See discussions, stats, and author profiles for this publication at: https://www.researchgate.

net/publication/264819244

Adoption of social networks marketing by SMEs: Exploring the role of social

influences and experience in technology acceptance

Article  in  International Journal of Internet Marketing and Advertising · January 2012

DOI: 10.1504/IJIMA.2012.044959

CITATIONS READS

57 5,095

3 authors, including:

Iryna Pentina Thuong T. Le

University of Toledo University of Toledo
63 PUBLICATIONS   1,365 CITATIONS    15 PUBLICATIONS   322 CITATIONS   

SEE PROFILE SEE PROFILE

All content following this page was uploaded by Iryna Pentina on 11 August 2015.

The user has requested enhancement of the downloaded file.

Int. J. Internet Marketing and Advertising, Vol. X, No. Y, xxxx 1

Adoption of social networks marketing by SMEs:

exploring the role of social influences and experience
in technology acceptance

Iryna Pentina*, Anthony C. Koh and

Thuong T. Le
Department of Marketing and International Business,
University of Toledo,
2801 W. Bancroft St. Toledo, OH 43606-3390, USA
Fax: 419-530-4610
E-mail: Iryna.Pentina@UToledo.edu
E-mail: Anthony.Koh@UToledo.edu
E-mail: Thuong.le2@utoledo.edu
*Corresponding author

Abstract: As social media increasingly penetrate the business world, it is

important to understand the underlying reasons for companies to adopt social
networks marketing (SNM). This study extends the technology acceptance
model (TAM) to explore the role of social influences in the context of SNM
technology adoption by small and medium companies, and considers how the
temporal aspect of new technology adoption affects this relationship. Our
findings show that adoption of SNM is strongly influenced by social influences
from experts, competitors, and customers. These social influences affect
intention to adopt this new technology both directly, and by affecting the
perceptions of the technology usefulness. For SMEs already using SNM, social
influence is the only strong determinant of the intention to continue employing
this marketing technology, with the amount of experience with SNM
strengthening this relationship.
Keywords: social networks marketing; SNM; social media; technology
acceptance model; TAM.
Reference to this paper should be made as follows: Pentina, I., Koh, A.C. and
Le, T.T, (xxxx) ‘Adoption of social networks marketing by SMEs: exploring
the role of social influences and experience in technology acceptance’, Int. J.
Internet Marketing and Advertising, Vol. X, No. Y, pp.000–000.
Biographical notes: Iryna Pentina is an Assistant Professor at the University of
Toledo. Her research interests include social and interactive marketing,
applicability of marketing theory to online sales situations, internet retailing,
and virtual communities. She has published papers in journals such as the
European Journal of Marketing, Journal of Retailing, Journal of Electronic
Commerce Research, European Journal of Innovation Management, Journal of
Consumer Behaviour and Journal of Customer Behaviour.
Anthony C. Koh is the Chair and an Associate Professor at the Department of
Marketing and International Business, University of Toledo. His major research
works have appeared in several publications, including International Marketing
Review, Journal of Business Research, Journal of Global Marketing, Journal of
the Academy of Marketing Science, Journal of Teaching in International
Business, International Business Review and the Journal of Electronic
Commerce Research.

Copyright © 200x Inderscience Enterprises Ltd.

2 I. Pentina et al.

Thuong T. Le is a Professor of marketing, e-business and supply chain

management at the College of Business Administration, University of Toledo.
His teaching and research focus on B2B e-commerce, internet marketing,
social computing, supply chain management and global business. His recent
research has appeared in Industrial Marketing Management, Electronic
Markets, Electronic Commerce Research and International Journal of Services
Technology and Management.

1 Introduction

Social media is the fastest-growing marketing channel in the world (Coremetrics, 2010).
Expenditures on social media marketing in the USA are predicted to grow 34% annually
and reach $3.1 billion in 2014 (Forrester Research, 2009). This trend reflects the
paradigm shift within advertising and marketing communications industry: from
one-way, ‘cluttered’ mass media to interactive, narrowly targeted approaches and towards
synergistic integration of all company communications. As opposed to paid online
advertising (banner, text, and search), social networks marketing (SNM) involves
initiating viral consumer-to-consumer communications by creating company/brand fan
pages and managing promotions and public relations within most popular social
networks, such as Facebook, YouTube, and Twitter. Such social networks applications as
product sharing and voting, collaborative design, and product launch announcements may
provide relevance, immediacy, and convenience to customers, as well as publicity and
brand name recognition to the company (Evans, 2009). This marketing medium appears
to be especially advantageous for small and medium-size enterprises (SMEs) due to its
moderate costs, and the flexibility with which smaller organisations can adapt social
networks for both marketing and new product development. While the advantages of
SNM are strongly supported by experts, the decision to adopt this new marketing
technology by SMEs is not automatic: challenges include lack of demonstrable results,
and difficulties in developing measurement metrics to estimate its effectiveness (Internet
Advertising Bureau, 2010). These challenges, as well as the risk of potential negative
viral spread damaging a company’s reputation, pose obstacles to extensive SNM
adoption. In spite of this, increasing numbers of businesses and brands make social
networks an integral part of their marketing strategy. Understanding the drivers of SNM
acceptance by SMEs may help provide practical advice and guidance to companies in the
process of strategic marketing planning and budget allocation, as well as assist academics
in further development of strategic marketing theory in the area of SNM.
The technology acceptance model (TAM) postulates that for an organisational
decision-maker, a decision to adopt a new technology is mainly based on the perceptions
of its ease of use and usefulness (Davis, 1989). Since using social networks does not
require considerable technological skills, but instead relies on the synergistic employment
of existing marketing, PR, and customer service skills, and because SNM usefulness in
terms of measurable marketing performance is difficult to assess, other factors may be
responsible for the decision to adopt SNM. This paper proposes the role of social
influences (SIs) (by industry leaders, competitors, and customers) as an additional
antecedent to SNM acceptance by small and medium companies, and compares its role at
different adoption stages. In the remainder of the paper, we develop our theoretical
 Adoption of social networks marketing by SMEs 3

model, describe data collection and testing methods, report and discuss the results, and
provide conclusion, managerial recommendations, and suggestions for future research.

2 SNM and small businesses

Recent developments in Web 2.0 and 3G/4G technologies have created a major paradigm
shift in business-to-customer relationships: a shift in information control. Customers are
no longer passive ‘receivers’ of company and brand-related marketing messages. Instead,
they are engaged in initiating conversations with and providing feedback to businesses, as
well as in creating and sharing content among themselves. Social network sites allow
users to create and share personal profiles, establish and develop new connections, and
provide and acquire information in an interactive manner (Boyd and Ellison, 2008). Open
access to other members’ contacts provides consumers unprecedented opportunities to
control the process of marketing communications by exponentially spreading viral
messages about products, brands, and/or customer service that can be either detrimental
or beneficial to any business. Given the remarkable size and growing marketing potential
(e.g., Facebook with its 500 million members commands a 20% share of the US online
advertising, social networks are acquiring strategic significance for companies
that appreciate their capacity for targeting, promotion, public relations, and market
research (Nielsen, 2010). According to eMarketer (2010), US online social network and
word-of-mouth marketing spending will grow 35% in 2010 to over $1 billion, and will
exceed $3 billion in 2012. This is substantially higher than paid social network
advertising that will rise 7.1% in 2010 (eMarketer, 2010).
Currently, most prevalent SNM practices involve creating and operating a company’s
fan page, managing promotions, maintaining public relations, and conducting market
research. Other activities include providing customer support, encouraging customer
reviews and discussions, and recruiting (McCorvey, 2010). Both academics and
practitioners agree that the key to business success with SNM is the ability to engage
followers. For example, Organize.com, an online seller of house and office products,
invited its followers to a two-hour Twitter party, bringing in 323 orders and $15,000 in
incremental sales. The online clothes store WetSeal has increased sales by 10% and an
average order value by another 10% by launching a community section of their site where
fans can design their own ensembles and publish them to the community for reviews.
Zappos (an online shoe store) uses Twitter to address customer service issues and to
reinforce their reputation by encouraging employees to participate in Twitter. It has been
noted that smaller companies are more suited to utilise SNM due to their greater
flexibility and higher need to contain marketing communications costs (Harris and Rae,
2009). Indeed, 91% of the Inc. 500 companies used at least one social media tool in 2009
(up from 77% in 2008), and 43% of the 2009 Inc. 500 companies reported that social
media was very important to their marketing strategy (Schweitzer, 2009).
While certain successes with using SNM are widely publicised and analysed, and the
advantages of using these media by small and medium businesses are extensively
discussed, the decision to adopt SNM as a marketing tool by SMEs is not automatic
(Drossos et al., 2011). As the 2009 GfK Roper survey of 500 businesses with fewer than
100 employees shows, 76% of executives find sites like Facebook, Twitter, and LinkedIn
to be of little help in finding new sales leads. In addition, 86% of those surveyed do not
use social networking sites for business advice or information (Schweitzer, 2009). It also
4 I. Pentina et al.

found that most of these businesses had not used online networks at all because they
considered it a waste of time (Economist, 2010). According to the Internet Advertising
Bureau (2010), major challenges of SNM include lack of demonstrable return on
investment (74% of respondents), as well as absence of reliable reporting metrics for this
emerging marketing tool (64% of respondents). Similarly, a Marketing Sherpa study
found inability to measure return on investment a major barrier to social media marketing
for 43% of responding organisations (Marketing Sherpa, 2009). Metrics such as the
number of viewers, visitors, friends, or followers do not automatically translate to higher
conversions, order value, or sales. It is true that given their viral characteristics, SNM
may be more effective in building brand awareness and enhancing brand reputation than
generating leads and increasing sales (Barnes and Hair, 2009). But even in this function,
SNM is only one part of integrated marketing communications, and it is difficult to
ascertain its contribution compared to paid advertising and other types of promotion.
Another issue is the length of time required for each new SNM tactic to work and the
resulting problem of measurement timing. Finally, quantifying engagement (the main
goal of SNM) that does not necessarily parallel numbers of friends, subscribers, tweets,
and retweets is still an unresolved issue. In spite of the existing scepticism regarding
SNM effectiveness and measurability, ever increasing number of companies worldwide
plan to incorporate it into their marketing programmes and to shift resources away from
traditional to SNM. The 2010 Customer Engagement Report by cScape/eConsultancy
shows that 61% of more than 1,000 surveyed marketers worldwide plan to increase
investment in social media in 2010 (Econsultancy, 2010). Forrester Research also
predicts that social media will see the steepest growth of any channel, a 34% CAGR over
the next five years, exceeding $3 billion by 2014 (Forrester Research, 2009). Given the
aforementioned lack of demonstrable success and adequate measurement metrics, other
factors (e.g., striving to be the first mover or the bandwagon effect) may be responsible
for the adoption of the SNM technology by small and medium companies. This study
applies the extended TAM to explore the role of SIs in the context of SNM technology
adoption by small and medium companies, and considers how the temporal aspect of new
technology adoption affects this relationship.

3 Conceptual framework and hypotheses development

The TAM is a theory that predicts intentions to adopt a new technology by organisational
users/decision-makers (Davis, 1989; Davis et al., 1989). It appears to be especially
applicable to the SME context that is characterised by fewer hierarchical management
levels, and as a result, a more direct decision making process (Thrassou and Vrontis,
2008). TAM has been widely applied and empirically supported to predict the adoption of
information technology (Davis, 1989; Taylor and Todd, 1995), computers (Davis et al.,
1989), spreadsheets (Mathieson, 1991), technology-based self-service (Dabholkar and
Bagozzi, 2002), e-business (Parker and Castleman, 2009), mobile marketing (Sultan et
al., 2009), mobile commerce (Wu and Wang, 2005), and many other information and
business-related technologies. Rooted in the social-psychology theory of reasoned action
(Fishbein and Ajzens, 1975) and theory of planned behaviour (Ajzen, 1991), TAM posits
that a user’s (decision-maker’s) behavioural intention to use a technology is determined
by two beliefs: perceived usefulness (PU) and perceived ease of use (PEU). PU is the
extent to which a person believes that using the technology will enhance job
 Adoption of social networks marketing by SMEs 5

performance, and PEU is the belief that using the technology will be free of effort. In
addition, PEU is posited to positively affect PU (Venkatesh and Davis, 2000). When
applied in varied technology and organisational contexts, PU has been very robust in
predicting user acceptance (standardised regression coefficients have consistently
approached 0.6), while PEU has shown a less consistent effect (Venkatesh and Davis,
2000). Based on the universality of the PU construct and its consistency in influencing
technology acceptance, we posit (Figure 1):
H1 PU will have a positive effect on intention to adopt SNM by SMEs.
In the SNM context, it appears that PEU is not a relevant predictor of SNM adoption.
PEU construct was traditionally connected to computer efficacy and reflected the degree
of technical skills and effort deemed necessary to use a new technology. The fact that
social networks websites were developed for mainstream users renders their technical
utilisation intuitive and user-friendly. Therefore, no substantial technical effort appears to
be required from a small business adopter of SNM to use these sites. In addition, social
networks websites are hosted and maintained by third parties that facilitate their use by
businesses and provide necessary technical support. Since the majority of small and
medium companies are still at the testing stage of this technology, the realistic assessment
of other skills (marketing, PR, customer service) needed for SNM to succeed may not be
possible. Therefore, we do not hypothesise any effects for PEU on either PU or intentions
to adopt SNM.
Multiple studies have attempted to extend TAM to include factors that may affect PU
for specific technologies and business environments. One of the most frequently
proposed determinants of PU has been SI, defined as a user’s perception that important
people think the user should adopt the technology (Venkatesh and Davis, 2000). The
rationale for SI – PU – intentions link is based on the notion of internalisation, whereas
the user incorporates an important referent’s belief into his/her own belief structure
(Kelman, 1958) as evidence about reality. The internalisation component of SI has been
compared to French and Raven’s (1959) expert power, when the user’s perception of the
technology usefulness increases based on persuasive social information. In the SNM
context, due to the lack of measurement metrics or positive bottom line results from the
companies that have adopted this marketing technology, PU appears to be strongly
determined by SI. Professional and mass media regularly emphasise the magnitude and
growing importance of social networks, and numerous marketing gurus explain the
potential advantages of getting involved with social media. In addition, various success
stories and case studies about companies that have creatively used social networks to
achieve sales goals penetrate the information space. While some negative information
about ‘social media hype’ is also present, experts and authors overwhelmingly agree that
using social networks for marketing presents great potential provided businesses find
their niche and formulate their goals correctly. Thus, we propose that internalisation
effect exists whereas SI positively affects PU in the context of SNM (Figure 1).
H2 SI will have a positive effect on PU of SNM by SMEs.
In addition to the indirect effect, SI has also been proposed to influence intention directly,
through the mechanism of compliance (French and Raven, 1959; Kelman, 1958).
Compliance occurs when the user believes that a social referent has the ability to reward
or punish the adoption behaviour, and is influenced by the referent’s opinion even
without accepting or internalising this opinion. Empirically, while Davis et al. (1989)
6 I. Pentina et al.

found that SI does not have a significant effect on intentions to use new information
systems over and above PU and PEU, Taylor and Todd (1995) found a significant direct
effect of SI on intention. In addition, SI has been shown to affect the adoption and use of
new media (Webster and Trevino, 1995) and adoption of new technology in education
(Robinson, 2006). In the study of broker workstations adoption, Lukas and Spitler (1999)
found that SI is a stronger predictor of intended use than PU or PEU. Finally, Venkatesh
and Davis (2000) confirmed both direct and mediated by PU effects of SI on intention to
adopt varied business process IT systems. In the social media context, businesses may be
compelled to use SNM because their customers and other stakeholders use online social
networks and expect being communicated to through this medium. Thus, businesses may
feel pressured to create their own fan pages even if they have not developed SNM goals
or strategies, and are not fully convinced in this technology’s effectiveness. Based on the
above, we hypothesise (Figure 1):
H3 SI will have a positive effect on intention to adopt SNM by SMEs.
The role of SI in adopting a new technology has been suggested to vary depending on the
degree of experience with the technology (Venkatesh and Davis, 2000). It is theorised
that at the early adoption stages, when knowledge about the technology is low, opinions
of experts and stockholders are more influential. After the technology has been
implemented, and when its strengths and challenges are better understood, the role of SI
subsides (Hartwick and Barki, 1994). Thus, Hartwick and Barki (1994) found that SI
effect on intention became insignificant three months after an information technology
implementation. Venkatesh and Davis (2000) reported that the influence of social factors
was significantly moderated by experience, decreasing both one and three months after a
new business technology implementation. Due to the lack of metrics for ascertaining
strengths and weaknesses of SNM, and uncertainty regarding the length of its effects on
building brand awareness and brand attitude, we theorise that SI will remain a major
influencer of intentions to adopt until results assessment and comparability are available
for the industry. In addition, once a business has established its social networks presence
and in the absence of objective performance indicators, compliance with customer
expectations may be the most important factor driving the continuation of SNM use.
Thus, those businesses that have had friends and fans following the company on the
social network for a long time, may feel obligated to continue SNM to avoid negative
repercussions (Figure 1).
H4 The positive direct effect of SI on intention to continue using SNM by SMEs will
increase with experience.

Figure 1 Applying TAM to SNM adoption by SMEs

 Adoption of social networks marketing by SMEs 7

4 Method

4.1 Procedure
Business executives of small and medium size companies in the Midwest who attended
the 2009 Annual Internet Marketing Conference sponsored by a Midwest university were
requested to fill out a paper-and-pencil survey about their experiences with, and plans for
utilising SNM (Appendix). Two versions of the survey instrument (for SNM adopters and
non-adopters) were distributed to the attendees. Both versions contained demographic
and psychographic questions about the company, respondent’s position and functional
area, and questions about reasons for adopting and possible benefits of SNM. They were
followed by the TAM scale questions adapted to reflect the differences between those
who were using SNM and those who were considering its adoption.

4.2 Sample
Out of 110 executives in attendance, 65 (59%) returned completed surveys. Due to the
exploratory character of this pioneering study, the sample size was deemed acceptable
for the purpose of detecting the phenomena of interest (and not for predicting or
generalising purposes), given the representative nature of the sample. Respondents
represented a wide variety of industries (Table 1), including consumer and business
services, business-to-business manufacturing, distribution, and retailing, with 80%
reporting annual revenues of less than $25 million (qualifying for the revenue-based SME
definition). A great majority (80%) of the respondents held decision-making positions of
owner, upper-, or middle-manager in their companies, which made them appropriate
subjects for testing TAM. Over 83% represented functional areas of marketing and
information technology that are mainly related to adoption and use of SNM. About
one-third (33.8%) of the sample were using SNM at the time of the conference, with the
remaining 66.2% admitting they had never used social networks for marketing before.
Table 1 Characteristics of the sample

Annual sales Position in

Primary business, % Functional area, %
range, % company, %
Consumer 38.5 Less than $1 32.3 Middle 38.5 Marketing 72.3
service provider million management and sales
B2B 18.5 $1.01 to $10 30.8 Upper 35.4 Operations 12.3
manufacturer million management
Business service 15.4 $10.01 to $25 16.9 Owner 6.1 IT 10.8
provider million
Distributor 12.3 More than 20 Business 5 Other 4.6
$25 million research
Consumer brand 7.7 Other 15
manufacturer
Retailer 6.2
8 I. Pentina et al.

4.3 Measures
The TAM scales for PU, PEU, intention to adopt a technology (Davis, 1989; Davis et al.,
1989) and the social influence scale (Taylor and Todd, 1995; Venkatesh and Davis, 2000)
were adapted to reflect the differences between SNM adopters and non-adopters. The
experience with SNM question “When did you start using SNM?” was only offered to
SNM adopters. Non-adopters’ version contained the question “When did you learn about
SNM?” in its place. Additional questions asked about reasons for SNM adoption and its
benefits, as well as what social networks sites respondents considered for SNM use or
were currently using (see Appendix). Descriptive statistics of main constructs are
provided separately for adopters and non-adopters in Table 2, and construct correlations
and covariances for the whole sample – in Table 3.
Table 2 Descriptive statistics for main constructs

# of Cronbach’s
Construct Range Mean Variance
items alpha
PU whole sample 3 4 (1 to 5) 2.95 1.025 0.92
SNM adopters 3 3.67 (1 to 4.67) 2.88 1.032 0.935
SNM non-adopters 3 4 (1 to 5) 3 1.047 0.91
Social influence whole sample 3 4 (1 to 5) 2.8 1.31 0.868
SNM adopters 3 4 (1 to 5) 3.29 1.389 0.867
SNM non-adopters 3 3.67 (1 to 4.67) 2.45 0.997 0.833
Experience: adopters 1 3 (less than 1 yr. to Median N/A N/A
between 4 and 5 yrs.) : less
than
1 yr
PEU whole sample 3 4 (1 to 5) 3.33 0.911 0.897

SNM adopters 3 4 (1 to 5) 3.3 1.364 0.944

SNM non-adopters 3 4 (1 to 5) 3.34 0.642 0.833

Intention to use whole sample 2 2.67 2.17 0.814 0.936

(0.67 to 3.33)
SNM adopters 2 2.67 2.52 0.58 0.972
(0.67 to 3.33)
SNM non-adopters 2 2.67 1.94 1.002 0.882
(0.67 to 3.33)
Table 3 Correlation-covariance matrix: whole sample

Social Intentions to
PU PEU
influence use
PU 1.025 0.518** 0.563** 0.171
Social influence 0.612 1.31 0.823** 0.151
Intentions to use 0.526 0.877 0.814 0.191
PEU 0.168 0.163 0.165 0.911
Notes: Correlations are above, and covariances – below the diagonal line containing
variances. **Correlation is significant at the 0.01 level (two-tailed). *Correlation
is significant at the 0.05 level (two-tailed).
 Adoption of social networks marketing by SMEs 9

5 Data analysis and results

Initial examination of the data revealed that the average adoption intention (intention to
continue using SNM in the case of companies already utilising this technology) is rather
low: 2.17 (var = 0.8) out of five, confirming the apprehensions companies may have
regarding this new marketing tool. When compared, the adopter group displayed a
significantly higher intention to continue using SNM (mean = 2.52) than the non-adopter
group - to adopt SNM (mean = 1.94, F = 5.857, p = 0.019). Consequently, the hypotheses
regarding the drivers of SNM adoption were tested separately for the adopter and
non-adopter groups. The results revealed that different mechanisms explain SNM
acceptance by small and medium companies that have not used this technology before
and the intention to continue using SNM by companies currently utilising this marketing
tool (Tables 4 and 5).
The regression analyses with intentions to adopt/continue using SNM (IA) as the
dependent variable and PU, PEU, and SI as independent variables confirmed
non-significance of PEU for either adopting (β = 0.1, p = 0.39) or continuing to use
(β = 0.2, p = 0.89) SNM by SMEs. However, mean values for PEU [3.34 (sd = 0.8) and
3.3 (sd = 1.2) respectively] do not support our assumption that companies perceive SNM
easy to use because they overwhelmingly consider this technology effortless. Even
though social networks are hosted and maintained by third-party companies and are
supported by their site maintenance staff, relatively low values for PEU in both groups
may reflect the respondents’ beliefs that using SNM requires additional skills and effort.
For example, a recent survey of senior level marketers showed that responsibility for
social media is expected to span a number of departments within an organisation,
requiring joint effort of marketing, PR, customer service, research, and IT functions
(Internet Advertising Bureau, 2010). Thus, once the decision to adopt SNM is made,
cross-functional teams may have to be created, contributing complementary knowledge
and skills that already exist in the company. Thus, although the perception of ease of
SNM use may be relatively low, this does not reduce the intention to adopt SNM due to
the expectation that existing company resources can be synergistically employed for its
purpose. The fact that PEU does not affect either the intention to adopt or the intention to
continue using SNM may also be explained by the presence of other, more significant
drivers of the adoption choice that outweigh the perceptions of ease of use. Our further
analysis supports this explanation.
Separate regression analyses were conducted for non-adopter and adopter groups to
identify the drivers of SNM acceptance and intention to continue its use, respectively.
The PEU variable was removed from these analyses based on the above insignificant
results. Our findings show that for companies that have not yet adopted SNM, both PU
(β = 0.414, p = 0.009), and SI (β = 0.516, p = 0.001), were strong predictors of IA,
supporting Hypotheses 1 and 3 (Table 4). Further, PU was found to mediate the influence
of SI on AI, supporting Hypothesis 2 (Sobel test statistic = 3.586, p < 0.001). The
mediation was partial, since SI and PU were both statistically significant in predicting IA
(Table 4).
For the adopter group (Table 5), the only significant variable affecting intention to
continue using SNM was SI (Hypothesis 3 supported). In order to test Hypothesis 4 and
to assess the role of experience in the SI – IA link, we conducted a separate moderated
regression for the adopter group with SI, Experience, PU, and SI*Experience as
independent variables, and the intention to continue using SNM as dependent variable
10 I. Pentina et al.

(Table 5). Our results supported Hypothesis 4: longer experience with SNM strengthened
the effect of SI on the intention to continue using it (β = 0.763, p < 0.001).
Table 4 Drivers of intention to adopt SNM by SMEs not currently using the technology

Dependent variable: intention to adopt SNM

Independent variables B Std. error Beta t p VIF
(Constant) 0.036 0.276 0.13 0.898
PU 0.307 0.109 0.4 2.825 0.009 1.66
SI 0.405 0.111 0.516 3.641 0.001 1.66

Mean
SS df F Sig.
square
R 0.828
R square 0.686 Regression 12.51 2 6.255 28.4 < 0.001
Adjusted r square 0.662 Residual 5.727 26 0.22
Std. error of the estimate 0.47 Total 18.238 28

Mediation of SI by PU in the decision to adopt SNM by non-adopter firms

Regression 1: Dependent variable: PU
Independent variables B Std. error Beta t p VIF
(Constant) 1.441 0.395 3.65 0.001
Social influence 0.651 0.15 0.635 4.35 < 0.001 1
Sum of Mean
df F Sig.
square square
R 0.635
R square 0.403 Regression 12.665 1 12.665 18.92 < 0.001
Adjusted r square 0.382 Residual 18.746 28 0.669
Std. error of the estimate 0.818 Total 31.411 29

Regression 2: Dependent variable: intention to adopt SNM

Independent variables B Std. error Beta t p VIF
(Constant) 0.483 0.251 1.92 0.65
Social influence 0.605 0.095 0.768 6.34 < 0.001 1
Sum of Mean
df F Sig.
square square
R 0.768
R square 0.59 Regression 10.842 1 10.842 40.25 < 0.001
Adjusted r square 0.575 Residual 7.543 28 0.269
Std. error of the estimate 0.519 Total 18.385 29
Note: Sobel test statistic = 3.586, p = < 0.001
 Adoption of social networks marketing by SMEs 11

Table 5 Drivers of intention to continue using SNM by SMEs currently using the technology

Dependent variable: intention to continue using SNM

Independent variables B Std. error Beta t p VIF
(Constant) 0.086 0.42 0.205 0.84
PU 0.068 0.146 0.069 0.464 0.648 1.399
SI 0.68 0.126 0.8 5.415 < 0.001 1.399

Sum of Mean
df F Sig.
square square
R 0.839
R square 0.704 Regression 14.81 2 7.405 22.55 < 0.001
Adjusted r square 0.672 Residual 6.241 19 0.328
Std. error of the estimate 0.573 Total 21.051 21

Moderation of SI by experience in the decision to continue using SNM by adopter firms

Dependent variable: intention to continue using SNM
Independent variables B Std. error Beta t p VIF
(Constant) 0.572 0.648 0.882 0.39
PU 0.025 0.152 0.025 0.162 0.873 1.525
SI 0.15 0.2 0.87 0.736 0.465 2.227
Experience –0.146 0.148 –0.142 –0.983 0.338 1.33
Experience*SI 0.216 0.043 0.763 5.002 < 0.001 1.49

Sum of Mean
df F Sig.
square square
R 0.848
R square 0.719 Regression 15.128 4 3.782 15.33 < 0.001
Adjusted r square 0.672 Residual 5.922 18 0.329
Std. error of the 0.574 Total 21.051 22
estimate

Additional questions about the benefits the companies expect to obtain from utilising
SNM, the SNM tactics they would employ, and the reasons they are interested in this
marketing technology complement our result. The single most prominent tactic all the
respondents selected was creating their company’s account on a social networks site and
inviting followers. There was no significant difference in types of benefits that adopters
and non-adopters expected from SNM. The benefits most frequently named by both
groups include: increasing brand awareness, spreading marketing message, and obtaining
customer feedback. Finally, non-adopters significantly outnumbered adopters in
naming the following reasons to join SNM: to try a new approach (chi-square = 15.665,
p < 0.001), to be an early player in the social networks medium (chi-square = 3.049,
p = 0.08), and to better reach our target market (chi-square = 5.682, p = 0.017). As can be
seen from the above responses, the major impetus to utilise SNM by SME respondents in
12 I. Pentina et al.

our sample is of exploratory nature, and is consistent with our finding of SI playing a
major role as a driver of SNM adoption and intention to use.

6 Discussion

According to our findings, social influence by experts, customers, and competitors affects
company intentions to adopt SNM both directly, and through the PU of SNM. Our
findings echo earlier results by Venkatesh and Davis (2000) who found that social
pressures exert both a significant direct effect on usage intentions over and above PU and
PEU, and an indirect effect on intentions mediated by PU. Our results also support Lukas
and Spitler’s (1999) found that the role of normative pressure in the intent to use
information technology is more important than perceptions about ease of use and
usefulness. For those SMEs already using SNM, SI appears to be the only strong
determinant of the intention to continue employing this marketing technology, with the
amount of experience with SNM strengthening this relationship. This result may be
explained by the relative newness of SNM that triggers massive publicity in professional
publications, industry circles, and in media, leading to the ‘bandwagon pressure’
(Pangarkar, 2000). The bandwagon theory argues that firms tend to imitate their rivals
regardless of value-enhancing consequences for themselves. This happens in the
environments characterised by ambiguity of costs and benefits assessment and/or
stockholder influences, provided the firm has sufficient resources to support the
imitation. In these conditions, the number of rival firms adopting a new technology
would serve as a proxy for the cost-benefit, means-ends, or environmental risk
indicators (Abrahamson and Rosenkopf, 1993). Since SNM is not considered capital- or
labour-intensive, and because its outcomes are still difficult to ascertain, many companies
may plan to continue using it for the sole reason of keeping up with their competitors.
This supposition is supported by the finding that the longer a company in our sample has
been employing SNM, the stronger the influence of social pressure from customers,
competitors, and experts on the intention to continue its use. Although our result
contradicts Venkatesh and Davis (2000) who found a negative effect of one- and
three-month experience on the social influence – intention to continue using a technology
link for mandatory technology use context, this difference emphasises both the voluntary
nature of SNM adoption and the newness of the SNM technology that amplifies
environmental ambiguity and mitigates outcome evaluation.
According to Gartner Inc. (Fenn et al., 2009), any emerging technology follows a
typical adoption path from over-enthusiasm through a period of disillusionment to an
eventual understanding of the technology’s relevance and role in a market or domain.
Each phase in this ‘hype cycle’ is characterised by distinct indicators of market,
investment, and adoption activities. Thus, Twitter is considered to have ‘tipped over the
peak’ of early adoption, and to be about to enter the infamous ‘trough of disillusionment’
characterised by negative press and failures (Fenn et al., 2009). In Gartner estimates, the
period from sliding into the ‘trough’ to ‘climbing the slope’ (understanding the
technology), to ‘entering the plateau’ (majority adoption) for this technology may take
from two to five years. From this estimate, SNM technology usefulness for businesses
will not be objectively evaluated for some time. With firms in our sample having had on
average less than one year experience with SNM, it appears that SI from the press,
experts, and customers will only increase as the experience with SNM use increases.
 Adoption of social networks marketing by SMEs 13

7 Conclusions and implications

With the social media penetrating the business world at an increasing pace, it is important
to understand the underlying reasons for companies to adopt SNM technology and to
develop strategies and guidelines for using it productively. The existing TAM does not
adequately explain SNM adoption due to TAM’s focus on more technical side of
technology acceptance, and lack of socially-determined variables in the model. This
paper extends TAM in the context of SNM adoption by SMEs. Our findings show that
adoption of new and emerging technologies is strongly influenced by SI from experts,
competitors, and customers. These SI affect intention to adopt a new technology both
directly, and by affecting the perceptions of the technology usefulness. Due to certain
amount of ambiguity surrounding the assessment of new technology effectiveness,
‘bandwagon pressures’ may serve as proxies for cost-benefit, means-ends, and
environmental evaluation, thus making SI the strongest determinant of intentions to
adopt. By following the ‘hype cycle’, companies that have adopted new technologies,
continue to be influenced by social pressure as they move from the peak of adoption
(characterised by maximum media hype) through the slope of disillusionment (with
negative media intensifying) to the plateau of mass adoption, at which point objective
assessment of technology effectiveness becomes possible.
Based on the above analysis, SME managers facing the decision to adopt or continue
using SNM should carefully balance the evidence to estimate how much their decision is
justified by a strategic goal vs. the bandwagon pressure, and whether the PU of SNM for
the firm stems from hard data or from anecdotal media accounts. In the absence of
generally recognised predictive metrics, in order to accurately ascertain the effect of each
social media marketing effort for their company, managers should set specific goals and
utilise appropriate metrics for their assessment. For example, if a Facebook branding
page is created to engage existing customers and reinforce their loyalty, its effectiveness
may be measured with online customer surveys, frequency and intensity of their
interaction on the page, and a net promoter score measuring the intention to spread
positive word-of-mouth. Similarly, a Twitter account established to tackle customer
service and PR issues should be gauged by measuring online ‘buzz’ and ‘retweets’.
Unique company communications needs should determine the purpose and tactics for
social media marketing, as well as the suitable metrics to ascertain its value.
While undeniable competitive advantages exist from being an early player, they can
only be achieved by following specific objectives, integrating SNM into your overall
marketing communications plan and monitoring the results by the means available.
Presence in the social media that is not supported by solid long-term strategy may
damage the brand by making it vulnerable to uncontrolled viral communications.

8 Limitations and future research suggestions

This paper contributes to the existing literature on technology adoption by clarifying the
importance of incorporating social elements into models of new technology adoption, and
by providing a tentative explanation to the role of experience in ‘social influence –
intention to adopt’ relationship. However, its results should be generalised with caution
due to relatively small sample (65 executives of small and medium Midwest companies).
Further research with a bigger and more diverse sample of companies is needed for our
14 I. Pentina et al.

conclusions to be extrapolated to the general SME population. Future research should

also consider a longer temporal dimension of new technology adoption both in terms of
its drivers, and the potential for a curvilinear effect of SI on adoption decision. Due to the
viral characteristics of social media, influences by customers, competitors, and marketing
experts on companies’ decisions to adopt and continue using SNM tools may manifest
differently compared to diffusion processes of other innovative technologies. The
function and length of experience with new technology and its effects on the decision to
continue using the technology also presents an interesting area for future research. Since
social media presuppose customer co-creation, the content of social network brand pages
may represent significant brand equity, thus imposing certain switching cost and the need
to continue maintaining the account. Finally, different types of social influence
(internalisation vs. compliance) may affect technology adoption decisions differentially
as the technology matures and the length of company experience increases.
Another promising area of research involving a longitudinal investigation may be
ascertaining the role of order of entry into social media marketing in determining
operational and financial performance of a firm. While generally first-mover advantages
are based on preemption of scarce resources and high buyer switching costs, relatively
low entry barriers to social media marketing may mitigate this advantage, rewarding
late-movers who base their decisions on available evidence of effectiveness.

References
Abrahamson, E. and Rosenkopf, L. (1993) ‘Institutional and competitive bandwagons: using
mathematical modeling as a tool to explore innovation diffusion’, Academy of Management
Review, Vol. 18, pp.487–517.
Ajzen, I. (1991) ‘The theory of planned behaviour’, Organizational Behaviour and Human
Decision Processes, Vol. 50, No. 2, pp.11–39.
Barnes, S.B. and Hair, N.F. (2009) ‘From banners to YouTube: using the rearview mirror to at the
future of internet advertising’, International Journal of Internet Marketing and Advertising,
Vol. 5, No. 3, pp.223–239.
Boyd, D.M. and Ellison, N.B. (2008) ‘Social network sites: definition, history, and scholarship’,
Journal of Computer-Mediated Communication, Vol. 13, pp.210–230.
Coremetrics (2010) ‘Comprehensive measurement: the key to social media marketing success’,
White paper, available at http://coremetrics.com.
Dabholkar, P.A. and Bagozzi, R. (2002) ‘An attitudinal model of technology-based self-service:
moderating effects of consumer traits and situational factors’, Journal of the Academy of
Marketing Science, Vol. 30, No. 3, pp.184–202.
Davis, F.D. (1989) ‘Perceived usefulness, perceived ease of use, and user acceptance of
information technology’, MIS Quarterly, Vol. 13, pp.319–339.
Davis, F.D., Bagozzi R. and Warshaw, P. (1989) ‘User acceptance of computer technology:
a comparison of two theoretical models’, Management Science, Vol. 35, No. 8, pp.982–1004.
Drossos, D.A., Fouskas, K.G., Kokkinaki, F. and Papakyriakopoulos, D. (2011) ‘Advertising on the
internet: perceptions of advertising agencies and marketing managers’, International Journal
of Internet Marketing and Advertising, Vol. 6, No. 3, pp.244–264.
Economist (2010) ‘A special report on social networks’, 30 January – 5 February, pp.3–20.
Econsultancy (2010) ‘Customer engagement report 2010’, available at
http://www.econsultancy.com/reports/customer-engagement-report
(accessed on 23 January 2010).
 Adoption of social networks marketing by SMEs 15

eMarketer (2010) ‘Marketing, not ads, fuels social spending growth’, 8 January, available at
http://www.emarketer.com/Article.aspx?R=1007455 (accessed on 10 January 2010).
Evans, D. (2009) ‘Social media is tailor-made for SMBs’, Clicz, 28 October, available at
http://www.clicz.com/3635468 (accessed on 10 January 2010).
Fenn, J., Raskino, M. and Gammage, B. (2009) ‘Gartner’s hype cycle special report for 2009’,
http://www.gartner.com/DisplayDocument?ref=g_search&id=1108412&subref=simplesearch
(accessed on 25 January 2010).
Fishbein, M. and Ajzen, I. (1975) Belief, Attitude, Intention, and Behaviour: An Introduction to
Theory and Research, Addison-Wesley Publishing Company, Reading, MA.
Forrester Research (2009) US Interactive Forecast, Forrester Research, Inc., July, available at
http://www.forrester.com/rb/research.
French, J.R.P. and Raven, B. (1959) ‘The bases of social power’, in Cartwright, D. (Ed.): Studies in
Social Power, pp.150–167, Institute for Social Research, Ann Arbor, MI.
Harris, L. and Rae, A. (2009) ‘Social networks: the future of marketing for small business’, Journal
of Business Strategy, Vol. 30, No. 5, pp.24–31.
Hartwick, J. and Barki, H. (1994) ‘Explaining the role of user participation in information system
use’, Management Science, Vol. 40, pp.440–465.
Internet Advertising Bureau (2010) ‘Social media budgets set for increase’, available at
http://www.iabuk.net/en/1/socialmediabudgetssetforincrease020210.mxs
(accessed on 14 February 2010).
Kelman, H.C. (1958) ‘Compliance, identification, and internalization: three processes of attitude
change’, Journal of Conflict Resolution, Vol. 2, pp.51–60.
Lukas, H. and Spitler, V.K. (1999) ‘Technology use and performance: a field study of broker
workstations’, Decision Sciences, Vol. 30, No. 2, pp.291–311.
Marketing Sherpa (2009) Social Media Marketing and PR: Benchmarks and Best Practices,
available at http://www.SherpaStore.com.
Mathieson, K. (1991) ‘Predicting user intentions: comparing the technology acceptance model with
the theory of planned behaviour’, Information Systems Research, Vol. 2, No. 3, pp.173–192.
McCorvey, J.J. (2010) ‘How to use social networking sites to drive business’, Inc.Com, 25 January,
available at http://www.inc.com.
Nielsen (2010) ‘Social networks/blogs now account for one in every four and a half minutes
online’, 15 June, available at http://www.blog.nielsen.com/nielsenwire/online_mobile/social-
media-accounts-for-22-percent-of-time-online/.
Pangarkar, N. (2000) ‘What drives merger behaviour of firms? Strategic momentum versus
bandwagon,’ International Journal of Organizational Theory and Behaviour, Vol. 3,
Nos. 1–2, pp.37–72.
Parker, C.M. and Castleman, T. (2009) ‘Small firm e-business adoption: a critical analysis of
theory’, Journal of Enterprise Information Management, Vol. 22, Nos. 1–2, pp.167–182.
Robinson, L. (2006) ‘Moving beyond adoption: exploring the determinants of student intention to
use technology’, Marketing Education Review, Vol. 16, No. 2, pp.79–88.
Schweitzer, T. (2009) ‘Study: inc. 500 CEOs aggressively use social media for business’, Inc.Com,
25 November, available at http://www.inc.com.
Sultan, F., Rohm, A.J. and Gao, T. (2009) ‘Factors influencing consumer acceptance of mobile
marketing: a two-country study of youth markets’, Journal of Interactive Marketing, Vol. 23,
pp.308–320.
Taylor, S. and Todd, P. (1995) ‘Understanding information technology usage: a test of competing
models’, Information Systems Research, Vol. 6, No. 2, pp.144–176.
Thrassou, A. and Vrontis, D. (2008) ‘Internet marketing by SMEs: towards enhanced
competitiveness and internationalisation of professional services’, International Journal of
Internet Marketing and Advertising, Vol. 4, Nos. 2–3, pp.241–261.
16 I. Pentina et al.

Venkatesh, V. and Davis, F.D. (2000) ‘A theoretical extension of the technology acceptance model:
four longitudinal field studies’, Management Science, Vol. 46, No. 2, pp.186–204.
Webster, J. and Trevino, L.K. (1995) ‘Rational and social theories as complementary explanations
of communication media choices: two policy-capturing studies’, Academy of Management
Journal, Vol. 38, No. 6, pp.1544–1573.
Wu, J. and Wang, S. (2005) ‘What drives mobile commerce? An empirical evaluation of the
revised technology acceptance model’, Information and Management, Vol. 42, pp.719–729.

Appendix

Internet marketing conference participant survey: non-adopter version

Screening question: Does your company currently employ SNM?
1 What is your primary business?
a Consumer brand manufacturer
b B2B manufacturer
c Distributor
d Retailer
e Consumer service provider
f Business service provider
g Other __________________________________
2 What is the annual sales range of your business?
a Less than $1 million
b $1 million to $10 million
c $10.1 million to $25 million
d More than $25 million
3 What is your position within the company?
a Upper management
b Middle management
c Owner
d Other ____________________________________
4 What is your functional area?
a Marketing and sales
b IT
c Operations
d Other _____________________________________
5 When did you learn about social networks marketing?
a Less than one year ago
b Between one and two years ago
 Adoption of social networks marketing by SMEs 17

c Between two and three years ago

d Between three and five years ago
e More than five years ago
6 What may be the reasons your company would use social networks marketing?
Select all that apply.
a To reduce advertising expenses
b To be an early player in the social networks medium
c Because everybody else is using it/ not to appear a technology laggard
d To break through advertising clutter
e To better reach our target market
f To try a new approach
g Other ______________________________________
7 Please indicate whether you agree or disagree with the following statements
regarding your thoughts about SNM. 1 – strongly disagree, 5 – strongly agree.
a I find social networks marketing easy to execute 1 2 3 4 5
b Social networks marketing is easy and understandable 1 2 3 4 5
c It is easy to become skilful at social networks marketing 1 2 3 4 5
d SNM may enable our company to accomplish goals quickly 1 2 3 4 5
e Using SNM may increase our productivity and ROI 1 2 3 4 5
f Using SNM may enhance our company’s effectiveness 1 2 3 4 5
g Our company intends to use SNM on a regular basis 1 2 3 4 5
h Our company plans to use SNM 1 2 3 4 5
i People important to our company think we should use SN 1 2 3 4 5
j It is expected that companies like ours should use SNM 1 2 3 4 5
k Our competitors use SNM 1 2 3 4 5
l Companies that are best in our industry use SNM 1 2 3 4 5

8 What social networks would you participate in? Please select all that apply.
a Face Book
b My Space
c Twitter
d You Tube
e LinkedIn
f Community on your company’s website
g Other _______________________________
9 What are the benefits SNM may provide for your business? Select all that apply.
a Increases brand awareness
b Spreads marketing message
c Enables customers to participate in product/service development
 18 I. Pentina et al.

d Provides customer feedback

e Enables better marketing research
f Improves customer support
g Other ______________________________
10 What social networks marketing tactics would work best for your business? Select
all that apply.
a Creating our own account on a social network site and inviting followers
b Creating a brand community/customer forum on our own site
c Providing customer reviews and ratings opportunity on our site
d Placing advertising on social networks sites
f Other _______________________________
11 What % of your sales may come from SNM?
a 1% to 5%
b 5.1% to 10%
c 10.1% to 25%
d More than 25%

View publication stats