Role Social Media Archipelagic Use

Solid State Technology
Volume: 63 Issue: 6
Publication Year: 2020
Role Social Media Archipelagic use in

Improving Performance Small Micro Business
in Small Islands in Indonesia
Nurhidayat1
Suliyanto2
Eko Wahyudi Antoro 3
1
Postgraduate Management Doctoral Program, Jendral Soedirman University, Purwokerto, Central Java
nurhidayat.unsoed@gmail.com
2
Lecture Management Doctoral Program, Jenderal Soedirman University, Purwokerto, Central Java
suli_yanto@yahoo.com
3
Practical Marketing Research, Kec. Kepung, Kepung sub-district, Kediri Regency, East Java
kmcwahyu99@gmail.com
Abstract:- Social media has the potential to help SMEs in marketing their products, especially for
MSMEs in the archipelago who experience serious obstacles from the marketing side to be able
to develop on a national and international scale. In response to these conditions, the government
is trying to create a new scheme and is ready to help the SMEs, one of them through a digital
trading system. There is a need to realize the competitiveness of small islands (MSME Islands)
that are different from other contexts namely through the use of internet technology or digitally
which in this case is the use of social media, in this study as a novelty of research researchers
realize it in a variable namelyArchipelagic Social Media Use. Thus, a common thread can be
drawn that the broader range of marketing of a company through social media, will make the
company and its products more recognized in the market. This of course will indirectly improve
the performance of the MSME itself. The purpose of this study was to determine the role of
archipelagic social media use in improving the performance of the UMKM Islands.
This research method uses a positivist or scientific approach using SEM-AMOS analysis
techniques. The data used are primary data distributed to 100 respondents. The results of this
study indicate that the owner characteristic has a significant influence on Archipelagic Social
Media Use, performance expectancy has a significant effect on Archipelagic Social Media Use
and archipelagic social media use has a significant effect on Performance SMSEs, which can be
interpreted when the MSME owners of these islands utilize Social Media in a way optimal, can
significantly support performance improvement.
Keywords: owner characteristic, performance expectancy, Archipelagic social media use,
Performance SMSEs, UMKM Islands
1. Introduction
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Indonesia has a vast sea area, so it is not surprising that the government launched the
concept of blue economy as a buffer to maintain the food sector going forward. Blue economy is
one of the basic concepts used by the Ministry of Maritime Affairs and Fisheries to sharpen the
fisheries and marine archipelago sector. The concept of blue economy wants Indonesia to
become a large country in the maritime sector (DetikFinance, 2012). The maritime sector and the
concept of blue economy become interesting to observe with the recognition of Indonesia as an
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Volume: 63 Issue: 6
archipelagic country, of course it cannot be separated from the existence of the archipelago
MSMEs in Indonesia.
However, it is not only the marine sector and the concept of blue economy that is
interesting to observe with the recognition of Indonesia as an archipelagic country, but the
existence of archipelagic MSMEs in Indonesia. Where until now, the islands MSMEs experience
serious obstacles from the marketing side to be able to develop on a national and international
scale. In response to these conditions, the government is trying to create a new scheme and is
ready to help the SMEs, one of them through a digital trading system (Gunawan, 2020).
Through the fostering of the digital trading community, all stakeholders seek to build
synergy between the distribution chain and MSME products in the Islands in a sustainable
manner, so as to be able to reach a wider market (Gunawan, 2020). One of the media that can be
used by Kepulauan UMKM in forming a digital trading community is social media.
Social media has the potential to help SMEs in marketing their products (Acheaw &
Larson, 2015). Social media is defined as a group of internet-based applications that create the
ideological and technological foundations of Web 2.0 that enable the creation and exchange of
user generated content(Stockdale, et al., 2012). Social media applications are available from
instant messaging to social networking sites that offer users to interact, connect and
communicate with each other. These applications intend to initiate and circulate information
online about the user experience in consuming products or brands, with the main goal of
reaching (engaging) the community. In a business context, people engagement can lead to profit
creation.
The above opinion is also supported by the Secretary of the Ministry of Cooperatives
who emphasizes the importance of Micro, Small and Medium Enterprises (MSMEs) utilizing the
presence of social media (social media) to improve the sales performance of their products. This
can be caused by utilizing social media, barriers of distance, space and time, and the price of
goods, can be eliminated. In addition, SMEs also no longer need a large space to display their
products. Not only that, wine is not an obstacle to sending goods, because there are many courier
service companies to deliver goods at cheap prices and quickly reach consumers. The range of
marketing can go global. Manpower can also be used effectively and efficiently (Julianto,
2017).
The practice of marketing through social media is widely adopted by business actors in
various sectors to develop their businesses, however there are still quite a lot of business actors
who have not made the most of the function of social media as digital marketing media. One of
them is by the micro and small businesses (MSMEs), especially in remote areas who tend not to
know the development of digital media for the marketing process. MSMEs must be careful in
choosing social media that suits their marketing objectives(Lau, 2016). Like Facebook which is
more suitable for the purpose of reaching more audiences because the character of its users
extends from all levels so that MSMEs can build relationships and awareness by utilizing the
features of events, status updates, and responding directly to feedback from consumers. MSMEs
can maximize the use of Facebook as a digital marketing medium by using page features and by
making descriptive updates with photos and website links for call-to-action. Meanwhile,
Instagram is suitable for building awareness and creating relationships with consumers,
especially with the presence of Instagram business features that offer a variety of services that
make it easy for consumers to interact with consumers.
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More and more people are using social media, especially Instagram to inspire marketers
to use it as a marketing communication medium of products and services produced. Where
everyone not only becomes a user, but also can become a publisher. It can be said that social
media is a very effective platform for communicating and listening to consumer opinions, such
as giving criticism, suggestions and complaints. Although marketing communication activities

Volume: 63 Issue: 6
are carried out online, the effects of marketing can also have an offline impact, through word of
mouth. If you are able to combine online and offline marketing models, then it is certain that the
products / services offered will be easier for consumers to accept(Acheaw & Larson, 2015).
The wider marketing range of a company, it will make the company and its products
more well known in the market. This of course will indirectly improve the performance of the
MSME itself. Performance is referring to the achievement or achievements of the company in a
certain time. However, utilizing social media as a means to support the improvement of MSME
performance is not as easy as turning the palm of the hand, because there are several things that
affect which one of them is the owner characteristic.
In general, Top Management in small and medium-sized companies is held by the owner
of the company. The characteristics of the owner and manager are one of the main symbols of
entrepreneurship from SMEs. The owner or manager identifies technologies opportunities and
coordinates the process of obtaining resources. The behavior of the entrepreneur and the main
variables in the characteristics of the owner / manager are age, education, work experience
innovativeness and personality traits (Hartono, 2009; Mandal & McQueen, 2012).
The progress of MSMEs depends very much on the ability of their owners. The
characteristics of the owner who is innovative, has ambition and passion in advancing the
business can more easily develop or improve his business(Zoysa & Herath, 2007). MSMEs in
the archipelago are currently lagging behind MSMEs in other regions due to the limited use of
technology and the use of social media, so that the range of products marketed is also not widely
available.
According to Rafiah & Kirana (2019), social media is content that contains information
created by people who use publishing technology, is easily accessible and is intended to facilitate
communication, influence, and interact with others and with the general public. Nowadays, the
practice of marketing through social media is beginning to develop and is used as a product
marketing tool and promoting a company's brand. Social media is a gathering place for people
who want to share information and a place to find new friends and interact with other friends
online. Social media that are growing very rapidly in Indonesia are Instagram, Facebook, Twitter
and the like.
That is, if the owner of UMKM has innovative characteristics and likes challenges and
has a willingness to always learn to keep abreast of the times, then the owner of UMKM will not
hesitate to use social media as a support for managing his business. This opinion is supported by
research proposed by Mandal & McQueen (2012) which states that the owner characteristic has a
positive and significant influence on social media use.
The next factor that influences the use of social media is performance expectancy. This
can be due to the fact that to sustain the current weak performance of the archipelago MSMEs, a
media that is expected to be a generator of promotion and marketing of the archipelago MSMEs
is needed. The simplest technology is the use of social media. More and more people are using
social media, especially Instagram to inspire marketers to use it as a marketing communication
medium of products and services produced. Where everyone not only becomes a user, but also
can become a publisher. It can be said that social media is a very effective platform for
communicating and listening to consumer opinions, such as giving criticism, suggestions and
complaints. Although marketing communication activities are carried out online, but the effects
of marketing can also have an offline impact, through word of mouth. If you are able to combine
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online and offline marketing models, then it is certain that the products / services offered will be
easier for consumers to accept(Acheaw & Larson, 2015).
That is, if all MSME elements have a positive perception of the use of systems and
technology, then they will try to learn and adapt to find what technology or system is the most
appropriate, easy and inexpensive to use, but has a huge impact on their business. Apparently,

Volume: 63 Issue: 6
the choice of most Indonesians is to use social media. This opinion is supported by research
proposed by Mandal & McQueen (2012) which states that Performance Expectancy has a
Therefore, it can be reiterated that social media is a very open media platform. That is, it
allows anyone to produce and consume it. With high involvement, where users can interact with
the account owner (admin), communication on social media takes place both ways and in real
time. Ease of operating social media also allows anyone, even those who have minimal
knowledge of the internet and information technology can manage a social media account
(Prihandari & Hamim, 2018).
The use of social media is basically specifically aimed at attracting new customers, but it
is also possible to maintain relationships with old customers, increase awareness, communicate
brands online, and receive feedback from consumers and business partners (Michaelidou, et al.,
2011). In the end, the profit that results from using social media is performance improvement.
Research findings(Schaup & Belanger, 2014) shows empirical evidence of the value of
Facebook's social media which has an impact on MSME performance.
Based on the explanation from the experts above and based on the need to realize the
competitiveness of small island MSMEs (Islands UMKM) which is different from other contexts
namely through the use of internet technology which in this case is the use of social media, then
in this study as a novelty of research researchers make it happen in a variable called Archipelagic
Social Media Use. This variable was formed from indicators adopted from the research proposed
by Mandal and McQueen (2012) as the domain of technical media, and research from Odoom et
al (2016) as social domains so that they can truly represent the characteristics of Archipelagic
variables Social Media Use.
Based on the description upfront, then a common thread can be drawn that the broader
range of marketing of a company through social media, will make the company and its products
more recognized in the market. This of course will indirectly improve the performance of the
MSME itself.
2. Theoretical Studies
2.1. Basic theory
The construction of this research involves a literature review involving various empirical
studies. From various empirical studies presented in the mapping of empirical studies, the
authors have not yet found research that constructs sequentially the theoretical basis behind the
information technology adaptation to improve the performance of micro small and medium
enterprises, starting from the basic theory of idea creation, which underlies the success of the
technology adaptation , to the successful use of technology with the performance of MSMEs as
an outpunt.
However, through this research, the author tries to compile these things in a study by using
the Innovation Diffusion and Innovation Decission Process Model (IDPM) as a grand theory,
Information Systems Success Model (DeLone & McLean, 2003) and Unified Theory of
Acceptance and Use of Technology2 (UTAUT2) (Venkatesh, et al., 2003) and Dynamic
Capabilities Theory (Teece, et al., 1997) as a middle range theory, as well as elements of
UTAUT2 theory, social media use (Odoom, et al., 2016) and MSMEs performance as the
applied theory (Fry, et al., 2018).
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The reason for the selection of the grand theory above is the phenomenon in this study that
there are problems related to the non-maximum performance of the Archipelago MSMEs in
Indonesia which are hampered by the existence of communication media, information transfer
and marketing patterns that on average still use conventional media, given the limited resources
and infrastructure. Therefore, the Grand Theory used in this study is the Innovation Diffusion

Volume: 63 Issue: 6
and Innovation Decission Process Model (IDPM). Where this theory underlies the idea that
MSME Islands need to innovate, the decision to do this innovation must be communicated to all
elements in MSME.
Considering that the main obstacle that is suspected to be a factor causing the non-
maximum performance of the Archipelago MSMEs in Indonesia is the problem of
communication, information transfer and marketing patterns that on average still use
conventional media, the innovations carried out are innovations in technology and information
systems so that the theories that support the Grand Theory and standing as Middle Range Theory
is a Model of Success of DeLone & McLean information systems through this theory
technological innovation and information systems carried out by MSMEs can be evaluated
against the systems implemented in a company is a very important thing to do. From this
evaluation, we can find out which parts of the company system that need to be improved, need to
be improved, or need to be maintained.
Then, the next Middle Range Theory used in this study is Unified Theory of Acceptance
and Use of Technology2 (UTAUT2). This model is used to reinforce the concept of technology
acceptance adopted as an innovation of the UKMM Archipelago in Indonesia and the last Middle
Range Theory used is Dynamic Capabilities Theory where the dynamic capability approach
seeks to analyze the sources of technology adoption by MSMEs besides being accepted by its
users also able to support the competitiveness and performance of the company.
The elaboration of the Grand Theory and Middle Range Theory above becomes one of the
Novelty or Novelty of Research in this study, which the author has not found in previous
empirical studies.
2.2. Archipelagic Social Media Use

The economic nature of small islands (archipelago) is such that the majority of companies
are classically called micro, small and medium enterprises (MSMEs). While the MSME
definition can vary in different countries to include different thresholds for the average number
of employees, annual income or asset value (Smith & Deslandes, 2014; Caribbean Development
Bank, 2016; Nicholson & Lashley, 2016); Wold Bank criteria are businesses with less than 300
employees (International Finance Corporation, 2012; Zavatta, 2008). It can be said that to
advance the contemporary area of MSME research in a broader discourse on corporate
competitiveness is important. This allows for the development of approaches to the nuances of
the competitiveness of small islands (MSME Islands) that are different from other contexts
through the use of internet technology.
In Indonesia the use of internet technology began around 1995 when Indo Internet opened
its services and the 1997s began to develop rapidly. But now the use of this technology is still
dominated by institutions such as banking, commerce, mass media, or industry. Nevertheless,
internet business innovation will continue to be born to overcome the constraints of the weakness
of the fixed internet network, user segments, to demographic and geological barriers such as the
scattering of islands in the archipelago and the limited payment card holders. As a virtual space
(online) and as a market, Indonesia's social media is very large in volume and will continue to
grow and be active. Even though most of the users use social media and the internet to just
socialize, (Ahyuna, et al., 2013).
Social media is a very open media platform. That is, it allows anyone to produce and
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consume it. With high involvement, where users can interact with the account owner (admin),
communication on social media takes place both ways and in real time. Ease of operating social
media also allows anyone, even those who have minimal knowledge of the internet and
information technology can manage a social media account (Prihandari & Hamim, 2018).

Volume: 63 Issue: 6
The use of social media is basically specifically aimed at attracting new customers, but it is
also possible to maintain relationships with old customers, increase awareness, communicate
brands online, and receive feedback from consumers and business partners (Michaelidou, et al.,
2011). In the end, the profit that results from using social media is performance improvement.
Research findings(Schaup & Belanger, 2014) shows empirical evidence of the value of
Facebook's social media which has an impact on MSME performance.
Based on the explanation from the experts above and based on the need to realize the
competitiveness of small island MSMEs (Islands UMKM) which is different from other contexts
namely through the use of internet technology which in this case is the use of social media, then
in this study as a novelty of research researchers make it happen in a variable called Archipelagic
Social Media Use. This variable was formed from indicators adopted from the research proposed
by Mandal and McQueen (2012) as the domain of technical media, and research from Odoom et
al (2016) as social domains so that they can truly represent the characteristics of Archipelagic
variables Social Media Use.
According to Mandal and McQueen (2012), Social Media Use has indicators including
duration, frequency and intensity. Meanwhile according to(Odoom, et al., 2016)Social Media
Use indicators are attract new customers, nurture relationships with clients and customers,
communicate firm's brand online, Receiving feedback, Create awareness of our brands and
Answering queries from customers and respond to requests. While the addition of researchers is
the content and area. The content of the conversation must be brief but clearly understood by the
recipient of the news. Contents that are too long will complicate communication between the
MSMEs of the islands. The area needs to be taken into account because the islands have limited
signal strength supporting communication media. Therefore,Archipelagic Social Media Use
indicators in research refer to the elaboration of Mandal and McQueen (2012), Odoom, et al.
(2016) and the definitions explained by experts so constructed as follows: (a) Duration; (b)
Frequency; (c) Intencity; (d) attract new customers; (e) nurture relationships with clients and
customers; (f) communicate firm's brand online; (g) Receiving feedback; (h) Creating awareness
of our brands and (i) Answering queries from customers and responding to requests.
2.3. Characteristic Owner
In general, Top Management in small and medium-sized companies is held by the owner
of the company. The characteristics of the owner and manager are one of the main symbols of
entrepreneurship from SMEs. The owner or manager identifies technologies opportunities and
coordinates the process of obtaining resources. The behavior of the entrepreneur and the main
variables in the characteristics of the owner / manager are age, education, work experience
innovativeness and personality traits (Hartono, 2009; Mandal & McQueen, 2012).
The characteristics of the owner are needed when the company wants to experience
growth, but the characteristics of the company and the nature of its strategic planning and
management processes are also important. The company's life cycle model which shows that a
company moves through various stages of the company's resource-based and owner's business
orientation, because the owner's strategic compensation determines business development
(Ismanto & Irawan, 2018).
The progress of SMEs is very dependent on the ability of their owners. The characteristics
of the owner who is innovative, has ambition and passion in advancing the business can more
easily develop or improve his business(Zoysa & Herath, 2007). The SME owner is the sole
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controller in the company both in the production process and in marketing. SME owners
determine business strategies, business processes and there is no standard managerial division, so
the characteristics of SME owners become an important factor in improving company
performance through the ability to market the products produced.

Volume: 63 Issue: 6
In this study, indicators of the characteristics of company owners refer to research

conducted by Mandal & McQueen (2012), which is complete as follows:
1) Innovativeness
Innovativeness is a picture of the general personality of a person in giving birth to ideas or
new ideas related to an object.
2) Personality Traits
Personality trait can be defined as the character or personality traits of someone who tends to
be easy to accept and utilize the novelty born of visionary thinking.
2.4. Performance Expectancy
Performance expectancy or also the expectation of performance is the level where someone
believes that using the technology or system can simplify or improve work performance, according
to Venkatesh et al., (2003) the relationship between Performance expectancy and intention behavior
is moderated by the gender and age at which. Which in his research shows that this effect occurs in
young men. Minton and Schneid in Venkatesh et al. (2003) also proved that basically that men are
more likely to be task oriented than women. This performance expectation is supported based on
previous technology acceptance theories.
Davis in Venkatesh et al. (2003) regarding his theory, TAM, defines that performance
expectancy is similar to his theory of perceived usefulness in which it relates to how confident a
person is that using a system will speed up its work, facilitate, and increase its productivity. This
is also similar to research conducted by Davis et al. in Venkatesh et al. (2003) regarding the
theory of extrinsic motivation which explains the perception of users who are willing to use or
do an activity because it can improve their performance.
Performance expectancy also built with the MPCU theory, which in MPCU defines that it
relates to how capable a technology / system can improve one's work performance as well as can
increase effectiveness in carrying out a task, speeding up work, and by using technology can produce
more output compared not using technology (Moghavvemi, et al., 2011).
Based on the above theory, it can be drawn that the expectation of performance expectancy
is an individual's trust in a system where if they use the system or technology it can improve
their performance and effectiveness in doing their work. IndicatorPerformance
Expectancyreferring to the research of Venkatesh, et al. (2003) are as follows:
1) Perceived Usefulness
Perception of usefulness is a perception or how far someone believes and believes that using a
particular system will increase and improve its performance.
2) Extrinsic Motivation
Extrinsic Motivation is a perception that the user wants to do an activity because it is
considered as a tool in achieving valuable results that are different from the activity itself.
3) Expectation Outcome
Expectation Outcome are consequences that are born and related to behavior.
2.5. UMKM Performance
MSME is a business entity that continues to be a concern and always gets priority by the
government. According to Law Number 20 Year 2008 article 1 concerning SMEs, Micro, Small
and Medium Enterprises are:
1) Micro business is productive business owned by individuals or individuals and
/ or individual business entities that meet the criteria for micro business as regulated in this
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Law.
2) Small business is a productive economy business that stands alone, which is
carried out by individuals or business entities that are not subsidiaries or branch companies
that are owned, controlled, or become a part of either directly or indirectly of medium or large
businesses that meet the criteria of small businesses as referred to in this Act.

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3) A medium-sized business is a productive economic business that stands alone,

which is carried out by an individual or business entity that is not a subsidiary or a branch of
the company that is owned, controlled, or becomes a part either directly or indirectly with a
small business or large business with a net worth or proceeds from sales of years as regulated
in this Law.
MSMEs can take the form of individual companies, partnerships, such as firms and CVs,
or limited liability companies. MSMEs can be categorized into three, mainly based on the
number of assets and turnover as listed in Act Number 20 of 2008 concerning MSMEs as
follows:
1) Micro business
(a) Assets less than Rp 50,000,000.00 and have net assets of less than or equal to Rp
50,000,000.00.
(b) Turnover is less than IDR 300,000,000.00 and has annual sales results of less than IDR
300,000,000.00
2) Small business
(a) Assets above Rp 50,000,000.00, under or equal to Rp 500,000,000.00 and having net
assets of more than Rp 50,000,000 up to a maximum of Rp 500,000,000.00 excluding
building premises.
(b) Turnover is below Rp. 300,000,000.00, above or equal to Rp. 2,500,000,000.00 and has
annual sales results of more than Rp. 300,000,000.00 up to a maximum of Rp
2,500,000,000.00.
3) Medium Business
(a) Assets of less than Rp. 500,000,000.00, more or equal to Rp. 10,000,000.00 and have a
net worth of more than Rp. 500,000,000.00 up to a maximum of Rp 10,000,000,000.00
excluding land and buildings for business premises.
(b) Turnover is more than Rp 2,500,000,000.00, less or equal to Rp 50,000,000,000.00 and
has annual sales results of more than Rp 2,500,000,000.00 up to a maximum of Rp
50,000,000,000.00
Hasibuan (2002) states that performance is a result of work achieved by a person or
organization in carrying out tasks assigned to it based on skill, experience and sincerity as well
as time. Meanwhile, according to Veithzal Rivai (2005) in performance is the result or overall
level of success of a person during a certain period in carrying out the task compared with the
possibility, such as the work, targets, targets or criteria that have been determined in advance and
have been mutually agreed upon. Another understanding was conveyed by Helfert (Srimindarti,
2004) that a company's performance is a complete view of the state of the company for a certain
period of time,
From some of the notions of performance and MSME above, it can be concluded that
MSME performance is the work achieved as a whole and compared with the work results,
targets, targets or criteria that have been determined in advance and have been mutually agreed
upon in a business entity with the criteria of assets and turnover specified in the law.
Performance is referring to the achievement or achievements of the company in a certain
time. The variables in this study were developed from the performance that has been examined
by Munizu (2010) and Mandal and McQueen (2012). The indicators used to measure
performance are:
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1. New Customer Gain

New Customer Gain is the company's ability to get new customers.
2. Engage Customer

Volume: 63 Issue: 6
Engage Customer is the closest route made by the company to achieve some important points
that can make a business successful, such as customer loyalty, repeat purchases, customer
based profits, and also customer ambassadorship.
3. Word of Mouth Marketing
Word of Mouth Marketing is a form of communication about products and services between
people who are considered independent of the company providing the product or service, in a
medium that will be considered independent of the company.
4. Sales Growth
Sales growth is a picture of the success of past investment period that can be used as a
prediction of growth.
5. Profit Growth
Profit Growth is the change in the percentage increase in profit that the company receives.
3. Research Methods
3.1. Research Approach
This study uses a positivist or scientific approach, because this study aims to identify causal
relationships that describe the behavior patterns of elements in organizations and to test existing theories
by developing research hypotheses. As stated by Popper that the positivist approach has two
characteristics, namely emphasizing general theory (theory) in special cases (case); and the existence of
clear demarcation criteria, so that it emphasizes what can be measured, not what can be
observed(Creswell, 2014).
3.2. Sample Collection Method

Population is a generalization area that consists of: objects / subjects that have certain
qualities and characteristics determined by researchers to be studied and then drawn conclusions
(Sugiyono, 2017). The population in this study consisted of all the UMKM archipelago in
Indonesia. The sample is part of the number and characteristics possessed by the population. The
population is quite spread across all islands in Indonesia, researchers may not study everything
that exists in the population, so the sample is taken from a truly representative population
(representing) (Sugiyono, 2017). Because of the large number of islands in Indonesia, with the
large number of MSMEs, writing is limited to the research sample in the Thousand Islands and
Riau Islands.
Based on the total population of this study that cannot be known and because there is no
detailed data collection on the research object and its growth is very dynamic, the determination
of the number of samples used refers to the minimum number of samples for analysis using
SEM, which is between 100 to 200 samples (Hair, et al., 2006). Based on the limitations of the
region's distance and willingness of respondents, the samples used in this study were 100 people
representing 100 MSMEs in the Riau Archipelago and the Thousand Islands
3.3. Data collection technique
The data collection method in this study is a survey method, which is a data collection method
based on questions raised to respondents designed to obtain information from respondents. Thus, in this
study data collection will be carried out through the delivery of questions that must be answered by the
respondents who became the study sample.
3.4. Data analysis technique

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The modeling in this research analysis is using SEM (Structural Equation Modeling). According to
Santoso, SEM is "a multivariate statistical technique which is a combination of factor analysis and
regression analysis (correlation), which aims to examine the relationships between variables in a model,
be it between indicators with their constructs, or relationships between constructs". Data processing and
analysis in this study, carried out using AMOS version 20(Santoso, 2015)
In the initial phase the test results will be presented using the initial research model, if in the initial model
there are still invalid constructs, the elimination process can be carried out. After eliminating the model, the
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researcher can still make modifications to the model developed, if it turns out that the resulting estimation has a
large residual(Santoso, 2015).
However, modifications can be made if the researcher has a strong theoretical justification, because
SEM is not intended to produce a theory but to test a model that has a correct theoretical footing.
Therefore, to provide an interpretation of whether the theory-based model being tested can be accepted
directly or need modification, the researcher must direct his research to the predictive power of the model
by observing the amount of residual produced(Santoso, 2015).
4. Analysis and Discussion of Research Results

4.1. Data analysis
Based on the results of the distribution of questionnaires it can be seen that the majority of
respondents in this study had a high school education with a total of 53 respondents (53%). When viewed
from the sex, most are women with a total of 60 respondents (60%). Furthermore, the characteristics of
respondents based on age, more dominated by respondents aged 31-35 with a number of 41 respondents
(41%).
Furthermore, data quality testing will be carried out by using data normality test, evaluation of
oulier, Multicollinierity and Singularity as well as the validity and reliability of the data to be presented as
follows:
Table 1
Normality Test Results
Variable min max kurtosis cr
X23 2,000 5,000 -, 022 -, 044
X22 2,000 5,000 , 335 , 684
X21 2,000 5,000 , 194 , 396
X12 3,000 5,000 , 694 1,417
X11 2,000 5,000 , 485 , 990
Y5 2,000 5,000 -, 468 -, 956
Y4 2,000 5,000 -, 296 - 604
Y3 2,000 5,000 , 139 , 285
Y2 2,000 5,000 - 377 -, 771
Y1 2,000 5,000 -, 022 -, 046
Z1 2,000 5,000 -, 403 - 822
Z2 2,000 5,000 -, 207 -, 423
Z3 2,000 5,000 -, 181 -, 370
Z4 2,000 5,000 -, 044 -, 091
Z5 2,000 5,000 -, 425 -, 867
Z6 2,000 5,000 - 269 - 548
Z7 2,000 5,000 - 626 -1,277
Z8 2,000 5,000 , 270 , 552
Z9 2,000 5,000 -, 370 - 756
Multivariate 13,243 2,344
Source: Primary Data Processed, 2020
The test results show that the value of cr mutivariate is outside ± 2.58, it means that the assumption
of normality is not fulfilled. This phenomenon is not a serious problem as stated by Bentler & Chou that
if the estimation technique in the SEM model uses maximum likelihood estimation (MLE) even though
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the distribution of data is not normal it can still produce a good estimate, so the data is feasible to be used
in subsequent estimations(Bentler & Chou, 1987).
Table 2
Outlier Test Results
Volume: 63 Issue: 6
Statistics Residuals
Min Max The mean Std. Deviation N
Predicted Value 10,14 96.90 50.50 15,641 100
Std. Predicted Value -2,581 2,967 , 000 1,000 100
Standard Error of Predicted Value 3,586 15,663 11,960 2,185 100
Adjusted Predicted Value -1.07 98.06 50.56 17,298 100
Residual -55,587 48,151 , 000 24,434 100
Std. Residual -2,045 1,771 , 000 , 899 100
Stud Residual -2,263 2,068 -, 001 1,004 100
Deleted Residual -68,060 66,429 -, 059 30,562 100
Stud Deleted Residual -2,324 2,113 -, 002 1,012 100
Expensive. Distance , 733 31,883 18,810 6,550 100
Cook's Distance , 000 , 085 , 013 , 017 100
Centered Leverage Value , 007 , 322 , 190 , 066 100
a. Dependent Variable: No
Outlier are observations or data that have unique characteristics that look very different from other
observations and appear in the form of extreme values for a single variable or a combination variable
(Hair, et al., 1998). Multivariate outliers were tested with Mahalanobis distance criteria at p <0.01 level.
Distance is tested with Chi-Square [2] on df for the number of independent variables (df = 19).
Conditions: if Mahalanobis> of value2 is a multivariate outlier. Based on the above table, after testing it
is known that the maximum MD value is 31.833 smaller than 36.191. Therefore it was decided in the
study that there were no outlier violations.
Next multicollinierity and singularity tests are performed. This test decision-making is done by
observing the Determinant covariance matrix, provided that if the determinant sample matrix approaches
0 (small), then multicollinearity and singularity occur (Tabachnick & Fidell, 1998). Based on the test
results using the AMOS 22.0 program, the Determinant of Sample Covariance Matrix results are> 0
which is 167,192 indicating that there is no multicollinearity and singularity in this data so that the
assumptions are met.
The next data quality test is testing the loading factor and Croncbach alpha values, complete as
follows:
Table 3
Validity & Reliability Testing Results
Cronbach's
Loading
Konstrak Indicator Alpha
factor
coefficient
Owner X11 0.833
Charac. 0.759
X12 0.763
(X1)
Perf. X21 0.767
Expec X22 0.837 0.830
(X2) X23 0.780
Z1 0.784
Z2 0.805
Z3 .874
Arch Z4 .883
Social
Z5 0.841 0.961
Media
Z6 .874
Use (Z)
Z7 .892
Z8 0.816
Z9 .854
Y1 0.761
Perceived Y2 0.794
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Susceptibi Y3 .852 0.930

lity (Z1) Y4 0.940
Y5 .906
eliminated
Based on the results of confirmatory factor analysis, it appears that the factor loadingseach question
indicator that forms each variable is mostly ≥ 0.5, so that the instrumentation indicators for each construct
Volume: 63 Issue: 6
can be said to be of fairly good validity and can be accepted. While the results of the internal consistency
reliability testing for each of the variables above shows good results where the Cronbach's Alpha
coefficient obtained entirely meets the required rules of thumb that is ≥ 0.7(Hair, et al., 1998).
If all the data quality tests have been declared to meet the requirements, then a further model and
causality test will be further explained as follows:
1. Model Testing
In the SEM model, the measurement model and the structural model the parameters are estimated
together. This method has a little difficulty in meeting the demands of the model fit. The biggest
possibility is caused by the interaction between measurement model and structural model which are
estimated together (One Step Approach to SEM). One step aprroach to SEM is used if the model is
believed to be based on a strong theory and the validity & reliability of the data is very good. The
estimation results and fit of the one step approach to SEM models using the Amos 22.0 application
program are shown in the Goodness of Fit Figure and Table below.
Figure 1
Model with One Step Approach
Table 4
Evaluate the Goodness of Fit Indices Criteria
Critical Model
Criteria Results
Value Evaluation
Cmin / DF 2,242 ≤ 2.00 Not Fit
Significance 0,000 ≥ 0.05 Not fit
RMSEA 0.112 ≤ 0.08 Not Fit
GFI 0.761 ≥ 0.90 Not Fit
AGFI .693 ≥ 0.90 Not Fit
TLI .879 ≥ 0.95 Marginal
CFI 0.895 ≥ 0.94 Marginal
Based on the test results above, it appears that the model does not meet the statistical
requirements because there are still many goodness of fit criteria, so that it still needs to be
modified. Commands indicating which parts must be modified based on the AMOS program are
presented in the appendix.If the model estimation is done the results are still not good, the author
can still make modifications as follows:
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Volume: 63 Issue: 6
Figure 2
Model with One Step Approach modification
Table 5
Evaluate the Goodness of Fit Indices Criteria
Critical Model
Criteria Results
Value Evaluation
Cmin / DF 1,331 ≤ 2.00 Fit
Significance 0.005 ≥ 0.05 Not fit
RMSEA 0.058 ≤ 0.08 Fit
GFI .856 ≥ 0.90 Marginal
AGFI .807 ≥ 0.90 Marginal
TLI 0.968 ≥ 0.95 Fit
CFI .973 ≥ 0.94 Fit
From the results of the evaluation of the one step modification model, it turns out that of all
the goodness of fit criteria used, most of them showed a good model evaluation results, meaning
that the model was in accordance with the data. That is, the conceptual model developed and
based on theory has been fully supported by facts. Thus this model is the best model to explain
the relationship between variables in the model in this study.
2. Causality Testing
Looking at the determinant of sample covariance matrix numbers: 167,192> 0 indicates that there
is no multicolinierity or singularity in this data so that the assumptions are met. Thus the magnitude of the
regression coefficients of each factor can be trusted as seen in the causality test below:
Table 6
Causality Test Results
Regression Weights Ustd Std
Prob.
Factor  Factor Estimate Estimate
OC_X1  ASMU_Z 0.923 .687 0,000
PE_X2  ASMU_Z 0.217 .186 0.043
ASMU_Z  SMSEsP_Y 0.835 0.824 0,000
Limits of Significance ≤ 0.05
Information:
X1 = Owner Characteristic
X2 = Performance Expectancy
Z = ASMU (Archipelagic Social Media Use)
Y = Performance SMSEs
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Judging from the level of probability of the causal relationship, the hypothesis which states
that the variable:
1. Owner Characteristic (X1) influences Archipelagic Social Media Use (Z), is acceptable (Prob.
Causal 0,000 ≤ 0.05 (significant).

Volume: 63 Issue: 6
2. Performance Expectancy (X2) has an effect on Archipelagic Social Media Use (Z), it can be
accepted (Probability is 0.043 ≤ 0.05 (significant).
3. Archipelagic Social Media Use (X) has an effect on SMSEs Performance (Y), acceptable
(Prob. Cause 0,000 ≤ 0.05 (significant).
4.2. Discussion
Based on the test results with the help of the AMOS 22.0 program, the first causality test
showed that the Owner Characteristic had a significant influence on Archipelagic Social Media
Use. This result is shown by the probability value obtained at 0,000 where the value is greater
than the specified cut-off value of 0.05. These results indicate that when the character of the
archipelago MSME owner in Indonesia is an innovative businessman, he will not hesitate to use
Archipelagic Social Media to support the development of his business.
This can be caused because in general Top Management in small and medium-sized
companies is held by the owner of the company. The characteristics of the owner and manager
are one of the main symbols of entrepreneurship from SMEs. The owner or manager identifies
technologies opportunities and coordinates the process of obtaining resources. The behavior of
the entrepreneur and the main variables in the characteristics of the owner / manager are age,
education, work experience innovativeness and personality traits (Hartono, 2009; Mandal &
McQueen, 2012).
The progress of MSMEs depends very much on the ability of their owners. The
characteristics of the owner who is innovative, has ambition and passion in advancing the
business can more easily develop or improve his business(Zoysa & Herath, 2007). MSMEs in
the archipelago are currently lagging behind MSMEs in other regions due to the limited use of
technology and the use of social media, so that the range of products marketed is also not widely
available.
According to Rafiah & Kirana (2019), social media is content that contains information
created by people who use publishing technology, is easily accessible and is intended to facilitate
communication, influence, and interact with others and with the general public. Nowadays, the
practice of marketing through social media is beginning to develop and is used as a product
marketing tool and promoting a company's brand. Social media is a gathering place for people
who want to share information and a place to find new friends and interact with other friends
online. Social media that are growing very rapidly in Indonesia are Instagram, Facebook, Twitter
and the like.
That is, if the owner of UMKM has innovative characteristics and likes challenges and has
a willingness to always learn to keep abreast of the times, then the owner of UMKM will not
hesitate to use social media as a support for managing his business. This opinion is supported by
research proposed by Mandal & McQueen (2012) which states that the owner characteristic has a
In the second causality test the result is thatperformance expectancyhas a significant
influence on Archipelagic Social Media Use. This result is shown by the probability value
obtained at 0.043 where the value is greater than the specified cut-off value of 0.05. These results
indicate that the better the ability of the system or online media offered by social media, the
owners of MSMEs will not hesitate to use Archipelagic Social Media to support the development
of their businesses.
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This can be caused by performance expectancybuilt through MPCU theory, where in

MPCU defines that it relates to how capable a technology / system can improve one's work
performance as well as can increase effectiveness in carrying out a task, speeding up work, and
by using technology can produce more output than not using technology (Moghavvemi, et al.,
2011).

Volume: 63 Issue: 6
That is, to sustain the weak performance of the archipelago MSMEs at this time, it requires
a media that is expected to be a generator of promotion and marketing of the products of the
archipelago MSMEs. The simplest technology is the use of social media. More and more people
are using social media, especially Instagram to inspire marketers to use it as a marketing
communication medium of products and services produced. Where everyone not only becomes a
user, but also can become a publisher. It can be said that social media is a very effective platform
for communicating and listening to consumer opinions, such as giving criticism, suggestions and
complaints. Although marketing communication activities are carried out online, but the effects
of marketing can also have an offline impact, through word of mouth. If you are able to combine
online and offline marketing models, then it is certain that the products / services offered will be
easier for consumers to accept(Acheaw & Larson, 2015).
That is, if all MSME elements have a positive perception of the use of systems and
technology, then they will try to learn and adapt to find what technology or system is the most
appropriate, easy and inexpensive to use, but has a huge impact on their business. Apparently,
the choice of most Indonesians is to use social media. This opinion is supported by research
proposed by Mandal & McQueen (2012) which states that Performance Expectancy has a
Next is the third causality test, showing the results that Archipelagic Social Media Use has
a significant effect on SMSEs Performance. This result is shown by the probability value
obtained at 0,000 where the value is greater than the specified cut-off value of 0.05. These results
indicate that when the island's MSME owners make optimal use of Social Media, it can
significantly support their performance improvement.
This can be caused by the practice of marketing through social media being adopted by
businesses in various sectors in order to develop their businesses, however there are still quite a
lot of business actors who have not utilized the functions of social media as digital marketing
media optimally. One of them is by the micro and small businesses (MSMEs), especially in
remote areas who tend not to know the development of digital media for the marketing process.
MSMEs must be careful in choosing social media that suits their marketing objectives(Lau,
2016). Facebook is more suitable for the purpose of reaching more audiences because its user
character extends from all levels so that MSMEs can build relationships and awareness by
utilizing the features of events, status updates, and responding directly to feedback from
consumers. MSMEs can maximize the use of Facebook as a digital marketing medium by using
page features and by making descriptive updates with photos and website links for call-to-action.
Meanwhile, Instagram is suitable for building awareness and creating relationships with
consumers, especially with the presence of Instagram business features that offer a variety of
services that make it easy for consumers to interact with consumers.
More and more people are using social media, especially Instagram to inspire marketers to
use it as a marketing communication medium of products and services produced. Where
everyone not only becomes a user, but also can become a publisher. It can be said that social
media is a very effective platform for communicating and listening to consumer opinions, such
as giving criticism, suggestions and complaints. Marketing communication activities are carried
out online, but the effects of marketing can also have an offline impact, through word of mouth.
If you are able to combine online and offline marketing models, then it is certain that the
products / services offered will be easier for consumers to accept(Acheaw & Larson, 2015).
1584
The wider marketing range of a company, it will make the company and its products more
well known in the market. This of course will indirectly improve the performance of the MSME
itself.

Volume: 63 Issue: 6
5. Closing
5.1. Conclusion
Based on the research results obtained, the conclusions that can be drawn are:
1. Owner Characteristichas a significant influence on Archipelagic Social Media Use. These
results indicate that when the character of the archipelago MSME owner in Indonesia is an
innovative businessman, he will not hesitate to use Archipelagic Social Media to support the
development of his business.
2. In the second causality test the results show that performance expectancy has a significant
effect on Archipelagic Social Media Use. These results indicate that the better the ability of
the system or online media offered by social media, the owners of MSMEs will not hesitate to
use Archipelagic Social Media to support the development of their businesses.
3. Archipelagic social media use has a significant effect on SMSEs Performance, which can be
interpreted when the MSME owners of these islands make optimal use of Social Media,
which can significantly support their performance improvement.
5.2. Suggestion
Based on the conclusions obtained, the following suggestions can be made:
1. this research is expected to be able to enrich the marketing literature, specifically related to
technology adaptation in the UMKM Islands, where it is expected to produce findings that are
able to explain the phenomena that are the focus of research while strengthening previous
research findings that have relevance. The findings of this study can also be used as a
reference for further research that wants to re-raise similar topics but with different objects.
2. This research is expected to be able to provides an overview of MSME owners, policy makers
and faunders of the weaknesses and constraints that surround the growth of archipelagic
MSME performance, and matters that need to be improved and facilitated so that MSME in
general and MSME archipelago in particular are able to adapt technology in an effort to
improve its performance.
6. References
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Volume: 63 Issue: 6
8. Fry, A., Ryley, T. & Thring, R., 2018. The Influence of Knowledge and Persuasion on
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Role Social Media Archipelagic use in

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2.2. Archipelagic Social Media Use

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In this study, indicators of the characteristics of company owners refer to research

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3) A medium-sized business is a productive economic business that stands alone,

1. New Customer Gain

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3.2. Sample Collection Method

3.4. Data analysis technique

4. Analysis and Discussion of Research Results

Susceptibi Y3 .852 0.930

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This can be caused by performance expectancybuilt through MPCU theory, where in

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Foundations and Trends in Information System, 2 (1), pp. 1-116.

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August 17, 1945.

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