Analyzing Social Media Marketing and Consumer Loyalty at Walmart

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This research report critically analyzes the impact of social media marketing on consumer loyalty, focusing on the Australian retail industry and Walmart. It investigates Walmart's social media marketing strategies, challenges, and their effects on brand awareness and customer loyalty. The report includes an introduction outlining the research problem, aims, and objectives, followed by a literature review covering social media marketing concepts, business procedures, and relevant theories like the AIDA model and social exchange theory. The research methodology section describes the mixed research design, data collection, sampling, and data analysis methods employed. The report highlights current issues in social media marketing, such as content management problems and the failure to engage organic followers. By examining Walmart's past social media campaigns, the report aims to provide insights into effective strategies for improving social media practices and enhancing customer loyalty in the competitive retail landscape. The research emphasizes the importance of understanding consumer behavior and leveraging social media to create a strong brand image and influence purchasing decisions.
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Running Head: APPLIED BUSINESS RESEARCH
CRITICALLY ANALYSING THE IMPACT OF SOCIAL MEDIA MARKETING ON

CONSUMER LOYALTY: A CASE STUDY OF WALMART
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APPLIED BUSINESS RESEARCH 2
Abstract

The main aim of this research is to critically analyze the impact of social media marketing on the

consumer loyalty. This report evaluates the social media marketing issues in the Australian retail

industry and Walmart Company. It also analyses the research issue by using the different

chapter. In the first chapter, it describes the introduction of the research topic and also defines the

research aims and objectives. Moreover, it determines the literature review regarding research

issue via gathering information through a journal article, online and offline sources, authentic

websites and textbook. In the next chapter, it defines the research design that would be used by

research to meet the research objectives. In the last, it defines the data analysis method that will

be used to present the information in a comprehensive manner.
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APPLIED BUSINESS RESEARCH 3
Table of Contents

Abstract
....................................................................................................................................................... 2
Introduction
.................................................................................................................................................4
The research problem
.............................................................................................................................. 4
Hypothesis
............................................................................................................................................... 5
Background
............................................................................................................................................. 6
Historical
.................................................................................................................................................6
Aims and Objectives of the research
....................................................................................................... 6
Literature review
......................................................................................................................................... 7
Introduction
............................................................................................................................................. 7
Conceptual framework
............................................................................................................................ 7
Concept of social media marketing
..........................................................................................................7
Theoretical
............................................................................................................................................... 8
Business procedures and social engagement
............................................................................................8
Association between social media marketing and brand loyalty
..............................................................9
Current issues in the system regarding the use of social media practices
...............................................10
Theories based on social media marketing
............................................................................................11
Research methodology
.............................................................................................................................. 13
Research design
..................................................................................................................................... 13
Data Collection Method
.........................................................................................................................13
Sampling
................................................................................................................................................14
Data analysis
..........................................................................................................................................14
Ethical consideration
............................................................................................................................. 14
References
.................................................................................................................................................15
Table of figures

Figure 1: Online sales growth dwarf in retail industry
....................................................................5
Figure 2: Conceptual Framework
....................................................................................................6
Figure 3: Walmart business model
..................................................................................................8
Figure 4: Consumer decision journey
..............................................................................................9
Figure 5: Issues in social media marketing techniques
...................................................................9
Figure 6: AIDA model of social media marketing
........................................................................11
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APPLIED BUSINESS RESEARCH 4
Figure 7: Social exchange theory
.................................................................................................. 11
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APPLIED BUSINESS RESEARCH 5
Introduction

In the recent business scenario, social media marketing is used by different businesses because it

is beneficial to deal with the global market. Social media platforms enable the different

corporation to channelize their way with respect to customers and act as a perfect way to create a

distinct image in the customer’s mind towards their products and services. It can be evaluated

that awareness of the brand is a centralized process for creating the loyalty among customer.

Although, social media marketing is beneficial for each corporation to increase their brand

popularity with less time and efforts yet there are different challenges faced by the company to

create uniqueness as well as create a trend which is to be omnipresent with advantages
(Babin
and Zikmund, 2015).
Along with this, word of mouth can be beneficial and disadvantageous for
the organization because it plays a vital role to encourage and discourage the purchasing decision

of people.

This research proposal emphasizes on the impact of social media on the customer’s loyalty. For

this research, an admired retail company named Wal-Mart is selected in order to assess its social

media marketing approaches and their primary flows.

The research problem

Social media marketing approaches require appropriate use of content, slang, and ellipsis to

persuade the high amount of customers towards the brand. It is identified that those companies

use social media practices can get benefits however this strategy is high receptive because one

small word can change the people’s thought. Walmart faces certain challenges with respect to

making content in social media. It is analyzed that this company made a large number of fault by

encouraging its brand awareness from the year of 2014-16 such as using controversial way. For

instance, this corporation had encouraged its strength products and services on the social media
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APPLIED BUSINESS RESEARCH 6
websites by using the slogan ‘fat girl costumes’. However, it got negative feedback of customers

hence this initiative of Walmart Company is prone to using significant social media

advertisement
(Einwiller and Steilen, 2015). Consequently, the company has lost its large
number of users who follow it on the social media websites which have ultimately effect on the

sales.

Figure
1: Online sales growth dwarf in retail industry
(Source:
Ferrell and Fraedrich, 2015).
From the above chart, it can be stated that online sales in higher than the offline sales in the retail

industry. Hence, it is a key issue for those companies that are unable to use the social media

websites.

Hypothesis

H1- This research can be able to deliver beneficial suggestion by using social media marketing

theories and strategies

H0- This research cannot be able to assess the beneficial strategies for companies due to

inadequate information regarding existing theories.
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APPLIED BUSINESS RESEARCH 7
Background

Social media marketing issue is a key issue which tends to exist in the recent business scenario.

But, at the same time, it facilitates the number of digital opportunities. It is analyzed that if this

social media issue will not be identified with time then it can create massive disaster and

financial issues in the future. The research of the link between social media marketing and

customer loyalty is a beneficial marketing tool that is required in current scenario
(France, et. al.,
2015)
. Thus, it might be effective for companies to create effective management practices in
upcoming years.

Historical

Social media marketing issues arise from earlier 20’s century. This issue has been seen in each

marketing disaster which is a serious threat for companies. For instance, Walmart has blocked

out to Germany in 2002 for exploiting the data through social media sites
(Grant, 2016).
Aims and Objectives of the research

To explore the role of social media practices used by Walmart for increasing the
customer’s loyalty

To identify the strategies by which social media marketing is used for persuading
customer base with respect to Walmart

To illustrate the awareness of Walmart by using social media practices so as buying
behavior can be influenced

To recommend the effective strategies to improve social media practices by the company
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Impact of
Social
Media
Marketing

Customer
Loyalty
AIDA model
Theory of Social Exchange

Consumer decision journey

APPLIED BUSINESS RESEARCH 8

Literature review

Introduction

A literature review is an effective part of research which develops an understanding regarding

substantial findings. This information is gathered from different journal articles, textbook, online

articles and company’s websites. This chapter emphasizes on the assessment of research issue

and develops critical analysis regarding research topic.

Conceptual framework

Figure
2: Conceptual Framework
Concept of social media marketing

According to the
He et al. (2015), Social media marketing is the term which is used to the
advertisement of the products and services by using the digital communication and social media

practices. There are certain aspects which are related to marketing tools like maintaining

patience, attractive content, and creating a loyal base to a customer who actually reacts towards

the message posted on the digital websites. It also generates a connection amid accessibility and
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APPLIED BUSINESS RESEARCH 9
advertisement of products and services on social websites. Consequently, these aspects grow the

business by leveraging the customer response with respect to specific advertisements.

In contrast to this,
Kim et al. (2014) opined that these aspects such as attractive tagline and
engaging content can unfavorable impact on the marketing procedure hence company should

emphasize on these aspects during the marketing. Moreover, taglines, eye catchy slogan, and

product’s detail can also injure the emotional sentiments while inappropriate contents are

exercised.

Theoretical

Walmart is using social media assimilation theory for marketing its products and services. This

structure is known for its expensive environment and has a disability to keep the confidential

data. Hence, it can be stated that if the corporation uses this theoretical structure then they may

face issues in an upcoming year
(Wal-Mart, 2017).
Business procedures and social engagement

In the view of
Kim and Park (2013), Walmart primarily uses a strategy to acquire business
companies for penetrating into a new market and also keep certain components in its marketing

process. Moreover, marketing tool is mostly expensive hence company should adopt the cost-

effective tool such as social media in its business procedure.

Figure
3: Walmart business model
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APPLIED BUSINESS RESEARCH 10
(Source:
Kim and Park, 2013).
Association between social media marketing and brand loyalty

According to the
Kumar et al. (2016), consumer behavior extensively relies on word of mouth
and a large amount of influential act is done by the social media. For example, feedback about

any products and services can modify the people’s perception. Moreover, in the current business

scenario, the customer goes through different ways while taking the purchasing decision because

there are different factors which may affect the customer’s decision-making. In the initial level,

the customer generates a plan to buy products by analyzing the negative and positive reviews of

products on social media. Hence, it is analyzed that customer takes completely differ decision as

compared to the initial plan.

Figure
4: Consumer decision journey
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APPLIED BUSINESS RESEARCH 11
(Source:
Kumar et al. (2016).
Current issues in the system regarding the use of social media
practices
Figure
5: Issues in social media marketing techniques
(Source:
Oberoi, et. al., 2017).
Lack of proper contact with customers on social media websites

There is a large number of company which makes page on social media websites but it is non-

existed and outdated to engage with the customers. Further, customers do not demonstrate their

interest towards those companies which do not try to interact with them. Together with, they

moved towards the other companies which regularly interact with the customers
(Oberoi, et. al.,
2017)
.
Issues in social
media
marketing
techniques
Lack of proper contact
with customers on
social media websites
Failure to
pool organic
supporters
Content
management
issues
Motivate to share the
information through
social media
platforms
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APPLIED BUSINESS RESEARCH 12
Failure to pool organic supporters

It is a hard thing to keep the relation on public pages in order to pool large number of new

followers frequently. Further, due to the outdated public page on the social sites, new followers

show their less interest towards the company as compared to others
(Ramanathan, et al., 2017).
Content management issues

Content makes the link with customers and their perception because it is a prime component to

pull the attention of customers towards the products and services. Large number of corporation is

unable to generate eye catchy content and unable to maintain the value of sentiment for

customers which lead the customers to go towards another brand
(Rapp, et al., 2013).
Motivate to share the information through social media platforms

It is analyzed that sharing the information through social media enables the company to pull the

attention of customers and helps to attract organic customers. In this way, the company should

create worth sharing content and also look beyond the product’s advertisement
(Schramm-Klein,
et al., 2015)
.
Theories based on social media marketing

There is different theoretical concept regarding social media marketing which is considered by

large number of organization to get competitive benefits. In this way, AIDA model is exercised

by dynamic corporations to build product and brand awareness among people. This model is

related to data analysis tool because it enables the company to enlarge awareness about products

and generates logic of interest and aspiration among the people
(Sheth and Sheth, 2017).
Figure
6: AIDA model of social media marketing
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APPLIED BUSINESS RESEARCH 13
(Source:
Sheth and Sheth, 2017).
It is analyzed that company should be competent to influence the customer’s desire which can

create favorable responses of customers with respect to products and services. This model is

effective to meet the customer’s needs and generate product strategy according to the customer’s

need and consumer behavior analysis
(Sheu, and Chu, 2017).
Figure
7: Social exchange theory
(Source:
Sheu, and Chu, 2017).
According to the
Valentini (2015), purchasing behavior of customer can be based on both
aspects i.e. favorable and unfavorable. For instance, favorable feedback of customers regarding
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APPLIED BUSINESS RESEARCH 14
any products may generate favorable impact on sales growth and negative feedback generates

adverse impact on the sales growth.

In support to this,
Sheu and Chu (2017) recommended that company should exercise this theory
to assess feedbacks with respect to certain products and services on community’s page. As a

result, it makes enhancement to enlarge awareness about products and services in upcoming

years.

Research methodology

Research design

For this research, mix research design will be used by the researcher to accomplish the research

objective because this design entails the characteristics of both designs. In this way, quantitative

research design will be used to measure the participant’s responses. Besides this, qualitative

research design will be used to get theoretical information regarding critically analyze the impact

of social media marketing on consumer loyalty in the context of Walmart (Sheth and Sheth,

2017).

Data Collection Method

For this research, both data collection method will be used by research because it will enable the

researcher to overcome the issues between potential information and actual required information.

In this, secondary information is gathered by using second-hand information like journal article,

government and annual reports, online and offline sites, academic publications, and authentic

websites. In contrast, primary data will be gathered by conducting the survey through

questionnaire with the targeted respondents because, it provides the accurate and reliable

information regarding research topic
(Oberoi, et. al., 2017).
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APPLIED BUSINESS RESEARCH 15
Sampling

For conducting this research, a researcher will use the probability sampling technique. In this

way, it will use simple random sampling method by using participants are selected on the

random basis. This sampling method gives equal chances to each participant to give their

response hence it declines the possibility of biases from survey through questionnaire
(Kumar,
et. al., 2016)
. For conducting the survey through questionnaire, 50 customers are selected from
different geographical areas of Australia who purchase the products of Walmart and other retail

stores through social media.

Data analysis

After gathering the data, a researcher will use statistical data analysis method to assess the

collected information and interpret it in a meaningful manner. For this research, the researcher

will use MS-Excel software to demonstrate the information through pie chart, bar diagram and

column chart (Kim and Park, 2013). Consequently, it will enable the readers to develop a

comprehensive understanding of research topic.

Ethical consideration

The researcher will follow the data protection act 1988 in which they have no right to disclose

the personal data to anyone earlier of research completion. The researcher will also not force to

any participants to provide personal data and cannot present it by manipulation. In addition, a

researcher will inform about the intention of research to the manager before gathering the

information. Consequently, research would be able to engage the participants
(France, et. al.,
2015)
.
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APPLIED BUSINESS RESEARCH 16
References

Babin, B. J., and Zikmund, W. G. (2015)
Exploring marketing research. USA: Cengage
Learning.

Einwiller, S. A., and Steilen, S. (2015) ‘Handling complaints on social network sites–An analysis

of complaints and complaint responses on Facebook and Twitter pages of large US

companies’,
Public Relations Review, 41(2), pp. 195-204.
Ferrell, O. C., and Fraedrich, J. (2015)
Business ethics: Ethical decision making and cases. UK:
Nelson Education.

France, C., Merrilees, B., and Miller, D. (2015) ‘Customer brand co-creation: a conceptual

model’,
Marketing Intelligence and Planning, 33(6), pp. 848-864.
Grant, R. M. (2016)
Contemporary Strategy Analysis Text Only. USA: John Wiley and Sons.
He, W., Shen, J., Tian, X., Li, Y., Akula, V., Yan, G., and Tao, R. (2015) ‘Gaining competitive

intelligence from social media data: Evidence from two largest retail chains in the

world’,
Industrial Management and Data Systems, 115(9), pp. 1622-1636.
Kim, J., Ha, S., and Fong, C. (2014) ‘Retailers' CSR: the effects of legitimacy and social

capital’,
International Journal of Retail and Distribution Management, 42(2), pp. 131-150.
Kim, S., and Park, H. (2013) ‘Effects of various characteristics of social commerce (s-

commerce) on consumers trust and trust performance’,
International Journal of Information
Management
, 33(2), pp. 318-332.
Kumar, A., Bezawada, R., Rishika, R., Janakiraman, R., and Kannan, P. K. (2016) ‘From social

to sale: The effects of firm-generated content in social media on customer behavior’,
American
Marketing Association
. [Online]. Available at:
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APPLIED BUSINESS RESEARCH 17
https://www.rhsmith.umd.edu/files/Documents/Departments/Marketing/social-to-sale-jm-

2016.pdf
(Accessed: 17 September 2017).
Oberoi, P., Patel, C., and Haon, C. (2017) ‘Technology sourcing for website personalization and

social media marketing: A study of e-retailing industry’,
Journal of Business Research, 80, pp.
10-23.

Ramanathan, U., Subramanian, N., Yu, W., and Vijaygopal, R. (2017) ‘Impact of customer

loyalty and service operations on customer behavior and firm performance: empirical evidence

from UK retail sector’,
Production Planning and Control, 28(6-8), pp. 478-488.
Rapp, A., Beitelspacher, L. S., Grewal, D., and Hughes, D. E. (2013) ‘Understanding social

media effects across seller, retailer, and consumer interactions’,
Journal of the Academy of
Marketing Science
, 41(5), pp. 547-566.
Schramm-Klein, H., Morschett, D., and Swoboda, B. (2015) ‘Retailer corporate social

responsibility: Shedding light on CSR’s impact on profit of intermediaries in marketing

channels’,
International Journal of Retail and Distribution Management, 43(4/5), pp. 403-431.
Sheth, J., and Sheth, J. (2017) ‘Revitalizing relationship marketing’,
Journal of Services
Marketing
, 31(1), pp. 6-10.
Sheu, J. J., and Chu, K. T. (2017) ‘Mining association rules between positive word-of-mouth on

social network sites and consumer acceptance: A study for derivative product of animations,

comics, and games’,
Telematics and Informatics, 34(4), pp. 22-33.
Valentini, C. (2015) ‘Is using social media “good” for the public relations profession? A critical

reflection’,
Public Relations Review, 41(2), pp. 170-177.
Wal-Mart (2017)
About us. [Online]. Available at:
http://corporate.walmart.com/our-story
(Accessed: 19 September 2017).
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