Influence of Online Communication in the Grooming and Cosmetics Retail Industry
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Influence of Online Communication in the Grooming and Cosmetics Retail
Industry
----- A Small Scale Pilot Study with Chinese Consumers
Candidate:
Miss Yun (Ring) Xu
Research Student
School of Management
University of Southampton
SO17 1BJ
Supervisors: Dr. Lisa Harris and Dr. Paul Harrigan from University of Southampton
Stage of the Doctoral Research: Early, Beginning of Second Year
Summaries of This Research
The conceptual domain: The main theoretical underpinning guiding this research
encompasses marketing communication models, consumer behaviour in relation to Game
Theory and online narrative characteristics.
The methodological domain: This research adopts mixed methods with two phases: induction
phase and deduction phase. Depth interview is conducted in the induction phase to propose a
model of communication and generate hypotheses and online questionnaire survey is carried
out in the deduction phase to test the hypotheses and modify the model.
The substantive domain: The main objectives of the research encompass (1) the influence of
online communication between consumers on consumers’ purchasing behaviour, (2) the
influence of online communication between brands and consumers on consumers’ purchasing
behaviour, and (3) the online communication model applicable in the grooming and cosmetics
industry and the variables that influence the model. As the communications happen online, all
the observations and questionnaire surveys will take place online with interviews carried out
through Skype or face-to-face where applicable.
1
Influence of Online Communication in the Grooming and Cosmetics Retail
Industry
----- A Small Scale Pilot Study with Chinese Consumers
Introduction
Given the rapid development of technological innovation, the marketing sphere is taking
substantial changes (Kitchen and Burgmann, 2010). As the Internet goes into the Web 2.0 era,
communication between people has never been more interactive. The interactivity also brings
intimacy between consumers and between brands and consumers that never happened before.
The rapid growth of the Internet and the advent of various Web 2.0 applications enable an
ordinary consumer to communicate with and influence a mass audience (Daugherty et al.
2008). Brands in many industries have captured the technological waves of marketing and
adopt social media marketing approaches (Hoffman and Fodor, 2010). Many brands in the
grooming and cosmetics industry have adopted themselves to the Web 2.0 world and many
emerging value brands such as Eyes Lips Face (E.L.F.) have made a fortune by playing the
social media well. A new generation of celebrities occur on the Internet and people call them
make-up artist gurus, beauty gurus, or skin-care gurus. These gurus distribute product reviews
online and become advocates of product/service. Online communications involving these
gurus or simply between average consumers have been taken more and more seriously by
brands’ marketing department.
This research is a project that investigates the mechanism of online communication among
consumers and between consumers and brands in the grooming and cosmetics industry. The
main objectives of the research encompass (1) the influence of online communication among
consumers on consumers’ purchasing behaviour, (2) the influence of online communication
between brands and consumers on consumers’ purchasing behaviour, and (3) the online
communication model applicable in the grooming and cosmetics industry and the attributes
that influence the model. This paper is a presentation of the results of the small scale pilot
study on Chinese consumers in the late half of the first year of this PhD research.
Literature Review
Thanks to the proliferation of the Internet, digital social networks are becoming indispensable
in almost every aspect of people’s lives. The growth of attention in digital marketing and the
adaptation of digital waves in marketing become a focus of researchers and practitioners in
marketing (Preibusch et al. 2007 cited in Yilmaz et al. 2010). Holland and Naude (2004) also
posit that the use of information system is now embedded in organisation that there should be
a better way of conceptualising marketing as “an information-handling problem rather than
merely transaction-based or relationship-driven problem”. Web 2.0-enabled social media can
be used to do what traditional marketer do in paper and media -- pushing information to
persuade prospects to consume (Fagerstrom and Ghinea 2009). Social media is also capable
of doing what is beyond the traditional marketing approaches’ reach – interactive
communication and quick spreading in social networks. Marketing communication innovators
propose the exploitation of such channels as means of establishing on-going dialogue with
customers and prospects (Economist 2006).
Social media marketing has been developed rapidly in a variety of forms including but not
confined to banner advertisements, ethnographic information scanning, email advertisements
and updates subscription, online consumer forum, and social networking sites such as
2
Facebook, Twitter, YouTube, E-blogger and many others. Network-based marketing
improves response (Hill, Provost and Volinsky 2006). Corollaries of this achievement are that
companies, which take advantage of social media in marketing and therefore attract more
clients, have higher possibility to occupy more market share, and that social media
applications can be a resolution for marketing managers who are grappling with the emerging
problem of how to maximize the chances of the client segments buying from one particular
brand rather than from a competitor.
Except for the function of fast message delivery to mass audience, social media marketing
frees consumers from their traditional passive roles as receivers of marketing communications
(Hoffman and Novak 1995) and gives them the power to be involved in and perhaps more
power than the advocators of marketing communications to control direction in which the
communication goes. Kolter et al.(2009, p.399) suggested that new approaches of marketing
communication need to be shifted to focus more on programmes which could build closer
relationship with customers. User Generated Content belongs to those programmes. Blogs
written by travellers about a hotel is more credible than the remark by the hotel itself or hotel
ranking websites. 2006 European surveys indicated that blogs 'are second only to newspapers
as a trusted information source' (Brown, Broderick, and Lee 2007, p.16).
With the value of digital marketing being recognised by practitioners and studied by
researchers, consumer behaviours in this particular communication platform have caught
researchers’ attention as well. Two binary modes of behaviour which belong to Game Theory
are connected to consumer behaviour in the dot-com era – cooperate and defect (Anderson
2010). Industrial examples proved that not all the consumers embraced the new trends in
business (Anderson 2010). Table 1 demonstrates the advertising response payoff matrix
which can be used as a fundamental tool to judge the marketing techniques in social media.
Table 1: The advertising response payoff matrix, retrieved from Anderson 2010, p.39.
Consumer: Consumer:
Respond to advertising Ignore advertising
Marketer: Increase exposure 3-2 1-1
Marketer: Decrease exposure 4-4 2-3
The marketer and the customers have both opposing interests -- each wants to maximise their
return on the deal -- and mutual ones, as both hope to make a deal in the first place (Anderson
2010). Therefore, there are two points of equilibrium, the 1-1 lose-lose situation in the upper
right quadrant and the 4-4 win-win situation in the lower-left quadrant. Decreased exposure
but increased response means fewer amount of but more relevant messages to the consumers.
It is an upward spiral in which consumers are more likely to respond to highly relevant
messages and in return the marketers get better payoff. Therefore, this has been shifted from
what Anderson calls a “one-way conquest” to a “two-way contest” (Anderson 2010, p.4).
As the psychological path changed to adapt to the digital world, model of communication sure
have some changes to fit in the digital world. Marketing communication is partly an attempt
to create and sustain a dialogue with various audiences. As communication is the process by
which messages are delivered to individuals, each participant in the communication bears a
role as an advocator, a receiver, or both. As media develop, the communication formats have
taken radical changes. The first and fundamental model of communication is the linear model
of communication developed by Wilbur Schramm (1955, Figure 1). This model failed to
3represent all kinds of communication
accurately concerning social and
relationship dimensions and the impact of
interactive communication.
As the delivery channel developed, the
linear model of communication had been
replaced by the influencer model of
communication, which depicted that
information was distributed from message
source to particular groups of people whom other members of the audience refer to for
guidance (Fill 2011, p.39, Figure 2). Though the influencer model of communication
accounted for individual’s participation in the communication process, it still excluded social
activities implicitly in the process. As a more advanced model, the interactional model of
communication proposed by Fill (2011, pp.41-42) demonstrates how the variety of influences
acting during the communication process between individuals in a social context (Figure 3).
The adoption of dialogue as the basis for communication changes the marketer’ vision of the
audience (Fill 2011). The importance of participations in the communication is emphasised in
the interactional model. Level of interactivity together with audience involvement that the
communication encourages determines the success of a dialogue.
Research Questions and Research Methodology
Consumers reads and have access to more information than ever before in online communities.
Messages they receive online, together with the one received offline, guide them in making
judgements about accuracy and credibility of the message, the brand and customer
expectations (Li and Zhan 2011). It is crucial for marketers to monitor closely the influences
that the online communications may have, and utilise it so as to earn “greater share of
customers’ purchases” (Kotler and Armstrong 2011, pp.44-46). Though online communities
and online communications have been the focus of researchers, online communication’s
influence in grooming and cosmetics industry is barely touched and different levels of
4influence of communication upon consumers hasn’t been studied. Therefore, the emerging
research questions are:
RQ1. How does online communication between consumers influence consumers’ purchasing
behaviour?
RQ2. How does online communication between brands and consumers influence consumers’
purchasing behaviour?
RQ3. How does the level of influence between consumers and between brands and consumers
differ?
Marketing research is mostly applied research, which is used to explain or explore a strategy
or to reduce uncertainty in management decision making (McDaniel and Gates 2010, p.10).
The nature of marketing research decides that it should be somewhere in the middle of the
whole spectrum with positivism on one extreme and social constructivism on the other.
Objective methods and subjective methods are both broadly used in marketing research in
order to neutralise the drawbacks of each other for the purpose of bringing the optimal results.
In this pilot study, mixed methods are applied and two phases of study carried out. Qualitative
interviews with online gurus in the grooming and cosmetics industry were conducted in the
first stage, followed by the deduction process where online questionnaire surveys conducted
through online social networks.
Main Findings
All together 20 in-depth interviews were
carried out and 47 complete and valid
questionnaires were used in analysing the
data. As in this pilot study all subjects
were Chinese, other cultural groups will be
included in the whole research. A model of
online interaction was proposed in the
induction phase and modified in the
deduction phase (Figure 4). As shown in
the model, the online communication
between brands and individual consumers
(opinion followers) is still generally one
way message delivery bearing weak
influence over the consumers’ purchasing
behaviour. The influence level between Figure 4. Online interaction model in the
opinion leaders (gurus) and opinion grooming and cosmetics industry
followers (average consumers) is strong
and the communication among average
consumers is in fact the most influential
one according to the results.
Consumers regard social media as a pool of information source. Personal need of making a
purchase of a product/service is the prerequisite of making a query of information online.
Consumers are more interested in pragmatic messages in supporting them to make the
judgement of purchasing or not. Online discussion has the highest credibility in comparison
with messages distributed by brands or information created by opinion leaders. Negative
messages created by average consumers (opinion followers) have a significant impact on
others’ purchasing behaviour. The main themes of online communication involved in
grooming and cosmetics industry are reviews and how-to tutorials and messages in these two
5types are most often viewed and replied. The implication for the message distributors is
simply that the higher proportion of these two themes they deliver, the more attention they get.
Also, there is proved to be a significant correlation between the frequency the followers view
the content created by opinion leaders and the probability of them making a purchase. Also
the frequency that the followers view the content distributed by opinion leaders are positively
correlated to the source credibility. Therefore, the more credible the opinion leaders are the
more likely the followers will be persuaded by the message.
It is important then for marketers to first identify opinion leaders whose perceived credibility
is high and let them be the spokesperson for the brands and the products. Also, monitoring the
discussion by opinion followers and managing the direction of discussion with caution is
necessary given that the interaction among consumers is most influential in shaping their
perception of product positioning.
6References
ANDERSON, E. 2010. Social Media Marketing: Game Theory and the Emergency of
Collaboration, Heidelberg, Springer.
FAGERSTRØM, A. & GHINEA, G. Year. The Persuasive Effects from Web 2.0 Marketing:
A Case Study Investigating the Persuasive Effect from an Online Design Competition. The
Symposium on Human Interface, 2009.
FILL,C. (2011) Essentials of Marketing Communications. Harlow: Pearson Education.
HILL, S., PROVOST, F. & VOLINSKY, C. (2006) Network-based Marketing: Identifying
Likely Adopters via Consumer Networks. Statistical Science, 21, pp.256-276.
HOFFMAN, D.L., NOVAK, T.P. & CHATTERJEE, P. (1995) Commercial Scenarios for the
Web: Opportunities and Challenges. Journal of Computer Mediated Communication, 3.
HOLAND, C.P. & NAUDE, P. (2004) The Metamorphosis of Marketing into an Information-
handling Problem. The Journal of Business & Industrial Marketing, 19, pp.168-177.
KOTLER, P. & ARMSTRONG, G. (2011) Principles of Marketing, 14th Ed. Harlow: Pearson
Education.
LI, J. & ZHAN, L. (2011) Online Persuasion: How the Written Word Drives WOM –
Evidence from Consumer-Generated Product Reviews. Journal of Advertising Research,
51(1).
MCDANIEL, C. & GATES, R. (2010) Marketing Research with SPSS: International Student
Version, 8th Ed. Hoboken: John Wiley & Sons.
YILMAZ, B.S. & OZDOGAN, O.N. (2010) Blogs as a Means of Information Sharing among
Tourism Consumers: the Case of Turkey. Tourism & Hospitality Management, 2010,
pp.1639-1648.
7You can also read
