Success Factors of Online Social Networks

Article excerpt

ABSTRACT

This paper focuses on success factors of online social networking strategies. The significant relationship between success factors and outcomes of online social networks is also investigated. The scope of this research emphasizes Thai E-commerce enterprises registered with www.truehits.net, one of Thailand's most recognized data providers of e-business. Regarding success factors of online social networks, Thai E-commerce enterprises focus most on the aspect of content. Providing accurate and up-to-date content to target online users leads to increase competitive advantages and results in a successful online social network. For the outcomes of online social networks, Thai E-commerce enterprises seem to be satisfied most with Brand Equity followed by Customer Insight and the number of Active Users respectively. According to the relationships between success factors and outcomes of online social networks, content factors significantly influence all major outcomes consisting of the number of active users, customer insight and brand equity. Updated and accurate content which is generated by members participating in the networks enhances potential success of online social networks of Thai E-commerce enterprises.

Introduction

The global populations nowadays live in a digital world. People's lifestyles have changed remarkably. It is the reason why business organizations have to adapt their strategy to catch up with the changing environment in order to create competitive advantages. As a consequence, digital strategy plays a substantial role in current business operations. One of the most popular and influential strategies is to use social networking strategy. The behavior of internet users has changed from using emails and search engines to creating, uploading and sharing personal content to connect with cyber friends. Social networks and consumer-generated content give users opportunity to interact in real time as well as create constant and large user base (Kozinets, 2002; Harris and Rae, 2009). According to recent statistics, internet consumers begin to communicate more via social networks than electronic mails. Goad and Mooney (2008) point out that people in England prefer to use social network as a way to communicate rather than email. Besides, the highest growth rate is in the SS years-and-over age group which is very interesting considering that the world is entering aging society. Since there are more people joining social network, it becomes a great tool for a company to communicate with consumers. The 2010 marketing budget on social networks was as high as 3.3 thousand million dollars world wide, increasing 31% from 2009. It expects to grow continually around 30% in 2011 (www.eMarketer.com, 2010). Facebook has the highest market share, at 39%. Moreover, 86% of marketer plans to increase budgets on social media (www.pamorama.net, 2010). Therefore, social network becomes a crucial competitive strategy that modern organizations have to focus on. Social network is not only important in visual world but also in physical world where many companies can use it as a tool to operate their businesses.

It is extremely important to study and understand how to develop a successful social network strategy. It should be adjustable to the changing circumstances especially when consumers are not only content receiver but they also become active creators. They can create and exchange contents in wireless world (Firat and Dholakia, 2006). The companies must grab opportunity and make the most of this trend. Nonetheless, there are not many academics, particularly in the East, to do a complete research on social networking strategy.

In Thailand, the survey indicates that from 18.1 million of internet users, 61% of people use online service for shopping. In 2008, electronic commerce business has a value of 527,538 million baht, increasing at 427,460 million baht compared to that of 2007. The most popular ecommerce businesses are fashion, jewelry and accessory. …