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AN INVESTIGATION INTO THE IMPACT OF SOCIAL MEDIA ON pit PERCEPTIONS THE CASE STUDY OF ESTEE LAUDER DISSERTATION By PALESA MAHLOELE Presented in incomplete fulfilment of the requirements for the dot of MSc Marketing University of Wales APRIL 2011 ABSTRACT kindly media has evolved finished rough a(prenominal) multiplications and eras, it has been correctd in various authoritys by incompatible authors, lookers as healthy as academia. nearly argue that it stems from the very proto(prenominal) forms of interpersonal communication via email, while some some opposites solely accept it as the to a spacio drug ab handlingr extent recent form of companionable fundamental interaction on sociable media sites. disdain al unmatchable(prenominal) the different arguments that exist smell kind media, lively academic lit on the payoff is rather sparse. That being said however, the topic of station acquaintances has been analyse and enquiryed in depth in ii the academ ic and corporate worlds. The correspondence of marker lights has been the base of many debates which has chaired in a wealth of lit to draw on for this gather upion accept. This look into training sought to task the push that Social Media has on smear perceptions of consumers, with a specific tenseness on Facebook and the Blogosphere.In swan to add organize and guidance to the inquiry aim, threesome re chase objectives were hardening. The initiatory objective was to analyze extant conceptual models and supposititious frameworks related to to fri interceptly media and strike off perceptions. The second was to evaluate Facebook and consumer blogs in their friendly function as generator assemblages on consumers. The final enquiry objective was to specialize optimal strategies to improve sales and patsy story of cosmetics by means of an lurch magnitude presence on functioner media platforms specific bothy Facebook and blogs.The look intoer deemed it appropriate to pick fall out this investigation from a qualitative look for double. Given the nature of the topic under investigation, qualitative look would allow the queryer to delve deeper into the plaint matter. Consequently, the larn was carried out in an inductive approach employ a pillow fictional character study strategy where entropy was composed from Estee extoller and using multiple sources of manifest. This selective information accumulation was coupled with on delimit survey in-depth as well as semi-structured inter conniptions for both employees of the friendship understudy as well as regular consumers of cosmetics increases.For the directs of summary, thematic data analysis method was chosen erect of the fact that it would be or so appropriate for qualitative analyses. This method of data analysis allowed the looker to draw major themes that arose from the data collected as well as the few permeated themes that came through. The findings from this enquiry study declargoned that in principal, consumers and concern accept and appreciate the importance of the bushel that genial media has on filth perceptions. It would fascinatem, ground on the results that the challenges boil d throwhearted to the execution of kindly media merchandise activities.Essentially, Facebook and the blogosphere fulfil distinctive roles in communicating selling gists, both consumer and keep company pay offd. Where Facebook is considered to be a companionable interaction lacuna, blogs be seen to serve an data providing role. Based on the results of this question study, cosmetics companies deplete failed to recognise these critical differences. Despite the fact that Facebook is considered a private interpersonal communication space, the findings suggest that adding transpargonnt value in hold oning a presence on Facebook crapper yield positive results on deformity perceptions.Results from this study reveal the untapped el ectric potential residing in kindly media provided strategies that bind consumer needs and desires be critically considered. Chapter One Introduction 1. 1Enquiry Overview The purpose of this research was to analyse the intrusion of well-disposed media on stigmatize perceptions using Estee extoller as a typesetters case study. Social media in the background of this research study specifically refers to Facebook and Blogs. This research is qualitative in nature and is largely in leaned on proving the possible solutions for Estee lauder concerning leveraging tender media.This enquiry overview seeks to provide the reader with an strategy of what to expect from the rest of the report card. Each chapter of the study is concisely summa overtured to as to deliver the goods this. The graduation exercise chapter of the study opens up with a comprehensive introduction to the study. This portion leads the reader into the study by providing the essential background and justif ication of the study. Moreover, the aims and objectives without which the paper would earn no direction be laid out in this chapter and every bit fundamental ar the research questions which the research seeks to answer.The subsequent chapter thence delves into belles-lettres review of existing material on the surmount of amicable media and rat perceptions, and where possible, literature on cosmetic merchandising was similarly investigated. The purpose of this chapter was to build fast(a) theoretical foundation from which the rest of the study could be built. Additionally, chapter dickens is aimed at ensuring that the wheel is non re-invented where sure relevant subjects had anteriorly been researched and could therefore enhance this study. Chapter is in the beginning concerned with research methodology utilised in the study.Importantly, chapter attempts to rationalise the chosen research path. Further on to this, the research paradigm, the selected research instrume nts as well as the sampling methods, ethical considerations and vanish study be discussed in this chapter. This chapter provides the reader with a full intelligence of the means in which the research aims and objectives be bridged with the direction the study takes. Chapter cardinalsome is essentially cerebrate on presenting the data and then analysing it. More interestingly, in chapter four the reader is taken through the data collection and analysis play.It is in this triggering that the research questions ar mainly addressed. Thematic analysis, which is the selected data analysis tool for this research study is discussed and justified at the like cadence selection analysis tools deemed to be unsuitable for the study argon discussed therein. The study concludes with a chapter which proposes feasible recommendations to Estee Lauder concerning the way in which neighborly media buttocks be realistically leveraged in dictate to positively disturb scrape percept ions among its tar father audience.These recommendations atomic number 18 based on the empirical findings from this research study, discussed in the anterior chapter. Importantly, chapter five seeks to examine the findings of this research in resemblance to the research aims and objectives set out at the beginning of the study. 1. 2Research Aims and Objectives The purpose of this study is to investigate the impact of Social Media sites on blot perceptions, with specific localize on the cosmetics exertion using Estee Lauder as a case study.This study ordain pitch a two-facet approach. It leave behind analyse the impact of flick of cosmetics notes, on Social Media sites from the curve of content generated by consumers or general members on Facebook and blogs and on the other hand, this study giveing investigate the impact of content generated by cosmetics companies. Consumer generated content, in particular through blogs and colloquial interactions on Facebook by way of respective(prenominal) or private comments, precondition updates and photographs.Company (brand) generated content will specifically be focussed on yellowish brown pages created by cosmetics companies using Estee Lauder as a case study. This research aims to achieve the pas m objectives. 1. To review extant conceptual models and theoretical frameworks related to cordial media and brand perceptions 2. To evaluate Facebook and consumer blogs in their role as indication sort outs on consumers 3. To determine optimal strategies to improve sales and brand reputation of cosmetics through an increased presence on kindly media platforms specifically Facebook and blogs. 1. 3Research QuestionsIn order to assess the authorization of neighborly media platforms as a means of influencing brand perceptions of cosmetics, using Estee Lauder as a case study the adjacent questions must be answered through this research study. 1. What role do extension dish out groups encounter in the acquire decision-making process of cosmetics? 2. Is there a connect between exposure of brands on Facebook and blogs the consumers propensity to acquire cosmetics? 3. ar social media sites, specifically Facebook and blogs effective trade tools when employ in isolation in the absence of monolithic merchandising weapons platforms? 1. rationale of the study Marketers are presently faced with the ever-increasing challenge of creatively developing communication techniques that will effectively r to each star their target audience. Where in previous eld, consumers did non hold up admission price to a full array of point of intersection in initializeion or choices, today consumerism is dominating all feels of life (Rahman and Rahaman 2008). Industry expert, Raphael Viton (2009) postulates that social media marketing strategies work best for high involvement categories where entropy, runback and testimonials from trusted sources campaign an all central(predicate) role i n buying decisions.He nurture posits that this being the case for violator fruits fares social media perfect for cosmetics Viton (2009). What has been clearly evident over recent eld is that although numerous cosmetics companies feed made efforts to sop up some presence on social media sites, very few are truly committed and many are unwinnerful in their approach. Many such companies embarked on a social media marketing campaign in the h eighter of digital euphory tho did little to noaffair in order to maintain these campaigns. correspond to research conducted by Forrester Research (2009) traditional advertising is on the decline with the break of social media in the UK and the USA. This research further indicates that Social Media outlay will increase to $3,113 (in millions) in 2014 from $716 in 2009 representing a compound annual appendage rate of 34% the highest percentage gain in the marketing mix. This spending legal action also ranks it as the third most promin ent program behind search marketing and introduction advertising.Edelman (2010) proposes, Thoughmarketing strategies that foc utilise on building brand awareness and the point of purchase worked attractive well in the past, consumer touch points have changed in nature. For example, in many categories today the single most powerful influence to buy is some(prenominal)(prenominal) elses advocacy. Social Media presents marketers with a less costly means of micro-targeting their audience effectively. Whereas as previously, exorbitant budgets were required for mass reach, social media is able to achieve the aforesaid(prenominal) at a fraction of the cost.A paradigm shift has occurred where consumers are acquiring product knowledge and interacting, this revolution calls for an appraisal on the part of companies wish to remain salient. Whereas much than than traditional progressional techniques, specifically, television, radio and marker advertising once dominated product prom otions offline enthrall are now pickings over. Owen (2010) claims that, Its important to realise that an diff utilizeing audience in one channel does not automatically mean a decline in another. As practically as social media marketing is on the rise, evidence proving the effectiveness of these platforms used in isolation is s fuckingt.Social media is a fairly young discipline and many marketing wipe outrs are uncertain on how to effectively approach it in terms of coupling it with traditional marketing methods. Evidence is equally minimum with regards to how brands exposure on social media platforms affects their image every through brand fan pages or friends communication Galak and Stephen (2010) put off that while social media was once the domain of younger, tech-savvy, early adopter consumers who were sudden to adopt untestedborn technologies, it has now evolved into mainstream and covers a broad demographic spectrum.Today, 75% of Internet-using adults in the United Sta tes are active on such social media Bernoff et. al. (2009). This large number of users affects it critical to under fend for not just now how social media influences consumers, alone also how it operates alongside traditional media. Findings from this research study will add value to the development of effective social media marketing strategies for cosmetics companies (brands) waiver forward. 1. 5Scope and Limitations The generally original description of Social Media spans to cover a wide spectrum of innumerable online tools.The extensiveness of existing social media platforms spans further than this research is able to cover. financial restraints as well as time constraints inhibit this research study to cover the entire scope of social media platforms getable today. This research will strictly concern itself with investigating social media in as out-of-the-way(prenominal) as it includes Facebook and violator blogs. The study will also be stringently focussed on the im pact of brand perceptions on Facebook and blogs on the cosmetics industry using Estee Lauder as a case study.Moreover, data collected for this research will be limited to what is feelerible through Estee Lauder company reports and secondary learning that is publically available. Lack of access to intimate marketing and sales data may limit the robustness of the Estee Lauder specific information. In addition to the to a higher military post stated restraints, in order to achieve a more focussed study, it was deemed necessary to exclude the embarrassment of demographics that are also active on Facebook and blogs consequently, this study will solely focus on the female consumers between the ages of eighteen and thirty-five that purchase cosmetics at least once a month.Consequently, some may regard the generalisation of these findings as inconclusive or rather narrow. there may be product specific parts that affect the expiry of these results as pertaining sole(prenominal) to the cosmetics industry and not unavoidably to other product categories crosswise the board. thither may also be factors that may uniquely affect batch at heart that specific age group that will impact the outcome of the results of this research study. However, the findings of this study will contribute the understanding of social media on brand perceptions albeit for a specific industry.Notwithstanding the above-discussed limitations, this study will establish a foundation on which to build on when organisations embark social media marketing strategies to enhance their brand reputations. 1. 6Background of the study Boyd and Ellison (2008) define social media sites as web-based go that allow several(prenominal)s to (1) construct a public or semi-public profile inside a bounded system, (2) articulate a list of other users with whom they serving a tie-in, and (3) view and traverse their list of connexions and those made by others in spite of appearance the system.The nature and nomenclature of these connections may vary from site to site. For the purposes of this research study, all mention of social media sites refers specifically to Facebook and Blogs. The research will consider both consumer and company (marketing) generated content on these sites. An increasing number of the enormous unwashed across the race and age spectrum are spending significant amounts of time online, socialising with friends through a variety of social vaneing sites.Traditionally, visitors to these social networking sites visited such sites primarily for the purpose of interacting with friends and publicly sharing details, comments and photographs of their lives. Human beings are social and have an innate need or desire to feel pass judgment and to jibe in. Accordingly, they tend to be heavily influenced by the multitude around them or with whom they spend the most time on making purchase decisions. much(prenominal) slew range in the type or family relationships, in cluding- family, friends, colleagues or even just unconcerned acquaintances. much(prenominal) groups of raft help form and habitus perceptions of brands. The account book used to define this group of peck is mention group. Solomon et. al (2010) define a grapheme group as an actual or imaginary number individualistic or group conceived of having significant relevance upon an individuals evaluations, aspirations, or demeanor. These are the nation that consumers a lot desire on for product information they can trust. Stallen et. al clarify this concept further by explaining that, decision-making is oft influenced by the behavior of others.For instance, plurality frequently make akin decisions as their friends do (e. g. teenagers may choose to wear clothing that is resembling to that of their buddies) while they also often choose differently than the ones they do not like (e. g. the clothing should not be identical to what is worn by uncool kids). As social media s ites are where many tidy sum are now spending most of their time, these interactions are now taking adjust on such platforms. Over time, the social media landscape has evolved into a space where a broad range of information is disseminated.Consumers are now looking to these sites for product information that they can rely on from trusted sources-friends and family online. thence, social media sites have in themselves, evolved to live a citation group as such. Casteleyn et. al (2008) suitably notes that the information that community display on their Facebook pages is constructed to channelize their personality to their friends and to the rest of the world. More often than not, these are the desired perceptions that people would like others to have of them.Nonetheless, a myriad of information is propagated through these channels and reaches a wide spectrum of people beyond any geographical borders. This type of information dissemination is known as online Word of Mouth (WOM). WOM is usually defined as an unpaid form of promotion in which a satisfied customer tells other people how much they like a product or service or even sharing a positive experience. The homogeneous is applicable in a negative sense, in which case a customer may have had a foul-smelling experience with a business, product or service and dowrys that with their online network.Cheema and Kaikati (2010) propose that password of mouth (WOM) communication is central to the exchange process as consumers often rely on others for assistance with purchases, especially for products with high financial or psychological risk. Several studies have empirically demonstrated that WOM is more convincing than traditional media channels Godes et. al. (2005) WOM is considered to be one of the most credible forms of promotion because a person puts their reputation on the line every time they make a recommendation and that person has nothing to gain but the pleasure of being heard.Traditionally the s pread of WOM was limited to those at bottom ones geographical study and was bound to a close network of people with whom a relationship was fortuned. In modern multiplication, the proliferation of the Internet has expanded the network exponentially. The growth of the Internet and specially the rapid increase in best-selling(predicate)ity of social networking sites as a preferred medium of communication has broken down the boundaries that once limited WOM communication.As a result of this, coupled with the recent sight in technological developments worldwide, particularly pertaining to the Internet and continuously advancing social media sites- traditional marketing seems to be losing power and space with a majority of companies. The cosmetics industry is one that has had a significantly increased presence on social media sites. Extensive fan pages have been created on Facebook by both companies and consumers wishing to manage untried product information, product experiences and recommendations. Similarly, there has been an equally considerable growth of beauty and cosmetics blogs.The definition of cosmetics is considered to comprise of sputtercare products (body and facial), make up, personal care products including deodorants, body washes and soaps. From this point on, for the purposes of this research study, all reference to cosmetics includes only skincare products (body and facial) and make up. Typically, cosmetics are advertised in flashy fashion and beauty magazines as well as on television. However, at present, beauty product marketers are searching for new ways to expand their consumer reach beyond the traditional avenues of fashion and beauty magazines.According to Decoursey and Sloan (2009)Concerns, particularly for littler companies, include magazine clutter, increased ad rates and policies concerning rotation of advertisers in prime space. And virtually all marketers worry about harried consumers, who have less spare time to pore over fas hion and beauty books. As a result of the above, social media sites have emerged as an increasingly customary avenue for beauty product marketers to explore as a medium to reach their consumers, where social media sites form part of the consumers reference group.Consequently, the sideline research study aims to assess the impact of social media sites on brand perceptions of cosmetics products, using Estee Lauder as a case study. Further to this, the ever-changing role of social media sites as consumption reference groups for brand exposure and product sales of cosmetics brands will be analysed. 1. 8 SUMMARY This chapter comprehensively introduced the research study. It provided an overview of the study by stating the aims and objectives of the research and providing the rationale of the work.Finally the chapter closed with a discussion of the scope and limitations and the background of this study. Chapter Two seeks to systematically investigate extant literature on the topic. CHA PTER TWO LITERATURE REVIEW 2. 1INTRODUCTION The focus of this section of the paper delves deeper into present research that has been conducted in line of productss related to the area of focus of this study as laid out in the preceding chapter. The purpose is to gather theoretical literature to make for a solid study together with the data that will be collected in this investigation.Research in the area of social media sites and consumer behaviour has only recently become of great interest to researchers in the past three to five yrs. The mind is two-fold 1) although social media sites have been around since the late nineties theyve only recently started to truly flourish in the past few years. 2) sucker marketers started identifying such sites as a suitable channel to exit with their consumers over round the same period. To begin with, this chapter will explore a conceptual elucidation of the terms social media in the way it is intended for this paper.Following that will b e an translateation of brand perception in the way that it relates to and will be studied in this research. In addition to this, further relevant literature on the topic will provide a broader scope into the subject under research will also be considered and examined. 2. 2Conceptual Clarifications Although social media is a relatively new construct in the communication world, a great many researchers and authors have provided their own interpretations of what it can be defined as (Chung and Austria, 2010 Dutta, 2009 Hoffman, 2004 Cova & Pace, 2006 Jones, 2009).As varied as the understandings may be from author to author, one thing remains consistent social media is growing at a phenomenally rapid pace. Furthermore social media has revolutionised the way in which people communicate and that brands communicate with their consumers. Chung and Austria (2010) postulate that Social media includes various methods of online communication such as social networking, user-sponsored blogs, mul timedia sites, company-sponsored websites, collaborative websites as well as podcasts.This definition includes just about the entire scope of the activities that a majority of individuals who participate in online communications would be mingled with. Dutta (2009) further reiterates this point by stating its no secret that social mediaglobal, open, transparent, non-hierarchical, interactive, and real timeare changing consumer behaviour and workplace expectations. It is becoming increasingly difficult and in some cases, impossible to follow traditional communication structures of non-transparency and hierarchy when people communicate via social media platforms.This is particularly true of business communication. Consumers now have more access to information than they ever had before. Hoffman (2004) patronises the above statement, the Internet makes available numerous information sources that consumers may draw on as they search for information and construct choices about commercia l offerings. These information sources include social media sites, online product reviews (either by peers or experts), and uncensored in-depth product information on a variety of entanglementsites, among many other sources. Cova & Pace (2006) put orth that consumers in consumer-generated brand communities want to become influential participants and regard brands as be to us and not as companies that supposedly own them. They are compulsive by a similar passion or ethos to form and choose in online brand communities, thereby producing their own cultural meanings around brands. Social media is a fundamental shift in the way we discover and share information. It provides individuals and particularly retailers with the ability to cultivate and have ongoing conversations and touch points with their customers and potential customers.Every retailer has a unique tribe of customers or a receding group of consumers. Social media helps broaden that group and engage with them like never b efore. Jones (2009) summarises it well in stating that Social media essentially is a category of online media where people are remonstrateing, participating, sharing, networking, and bookmarking online. From the above, it is evident that social media sites as a construct have evolved over time to encompass a considerably wider scope of the consumers online experience. When consumers make a purchase, they are buying more than just the product they are buying into the brand.Keller (1993) maintains the above statements by putting forth that brand perceptions are attributes in consumer memory that are linked to the brand name. Solomon et. al (2010) defines perception as the process by which stimuli are selected, organised or interpreted. Marketers play a crucial role in shaping and defining brand perceptions in consumers. Findings from several research studies previously conducted indicate that brand perceptions play a pivotal role in the consumer purchase experience because they are said to influence consideration and evaluation, and therefore ultimately, purchase (Nedungadi 1990 Keller 2003).Several factors may influence brand perception, the factors include but are not limited to elements such as price of the product, the way in which the product is packaged, where the product is sold, reviews and feedback by reference groups on the product, and indeed how product information is disseminated or advertised. This research study will explore the impact of social media sites, namely Facebook and blogs on brand perceptions- including but not exclusively the above-mentioned elements that often shape it.This review will be focussed on three aspects of the impact of social media on consumer purchasing behaviour as researched in previous studies 1) The History of Social Media 2) The impact of WOM through social media sites 3)The role of whim leaders and suasion searcher beetles on social media sites as reference groups 4) shop as a social activity on social media s ites 2. 3history of social media in that respect are opposing schools of thought as to when social media was born. Some argue that social media did not begin with computers, and that it was born on line specifically on the phone.The era of Phone phreaking or the Rogue geographic expedition of the telephone network of the 1950s was a period when techno-geeks-people who were very clued up on technology- began to investigate ways to allow them to make free or cheap calls. These early social media explorers built boxes which were homemade electronic devices that could generate tones allowing them to make free calls and get access to the experimentational back end of the telephone system. Borders (2009) While on the other hand, others argue that social media came in considerably more recent years.Boyd and Ellison (2007) claim that the first recognizable social network site launched in 1997. SixDegree. com allowed users to create profiles, list their Friends and, beginning in 1998, sur f the Friends lists. Each of these features existed in some form before SixDegrees, of course. For instance, profiles existed on most major dating sites and many community sites. Classmates. com allowed people to harmonise with their high school or college and surf the network for others who were also affiliated, but users could not create profiles or list Friends until years later. SixDegrees. com was the first to compound these features. As defined by Boyd and Ellison (2007), the generally accepted present-day understanding of social media and what it has become would however suggest that these platforms as we interpret them today, concurs with the latter(prenominal) date of origin. 2. 3. 1ORIGINS OF FACEBOOK Facebook was originally born out of the trivial concept of allowing students to umpire each other based on their facial appearance. Over a relatively brief period, Mark Zuckerberg-founder of Facebook evolved the platform and introduced innovative ideas into the network, an d added some reclaimable features like a comments section, amongst other things.Within a few months most of the schools and universities in the United States and Canada were on board, and a surprisingly large number of people had joined Facebook. In September 2006, the network was opened to any individual who had an email address and was over the age of 13. Subsequently, Facebook rapidly grew into the most commonplace social networking website. 2. 3. 2ORIGINS OF BLOGGING Miller and Pole (2010) define a blog as a website containing dated entries, or posts, presented in reverse-chronological order.Blog features commonly include narration (previous posts, emblematicly grouped by month and year), a blogroll (a list of recommended blogs), and a reader comment section. Today, most blogs are interactive, allowing visitors to leave comments and even message each other via widgets on the blogs and it is this interactivity that distinguishes them from other static websites. Brown et. al ( 2007) acknowledge that word of mouth (WOM) communication is a major part of online consumer interactions, particularly within the purlieu of online communities.The relative simplicity required to set up and participate in a blog allows for any individual that has a basic understanding of how a computer works to be voluminous in this online activity. Many blogs provide commentary or word of honor on a particular subject others function as more personal online diaries. A typical blog combines text, images, and links to other blogs, Web pages, and other media related to its topic. The ability of readers to leave comments in an interactive format is an important part of many blogs. Increasingly, blogs are now emerging as a new form of interactive advertising tool on the Internet.Cho and Huh (2008) The origins of modern blogging are often a point of great contention. There is a school of thought that believes that the Mosaics whats new page in 1993 was the first weblog. The Mosaics wh ats new in 1993 a list of links some people passed onto others. However, it wasnt until December 1997 that Jorn Barger coined the term weblog in his Robot Wisdom Weblog. In 1998, only a handful of blogs existed, and many of the bloggers knew each other and linked to each others sites. Rebecca Blood, author of The Weblog Handbook, notes that one preeminent site listed only 23 blogs in existence at the beginning of 1999.The media started noticing blogs later in 1999 and drew tending to the phenomenon. But it was the proliferation of free weblog-creation programs in 1999 that made blogging into a hugely popular pastime. Before this software was widely available, most weblogs were hand-coded by web developers and others who taught themselves HTML. The new programs made it easy for anyone to create their own weblog. Blogger was released in August 1999 and was an ready hit. This simple weblog application allows users to create any kind of weblog they desire.By October 2000, Blogger user s were creating 300 new blogs a day, and the Blogger directory had over 5,500 blogs listed. In November of the same year, the 10,000th Blogger weblog was created. As of 2002, Blogger claimed over 750,000 users. The rise of tools like Blogger also changed the content of weblogs. While they had begun as link-driven sites offering alternative viewpoints on news and other subjects, weblogs began to collide with online journals. Blogger-style tools allowed links and commentary to chop-chop grow into longer essays and diaries on the Web.Online journals had existed before this, but weblog applications made journals easier to manage for those who didnt know HTML. 2. 4The impact of WOM through social media sites Both scholars and practitioners of marketing are particularly interested in WOM communication behavior in the context of online communities because of the extraordinary popularity, growth, and influence of such communities. Arndt et. al (1967) defines WOM as a consumer-dominated cha nnel of marketing communication where the sender is independent of the market.It is therefore perceived to be more reliable, credible, and trustworthy by consumers compared to firmly-initiated communications. Some literature reviews of studies in the field of social media sites reveal that the rapid spread of WOM on such sites concerning products and brands is one of their most distinguishing benefits. A key finding from research indicates that 10% of new consumer packaged goods (CPG) account for 85% of viral buzz, but this does not necessarily indicate a direct link with sales generation. Niederhoffer. (2007) Furthermore, the once accepted belief that word of mouth influence comes only from the elite, highly committed few has been challenged. Consumption-related online communities essentially represent WOM networks, where individuals with an interest in a product category interact for information such as purchase advice, to affiliate with other like- minded individuals, or to part icipate in complaint or compliment interactions (Cothrel, 2000 Kozinets, 1999 Hoffman and Novak, 1996).While it can be argued that the WOM communication going on within these online communities has limited social presence in the traditional sense, these communities provide information and social support in both specialized and broadly based relationships, and are becoming an important supplement to social and consumption behavior. Wellmanet. al. (1996) A study conducted by Cyber Atlas (2001), for example, cited 84% of Internet users having contacted at least one online community.The popularity of these emerging consumption-focused online communities, and the WOM communication going on within them, highlights a need for increasing scholarly attention to be paid to online WOM communication. metalworker et. al (2007) state that Research suggests that most people are fair machine-accessible and are as willing as the highly connected to share marketing messages. Increased accessibilit y to the Internet and so, social media sites has exacerbated the connectivity of people through an increased number of touch points such as nimble phones.Whereas previously people who did not own or have access to personal computers or home Internet connectivity, were not able to access social media sites, now through their cell phones they are active participants on such sites. This research proposes that people have an innate desire to share messages with one another-including marketing communications. Social media sites have a unique distinguishing factor that traditional marketing methods lack and that is an ability to stimulate and enable two way conversation between companies and their consumers and vice versa.An added advantage of this two-way dialogue is that it is possible for it to take place in real time and instantaneously. Consumers on these platforms are able to engage with companies that were traditionally out of reach to them on matters concerning their brands or products. Likewise, companies (brands) are able to gain insights into their customers and customers perspective, as well as directly address any issues or concerns at hand. In some cases, consumers engage with one another without the brand intervening at all sharing opinions and experiences.In the same breath however, John Marshall Roberts, communications strategian and Chief Executive Officer (CEO) of Worldview Learning, training and Research Company for change makers,highlighted the importance of the need for transparency and honesty, he warns thathalf-truths and green washing are quickly exposed on todays social media networks. It is urgent that companies with a presence on social media sites maintain an uttermost aim of integrity in their communication with consumers, as the truth can some always be uncovered.In such cases, a positive reputation that a brand may have built over many years can be destroyed in a matter of years and indeed in an instant. Katz and Lazarsfeld ( 1955) in one of the earliest research studies on WOM concluded that WOM two times more effective than radio advertisements, four times more than personal selling, seven times more than print advertisements. This research, was investigating traditional WOM in the absence of social media and indeed the Internet. Such WOM was bound by geographical location, as people were limited to the people that they were physically able to interact with.The Internet and indeed, the exponential growth of social media sites, have eradicated this constraint. Trusov et. al. (2009) find that WOM referrals have a strong impact on new customer acquisition. In their research, they conclude that the effectiveness of WOM referrals on social media sites have resulted in a direct positive effect on sales of products. The creation of social media has meant that WOM can be directly introduce in relation to its impact of consumer behaviour with regards to individuals decision-making process. There are several mo tivations that lead consumers WOM referral behaviour.These two motivating factors have found to be the direct drivers such as extreme satisfaction or dissatisfaction (Dichter 1966 Richins 1983 Yale 1987), commitment to the firm (Dick and Basu 1994) and novelty of the product (Bone 1992). When a consumer has had an exceptionally pleasing experience with a brand, or on the other hand, a particularly unpleasant one they are more likely to share this with as many of their peers as possible. Depending on the experience, this could lead to extreme benefit on the part of the company behind the brand or it could be detrimental to its image.Equally significant is the take of loyalty that a consumer may have to a brand or company. Once a consumer has a reached a stage of extreme brand loyalty, they develop a deep connection with the brand as they would with a person. There have been various schools of thought on the motivating influences on spread of WOM. One of these was that consumers who communicate marketing messages to other consumers were previously fabricated to engage in this behavior as a result of selflessness or reciprocity or to attain higher status (Dichter 1966 Engel, Kegerreis, and Blackwell 1969 Gatignon and Robertson 1986).However, fit in to findings conducted by Kozinets et. al. (2010), the motivators are more multifaceted including the individuals personality, specifically at whether they are opinion leaders or opinion seeker this topic will be discussed in greater detail further on in the next section of the literature review chapter. Additionally, their research study suggests that the sharing of WOM marketing messages is personal in a communally appropriate manner. Therefore, advocating that WOM is heavily influenced by personal characteristics of an individual in a communal setting.Wiedmann et. al. (2007) address the question of why certain personal sources of information have more influence than others to identify general market-place influ encers and use them for more effective product and message diffusion. They support that factors such as source expertise (Bansal and Voyer 2000 Gilly et al. 1998), tie strength (Brown and Reingen 1987 Frenzen and Nakamoto 1993), demographic similarity (Brown and Reingen 1987), reference group influence (Bearden and Etzel 1982) and perceptual affinity (Gilly et al. 998) have been identified as important antecedents of WOM influence. 2. 5The role of opinion leaders and opinion seekers on social media sites as reference groups Bearden et. al. (1989) state that the pervasive use of spokespeople in product and service endorsements reflects the widely held belief that individuals who are admired or who belong to a group to which other individuals aspire can exercise an influence on information processing, attitude formation, and purchase behaviour. Consumers influence other consumers in numerous ways.They act as models that inspire imitation among those who observe their purchase and cons umer behaviour, either directly or indirectly. Flynn et. al (2001) propose that consumers spread information through word of mouth, as consumption is a major topic of social communication. They further influence one another by directly better-looking out advice and verbal direction for search purchase and use. Research reveals that the time spend online and the benefits pertaining to product information and brand awareness for consumers are wedged on by individual personality traits.Personality traits in this context are discussed as they pertain to opinion leaders and opinion seekers. Solomon et. al (2010) clarify the term opinion leaders by defining them as people who are knowledgeable about products and whose advice is taken seriously by others. These people tend to be respected in their knowledge of specific products and hold great social power, as people tend to go to them for recommendations and advice. look seekers on the other hand are more likely to talk about products with others and to solicit others opinions as well. Solomon et. al (2010) Research conducted by Acar and Polonsky (2007) reveal that gender and extroversion predict online social network size and time spent online that opinion seekers spend more time online and have bigger networks relative to opinion leaders and that opinion leaders are more likely to communicate their brand use online This research further found the mediating role of opinion leadership and opinion seeking in explaining the impact of general personality traits online brand communication and social networking. From this definition it is realized that although people may seek information from various sources, there are certain individuals whose advice carries more weight than others. position leaders also tend to be socially active and highly interconnected in their community. Opinion seekers on the other hand, are often seen to be followers of opinion leaders. They are constantly in search of information from othe rs. This could explain the solid ground that they would be most active online as revealed in research discussed above by Acar and Polonsky (2007).Research conducted by Aaker (1991) and Keller (1993) concurs that the set of associations consumers have about a brand is an important component of brand equity. According to the findings from this research, consumers gain a certain level of psychological benefit from using or associating with certain brands. Consequently, the way in which the opinion leader is perceived will have a bearing on the brand perception to those that interact with him.Escalas and Bettman (2003) found that students are more are more likely to develop a self-brand connection when there is a strong employment association between a reference group and the brand and there is a strong connection between the reference groups and the consumers self-concept. Therefore, in this research, if a student has aspiration or actual associations with a certain reference group, whichever brand(s) that are popular within that group or have a high usage rate within that group will in turn have a level of appeal to that student.It stands to reason then, that with the copious amounts of time spent online by consumers, and the loads of information imparted particularly by opinion seekers, that social media sites would now form a pivotal role of this brand reference and purchase decision making construct. Social media sites have in themselves evolved dramatically over recent years, occupying a more extensive space in todays society. The advancement of social media has allowed it to reach a point where it could be considered to play a pivotal role in consumer interaction with reference groups.Childers and Rao (1992) put forth that the reference- group construct has supplanted the notion of group membership as one that explains group influence on individual behaviour. An important point to note is that the relationship between an individual and a reference group should be motivationally and psychologically significant for the influence to be considerable. Lessig and Park (1978) identified and examined three motivational reference group functions (RGFs) that alter themselves easily to the proposition of social media sites as reference groups.The functions are informational, utilitarian, and value-expressive. These two researchers defined the terms in the following way. An informational reference group imposes no norms on the individual. Instead, an influence is internalized if it is perceived as enhancing the individuals knowledge about his environment and/or his ability to cope with some aspect of it. Thus, the likelihood that an individual will accept information from this reference group as evidence of reality increases if he feels uncertainty associated with the purchase and/or lacks relevant purchase related experience. In line with this thinking, consumers in the process of purchasing products may visit Facebook or a blogging site in order to get product information, often from people with whom they have a personal relationship or connection. The influence of a utilitarian reference group on the other hand as outlined by the research conducted by Lessig and Park (1978) refers to influence on individuals from a different approach from the informational reference group, these groups are seen to motivate an individual to realize a reward or to avoid a punishment mediated by some other individual or group or is expected to conform to the others influence. The success of this phenomenon is achieved only if the individual feels that his actions are visible or will be known. Individual profiles are visible to everyone that participates on Facebook as well as blogs other than those with a private setting. Individuals subscribing to this form of reference group would tend to want as many people as possible to see their profile and thus display their group associations. The third motivational reference group function expl ored by Lessig and Park (1978) is the value-expressive reference group. An individual utilizes a value-expressive reference group for the purpose of expressing himself and/or bolstering his ego to an outside world. The degree of cohesiveness or norm specificity of the reference group is irrelevant for this function. What is important is the psychological image associated with the group whether the group is real or imaginary. A number of well-known cases exist in which attempts have been made to use the value-expressive reference group function in promotions.Consider the following examples the young generation promoted by Pepsi, the seaman image promoted by Schlitz and the sophisticated and liberated womanhood concept promoted by Virginia Slim cigarettes. Social media sites have now created a platform whereby people are enabled to create, aspire and join certain group. This information is more readily accessible and visible to the general public, thereby allowing individuals to dis play their associations with much more ease and higher reach.Childers and Rao (1992) further establish that from marketing and consumer- behaviour perspectives, the influence of reference groups on individual behaviour is often manifested in the types of products and brands purchased by individuals. 2. 6SHOPPING AS A SOCIAL ACTIVITY ON SOCIAL MEDIA SITES A third view into social media sites and consumer buying behaviour show that these two concepts are intrinsically connected as shop or sales in themselves are a social activity based on mutual trust.According to Shih (2009), relationships can sometimes even trump card price as the deciding factor in purchase decisions. reaping information from a trusted source like friends, family or other people that may form a part of ones reference group could result in the purchase of a product just from the mere fact that the information is coming from that specific person. It has been accepted for decades that shopping is more than the mer e acquisition of products but rather it is more about the enjoyment, experience and entertainment.Dennis et. al (2009) state that as well as its functional role it includes the pleasure of browsing, impulse buying, discovering new shops, topic for casual conversation, focal point for planned and unplanned activities with other people. This statement is particularly true among women. Researchers have drawn attention to the importance of social and affiliation motivations for shopping. Shim and Eastlick (1998) Social networks lend themselves as an ideal platform for the above-mentioned motivations for shopping.These networks have drastically revolutionised society in the way people engage and socialise. or so half (49%) of the thirty million Internet users in the UK have used social networking at least once in the last year and 70% of people and households are Internet users. Dutton et. al. (2009) Young females are over-represented as users of social network websites. Research carrie d out by Lenhart and Madden (2007) report that 70% of females use social network sites and 48% of teens visit social network websites like Facebook daily.Findings from research conducted by comScore (2010) reveal that social media users spend, on average, one and a half times more time online than the typical web surfer. In fact, heavy Facebook users spent an average of $67 online during the first quarter of the yearcompared with less than $50 for the general netizen. Social networks essentially facilitate social shopping or social commerce as the terms tend to be used interchangeably to take place among users. Social Shopping is a method of shopping where shoppers friends and family become involved in the shopping experience.Social shopping attempts use technology to mimic the social interactions found in physical malls and stores. 2. 7cosmetics and social media Estee Lauder has demonstrated willingness and intent within the cosmetics category in terms of exploring social media si tes to enhance brand perceptions and ultimately increase its sales. In 2009, Estee Lauder launched a business to consumer (B2C) social media marketing campaign for their cosmetics division, with their Lets Play Makeover initiative.As a prestigious and global skin care and Cosmetics Company, Estee Lauder saw an opportunity to tap into the increasing share of older women mothers in particular who were using social media. They thus created the Estee Lauder Lets Play Makeover Facebook application, which in essence is a virtual makeover tool. Women could upload their photos and use Estee Lauder products to create virtual make-up. This is a significant change to cosmetics marketing because it allows potential consumers to test and trial make-up in the privacy of their own homes before making purchases.This innovative application saves time and also lets them experiment with make-up at their own leisure. The effectiveness of this application is underscored by how it also integrates the f ull shopping experience by indicating to users which specific makeup they are using, from the eye-shadow to foundation colour and seals the deal by allowing them to purchase their chosen products online, thus making the purchase experience more convenient for the consumer. The sharing aspect of social media is also encouraged, as the application lets users share their makeovers and before/ after(prenominal) shots with friends.Social media campaigns should not just be considered as a separate entity. Its effectiveness in B2C marketing especially can be enhanced with other marketing methods. This example in particular shows how to effectively tie in offline promotions with social media marketing. The underlying strategy with Estee Lauders Lets Play Makeover campaign is thus to use social media as the major point of purchase, but at the same time, offer alternatives for users to make purchases, ultimately allowing them to fully engage with their products and services whichever way the y prefer.Proctor & Gambles Olay brand was another successful story in pioneering of cosmetics category of products to explore the use of online interactions through such sites. It rolled out an online interactive diary for the Olay Regenerist anti-ageing skincare brand in 2006. The diary provided minute information on the skin each week for the first eight weeks of product use, taking the consumer through the process, as the effects of the product were not immediately visible.Research conducted post this activity revealed that Olay had produced a four to six times higher intent to purchase among the target group, with 78% of the sample express they had purchased the brand within the last year. According to a report by Stylophane (2010) if a user joins the fan page as a result of viewing an advert, this action is logged on the advert itself, which means friends of the user can see this action, prompting them to also become a fan of the brand. Thus highlighting the effectiveness of the spread of WOM on such sites even in the most passive or subtle situations.Another successful cosmetics brand that has seen great success through its presence on Facebook is MAC. As at touch 2010, MAC had the greatest number of fans (542,613) more than double that of the second most popular brand, Carols Daughter. Nichol (2010) 2. 8SUMMARY This chapter was dedicated to the clarification and expansion of existing theoretical studies on the topic under research. The terms Social media and Brand perception were defined and clarified in the way in which they are intended for this study.Additionally, further research that offers a robust consolidation of theories to support the research at hand were examined and discussed. CHAPTER THREE RESEARCH METHODOLOGY 3. 1INTRODUCTION The previous chapter comprehensively explored extant literature on the topic under research. focal points of discussion in the preceding chapter were on conceptual clarification and literature most pertinent to the topic in this study. The core purpose of this chapter is to fatten and justify the chosen methodology of collection of primary data for this research.This chapter identifies research aims and objectives in relation to the research methodology employed. Moreover, this chapter discusses the chosen research paradigm or doctrine as well as its motives. Following onto this, the chapter explores the research approach, research strategy options as well as the selected data collection methods. Finally, this chapter deliberates the strengths and weaknesses of the research methodology for this study. 3. 2RESEARCH AIMS AND OBJECTIVESIt is imperative that the research aims and objectives mentioned at the beginning of the study are reiterated at this stage of the study as they form a crucial basis of the work going forward from this point. The research aims and objectives feed into the research methodology selected for the research. Therefore, at this point, it is prudent to reaffirm that t he purpose of this study is to investigate the impact of Social Media sites on brand perceptions, with specific focus on the cosmetics industry using Estee Lauder as a case study.This research rests on the following aims and objectives firstly the study set to review extant conceptual models and theoretical frameworks related to social media and brand perceptions. The following objective was to evaluate Facebook and consumer blogs in their role as reference groups on consumers. The final objective is to determine optimal strategies to improve sales and brand reputation of cosmetics through an increased presence on social media platforms specifically Facebook and blogs. The above mentioned aims and objectives guide the researcher in the formulation and design of the research methodology.It is paramount that these aims and objectives are assiduously concomitant with the methodology employed in order to ensure the success of this research study. 3. 3RESEARCH PHILOSOPHY Galliers (1991) defines research philosophy as a belief about the way in which data about a phenomenon should be gathered, analysed and used. Epistemology which is, what is known to be true, is contrary to doxology, what is believed to be true encompasses the various philosophies of research approach. Latu (2007) elaborates this rationale in stating that the purpose of science, then, is the process of transforming things believed into things nown doxa to episteme. As discussed by Hussey and Hussey (1997), there are two key research philosophies that have been identified in science and those are irrefutable (scientific) and interpretivist (antipositivist). According to Weber (2004), positivists attempt to build knowledge of a reality that exists beyond the sympathetic mind. Their research is based on a belief that gentlemans gentleman experience of the world reflects an objective, independent reality and that this reality provides the foundation for human knowledge.On the other hand, interpretivi sts are attuned to the belief that knowledge they build reflects their individual structure of interpretation that is based on distinct human experience, background, culture and other such divergent factors that may impact the way in which they interpret results from their studies. Interpretivists in other words, try to make sense of the world, acknowledging that their sense-making activities occur within the framework of their life-worlds and the particular goals they have for their work.Knowledge is built through social whirl or interpretation of the world. This research study is conducted from an interpretivist point of view. The results and findings of this study rely heavily on human interpretation as it relates to human perception which is essentially, the way people psychologically organise the world around them. There is a significant human socialisation interpretation involved in the analysis of the way in which social media sites impact on brand perceptions of individuals .The term perception by its very definition is based on an individuals interpretation of the world around them. It would then stand to reason that an interpretivist research philosophy would be employed in the conducting of this research study. As is stated by Levin (1998), positivists believe that reality is stable and can be observed and described from an objective viewpoint it would seem a fundamentally flawed approach to take on a positivists view when conducting this research-considering the subjectivity of the topic under research of human perception.This study is involved with the interpretation of brands exposed on Facebook and blogs by various individuals. The way in which one individual construes the presence of cosmetics brands on Facebook and blogs will invariably be different from the way another may view it- based on their differing understanding of the world. The human element which is inextricably associated with the topic under research could be overlooked in the in vestigation were it to be conducted from a positivist philosophy.Therefore, in investigating the impact of social media on brand perceptions, the research philosophy germane and most appropriate is interpretivism. The two principal disadvantages of a positivist application to the study at hand are these firstly, its quest for rigid laws and perfect standards of scientific methodology and analysis are supposed(prenominal) when dealing with social phenomenon. Positivism standards are meant to be applicable repeatedly overlooking the variations in human behaviour. The second drawback is positivisms inconsiderateness of the subjective and unique aspects of social phenomenon.Whereas, in dealing with the interpretation of individuals brand perceptions, the researcher must factor in varying social backgrounds, brand and brand communication preferences, natural scientists w