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CCIJ
22,4
440
Received 15 April 2017
Accepted 19 June 2017
Corporate Communications: An
International Journal
Vol. 22 No. 4, 2017
pp. 440-454
© Emerald Publishing Limited
1356-3289
DOI 10.1108/CCIJ-04-2017-0036
Using Facebook efficiently
Assessing the impact of organizational
Facebook activities on
organizational reputation
Lan Ye
Department of Communication Studies,
State University of New York at Cortland, Cortland, New York, USA, and
Yunjae Cheong
Department of Media Communication,
Hankuk University of Foreign Studies, Seoul, South Korea
Abstract
Purpose – The purpose of this paper is to assess the role of Facebook in organizational reputation
management by analyzing how efficiently the most reputable companies in the USA use Facebook.
Design/methodology/approach – This study analyzed 22 companies’ efficiency in using Facebook in
reputation management, using data envelopment analysis.
Findings – Results reveal that, on average, the efficient companies (n ¼ 8) posted less frequently than did the
inefficient companies (n ¼ 14); companies receiving more engagements were more efficient than those
receiving fewer engagements; and companies adopting one main Facebook page were more efficient than
those adopting multiple Facebook pages. The size and length of history of an organization were not found to
affect efficiency outcomes significantly.
Originality/value – The findings of this study will contribute to the optimization of Facebook use in
organizational reputation management.
Keywords Facebook, Data envelopment analysis, Social media, Reputation management,
Performance efficiency
Paper type Research paper
1. Introduction
Social media have transformed the internet from a platform for information to a platform for
influence (Hanna et al., 2011). On social media, stakeholders are no longer passive recipients
of organizations’ messages; instead, by actively sharing experiences/opinions of products,
they and the organizations are working together to create everything from new products
and services, to business models and values (Kim and Ko, 2012). Understanding the value
social media bring to stakeholder relationship building, organizations now view social
media as a mandatory element of their communication strategy (Hanna et al., 2011).
According to the research conducted by the University of Massachusetts Dartmouth,
93 percent of the Fortune 500 companies are active on at least one social networking site,
mainly Twitter (78 percent) and Facebook (74 percent) (Barnes et al., 2015). Organizations
use social media to foster favorable relationships with stakeholders by creating sharable
content, interacting with stakeholders online, monitoring what stakeholders are saying and
addressing negative comments (Dijkmans et al., 2015). These activities are known as online
reputation management.
Despite the growing attention that organizations give to social media, whether such
social media activities are, in fact, beneficial for organizational reputation has not been well
explored. Research regarding social media and reputation has been done on engaging
consumers online (e.g. Dijkmans et al., 2015; Men and Tsai, 2014), or users’ reactions to
organizations’ messages online, especially in crisis situations (e.g. Coombs and Holladay,
2012). Limited effort has been made to explore the efficiency of organizations’ daily social
media activities for their reputation. The purpose of this study is to assess the role of Using
Facebook in reputation management by analyzing how efficiently the most reputable Facebook
companies in the USA use Facebook. efficiently
This study uses data envelopment analysis (DEA), which is a method for assessing the
relative performance of organizations (Cooper et al., 2006). DEA allows researchers to
incorporate multiple inputs and multiple outputs simultaneously to provide organizations with
realistic efficiency estimates and actionable targets for improvement (Cooper et al., 2006). 441
By using DEA, we examined the relative efficiency of 22 companies in terms of their reputation
scores for their Facebook activities such as the volume of posts, volume of responses to
followers’ comments and use of different types of posts. The findings of this study will
contribute to the optimization of Facebook use in organizational reputation management.

2. Literature review
2.1 Organizational reputation
Previous studies have identified several elements of organizational reputation, for example,
the overall knowledge stakeholders hold about the underlying characteristics of an
organization (Fombrun, 1996), the outcome of an organization’s past actions (Weigelt and
Camerer, 1988), results from direct and indirect experiences and information received about
an organization (Yoon et al., 1993), and the extent to which an organization is seen as good,
reliable and trustworthy (Roberts and Dowling, 2002). Attempting to capture the comment
elements of organizational reputation, Fombrun et al. (2000) define organizational reputation
as “a collective representation of an organization’s past behavior and outcomes that depicts
the organization’s ability to render valued results to multiple stakeholders” (p. 243).
Reputation is an intangible asset for organizations. A favorable reputation has been
linked to significant outcomes such as attracting customers, generating investment interest,
attracting and retaining employees, enhancing competitiveness, generating positive media
coverage and word-of-mouth, lowering costs by reducing concerns of suppliers and being
able to charge a price premium because consumers experience lower uncertainty when
purchasing the products (Coombs and Holladay, 2006; Dowling, 2001; Herrbach et al., 2004;
Rao and Monroe, 1996). Moreover, a favorable reputation of an organization can create a
halo effect, protect the organization from negative speculation produced by a crisis, lead
stakeholders to believe the claims made by the organization and help to facilitate its repair
(Coombs and Holladay, 2006).
Given the significance of reputation, how to manage it effectively has received increasing
attention from both scholars and practitioners. Reputation management involves creating and
defending positive public perceptions (Gibson et al., 2006). Though different stakeholders may
form different perceptions of an organization based on the organization’s performance, in
most cases, reputation is a matter of trust, and organizations ensure that stakeholders develop
a sense of trust in them through communication (Kietzmann et al., 2011). A survey of Fortune
500 companies found that companies ranked “manage reputation” as the leading role of
corporate communication, and corporate spending on communication was positively related
to corporate reputation (Hutton et al., 2001). Because reputation is not a physical commodity,
the challenge of reputation management lies in managing all the signals sent by an
organization (Budd, 1994/1995), including messages on social media.

2.2 Social media and organizational reputation

Social media attained major advances in the early 2000s with the establishment of LinkedIn,
MySpace and Facebook (Chapman, 2009). Since then, there has been a stable increase in the
use of social media. By December 2015, Facebook had 1.59 billion monthly active users;
Instagram had 400 million active users; and Twitter had 320 million users worldwide
(AdWeek, 2016).
CCIJ Social media provide the platform where organizations can reply to their stakeholders’
22,4 questions and concerns, offer them a broad range of information, release information rapidly
and encourage and strengthen the organization-stakeholder collaboration (Hart, 2011).
These attributes make social media an important tool for organizations to build
relationships with stakeholders and thus build “reputation capital.”
As a unique and meaningful way to reach customers with lower costs than traditional
442 media, social media have been widely adopted by marketers. According to the recent
industry reports, in 2015, 96 percent of marketers were participating in social media
marketing (Stelzner, 2015), and Fortune 500 companies had increased their use of Facebook
by 12 percent (74 percent) and their use of Twitter by 16 percent (78 percent) since 2011
(Barnes et al., 2015). Moreover, social media spending is expected to grow to 23.8 percent of
total marketing budgets in the next five years, while the share was only 5.6 percent in 2009,
and 10.7 percent in 2015 (Maddox, 2015).
Previous studies indicated that social media have a dramatic impact on organizational
reputation (Kim and Ko, 2010, 2012). For example, it was found that consumers thought
more positively about companies that have blogs (Kim and Ko, 2010), and the social media
marketing activities of luxury fashion brands positively related to value equity, relationship
equity, and brand equity, and, therefore, are effective in strengthening consumer
relationships and creating purchase intent (Kim and Ko, 2012).

2.3 Facebook use and reputation management

Facebook, the focus of this study, is viewed as the most important new communication
medium for message distribution, and has become the most frequently used social
networking site by professionals (Wright and Hinson, 2011). Facebook enables
organizations to better nurture the organization-stakeholder relationships by posting
promotion and new product announcements, and informing their stakeholders of upcoming
events. Also, organizations try to engage stakeholders on their Facebook page by allowing
direct posting to their walls, or fan-to-fan conversations. As a result, organizational
Facebook pages are attracting more customers than traditional organizational websites,
making Facebook the leading platform for relationship building (Neff, 2010). Though
93 percent of marketers are using Facebook, most of them are not sure whether their
Facebook efforts are effective (Stelzner, 2015). This study aims to find out how an
organization can use Facebook efficiently in managing reputation in terms of information
volume, interactivity and post types.
Reputation can be potentially affected by information available on Facebook
(Dutot and Castellano, 2015). Facebook enables organizations to identify stakeholder
needs, and provide a wide range of information in a quicker, cheaper and easier way.
Given that reputation is about being known, known for something and generalized
favorability (Lange et al., 2011), transparency helps organizational reputation by building
trust (Auger, 2014).
Another crucial factor that impacts reputation is interactivity (Dutot and Castellano,
2015). Social media enable organizations to rapidly respond to stakeholders’ enquiries.
Lee and Park (2013) conducted an experiment to investigate how messages’ interactivity on
organizational websites and blog sites influences perceptions of relationship management
and reputation. They found that, regardless of the familiarity with the organizations,
participants evaluated organizations that responded to their comments as more trustworthy
and committed, and as having better control of mutuality than organizations that did not
respond; thus, the participants were more satisfied with the relationship with the
responding organizations (Lee and Park, 2013). More recently, Proserpio and Zervas (2017)
explored the impact of management responses on consumer ratings and found that
responding hotels see a 0.12-star increase in their TripAdvisor ratings when they begin
responding to reviewers, because consumers with a poor experience become less likely to Using
leave a negative review for responding hotels. Facebook
Effective content strategies require figuring out what type of content gains certain efficiently
results for different stakeholders. Organizations usually post four types of content on
Facebook: text-only status updates, photos, videos and links. Existing research suggests
that videos and photos work much better for reaching and engaging consumers on
Facebook (Cohen, 2015a). For example, a study of 5,000 Facebook pages, conducted by 443
Locowise, a social analytics and reporting firm, found that the average reach for videos was
9.42 percent, followed by links (8.95 percent), photos (7.75 percent) and status updates
(5.51 percent) (Cohen, 2015a).
Based on the literature, the following research questions were posed:
RQ1. How efficiently did the top reputable organizations in the USA use Facebook in
reputation management?
RQ2. How can inefficient organizations benchmark the efficient ones?
Public engagement via social media has been recognized as an influential factor in
cultivating and reinforcing relationships (Sashi, 2012). Men and Tsai (2014) surveyed 250
respondents and found that, when publics are highly engaged with an organization on the
organization’s social networking sites (e.g. commenting on the organization’s posts, sharing
the organization’s posts, expressing support, etc.), they are more likely to perceive the
organization as transparent and authentic, and they tend to be more trusting of, more
satisfied with and more committed to the organization. Therefore, we posited that:
H1. Organizations receiving more engagements on Facebook are more efficient in
reputation management than those receiving fewer engagements on Facebook.
With the popularity of Facebook, one question that organizations have regarding Facebook
use is whether they should have just one main page or multiple pages. Having multiple
Facebook pages enables an organization to target the right audience with the right content
and foster loyalty (Murvine, 2013). However, considering that each page has its own
audiences and interests, having multiple pages require more time and energy to manage the
pages (Murvine, 2013). Moreover, having more pages and audiences means it is tougher to
keep messages consistent among all the different pages, and may confuse stakeholders
when they search the organization on Facebook (Murvine, 2013). Therefore, we posited that:
H2. Organizations adopting one main Facebook page are more efficient than those
adopting multiple Facebook pages.
Organizational size and organizational history may also affect an organization’s efficiency in
using Facebook. Previous research suggests that a more extensive division of labor raises
productivity because returns on the time spent on tasks are usually greater for workers who
concentrate on a narrower range of skills (Becker and Murphy, 1992). In this sense, an
organization could be more efficient if its employees have a focused goal to aim for, and if its
employees’ assignments are as clear and narrow as possible. Therefore, organizations hiring
more employees are more likely to assign employees to work specifically on Facebook-related
tasks, for example, monitoring and responding to users’ comments, which, in turn, can
contribute to the organizations’ reputation management efforts. Therefore, we posited that:
H3. Organizations hiring more employees are more efficient than those hiring fewer
employees.
Organizational capabilities are one major source for the generation and development of
competitive advantages (Barney, 1991). It takes time for an organization to develop
capabilities. Any organizational capability is the result of a learning process, a process in
CCIJ which a specific way of “selecting and linking” resources gradually develops (Schreyögg
22,4 and Kliesch-Eberl, 2007, p. 916). Organizations with a longer history are likely to be able to
allocate resources and solve problems more effectively than those with a shorter history.
Therefore, we posited that:
H4. Organizations with a longer history are more efficient than those with a shorter history.

444
3. Method
3.1 DEA
Using DEA, this study explores the efficiency of top reputable organizations in the USA in
using Facebook to manage reputation. DEA is a powerful benchmarking technique. It is
used to measure the relative efficiency of a set of decision-making units (DMUs), which can
be individual organizations, sub-units within an organization or even individual decision
makers (Charnes et al., 1978). In this study, each company sampled is a DMU. The basic
principle of DEA is to use the ratio of a weighted sum of outputs to the weighted sum of
inputs to generate a single measure of relative efficiency (Charnes et al., 1978).
In the context of DEA, to be efficient means producing greater outputs with any given
amount of inputs (output-oriented model) or maintaining outputs with fewer inputs
(input-oriented model) (Charnes et al., 1978). The most efficient DMUs are identified and
used as bases for comparison with all other DMUs. The line that connects all the points that
represent the best performers is called the “efficient frontier,” which covers inefficient DMUs
like an envelope. The DMUs on the efficient frontier have an efficiency score of 1
(or 100 percent relative efficiency), while the inefficient DMUs have an efficiency score of
less than 1 but greater than 0 (Luo and Donthu, 2001). With the relative efficiency scores,
scholars can compare the performance of similar units to identify best practices and to
provide suggestions to less efficient units on how to improve.
DEA is considered to be a better performance measure than other more traditional
performance measures (Cooper et al., 2006). Unlike the typical parametric approach that
compares each DMU to an average DMU, DEA compares each DMU to the “best”
DMU (Cooper et al., 2006). Additionally, DEA can incorporate any number of inputs and
outputs into the analysis, and, moreover, the inputs and outputs can be of any nature
(Martínez-Núñez and Pérez-Aguiar, 2014).
The application of DEA has been considered as an appropriate methodology for relating
efficiency outcomes to organizational performance (Martínez-Núñez and Pérez-Aguiar,
2014). For example, Martínez-Núñez and Pérez-Aguiar (2014) used DEA to analyze the
productive efficiency of Spain’s telecommunication companies by comparing those that use
social media with those that do not use social media. The results of their study indicated
that, in order to be efficient, a company should be able to incorporate social networking
sites into its business strategy and improve the skills involved in managing those sites
(Martínez-Núñez and Pérez-Aguiar, 2014).
Previous research suggests that DEA is a way to view reputation from inside the
organization (Brønn and Brønn, 2005). Reputation is an intangible asset, and exactly how it
is affected by managerial and organizational characteristics is unclear (Brønn and Brønn,
2005). Brønn and Brønn (2005) suggest that the non-parametric basis of DEA, which makes
no assumptions about the underlying data or the form of the production function, makes it
“a realistic way to represent the results of the causally ambiguous processes that result in a
firm’s perceived reputation” (p. 56). In this sense, DEA is appropriate for this study.

3.2 Data
In this study, the DMUs are the top 22 reputable companies in the USA from the list of 2016
US RepTrak® 100, which was released by the Reputation Institute. The Reputation Institute
measures the reputation of the most highly regarded companies in the USA annually. Using
The 22 companies are Amazon, Hallmark, Samsung, Kellogg, Sony, etc. (see Table AI). Facebook
The output variable used in this study is the RepTrak Pulse (reputation score). efficiently
The reputation scores of the 22 companies were collected from the Reputation Institute’s 2016
US RepTrak® 100 report. The Reputation Institute measures organizations’ reputations, using
the seven-dimensional RepTrak system, which has been extensively tested since 2005
(Fombrun et al., 2015). The RepTrak system assesses whether an organization’s products/ 445
services are thought to be high in quality, in value and in ability to meet customers’ needs
(product/service); whether an organization is perceived as innovative and adaptive (innovation);
whether an organization is considered ethical, fair and transparent (governance); whether an
organization is viewed as a supporter of good causes and a positive contributor to society
(citizenship); whether an organization shows concern for its employees, and treats and rewards
them fairly (workplace); whether an organization’s leaders are perceived as excellent and
visionary managers and strong endorsers of their organizations (leadership); and how
stakeholders perceive an organization’s overall financial performance and growth prospects
(performance) (Fombrun et al., 2015). By averaging the scores of the public’s ratings for an
organization, based on the seven dimensions, the RepTrak Pulse, a reputation score, is assigned
to the organization. For example, the RepTrak Pulse of Amazon was 85.4, and the RepTrak
Pulse of Hallmark was 85.1 in 2016 (Reputation Institute, 2016).
The six input variables used in this study comprise the volume of corporate Facebook
posts, the volume of corporate responses to Facebook fans’ comments, and the volume of
each of the four types of corporate posts: photos, videos, links and status updates.
We identified the Facebook pages of each company, and selected only the verified/official
page(s). Some companies have more than one official page; for example, Samsung has five
official pages: Samsung USA, Samsung Mobile USA, Samsung TV USA, Samsung Home
Appliances USA and Samsung Support USA. Then, data were retrieved from the verified
pages and analyzed by using NEXT Analytics, a social media measurement and analysis
software. Because 2016 US RepTrak® 100 is based on the survey results collected in the first
quarter of 2016, the 2016 RepTrak Pulse of each organization represents the public’s overall
perceptions of the organization in 2015. Therefore, we collected data on the six input
variables from January 1, 2015 to December 31, 2015. Table I shows the descriptive statistics
of the input and output variables.
We also collected data of the total engagements and the number of Facebook pages of
each company. Total engagement is the total number of times that people like, comment on
and share an organization’s posts (Simply Measured, 2014). The number of employees and
years of establishment of the companies were collected from corporate annual reports.

3.3 DEA model specification (RQ1-RQ2)

This study employs an “input-oriented” approach in DEA (Charnes et al., 1978). It minimizes
inputs through linear programming methods, while keeping constant the current level

Input/output variables Mean SD Max. Min. Median

No. of corporate posts on Facebook 1,119 1,807 8,720 54 517

No. of corporate responses to Facebook fans’ comments 1,388 3,296 15,500 0 362
No. of photos 658 941 4,434 34 391
No. of videos 215 256 980 17 95 Table I.
No. of links 203 522 2,484 0 66 Descriptive statistics
No. of status updates 42 173 818 0 3 of Facebook activities
Corporate reputation 81.04 2.04 85.40 78.70 80.4 and reputation
CCIJ of outputs. To calculate efficiency scores employing DEA, two different assumptions can be
22,4 made, i.e. constant return to scale (CRS) and variable return to scale (VRS). In the case of
CRS, all DMUs are assumed to operate at optimal scale, and an increase in inputs results in a
proportional increase in outputs (Coelli et al., 2005). However, in reality, DMUs often do not
operate at optimal scale. To account for this situation, DEA can be specified for VRS,
meaning that any input increases result in disproportional output increases (Cooper et al.,
446 2006). Different companies may operate at different economies of scale. Thus, in our study,
efficiency values are calculated assuming VRS.
In this study, the VRS input-oriented DEA model, which uses Facebook activities
as input variables and corporate reputation score as the output variable, is specified
as follows:
!
Xm Xs
 þ
Minimize ye si þ sr
i¼1 r¼1

X
n
lj xij þs
i ¼ yxi0 i ¼ 1; . . .; m
j¼1

X
n
lj xrj srþ ¼ yr0 r ¼ 1; . . .; s
j¼1

X
n
lj ¼ 1 j ¼ 1; . . .; 22
j¼1

lj X0 j ¼ 1; . . .; 22

where xij is the volume of corporate posts on Facebook, volume of corporate responses to
Facebook fans’ comments, and volume of each type of post (i.e. photos, videos, links and
status updates); i ¼ 1, …, m, m the total number of inputs; j ¼ 1, …, n, n the total number of
DMUs; yrj the organization’s reputation score, r ¼ 1, …, s, s the total number of outputs;
θ0 the efficiency score of a focal DMU; and λj the weight value assigned to the jth reference.
The levels of performance targets are obtained as follows:

x^ i0 ¼ yn xi0 s
i
n
i ¼ 1; . . .; 6

y^ r0 ¼ yr0 þsiþ n r ¼ 1

where θn is the optimal efficiency score; siþ n the input slack; siþ n the output slack.
Following the approach of Banker et al. (1984), we get optimal solutions of θn and λn by
solving the VRS input-oriented DEA above. The jth out of 22 companies’ inputs are minimized
through θn, as much as the constraints will allow. If the efficiency score equals to 1, the current
input levels are efficient, which means that the DMUs are on the efficient frontier. If the
efficiency score is less than 1, the current input levels are inefficient, and their benchmarks are
the set of efficient DMUs (i.e. reference set) to which the inefficient DMU has been directly
compared when calculating its efficiency rating. To become efficient, an inefficient company
must use a combination of efficient companies in its reference set as its benchmarks.
The λn values, which are the raw weights assigned to the references of an inefficient company, Using
allow an optimization of efficiency score (θn) in the DEA model above. Facebook
The proportional reductions, or radial movements, in Facebook activities are calculated efficiently
by multiplying the input values of inefficient DMUs with the efficiency score (θn). If there
exist leftover proportions of inefficiencies after the proportional reductions in Facebook
activities are made, investigation of the slacks for the inefficient companies can indicate
where activities may be further reduced while maintaining the output levels. To calculate 447
the performance target of each input variable, the slack and radial movements are combined
and subtracted from the actual amount of each input variable.

3.4 Tobit regression (H1-H4)

This study uses a Tobit regression to examine the influences of the engagement on Facebook,
having single or multiple pages, the number of employees and the years of establishment, on
the efficiency score (H1-H4). The regression model based on censoring the distribution of the
dependent variable is referred to as the censored regression model or the Tobit model
(Tobin, 1958). Because the primary dependent variable of interest (i.e. efficiency score) in this
study is bounded between 0 and 1, the two-limit Tobit model procedure is used to estimate the
regression coefficients (Long, 1997). Coefficients of Tobit regression can be decomposed into
two effects: the effects of each independent variable on the likelihood of passing the limit; and
the increase in the level of the dependent variable (McDonald and Moffit, 1980). However, such
a decomposition procedure does not affect the significance level of the coefficients
(Kang, 2007). In this study, we were interested in the significance level of each independent
variable rather than understanding the decomposed effects. Therefore, we did not decompose
the coefficients; this approach is consistent with previous DEA literature using Tobit
regression (e.g. Barros, 2006; Perrigot and Barros, 2008).

4. Results
4.1 Reputation management efficiency in the use of Facebook
RQ1 focuses on the most reputable companies in the US reputation management efficiency
in Facebook activities. Table II shows that the mean efficiency score of all 22 companies was
0.979, which means that, to become efficient, these companies need to use approximately 2.1
percent fewer inputs than they had been using.
An examination of the efficiency ratings shows that 8 (36.3 percent) of the 22
companies were efficient (i.e. their efficiency scores are ones) with the rest being inefficient
(see Table II). This means that 14 (63.6 percent) of the companies could have further
reduced activities on Facebook while maintaining the same reputation score. Based on the
DEA, Amazon demonstrated the lowest reputation management efficiency, 0.922,
indicating that Amazon operated only 92.2 percent as efficiently as its reference DMUs on
the frontier line (i.e. Costco Wholesale).

4.2 Benchmarks
RQ2 asks how the inefficient organizations can benchmark efficient ones. Table II shows the
reference set for each inefficient company. The reference set is the set of efficient
organizations to which the inefficient organization has been directly compared to calculate
its efficiency score. The identification of the reference set enables comparisons between the
inefficient organizations with those that are not only efficient but also most similar to them.
The reference set of an inefficient DMU consists of the nearest efficient DMUs placed on
the frontier line; for the inefficient DMU, a linear combination is performed to project it on
the frontier line. For example, Table II shows that Sony’s reference companies are Toshiba
and Costco; Sony can reach the VRS efficient frontier by combining their practices.
CCIJ No. Companies Efficiency References
22,4
1 Amazon 0.922 Costco Wholesale
2 Hallmark 0.925 Toshiba; Costco Wholesale
3 Samsung 0.933 Toshiba; Costco Wholesale
4 Kellogg Co. 0.941 Toshiba; Costco Wholesale
5 Sony 0.954 Toshiba; Costco Wholesale
448 6 Johnson & Johnson 0.970 Clorox; Toshiba; Costco Wholesale
7 Rolex 1.000 Rolex
8 Intel 0.980 Fruit of the Loom; Tiffany & Co.; Whirlpool
9 Netflix 0.973 Tiffany & Co.; Toshiba
10 The Walt Disney Co. 0.996 Rolex; Nintendo; Clorox
11 Campbell Soup Co. 0.995 Fruit of the Loom; Tiffany & Co.
12 Fruit of the Loom 1.000 Fruit of the Loom
13 Michelin 0.983 Whirlpool; Toshiba
14 LEGO Group 0.984 Tiffany & Co.; Toshiba
15 Nintendo 1.000 Nintendo
16 UPS 0.996 Rolex; Fruit of the Loom; Toshiba
17 Clorox 1.000 Clorox
18 Tiffany & Co. 1.000 Tiffany & Co.
19 Whirlpool 1.000 Whirlpool
20 Adidas 0.999 Toshiba; Costco Wholesale
21 Toshiba 1.000 Toshiba
Table II. 22 Costco Wholesale 1.000 Costco Wholesale
Efficiency scores and Average 0.979
reference sets Note: n ¼ 22

Once the reference set of each inefficient company is identified, the reference companies can
serve as benchmarks for an inefficient company by providing examples of good practices
for it to emulate, and providing insights on which inputs the inefficient company is
underperforming in. For example, Toshiba (the reference of Sony), which was 95 percent as
reputable as Sony, posted only 20 percent as much as Sony did and responded to fans’
comments 59 percent as often as Sony did (see Table III). Inspection of corporate post types
shows that Toshiba posted only 39, 4, 12 and 38 percent of the total number of Sony’s
photos, videos, links and status updates, respectively.

4.3 Impact of influential determinants on the efficiency score

H1-H4 seek to examine the impacts of influential determinants on the efficiency score.
To test the hypotheses, we performed Tobit regression in view of the truncation of
reputation management efficiency scores between 0 and 1 (Greene, 2002).

Input/output variables Sony Toshiba % of Sonya

No. of corporate posts on Facebook 1,323 266 20

No. of corporate responses to Facebook fans’ comments 345 204 59
No. of photos 575 223 39
No. of videos 633 27 4
Table III.
Comparisons of Sony No. of links 106 13 12
and its reference’s No. of status updates 8 3 38
Facebook activities Corporate reputation 82.6 78.8 95
and reputation Note: aToshiba/Sony × 100
H1 posits that organizations receiving more engagements were more efficient. Using
Table IV shows the regression coefficients predicting efficiency scores. Specifically, Facebook
receiving more engagements on Facebook (β ¼ 1.04e-09, p o 0.05) is significantly efficiently
associated with a higher efficiency score. Thus, H1 is supported. H2 posits that
organizations using one main Facebook page were more efficient. The results of Tobit
regression analyses further suggest that having a single Facebook page (β ¼ 0.033204,
p o 0.01) is significantly associated with a higher efficiency score: H2 is supported. 449
Having one main page rather than having multiple pages on Facebook increases the
efficiency score on reputation management on Facebook. H3 and H4 posit that
organizations hiring more employees and organizations having a longer history were
more efficient. The number of employees and year of establishment did not influence the
efficiency score significantly. H3 and H4 are not supported.

5. Discussion
This study analyzed the Facebook activities of 22 companies, using DEA. The results reveal
that over 60 percent of the 22 companies were inefficient, and, on average, the efficient
companies posted less frequently than did the inefficient companies. The results also reveal
that companies receiving more engagements and companies adopting one main Facebook
page were more efficient than those receiving fewer engagements or adopting multiple
Facebook pages. The results of this study shed light on some issues in the efficient use of
Facebook in organizational reputation management.
First, organizations using social media face the dilemma of how to connect with followers
without driving them away, in other words, how to balance sharing and listening
(Lee, 2014). In this sample of 22 companies, the efficient companies each created an average
of approximately 39 posts per month, which is about one-third as many as each of the
inefficient companies did per month (n ¼ 124). The results confirm previous studies
suggesting that sharing more information on social media does not automatically lead to
more favorable reputation (McCorkindale et al., 2013). McCorkindale et al.’s (2013) study,
which examined the millennial-Facebook relationships, found that 42 percent of the
respondents said they had actively left an organization’s page because they were
overwhelmed with communication. Similarly, Locowise’s study of 600 Facebook pages
found that pages that posted once per week or less often reached more users (15 percent)
than pages that posted two to four times per week (10 percent), once daily (8.42 percent), or
over ten times per day (6.51 percent) (Cohen, 2015b). Most users do not spend enough time to
see all the stories filtered on their news feed; therefore, organizations need to be listening
rather than superficially pushing the relationships by sharing information. As suggested by
Cohen (2015b), less is more when running a Facebook page.

Input/output variable Coefficient SE t

Constant 1.323907 0.194 6.81

Total engagement 1.04e−09 5.03e−10 2.08*
Single page dummy 0.033204 0.0088 3.79**
No. of employees −4.203-08 3.84e−08 −1.10
Year of establishment −0.0001872 0.0001 −1.84
Sigma 0.0183886 0.194
LR χ2(4) 15.80
Table IV.
ProbWχ2 0.0033 Tobit model for
Pseudo R2 −0.162 impact of influential
Notes: n ¼ 22. Coefficient ¼ Tobit coefficients estimated through Tobit type maximum-likelihood estimation determinants on the
(Hausman and Wise, 1977). Tobit model was conducted with LIMDEPTM version 9.0. *po 0.05; **p o0.01 efficiency score
CCIJ In terms of the best practice for organizations, when it comes to responding to stakeholders’
22,4 comments, some experts argued that organizations should always respond and respond as
much and as often as they can, while other experts argued that organizations should not
respond to each comment, but should respond when it makes sense to, for example, respond
to requests and questions (Debaise, 2013). The results reveal that efficient companies
responded less often (n ¼ 18) than inefficient companies (n ¼ 171) did per month. The results
450 confirm the suggestion that organizations should respond when it is necessary (Debaise,
2013). One explanation could be that stakeholders perceive organizations whose responses
are highly related to their comments as being more reputable (Lee and Park, 2013). Though
responding organizations are perceived as more trustworthy and committed than
organizations that do not respond (Lee and Park, 2013), posting too many responses may
overwhelm stakeholders, in particular, when the responses are not closely related to
stakeholders’ comments.
An important issue for organizations is which type of content to post in order to be
successful on Facebook. This study found that both efficient and inefficient companies
posted photos most frequently, followed by videos, links and status updates. Compared to
the inefficient companies, for the efficient companies, photos (74 percent) and videos
(15 percent) account for a greater share of posts, while links (10 percent) and status updates
(1 percent) account for a smaller share of posts. The popularity of photos and videos might
be due to their power of engagement. According to findings of Locowise’s study of 5,000
Facebook pages, photos had the highest average engagement at 6.6 percent, followed by
videos (6.53 percent), status updates (4.25 percent) and links (3.96 percent) (Cohen, 2015a).
Status updates make up only 1 percent of posts created by efficient companies. This is
consistent with the findings of Facebook use of the Top 100 Global Brands in 2015, which
showed that status updates accounted for 1 percent of all posts (Shively, 2015).
Organizations that abandoned status updates for photos, videos and links might have done
so because status updates lack the same power of engagement that visual content
(i.e. photos and videos) has, and status updates do not tie to other organization-related
information, as links do.
This study found that companies receiving more engagements were more efficient than
those receiving fewer engagements on Facebook. This is consistent with the findings of
Dijkmans et al.’s (2015) survey of customers and non-customers of an international airline,
which found that customers’ intensity of social media use is positively related to their
engagement in the airline’s social media activities, and customers’ engagement with the
airline via social media is positively related to the airline’s corporate reputation. Given
the earlier results of this study about post types, organizations may want to increase
engagements by primarily posting photos and videos.
Regarding the question of whether organizations should have one or multiple
Facebook pages, the findings of this study reveal that companies adopting one main page
were more efficient than those adopting multiple pages. In this study, all of the efficient
companies have only one page except for Nintendo, which has three pages. In contrast, the
inefficient companies each have an average of five pages: for example, Amazon has
18 pages; Adidas has 10 pages; and LEGO has 9 pages. If an organization has too many
Facebook pages, stakeholders may be unclear about which are the official channels. Thus,
the multiple pages may end up competing with each other, whereas adopting fewer
Facebook pages enables an organization to concentrate its time and energy to manage
those pages, thus becoming more efficient. As Martínez-Núñez and Pérez-Aguiar (2014)
suggest, only using social media but not managing its use does not automatically lead to
an improvement in efficiency.
Finally, this study found that corporate size and corporate history did not influence
efficiency significantly. The bigger and older companies analyzed were not always efficient
when they managed their reputations on Facebook. Thus, without making efforts on Using
reputation management on social media, organizations’ size and length of history do not Facebook
automatically translate to higher efficiency outcomes. efficiently
6. Limitations and future research
This study has several limitations that warrant more research. First, the 22 companies
analyzed in this study are not representative; thus, the results should not be generalized to 451
other organizations not included in the sample. The companies analyzed in this study are
not all in the same industry; therefore, they may not share the same objectives and
functions. Future research may want to increase the sample size, and focus on specific
industries or product categories, where all DMUs share the same production function.
In addition, Facebook is a slice of the media used by the companies analyzed to
communicate with their stakeholders. Stakeholders’ perceptions of an organization are
formed by organization-related information from various sources, including social media
and traditional media. Future research could use DEA to further explore organizations’
efficiency in using other social networking sites such as Twitter and Instagram,
organizations’ own web pages, or traditional media in reputation management.
This study analyzed the Facebook activities of the companies sampled in 2015. Thus, the
results of this study cannot account for the effects of Facebook activities on reputation
management efficiency during the years before or after 2015. Future research could address
the efficiency of the 22 companies during other years as well.
Finally, considering that DEA results are driven by the data rather than by a theory, some
real-world factors such as employee training and competitive activity are not taken into
account. Therefore, the results of DEA should be used as information rather than definite
solutions to the organizations’ problems. More research methods such as case studies, focus
groups and surveys could be used to address more in-depth the questions such as how and
why the inputs in this study affect organizational reputation management efficiency.

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Appendix

Corporate Corporate
Corporate responses to fans’ Status reputation
No. Companies posts comments Photos Videos Links updates score

1 Amazon 8,720 2,439 4,434 980 2,484 818 85.4

2 Hallmark 1,108 1,321 561 208 327 7 85.1
3 Samsung 1,037 15,500 855 128 46 5 84.4
4 Kellogg Co. 584 378 446 80 54 5 83.7
5 Sony 1,323 345 575 633 106 8 82.6
6 Johnson & Johnson 341 124 70 57 212 1 81.8
7 Rolex 54 0 34 20 0 0 81.4
8 Intel 370 395 233 113 23 1 81.3
9 Netflix 961 987 513 366 80 2 81.1
10 The Walt Disney Co. 2,152 20 1,018 666 465 3 81
11 Campbell Soup Co. 307 1,664 168 40 100 0 80.4
12 Fruit of the Loom 146 86 104 25 17 0 80.4
13 Michelin 450 128 335 75 29 11 80.3
14 LEGO Group 1,287 1,131 760 384 122 3 80.1
15 Nintendo 1,769 0 1,367 281 94 26 80.1
16 UPS 308 3,985 213 79 14 2 79.7
17 Clorox 107 70 38 17 51 1 79.4
18 Tiffany & Co. 407 410 282 47 78 0 79.2
19 Whirlpool 161 111 86 50 23 2 79
20 Adidas 1,924 319 1,526 343 33 16 78.9
Table AI. 21 Toshiba 266 204 223 27 13 3 78.8
Data set 22 Costco Wholesale 826 921 627 110 84 5 78.7

Corresponding author
Lan Ye can be contacted at: lan.ye@cortland.edu

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