The influence of social media on organizational performance in retailing. A study case of Amazon

This study analyzes the influence of social media on organizational performance in the retail sector, with a specific focus on Amazon. It examines the concept of social media marketing, the practices used by Amazon, the challenges associated with implementation, and the overall impact on the retail sector.

The influence of social media
on organizational performance
in retailing. A study case of
Amazon
Name:
Student number:
College and university name
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Abstract:
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Table of Contents
Abstract:...........................................................................................................................................2
Title: The influence of social media on organizational performance in retailing. A study case of
Amazon............................................................................................................................................4
Introduction.....................................................................................................................................4
Aims and objectives:........................................................................................................................5
Overview of Company:....................................................................................................................6
Research rationale:...........................................................................................................................6
Literature review:.............................................................................................................................7
REFERENCES..............................................................................................................................19
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Title: The influence of social media on organizational performance in retailing. A study case
of Amazon
Introduction
Social media is playing a very crucial role in affecting the marketing and promotional
strategies of organisations. Social media has transformed the way organisations perceive their
promotional activities as per the requirement of target segment of customers. It helps
organisations in targeting audience as per their specific needs and then influencing their choices
or preferences as per changing external environment. The report analyses the impact of different
social media practices on the retail sector organisations. Business organisations especially in the
retail sector are finding new ways to implement their marketing strategies through social media
platforms (Mora and et.al., 2019). Prior to development of various social media applications
business organisations use to rely on television commercials, physical hoardings, mailing and
word of mouth publicity.
With our changing time there is transformation in the way there is arrival of new products and
exclusive promotion techniques. Social media has affected the way many retail business
organisations are communicating with their customers. Customers can send personalised
messages and customised scenario is used to post the information publicly on these social media
platforms.
Generally these applications have both positive and negative impact on customer mind set as it is
related to being aware of various new launches that are made by such organisations. This report
is going to help in making a detailed analysis of the different challenges that are associated with
implementation of effective social media practices. Apart from this there will be detailed
evaluation of the basic concept of social media marketing and the different practices that are
used by Amazon in order to maximize their overall productivity.
Presentation of the problem identified:
The use of social media practices and internet has changed the customer behaviour in which the
businesses are being conducted. Digital marketing and social media offers video significant
opportunities to organisations by having lower cost and improving brand awareness. However,
there are significant amount of challenges that are arising from negative word of mouth for
irritating online brand presence. Further, with the fast changing external dynamic environment
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there is constant change in customer’s strategies. So, it becomes very important for organisations
to analyse the issue of having effective social media marketing strategies so that they are able to
deal with the issues that are arising in course of effective social media channels. For this purpose
the report is going to analyse the issue of social media marketing and its impact on long-term
functioning of organisations. In case of, global retail brands like Amazon it becomes more
important to analyse the issue in context of having effective practices that are associated with
effective social media marketing process.
Aims and objectives:
The aim of the research is to analyse the overall impact of different social media practices on
retail organisations with specific reference to Amazon
1. To evaluate the concept of social media marketing as a digital marketing practise.
2. To identify various social media practises used by Amazon as a promotional tool.
3. To analyse challenges associated with implementation of effective social media practise.
4. To analyse the impact of various social media practises on the retail sector organisations like
Amazon.
Questions:
1. What is the basic concept of social media marketing as a digital marketing practise?
2. What are some of social media practises used by Amazon as a promotional tool?
3. What are challenges associated with implementation of effective social media practise?
4. What is the basic impact of various social media practises on the retail sector organisations
like Amazon?
Overview of Company:
Amazon is an American multinational technology brand that focuses on cloud computing
artificial intelligence, digital streaming and e-commerce. It is one of the big five brands in United
States and is referred as one of the most influential economic and cultural forces across the
world. It was started as a online marketplace for books but then it is expanded to software video
games, electronics furniture, apparels, jewellery, toys and many other such related products.
Which time Amazon has been able to become a market leader in e-commerce industry and also
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surpassed various other existing big retail brands like Wal-Mart. In 2018, Amazon has launched
it’s the second day delivery system with Amazon prime and they have successfully able to
surpassed 100 million subscribers across world. Amazon is a brand that is known for using latest
technologies and disruption of well established industries by using technological innovation at a
mass scale. This brand has focused on enhancement of their brand image by using latest
technology and focusing on internet as a tool to transform the customer mind set by having a
drastic impact on their overall purchasing behaviour.
Research rationale:
The present research work is conducted on the use of various social media practices that can
possess a direct impact on the functioning of retail sector organisations. This report is going to be
very helpful for the purpose of laying as a source of future course of research in social media use
for retail industry. There will be development of various communication and researching skills
through the application of concept as a part of the present search work. It is going to develop
knowledge base that is related with the impact of different social media practices on large
organisations like Amazon. This Research report is going to analyse the major influence of social
media practices on an organisation functioning. It will assist in the process of analysing the way
different activities can help in maximizing the productivity of such organisations.
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Literature review:
Basic concept of social media marketing as a digital marketing practise
As per view pints of Adam Hayes (2018), social media is a term that is regarded as the use of
social media and social networks for the purpose of marketing an organisation's products or
services. Social media marketing offers organisations to engage with the customers to reach a
new customer segment. It is focussed on promoting the desired mission, culture and tone of the
organisation social media marketing. Further, this practise is adopted to build data analytics tools
that can help marketers in tracking the success of efforts of an organisation. Social media
marketing is a term that is used for the organisation to engage with the present customer base. It
is used to reach the new customer segment by promoting the overall mission, culture. There are
various social media sites that include twitter facebook and instagram that are used for the
purpose of executing the social media marketing strategies of organisations. Social media has
changed the way marketers are allowed to employee a broad range of strategies and tactics for
the purpose of promoting the content and engaging people. There are many social networks that
allow users to have a detailed demographic, geographical and personal information that enables
marketer for the purpose of tailoring their messages in order to resonate with their existing users.
While formation of a suitable social media marketing strategies there are some of the tapes that
are to be considered by the organization. It includes determination of strategies that is the right
social media channels has to be determined (Varkaris and Neuhofer, 2017). Next step is planning
and publishing in this there is decision made with respect to the platform that has to be selected.
Next step is engagement and listening in this there is monitoring about customers and other
brands, posts and other business assets for which there is requirement to use a proper social
media engagement tool (Diba, Vella and Abratt, 2019). Another aspect is analytics and reporting
that is analysing the overall reports of engagement.
Last aspect is advertising that is purchasing of advertisements on social media is also a great way
of promotion and further development of a brand. The main strategy that is used by social media
marketing platforms is to develop the content and messages that can help various individual
users for the purpose of sharing it with their other known ones; this strategy relies on providing
many benefits and word of mouth publicity (Erlangga, 2021). It also helps in sharing of connect
for implicit endorsements that are sent by people who are neon recipient and trusts. Social media
strategy allows creation of concept that can help in getting user attention and enhancing the
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possibility of more desired actions so that there can be better sharing of content within the own
network (Tayo, Adebola and Yahya, 2019). Marketers in case of big retail sector organisations
like Amazon are able to create a viral content that is designed specifically to spread quickly
among the existing users, social media marketing is also based on encouraging of customers for
sharing of the own content, comments that can be positive or negative and further sharing the
review that is most important for a new customer to approach the brand for the first time (Chahal
and Rani, 2017). Social media marketing has many advantages as it helps in appealing a board
range of audiences. For instances there are campaigns deigned that can help in dealing with
obstacles. There are videos that go viral and lead towards higher customer engagement apart
from this it has a major associated disadvantage also that some instances if there is a negativity
associated with a particular video then it might lead to difficulty in changing the negative view
pint that people develop in course of the functioning (Kimand Lee, 2019). So it becomes very
important for organisations to develop proper measures which can assist in the process of having
a suitable and effective social media marketing strategies.
Social media marketing will be used as one of the most important marketing strategies for all the
target markets. It helps in creation of an audience persona that is a core of effective social media
marketing referring to a specific medium with the social posts. It can help in looking deep in the
person of audience, fears, needs and interests of individuals. Another element of effective social
media strategy is to identify the key goals of achieving the laid strategy that can help in building
up of brand awareness, leads to generation of traffic and getting proper website traffic. Team
building also aspect of having a effective social media strategy in which there is development of
a social media strategy for the purpose of securing of enough internal resources in order to build
teams. Researching is a basic concept associated with social media marketing in which there s
creation of campaign content and spotting of strategy that involves combination of the one native
content of a brad along with sharing content of others at the same time (Social Media Marketing
(SMM), 2020).
Identify various social media practises used by Amazon as a promotional tool.
As per viewpoints of Dave Chaffey (2021), there are main effective social media marketing
strategies that are used by Amazon for the purpose of managing the social media presence of this
brand. It includes different strategies that are to be formulated as per specified time period in
order to build long-term customer base. For instance there have been recently many campaigns
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associated with having effective customer base in which Facebook advertisements are one of the
most important tool that is used by Amazon. Many top Amazon sellers are observing Facebook
as one of the avenues to advertise the products because of the two billion plus active monthly
users. This social media giant has been able to help Amazon to display the advertisements and
the present Facebook users to influence their purchasing decisions. One of the highly suggested
strategies of Facebook media campaigns are related to Amazon where they are redirecting users
to landing page before sending them to Amazon store listing.
Amazon has also focused on using Twitter as one of the social media marketing strategies in
which they have invested in various social media campaigns. They are using Twitter as a tool for
having specific posts to target specific group of potential customers. Amazon has been able to
showcase the family picture also by trying to target family oriented online users. In this social
media marketing strategy Amazon is inserting videos in a post as an effective method that is used
for their Twitter campaigns. Amazon is relatively successful with the Twitter campaigns that
have helped them in achieving instant success. For establishing the brand there is requirement to
focus on drawing potential customers. Another social media platform that is Instagram is also
used for Amazon that is the second most highly used platforms as per survey of United State
adults. Instagram is also one of the viable platforms for Amazon social media campaign. The
overall effective social media strategies can help Amazon in improving their present market
position. In terms of achieving higher return investment Instagram has also assisted Amazon in
having higher return on investment because maturity of the users are tech-savvy and are falling
within the million demographics.
More than half of the global Instagram population in east is of 34 years and younger than that.
Amazon is using some amazing Instagram campaigns by being consistent with their posts. They
are using high quality images and for the purpose of creating higher engagement they are
uploading videos of products continuously. For the purpose of having a two way interaction
process they are organising various giveaways contest that has lead towards generation of traffic
and increasing the sales of Amazon in recent time period. P interest is also one of the effective
social media platforms that are used by E-Commerce brands like Amazon. With the changing
time P interest is regarded as third largest social networking platforms where Amazon sellers are
taking advantage of wide range of audiences that are using P interest. In recent times P interest
has just surpassed Snapchat in terms of monthly users and they are now having it 82.4 million
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monthly engagements that are higher as compared to other effective social media platforms. For
capitalising and potentially enhancing the Amazon customer engagement process there is
advantage of popular categories that helps customers in creating boards. Amazon is a very
competitive industry and they are using re pricing strategy as well as product listing strategy as
one of the effective social media strategies for having higher engagement process.
In the first quarter of 2021 Amazon has reported a net sales of 10 8.518 billion dollars and there
has been a 43.8 % increase from 70 5.45 to billion dollars in the similar quarter in year 2020.
Apart, from this Amazon has been able to fulfil services that has hit 51.0 to 7 billion US dollars
and 51.8% prior to 33.6 11 billion dollars. Amazon marketing strategy has evolved since it was
founded in the year 1994. Ranging from various small business start-up to large international
business there is more focus on customer preferences. Amazon is testing market opportunities
that are made available by digital technology transformation they have focused on testing and for
the analysis to improve the results. This brand has always focused on higher customer
experiences by developing a customer obsession. The main approach of Amazon towards their
social media marketing strategy is based on race framework.
Analyse challenges associated with implementation of effective social media practise
As per Werner Geyser (2020), there some of the challenges that are associated with effective
social media practices and affect the present business organisations. In some organisation is there
is difficult to have sufficient time period for the purpose of discovering a creative and interesting
content that can be used as a social media strategy. It becomes complex to have social media
management tools that are related to managing the post creating it quickly scheduling the
multiple accounts and having a organised structure. Another challenge is associated is with not
having great ideas because of effective social media strategies that are used by competitive
brands. Amazon is also dealing with issues of having lack of design resources. Sometimes the
in-house design team is overloaded with various design projects outside the social media so it is
very difficult to find and come up with new creativity that is also time-consuming for a large
sector organisation. Amazon is already managing their E-Commerce platform set associated with
receiving customer orders and delivering them with required products and services. it is
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necessary to ensure right size for social media graphics and become sometimes difficult at a
particular time period. The biggest challenges that are experienced by social media managers is
keeping with the latest updates of social media platforms that may affect the social media
process.
Developing an effective social media strategy is one such challenge that is associated with not
having effective plan to be implemented. Social media strategies related to guiding the actions of
an organisation that is measured by the way organisation is willing to fail or success in coming
future. In context of Amazon the Matrix that is chosen is monitoring the influence of goals at a
being set by the organisation. So it is very important to have an effective social media strategy so
that there can be repeated audit that can keep a tab on the overall performance in a specific
quarter.
(Source: 5 of the Biggest Social Media Marketing Challenges, 2020)
One of the most commonly face challenges is defining of marketing goals. Amazon as a retail
brand is dealing with difficulty in having setting a specific marketing campaign that can align
with the goals. What is 7% of the business are citing this as one of the biggest challenges to
cause increasing brand awareness is top gold for 70% of marketers. If the goals are not well
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defined it becomes hard to measure the marketing performance and demonstration of the overall
value to stakeholders (Cao and et.al., 2018). This scenario may also adversely affect the budget
for future marketing campaigns.
Social media return on investment is the way business gets back from time money and resources
by putting forward towards a social media strategy. Social media ROI is generally based on
moving from traditional online marketing to seeing the value of a particular post likes comments
and further analysing it to reach towards relevant conclusions.
While generation of online presence brands are generally focused on generation of awareness
and driving of future organic reach. For being able to achieve the required success it becomes
very important for retail brands like Amazon to create content for employees, customers and
other stakeholders to share it across social networks.
Another major challenges faced by many retail sector organisations and identification of rights
platform. There is next hurdle marketers is facing in the selection of the platforms to be
leveraged. In Amazon marketers are researching the target markets thoroughly to identify the
platforms where target audiences are active (Xu and Han, 2019). The chart below clearly
mentioned that there is a disconnection between marketers and customers. It is observed that
LinkedIn is used by 38% of social media marketers 46% of customers are using the platform to
follow brands. Marketers are wasting their resources and efforts on platform 70 not bankable.
Investing in wrong platforms can lead to exhaustion of budgets if there is regularly use of paid
advertisements.
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(Source: 5 of the Biggest Social Media Marketing Challenges, 2020
(Source: 5 of the Biggest Social Media Marketing Challenges, 2020
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If the decision makers in organisation or not selling it of social media marketing in the first place
it might lead to difficulty in future steps of launching and implementation of the platform.
Another major challenge that is faced by Amazon understands of the target audiences (Xu and
Pratt, 2018). There are many organisations that have performed really well in their regular
operations but miserably fail on social media sites. The difference arises in case of the approach
of customer towards brand in physical stores and in e-commerce stores is completely different.
(Source: 5 of the Biggest Social Media Marketing Challenges, 2020
Marketers are creating content first and then for the figuring out the target audiences. There is a
misconception that great content converts even if it is not targeted. Amazon is facing issue of
great content engagement that is not generating leads but is affecting the needs of target
audiences (Irfan amd et.al.,, 2017). Directionless marketing relies on a spray and pray approach
that there are seldom desired returns. Damage of brand credibility may affect the risk of getting
blocked or reported with having a relevant content. Amazon is also dealing with the issues of
organic reach on leading social platforms that is plummeting. The cost of paid advertisements is
increasing and this brand is wrongly to strike a balance between budget and goals.
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(Source: 5 of the Biggest Social Media Marketing Challenges, 2020
Analyse the impact of various social media practises on the retail sector organisations like
Amazon.
Amazons is an online e commerce brand that is leader in various diversified areas of business
that includes software’s, film, apparel, home ware, technology. With being one of the world’s
biggest cloud infrastructures this brand has successfully spread across various other areas.
Growing from juts a market place they are becoming a leading producer of customer electronics
that includes smart home technology and Smartphone. They reacted first staggering of 1 trillion
dollars in September 2018. Amazon worth is 1.5 trillion dollars that is founded by Jeff Bezos. He
is forts person ever to have worth of 200billion dollars (Sashi, Brynildsen and Bilgihan, 2019).
Apart from this Amazon is world’s largest online retail brand that has used its digital presence so
that they are able to use various social media platforms for the purpose of expanding its
effectiveness for the target segment of customers.
In recent years this strategy has been complete transformed by Amazon because they have
created central braded and verified accounts of their brands that includes Amazon prime video,
Amazon music and Amazon web services that is for the purpose of utilising the social media to
its fullest extreme so that it can be used as a both customer service and a effective marketing
tool. Amazons primary facebook account is adopted for the purpose of marketing the products
that highlights the deals, running of competitions, sharing of important posts and sharing of
effective community content (Tutenand Perotti, 2019). All this is optimised for the purpose of
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coinciding it with relevant events and offering valuable content for the target segment of
customers that are presently associated with this brand (Lai, 2019). Amazon is using some
specific facebook accounts for their products that include prime video and Amazon kindle. Apart
from their central account these are used for the purpose of drawing attention of relevant
products and then offering customer’s with the process of driving the engagement process for the
purpose of gaining sales (Cooley and Parks-Yancy, 2019).
(Source: Social Media Case Study: How Do Amazon Use It, 2020)
While analysing the increase in social media following of Amazon on various applications as per
the data collected in April 2021 is that facebook accounts for 29 million likes, prime video UK
accounts’ for 15 million lines, in twitter it is recorder at 3.6 million followers, Instagram 3.1
million followers, Amazon influencer program has 487 k followers, Amazon video has 1.7 m
followers (Erkan and Evans, 2018). Apart from this other following includes LinkedIn having
19.1 million followers for Amazon account and Amazon advertising includes 117K followers.
YouTube has 477 K subscribers, Amazon Prime video has 988K subscribers, Amazon Music
subscribers include 132 K.
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(Source: Social Media Case Study: How Do Amazon Use It, 2020)
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(Source: Social Media Case Study: How Do Amazon Use It, 2020)
P interest is also one of the most popular social media application that is being focussed by
Amazon for the purpose of enhancing its presence across various platforms such as presently it
has 115.3 k Followers and Amazon books account for 785k followers. Apart from this while it is
aggregated it came that it includes approximately 100 million followers across all the channels
together (Charoensukmongkol, 2018). The use of social media platforms for the purpose of
enhancing the social media presence is very important because now Amazon is using it not juts
as a marketing tool but a very important step for the purpose of offering effective customer
services to customers. So it has become a platform of getting customer feedbacks and then
responding it through customer’s services accounts created on such social media platforms by
Amazon. (Chen, Fan and Sun, 2019). It helps in getting quick and reliable customer respondents
in both positive and negative responses with the brand.
From the above made discussion it can be said that social media marketing strategies are a
great tool that can be used by organizations for the purpose of enhancing their presence. But
there are certain associated disadvantages also that Amazon has observed a huge controversy and
backlashes in recent years. There is a separate Wikipedia page that is “criticism of Amazon”
where it includes recent controversies surrounding the environment matters, working conditions
and union disputes that are piled together (Mathur, 2018). Many customers are upset and not
satisfied with the overall practises and values that have lead to boycotting the brand in favour of
many small business & eco friendly chains. For this Amazon has also issued a rare apology
regarding their delivery drivers working on improving the present supply chain conditions.
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