CHAPTER ONE
INTRODUCTION
1.1 Background to the Study
Small and Medium Enterprises (SMEs) has gradually continued to be vital to nations not just in terms of monetary value but also in terms of economic development (Abdullahi, 2015). They are a strong source for providing employment and this improves the standard of living drastically and in turn reduces poverty rate in a nation (Hassan & Ahmad, 2016). The growing popularity of Social Media has been said to have significant impact on the Small and Medium Enterprises such as in marketing and reaching consumers with their products (Henry, & Joseph, 2016). Most social media platforms are free and with millions of users every day, it provides a wide selection of customers for business to select from and this result in high performance and little cost (Eze, 2015). Social media platforms have provided business such as SMEs and individuals an opportunity to interact efficiently on business and personal level (Ilegbinosa, & Jumbo, 2015).
According to Adegbuyi, Akinyele, & Akinyele, (2015) social media aids in improving sales, including consumers in their brands, boosting brand awareness, positive associations and enhancing consumer loyalty towards a brand. Managing social media properly can help to attract a lot of consumers, and consumers when they are satisfied will bring in more through referral which will enhance profitability (Adegbuyi, Akinyele, & Akinyele, 2015).A lot of people spend time on the internet searching for information on what to buy and where to buy, so the method in which a business does its marketing will go a long way in influencing the decision of consumer.
In as much as social media is used for business communication among businesses and consumers, it is also used for consumer to consumer communication as reviews and suggestions are shared (Abdullahi, 2015). As compared to traditional methods of marketing, social media creates platforms for consumers to interact among themselves rather than just watch and accept whatever that they see or hear. They have the opportunity to ask for opinions from others who have had experience with the product, service or brand. Social media has also created a platform where businesses can answer enquiries and request thereby building relationship between brands and consumers (Lawore, 2016).
Social media gives the freedom for businesses to market their product, service or brand with no restriction to location or distance and for consumers to get and also share opinions and information with fellow consumers and if the reviews are positive, it can boost the businesses. However, in developing countries such as Nigeria, SMEs are yet to partake in this social media tradition as most are still wary (Orji, Andah, Chima,&Abba, 2017). Over the years social media have been used by SMEs in developed countries to encourage small and medium scale businesses to grow by applying the advantages of facebook, twitter and youtube in performing business activities and personal communication. Organization used social media to ensure employees communicate their services and product to customers and this may increase the employees performance in terms of commitment.
The development in Information Communication and Technology has brought about the use of the Internet which has consequently led to the emergence of social media. The use of social media by business owners has become an important platform for marketing their products and services to consumers in recent times (Orji, 2016).
The media have become part of the marketing strategy now used by some organisations to connect with their potential customers and this trend has continued to bring dramatic changes to how business is done now compared to what obtained about three to four decades ago. Conversely, the Internet has also enabled customers to survey, select, and purchase products and services from businesses around the world.
1.2 Statement of the Problem
In increasing usage and popularity of Social Media has disrupted how SMEs carry out their operations and businesses function, particularly reaching out to consumers. The problem of brand awareness has necessitated the use of various platform by SMEs to making their brand known to potential consumers. Nevertheless, the question on the minds of many is that is there a relationship between social media and consumer purchase decision owing to the adoption of various social media by SMEs (Ilegbinosa,& Jumbo, 2015). Furthermore, keen competition among business has been a major problem to organizations, specifically SMEs that have not adopted Social media or digital platform in their operations. Therefore, is there a relationship between social media and SMEs competitive edge seeing that small businesses play a crucial role in economic development and survival, and are strong drivers of new innovation which is an impetus to job creation and economic rejuvenation.
Although a lot of SMEs are aware of social media, most do not know the business value and strategy attached to using it to boost business, build brand equity, enhance profitability and influence consumer purchase decision and it is against this background that this study seeks to examine the impact of social media on SMEs in Abuja.
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