention or increase traffic on their website through social media sites like Twitter, Facebook,
YouTube and Pinterest (Heinonen, 2011). Even though traditional marketing continues to
dominate the marketing sector, social media is rapidly changing the marketing campaigns being
undertaken by business organizations. The increasing use of social media in the average daily
life of an individual is the major reason behind this. Moreover, there are several benefits of using
social media marketing because of which increasing number of business organizations have
started undertaking this method of marketing. This includes:
 Cost of social media marketing is much lower as compared to traditional marketing.
 It is easier to accurately evaluate the performance and success of social media marketing.
6 | P a g e

 Social media sites have a highly responsive and active community and business
organizations can easily reach and interact with a specific target market.
2.4 Impact of social media on consumer decision making
With the ease in the usage of household internet, social media usage has also increased. Along
with connecting with their friends and family members, consumers also use this platform for
creating close relations with the brands that they like. Different functions like plug-in
applications, becoming a part of consumer groups and following the brand on its social media
handles are undertaken by consumers.
Figure 2: Usage of household internet by region in Great Britain
(Source: ons.gov.uk, 2018)
One of the most effective tools of marketing for a business organization is word of mouth, and
this marketing tool has taken a new form after the advent of social media. Consumers use social
media websites for talking about brands and different products that have been used by them,
which influences the buying decisions of other consumers. Writing reviews on social media sites
has become a popular practice for consumers, and most of the potential customers prefer going to
7 | P a g e

the social media pages of business organizations for reading the reviews that have been posted
about them before taking a decision (Akar and Topçu, 2011). In fact, some often look for
reviews before even visiting the official website of the company, and the reviews play an
important role in the buying decision taken by them. Moreover, reviews act as word-of-mouth
publicity for business organizations, which lead to popularity of companies. Social media sites
allow consumers to share content and recommend products that they like or discuss about any
negative experience that they have had, which motivates or de-motivates other consumers from
buying the same product.
Social media sites provide consumers with the information that they require for taking decisions,
which shows that these platforms plays a significant role in the decision making process of
consumers (Ioanăs and Stoica, 2014). Moreover, increasing number of companies have started
undertaking social media marketing, which has resulted in increased awareness about brands
among consumers. Since consumers are more aware about different brands and the offers that
they provide, potential purchases are triggered. Social media has also enabled two-way
communication among consumers and business organizations as compared to one-way
communication enabled by traditional marketing. The response received by consumers from
interacting with these companies affects the reputation of the brand and influences their buying
behavior.
8 | P a g e

Chapter 3: Methodology
3.1 Research philosophy
There are several types of research philosophies that can be used by a researcher for conducting
the study in a logical manner (Williams, 2011). This includes pragmatism, interpretivism,
realism and positivism among others. Out of these, interpretivism looks at the qualitative aspect
and takes consumers’ feelings into account, while positivism looks at the quantitative aspect and
uses facts and figures for conducting research. Pragmatism research approach will be used for
understanding the influence of social media on consumer buying behavior, which uses multiple
or mixed methods.
3.2 Research approach
Out of deductive and inductive approaches of carrying out research, deductive research approach
will be used (Terrell, 2012). According to this approach, the outcome of the research is derived
by using the models and theories that have been previously proposed by other researchers.
3.3 Research design
Explanatory research design will be used for understanding the impact of social media on buying
behavior and decision making process of consumers. This research design has been chosen as it
does not use hypothesis for guiding the research (Venkatesh et al., 2013).
3.4 Data collection and analysis method
Primary data will be collected for carrying out this research, in which both quantitative as well as
qualitative research methods will be used for collecting and analyzing data. A survey will be
done by distributing questionnaires containing ten close-ended questions to retail consumers for
understanding their viewpoint. Qualitative research will be done by taking an interview of two
managers of Tesco, in which two questions related to social media’s impact on sales will be
asked. Analysis of the data that has been collected will be done by using graphs, charts and
tables, for getting a comprehensive view about the perspective of consumers.
9 | P a g e

3.5 Timeline of research activities
Particular First week Second week Third week Fourth week
Conducting
research about the
issue
Doing an analysis
of the data that has
been collected
Creating the
literature review
Understanding the
literature research
gap
Framing the
research project’s
aims and objectives
Undertaking
primary research
Collating and
evaluating the
collected data
Collecting and
analysing
qualitative data
Obtain a valid
conclusion
Submit the
research project
Table 1: Proposed timetable of activities
(Source: Created by the learner)
10 | P a g e

Chapter 4: Expected Outcome
From the literature review that has been written, it can be said that social media has evolved
significantly in the past decade, and it has changed the way in which business is conducted. The
results obtained from quantitative and qualitative research are expected to show that social media
has a considerable influence on the purchase behavior and decision making process undertaken
by consumers. Consumers have become social influencers because of the reviews posted by
them, as most of the prospective consumers’ prefer reading the reviews that have been posted by
other consumers.
Moreover, the presence of business organizations on social media affects the decision making
process of consumers, as social media sites constitute an important part in the lives of consumers
nowadays. If business organizations are active on social media, then it becomes easier for them
to convince consumers about their credibility, and consistent feed by these organizations helps
them in attracting more visitors and turning them into buyers. Strong and attractive feed
increases the ability of business organizations to attract followers, which acts as a chief
component in influencing purchase decisions.
11 | P a g e

Reference List
Akar, E. and Topçu, B., 2011. An examination of the factors influencing consumers' attitudes
toward social media marketing. Journal of Internet Commerce, 10(1), pp.35-67.
Darley, W.K., Blankson, C. and Luethge, D.J., 2010. Toward an integrated framework for online
consumer behavior and decision making process: A review. Psychology & marketing, 27(2),
pp.94-116.
Hajli, M.N., 2014. A study of the impact of social media on consumers. International Journal of
Market Research, 56(3), pp.387-404.
Heinonen, K., 2011. Consumer activity in social media: Managerial approaches to consumers'
social media behavior. Journal of Consumer Behaviour, 10(6), pp.356-364.
Ioanăs, E. and Stoica, I., 2014. Social media and its impact on consumers behavior. International
Journal of Economic Practices and Theories, 4(2), pp.295-303.
Jisana, T.K., 2014. Consumer behaviour models: an overview. Sai Om Journal of Commerce &
Management, 1(5), pp.34-43.
Ons.gov.uk. (2018). Internet access – households and individuals - Office for National Statistics.
Available at:
https://www.ons.gov.uk/peoplepopulationandcommunity/householdcharacteristics/
homeinternetandsocialmediausage/bulletins/internetaccesshouseholdsandindividuals/2017
[Accessed 10 Jan. 2018].
Terrell, S.R., 2012. Mixed-methods research methodologies. The qualitative report, 17(1),
pp.254-280.
Venkatesh, V., Brown, S.A. and Bala, H., 2013. Bridging the qualitative-quantitative divide:
Guidelines for conducting mixed methods research in information systems. MIS quarterly, 37(1).
Williams, C., 2011. Research methods. Journal of Business & Economics Research
(JBER), 5(3).
12 | P a g e