Analyzing the Impact of Social Media on Saudi Arabian Businesses

This report investigates the impact of social media on businesses, with a specific focus on the Saudi Arabian market. It begins with an abstract outlining the growing use of social media platforms like Facebook, Twitter, and Instagram by businesses, particularly SMEs, in Saudi Arabia for advertising and customer engagement. The research aims to assess how large companies in Saudi Arabia leverage social media as a marketing strategy and its broader impact on Saudi society. The methodology involves a qualitative approach, using case studies of the Saudi Telecom Company (STC) and Alhokair Group. The findings highlight the awareness of large businesses regarding the importance of social media for promotion and customer interaction, while also pointing out the lack of awareness among small businesses. The report further explores the challenges faced by businesses in Saudi Arabia, such as confidentiality and liability. It provides a detailed literature review on the topic of social media's influence on businesses, covering topics like communication, marketing, and decision-making. The research methodology is explained, including the selection of STC and Alhokair as case studies, and the data collection and analysis methods. The findings are presented through case studies, exploring how social media supports businesses, the reasons for its use, and the challenges faced. Finally, the report includes a comprehensive discussion of the findings, chapter summaries, and recommendations for businesses in Saudi Arabia.

THE IMPACT OF SOCIAL MEDIA ON BUSINESESS IN SAUDI ARABIA
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Abstract
This research highlights the use of social media on worldwide businesses
and particularly discusses the context of small and medium sized
enterprises in Saudi Arabia. Social media networking sites such as
Facebook twitter Instagram and many more to name are getting
worldwide popularity compared to traditional method such as TV, Radio,
Newspapers and other old Media’s.
Saudi Arabia has adapted fast growing technologies rate in the Middle
East, which allow businesses to utilize social media for advertising and
promoting their business. The concerning aim of this research is to
evaluate how Saudi Arabian large companies use social media for
enhancing their customer interaction. This can be considered as a part of
their marketing strategy. The research further revealed the impact of
social media for Saudi society completely by keeping its aim toward
businesses. Second part of methodology discusses data collection for this
research, which is qualitative approach, done among two chosen
companies Alhokair group company resembling small business and STC a
large business in Saudi Arabia. The findings states that the large
businesses acknowledge the importance of social media and the
networking sites for promotion and they have active involvement in
customer interaction. However, small businesses are still unaware of the
profit that social media will provide them. Businesses face many
challenges in Saudi Arabia such as confidentiality, alterations, defense,
liabilities and lost productivity. Study also revealed that the Hierarchy
pyramid can be useful for small businesses to initiate and develop their
marketing strategies.
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Acknowledgment
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Table of Contents
ABSTRACT................................................................................. 2
TABLE OF CONTENTS..................................................................3
LIST OF FIGURE..........................................................................4
LIST OF ABBREVIATIONS............................................................4
CHAPTER 1: INTRODUCTION.......................................................5
1.1 OVERVIEW OF SOCIAL MEDIA..................................................................5
1.2 1 RESEARCH AIMS, OBJECTIVES..............................................................7
1.2.1 Aims...........................................................................................7
1.2.2 Objectives..................................................................................7
1.2.3 Research Questions...................................................................7
1.3 RESEARCH CONTRIBUTION.....................................................................7
1.4 OUTLINE OF THE DISSERTATION..............................................................8
CHAPTER 2: LITERATURE REVIEW................................................9
1.5 INTRODUCTION.....................................................................................9
1.6 DISCUSSION ON IMPACT OF SOCIAL MEDIA ON BUSINESSES........................10
1.6.1 Communication........................................................................11
1.6.2 Marketing.................................................................................12
1.6.3 Decision making.......................................................................13
1.6.4 Gain valuable customer insights..............................................14
1.7 THE USE OF SOCIAL MEDIA IN SAUDI ARABIA..........................................14
1.8 CHALLENGES OF SOCIAL MEDIA MARKETING IN SAUDI ARABIA....................17
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1.9 COMPARISON BETWEEN SOCIAL MEDIA BUSINESS AND TRADITIONAL BUSINESS
17
1.10 CHAPTER SUMMARY.........................................................................18
CHAPTER3: RESEARCH METHODLOGY.......................................19
1.11 INTRODUCTION AND OVERVIEW..........................................................19
1.12 RESEARCH SAMPLE..........................................................................20
For this study, it was important to find a sample size comprising only
organizations.......................................................................................20
that use social media. Two organizations were selected; Saudi
Telecom...............................................................................................20
Company (STC) and Alhokair Group company. More details about
these two.............................................................................................20
chosen companies are included in the Findings and Discussion
Chapter................................................................................................20
1.13 OVERVIEW OF INFORMATION NEEDED..................................................21
1.14 RESEARCH DESIGN OVERVIEW...........................................................21
1.15 DATA COLLECTION METHOD..............................................................22
1.16 DATA ANALYSIS AND SYNTHESIS........................................................22
1.17 ETHICAL CONSIDERATIONS.................................................................23
1.18 ISSUES OF TRUSTWORTHINESS...........................................................23
1.19 LIMITATIONS OF THE STUDY...............................................................24
1.20 CHAPTER SUMMARY.........................................................................24
CHAPTER 4: RESEARCH FINDINGS & DISCUSSION.......................25
1.21 INTRODUCTION................................................................................25
1.22 SECTION 1: A DETAILED ILLUSTRATION OF RESEARCH CASE STUDY..........25
1.22.1 Saudi Telecom Company (STC)................................................26
1.22.2 Alhokair Group Company.........................................................29
1.23 SECTION 2: ILLUSTRATION OF THE RESEARCH QUESTIONS WITH THEIR
ANSWERS..................................................................................................31
1.23.1 How do social media support businesses in the KSA to make a
better sale nowadays than in the past when there were no social
media?31
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1.23.2 Why do businesses in the KSA use social media and do they
use it effectively?................................................................................32
1.23.3 What are the challenges of the use of social media by an
organization?.......................................................................................34
1.24 SUMMARY OF THE CHAPTER...............................................................35
LIST OF FIGURE
Figure 4.1: The STC Twitter Page..............................................................31
Figure 4.2: The STC Facebook Page..........................................................32
Figure 4.3:Alhokair Group Facebook page................................................36
List of Abbreviations
Kingdom of Saudi Arabia (KSA)
multi-national corporations(MNC)
small and medium enterprises (SMEs)
Saudi Telecom Company (STC)
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1 Chapter 1: Introduction
1.1 Overview of Social Media
This research focuses on discussing the impact of social media in Kingdom
of Saudi Arabian Businesses. Social media has become an innovative and
effective medium that combines technologies and marketing strategies.
Social media is often used to increase brand awareness and in promotion
of the products. The social media offers the market with the opportunity
to contact with the peers and the customers by personalizing their brand
(Lenhart et al 2015).
Social media tools such as Facebook, Instagram, and Twitter offer an
opportunity for corporate brands to connect with their customers on a
personal level. It is also useful in getting feedback and reviews about
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products. Similarly, online review services help an enterprise whilst at the
same time having the potential to make or break their business (King et
al. 2014). The ability of a company to leverage user review helps in
obtaining knowledge about their customer base and their product or
service perceptions. It consequently helps in building client relationship
and identifying the brand’s value-added offering from the user’s
perspective. The most important platform is the company website to show
case the brand product or service to the world (Brynjolfsson et al. 2013).
Social media marketing reaches to a larger number of customers and
using social media in marketing can bring great success to business.
Presently, the importance of social media is realized as it enhances the
process of connectivity with the customers. Both multi-national
corporations (MNCs) and small and medium enterprises (SMEs) implement
strategies to engage their customers using the online platform, which
helps them in promoting the products and building trust among customers
(Fuchs, C., 2017). Social media offers two other important benefits, which are
cost reduction and revenue generation opportunity. For marketing social
media helps in evaluating the prospects of business by introducing
customer interaction and help in receiving customer feedback. Excluding
this, using social media for marketing helps the business in acquiring
information about the competitors and helps in implementing the business
strategies to expand their business (Goud, 2016).
Using traditional marketing tools for building a brand image is a
time consuming process. using social media, communicating with the
customers is easier. About 47% of the world population are using internet
and among them, the buying through Smartphone has rapidly increased
with the demographic use of internet (Taylor 2017). To be more precise,
this research focuses on the use of social media in Saudi Arabian business
by highlighting the aims and objectives of the research in the following
sections.
1.2 Aims and objectives of the research
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1.2.1 Aims
 The primary aim of this research is to conduct a primary research in
the literature review section and discuss the use of social media for
Saudi Arabian business to acquire the knowledge about how to
promote the products.
 Another aim of this research is to how expanded the media crusade
are in online networking and in which way the SME’s can take up
their suggestion for introducing advertising and branding
techniques.
1.2.2 Objectives
 To investigate, which factors of social media impacts on the Saudi
Arabian business?
 To evaluate in which way the Saudi Arabian business uses social
media as a form of marketing strategy for developing customer
interaction.
1.2.3 Research Questions
 How do social media support businesses in the KSA to make a better
sale nowadays than in the past when there were no social media?
 Why do businesses in the KSA use social media and do they use it
effectively?
 What are challenges/benefits of the use of social media by the KSA
organisations?
1.3 Requirement of Research in Saudi Arabia and Its Contribution
According to the research of Alwagait, Shahzad&Alim (2015), Social media
is most popular media for marketing purposes as this is the tool where
customers can involve in thetwo-waycommunication process and business
can promote their products or services cheaper than traditional methods
such as TV, radio, newspaper, etc.Due to its popularity, many types of
researchhaveperformed on the effect of social media over different
countries, but there is not much information available for KSA market
impact. Therefore, the requirement of this research increases and the
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contributions of this research are as follows:
 This studyexamines the influence of social media on the business of
Saudi Arabia companies.The reason for research in Saudi Arabia
was that social media usage has affected different countries market
but there is significantly low information available for Saudi Arabian
market. This investigation emphasis on ascertaining the effect of
social mediaon the business of Saudi Arabian
companies.Aqualitative investigationmethod has been adopted for
this investigation.
 The information from organizations such as Saudi TelecomCompany
(STC) and Alhokair Group Company has been taken to understand
the influence of using social media in their business. The selection
of these companies assists in comparison to both big and small
business on Saudi Arabia towards the use of Social media.
1.4 Outline of the Dissertation
This particular dissertation is constituted with five consecutive chapters including
introduction, literature review, research methodology, findings and discussion and conclusion
and recommendation. A brief outline of the five chapters has been given below:
Chapter 1: Introduction
The first chapter covers a brief overview of the primary research issue based on which the
entire project is conducted. While identifying the research issue the chapter has focused to
cover up particular research background, aims and objective of the entire research work.
Chapter 2: Literature review
This specific chapter is the in-depth evaluation of concepts as well as theories of research
study. In order to establish the overall concepts the point of views of some of the eminent
scholars has been discussed critically.
Chapter 3: Research methodology
This specific chapter provides detailed analysis of using methodological tools, data collection
method, research design and process. Various relevant sources of data collection along with
its proper sampling size are discussed in the chapter of research methodology.
Chapter 4: Discussion and findings
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This particular chapter is the outcome of applying appropriate research methodologies.
Discussion and findings actually evaluates the response of the participants based on which
the researcher makes a conclusion on the entire research issue.
Chapter 5: Conclusion and recommendation
This particular chapter presents the entire scenario of above four chapters. Based on the
process of work as well as research issue some of the major recommendations have also been
given.
2 CHAPTER 2: LITERATURE REVIEW
2.1 Introduction
According to the research of Gerbaudo (2012), Social media are
platforms established on internet sitesthat allow users to communicate
and share content between users. They are a method of electronic
communication by which members can create online societies to create
and share a new content or ideas.Social media has evolved from a tool of
personal interaction into a vibrant marketing channel for businesses of
different sizes. Under the global competitive environment, it becomes
challenging to predict and control the factors that impact firms’
performance. It is now a requisite for all business in order to compete in
the competitive business environment. However, it is difficult to
determine the impact of social media with the deluge of technology. The
literature review section delves deep into studies conducted on the impact
of social media on businesses. A research conducted by Hughes, Rowe,
Batey& Lee (2012) concluded the usage of Twitter and Facebook for
personality prediction of customers. The research proved the difference in
personality of customers and how companies can use them to enhance
their growth.While many studies have been conducted on social media
and business, only a few studies focus on businesses in Saudi Arabia
(Hudson &Thal, 2013). This makes it necessary to research on the impact
of social media on businesses in the context of Saudi Arabia.A research
conducted by De Choudhuryet al. (2010) over North American and Asian
countries provides the change in data sampling strategy of organizations
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by usage of Social media. In particular, they find that the impact of social
media on business is highly dependent on a range of factors rather than
the mere use of social media. As a result, there is scarcity in studies that
investigate the impacts of social media on businesses which justify the
objective of this study. There is a need to add to the literature on social
media use in Saudi Arabia by focusing on businesses located in the
country. This study will examine the impact of social media on business in
Saudi Arabia.
The layout of this chapter is organized as follows: it starts with an
introduction to the research study which presents a general scope and
purpose of the undertaken research. Then, the second section provides a
discussion on impact of social media on businesses. Common themes are
developed and discussed in this chapter. Different studies conducted on
the impact of social media are also discussed in this chapter. The last
section is a summary of thechapter which narrows down the topic of
research and also outlines the discussion of the literature review.
2.2 Discussion on Impact of Social Media on Businesses
The 21st century has embraced social media as one of the driving
forces behind increased business growth. Social media is an essential
ingredient for business strategy and globalization. It is evident that social
media has brought immense improved and advanced ways of conducting
business in a fast manner in the different economies. According to
Qualman (2010), today, the use of social media by businesses is no longer
an added advantage but the actual cause and driver of business strategy.
As a result, they have become effective tools for business operations
today. This means that businesses are increasing using social media
platforms for publicity and advertisement purposes.
The adoption of social media in businesses has influenced many
aspects of organizations including people, processes and business
strategies. As per the research of Gallaugher&Ransbotham (2010),
improved access to information is possibly the greatest impact of social
media on customers. The huge increase in access to information
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