Assignment Paper

An Investigation into Social Media Advertising Features Influencing Purchase Intentions of Millennial Generation in the UK

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Abstract

Table of Contents

CHAPTER ONE
INTRODUCTION
1.0 Background of the Research
There has been an exponential increase in the number of people using social media with the latest International Communication Union (ITC) survey revealing that by the end of 2018, about 3.9 people were using the internet, translating to approximately 51.2% of the global population (ITU, 2018). Consistently, the UK has a higher internet coverage and usage with recent data published by the Office of National Statistics (ONS) indicating that 99% of young adults (16 to 34 years) in the country were active users of the internet by the end of 2018 (ONS, 2018). These statistics suggest that many people are increasingly looking at the Internet including social media applications as an integral part of their life. Particularly, social media has provided unlimited possibilities to people. Social media platforms have offered people with unlimited and powerful ways of interacting and sharing information with others online (Lampe et al., 2010). Today, people share ideas, communicate and network via these applications (Wang & Chen, 2012).
Additionally, social media applications have been recognized as effective channels for bolstering advertising and marketing campaigns (Miller and Lammas, 2010). Social media provides a powerful advertising tool for generating more business and connecting with target customers effectively (Khasawneh (2017). Social media platforms are user-based, interactive, community-based, and cost-efficient and convenient (Kirtiş and Karahan, 2011; Alalwan, 2018). These media are widely applied in customer engagement and relationship management (Filo et al., 2015). For example, business enterprises can leverage social media to ensure a two-way communication with their customers, and accordingly, strengthening awareness and loyalty to their brands. Moreover, social media allows organisations to create and share content in many different formats – visual, verbal, textual or a blend of these formats. Firms are also leveraging social media platforms to enhance their interactions with both prospects and existing customers to facilitate information search, promoting their brands, attract customers and persuade them to purchase their products and services. Businesses have devised a variety of social media advertising to improve their brand identity and overall marketing performance (Alalwan, 2017). In fact, many firms are spending vast resources in creating and executing their advertising and branding activities on social media to achieve their promotional goals such as engaging and attracting customers (Dehghani and Tumer, 2015; Alalwan, 2017).
Equally, social media advertising has attracted a lot of attention from the academia (Alalwan, 2018). Researchers and scholars are making efforts to expand existing knowledge and understanding about successful adoption and application of such platforms in different business contexts, including marketing and advertising. This interest is spurred by a growing need to better understand the key requirements for applying such technologies effectively and determine the feasibility of the growing investments in these technologies. Preliminary research shows that social media advertising positively impact brand awareness or loyalty, customer relationships, customer loyalty, and employer branding (Jones, Borgman, and Ulusoy, 2015). Social media advertising also positively impact consumer purchase intentions (Zhang and Mao, 2016; Alalwan, 2018). Although numerous studies have explored social media technologies and their applications in different business contexts, research into social media advertising characteristics and factors that influence purchase behaviours of online consumers across different generations, including millennials is scanty (Dehghani and Tumer, 2015). Several researchers and scholars have pointed out that research in this area is still at the exploratory stage, which justifies the need for further research and understanding (Rowe, 2014)
Therefore, it is imperative for business managers and marketers to develop an in-depth understanding of the unique features and characteristics of social media networks and their influence on the purchase behaviours of millennial consumers to effectively creative and implement ads and other marketing activities on social media platforms. Furthermore, marketers need to understand major issues and challenges that may potentially hinder them from adopting and leveraging social media networks to promote and sell their products and services effectively to millennial consumers.
1.2 Statement of Research Problem
The effect of marketing and advertising via social media platforms on consumer purchase intentions has been studied extensively (Hutter et al., 2013; Dehghani & Tumer, 2015; Schivinski & Dabrowski, 2016; Alalwan, 2017). Alalwan et al. (2017) identify that the increased adoption of social media as an effective mechanism for advertising and advertising has gained a lot of attention from academic scholars and researchers. However, research into social media advertising characteristics and how these features affect the purchase intentions of millennial consumers is scanty. Knowledge about the factors that motivate millennials to decide to buy brands that they see in social media ads remains limited (Dehghani and Tumer, 2015). Although many studies have examined the impact of social media advertising on the purchase behaviours of millennial consumers, just a handful have focused on discerning the unique features of social media ads that influence the decision-to-purchase among millennials.
The limited research and knowledge on this area has overarching implications on contemporary enterprises and marketing professionals. For instance, research shows that many companies and marketers are facing serious challenges in effectively planning and implementing their promotional campaigns and activities over social media networks (Alalwan, 2018). Furthermore, some firms also report challenges in successful adoption of social media to promote and sell their products and services, with limited technical knowhow and unfamiliarity with these new technologies cited as some of the major barriers to adoption (Holmes, McLean, and Green, 2012). Therefore, the purpose of this qualitative inquiry is to expand existing knowledge and understanding about features of social media ads and how these characteristics affect the purchase intentions of millennial consumers.
1.3 Research Aim ad Objectives
The main aim of this study was to examine social media advertising features that influence purchase intentions of millennial consumers in the UK. The qualitative investigation sought to achieve the following specific objectives:
1. To identify social media technologies used in advertising.
2. To find out online consumer behaviours among UK millennials using social media advertising.
3. To explore the key characteristics of social media advertising that influence UK millennial consumers’ purchase.
4. To examine how these features impact purchase intentions of UK millennials.

1.4 Research Questions
The central question this study sets out to answer is: What are the features of social media advertising and how do they affect the purchase intentions of millennial generation in the UK? The following specific questions will be answered to address the main research question:
1. What social media applications are used in advertising in the UK?
2. What are the social media consumer behaviours among UK millennials?
3. What are the key features of social media advertising that influence UK millennial consumers’ purchase?
4. How do these features impact purchase intentions among UK millennials?
1.5 Significance of the Research
People all over the world are increasingly getting attracted to and using social media platforms to interact and share information about public issues (Kaplan and Haenlein, 2010). By equal measure, business enterprises are widely adopting these applications as effective and efficient means of conducting their marketing and advertising campaigns (Alalwan, 2018). Social media provides unique and powerful mechanisms of interacting more and persuading their customers to purchase their products (Jones, Borgman, and Ulusoy, 2015). However, many enterprises are facing serious issues and challenges in designing and implementing social media ads that can bolster their ability to attract and motivate prospects and customers to buy their products or services (Jones, Borgman, and Ulusoy, 2015; Alalwan, 2018). Almost all (99%) young people and young adults (16 to 34 years) using the internet compared to 44% of older adults (75years and over) in the UK today (ONS, 2018) and spending an increasing amount of hours searching for information. The high interaction and engagement on these platforms affect the users’ purchase intentions (Poturak and Softić, 2019).
The current challenges in designing and implementing successful social media ads coupled by the exponential increase social media usage provides a strong justification for further research in this area. Expanding knowledge and understanding about specific features that attract them to this media and persuade them to decide to purchase a company’s brand would enterprises and enable marketers to create more attractive advertising ads and effectively implement them on social media platforms.
1.6 Organisation of the Research
This research report is organized into five chapters. Chapter one introduces the general context of research and defines the research problem. It also outlines the research goal, objectives and questions, and justification for conducting the study. In chapter two, the research reviews existing theoretical and empirical literature to locate the present study within the context of existing literature, identify gaps in previous research, and justify the need for further research on the study topic. Chapter three provides a detailed description of the research methodology including the research approach and design, sampling technique, and data collection and analysis methods and techniques. It also highlights ethical considerations for the research. Chapter four presents the results of the study. In chapter five, the researcher discusses the study findings based on the research questions. The researcher also outlines the limitations of the investigation and implications for practice and policy and further research.

CHAPTER TWO
LITERATURE REVIEW
2.0 Introduction
In this chapter, the researcher reviews, synthesizes and integrates existing literature and research evidence on social media advertising. The chapter is divided into two sections. Section one reviews existing theories and models of consumer purchase decision process. The second section reviews empirical literature on the research topic.
2.1 Theoretical Literature
John Dewey is largely credited for the development of the original five-stage consumer decision-making model. Kotler, Armstrong, and Parment (2011) note that the framework suggests that consumers go through five distinct steps a consumer goes through when buying an item (Figure 2.1). The authors further explain that the model explains the purchase decision process that consumers go through before, during and after deciding to buy a product or service. Sumi and Kabir (2010) point out that the theoretical framework can be perceived as a cost-benefits analytical tool that consumers can use to assess multiple alternatives. Cheng, Luckett, and Schulz (2003) argue that although the theoretical framework was developed in the 1910s but still remains useful and widely applied in evaluating the journey consumers go through before making the decision to purchase a product or service.
Cheng, Luckett, and Schulz (2003) perceived recognising a need or problem to be the first and most important step in the purchase decision process because a person cannot buy an item without perceiving the need for that product. Kotler (2009) agrees that the buying decision making process will start only after a consumer feels or identifies a need that can be satisfied by purchasing a certain good or service. Sumi and Kabir (2010) explain that buyer decision making is a cognitive process that can be triggered by both internal (e.g., hunger) and external (ad or word-of-mouth) stimuli.
Figure 2.1 Dewey’s Purchase Decision Process Framework

Source (Kotler, Armstrong, and Parment, 2011, p.152).
The second step is information search. Ashman, Solomon, and Wolny (2015) assert that information search is also an integral part of the purchase decision journey because it allows consumers to find the best solution to their problem or alternative that will generate the greatest value. Kotler (2009) observed that the customer may not engage in initial data collection process especially when the drive is strong and the desired item is near. Kotler, Armstrong, and Parment (2011) opine that if the need is not clear, the information search may be necessitated. Sumi and Kabir (2010) state that there are numerous sources of information, including personal experiences, friends, and the internet. Zhang and Mao (2016) identify social media platforms as potential channels for facilitating the information search because by allowing consumers to click on online ads, review products, share their experiences with the products, and access what other consumers comment about products. Faith and Agwu (2018) agree that the internet helps online consumers to make well-informed purchase decisions.
Powers et al. (2012) hold a similar perspective by explaining that digital and social media sites have empowered traditional consumers by giving them hyper interactive platforms where they can access, create, and share content and connect with other consumers online. On the same note, Wang, Yu, and Wei (2012) found that socializing online impact on consumers’ buying decisions by reinforcing conformity with other online consumers and involvement with a brand. Daugherty and Hoffman (2014) confirm these assertions by stating that electronic word-of-mouth (eWOM) has a strong influence on consumer purchasing behaviour in terms of capturing prospects’ attention within social media. Therefore, Kotler, Armstrong, and Parment (2011) point out that marketers should focus on finding out what made consumers to search the product or service at this stage.
The third step involves evaluation of alternatives. Cheng, Luckett, and Schulz (2003) explain that this step involves comparing different brands to find one that has desired attributes. Kotler (2009) identifies that the ultimate goal is finding a brand that will offer the benefits the consumer is seeking. Ashman, Solomon, and Wolny (2015) opine that people have to weigh options to ascertain that the money the money they invest in buying the product will solve their need in the best way possible. Kotler, Armstrong, and Parment (2011) observe that prospective buyers may consult an array of sources to such as friends, product reviews, and sales professionals to get insights on evaluating potential options. Burnett (2008) suggests that available brands may be assessed based on their cost, timing, available information, risk involved, and the customer’s attitudes in relation to rival products. Faith and Agwu (2018) opine with Burnett’s assertion by stating that price is an important consideration in the purchase decision. The scholars reiterate that the price of competing brands influences purchase of a product hugely because consumers often prioritise brands that will deliver the greatest value. Consumer attitude and level of involvement are very influential at this stage as customers who exhibit a positive attitude and get highly involved on the process will examine several alternatives. Therefore, the way consumers perceive the price, quality and other attributes of a brand will affect the purchase of a company’s products. Therefore, marketers should create social media ads that clearly articulate the value to prospects via different means, including pricing. Additionally, firms should take into consideration their competitors’ prices and determine the extent to which they impact purchase of their offerings.
After identifying the best option, the consumer makes the purchase decision at stage four. However, Kotler, Armstrong, and Parment (2011) caution that certain factors such as negative feedback may ‘disrupt’ the customer from making the final decision to buy the item. Daugherty and Hoffman (2014) argue that even after consumers make up their mind to purchase a product, coming across a negative review or eWOM by an individual they trust or close to them can influence them to withdraw their buying decision. Two empirical studies conducted by Park and Lee (2009) and Cui, Lui, and Guo (2012) confirm the above assertion by establishing that negative eWOM bear a greater impact on purchase intentions than positive comments. However, Berger, Sorensen, and Rasmussen (2010) argue that even negative reviews or word of mouth can still increase sales. Drawing on the findings of their econometric analysis and experimental methods, the researchers found that unfavourable information about a brand can spur purchase probability and sales by enhancing product awareness. These results contradict previous research findings indicating that negative WOM hurt product evaluation and sales (Park and Lee, 2009; Cui, Lui, and Guo, 2012). Nevertheless, at the purchase decision stage, marketers should focus on ensuring that consumers review their products and talk about the company favourably.
The decision-making process continues even after effecting the purchase decision. At the post-purchase behaviour phase, the consumers may compare their brand experiences against their initial expectations (Kotler, Armstrong, and Parment, 2011). A positive experience leads to satisfaction and vice versa. Therefore, this point remains important to marketers because they can leverage it to promote customer loyalty or retention by persuading them to not only purchase the brand again but also share their positive experiences with other consumers (Burnett, 2008).
Several scholars and researchers have adapted the initial model of consumer behaviour in an effort to shade more light on the customer buying bevahiour and purchase decision processes. For instance, Engel Kollat Blackwell extended Dewey’s framework to create a four-stage model that takes into account the growing body of knowledge about consumer behaviour (Darley, Blankson, and Luethge, 2010). The four stages include information input, information processing, and decision process, and evaluation of variable affecting the decision process. Unlike the original five-stage model, the EKB model includes more factors that impact the consumer decision-making process, including values, lifestyle, culture, and personality (Darley, Blankson, and Luethge, 2010). Overall, developing a better understanding of the consumer purchase decision-making may enable sales and marketing professionals to align their sales and marketing strategies and promotional activities accordingly.
2.2 Empirical Literature
2.2.1 Social Media Platforms
Anderson and Jiang (2018) note that social media has gained ubiquitous presence in the lives of both young and adult people. Atzmueller and Hilgenberg (2013) agree that in addition to mobile devices, social networking sites have woven themselves deeply into the day-to-day life of people today, affective social interactions. On the same note, Atzmueller, Mueller, and Becker (2015) opine that the ubiquitous nature of social computing technologies and applications are increasingly creating new environments that in which different people from different parts of the world can interact and share content with immense ease and convenience. Fischer and Reuber (2011) believe that the second generation of the World Wide Web (Web 2.0) has provided people with very interactive and dynamic platforms for collaborating and sharing information via the internet, including social media channels (Facebook, Twitter, Instagram, Snapchat, YouTube, WhatsApp, and LinkedIn), wikis, blogs, micro blogging, and online communities.
Darwish and Lakhtaria (2011) opine that Web 2.0 technologies have been at the engine of this overarching trend that have significantly transformed traditional communication and revolutionalised the contemporary society. The authors further characterize Web 2.0 applications with hyper interactivity, easier interconnectivity and active participation which have enabled individuals to share their personal or public content in their social and professional life. Goh, Heng, and Lin (2013) share these opinions by asserting that Web 2.0 technologies have stimulated evolution of the internet into a social environment where users can not only interact and collaborate with others through social medial dialogue but also create and share content in a virtual community.
Social media networks have certain fascinating features and characteristics which make them more powerful, unique and effective communication and advertising channel. First, social media sites such as Facebook, YouTube, Twitter, and MySpace are more user-based. Alalwan (2018) advances knowledge in this area by distinguishing traditional and new digital and social media in terms of their defining characteristics. The author observes that traditional websites involved one-way communication where content was created and updated by one user and accessed by passive users. Alalwan et al. (2017) conquer that with the single directional communication; researchers explain that the owner of the websites had the sole power to determine what content is shared on the network. In contrast, social media has challenged this norm by empowering online users by allowing them to create and share vast amounts of content online. Unlike passive traditional media consumers, Alalwan (2018) argue that today’s users are content creators who can create their own blogs, make posts on these networks expressing their opinions and perspectives on a current issue, upload digital photos or videos of their recent experiences on these sites, or share content developed by other internet users. Kietzmannn (2011) agrees with Alalwan (2018) by stating that contemporary social media users are not only capable of expending, reading, watching and utilizing internet content to make more informed purchase decisions but also creating, modifying, sharing, and discussing the information online via networking sites, blogs, and wikis, among other sharing platforms. Berthon et al. (2012) emphasise that this power has transformed traditional internet users into dynamic and hyperactive users in online communication forums. Christodoulides, Jevons, and Blackshaw (2011) elaborate that the two-way communication on social media platforms allows users to engage actively with brand messages and provide feedback on advertising and marketing campaigns. Therefore, business enterprises cannot afford to ignore social media due to their potential impact on their brand reputation, sales, and even growth and survival of their business.
Furthermore, social media networks are very interactive. Valentini and Kruckeberg (2012) argue that social media and its users are inseparable and the latter cannot exist without the former because the interactive nature of social medial networks creates a community feeling. In their discussion of the challenges and opportunities presented by social media, Kaplan and Haenlein (2010) point out that business enterprises are increasingly relegated (by social media) to sidelines as mere observers with very limited knowledge and chances of controlling or change the information available about their organisations and brands since online consumers can interact so freely with each other and post any comment about the business. Kietzmann et al. (2011) opine that social networking sites have transformed from the traditional collection of passive users into highly interactively platforms with advanced tools such as chat rooms, discussion boards, forums, and social networking sites, which facilitate the creation, modification, sharing, and discussion of online content. In light of these insights, businesses have to embrace social media to not only enhance engagement with their online customers but also leverage their interactions to bolster their marketing and sales strategies.
Additionally, social media is community-driven. Kietzmann et al. (2011) identifies conversations, sharing, presence, relationships, and groups as the major functional building blocks of social media networks. Miller and Lammas (2010) agree that online communities are built and thrive on these blocks. Khasawneh (2017) shades more light on this attribute by saying that just like real communities or social groups, an online or internet community is a virtual community whose members share common beliefs or commonalities, or hobbies and interact primarily through the internet. Holmes, McLean, and Green (2012) contribute to this debate by pointing out that these networks have provided means by which groups of like-minded people can share ideas with a lot of ease and examine information on public issues in greater depth and detail. Obar and Wildman (2015) illuminate the role of social networking sites in facilitating the development of online communities by explaining that these media connect a user’s profile with those of other members or the group. Moreover, Lampe et al. (2010) and Wang and Chen (2012) opine that through these virtual communities, internet users can make new friends and even link up with older friends that they lost contact with several years ago. Therefore, social media promotes a sense of interconnectedness and community by bring diverse individuals from different parts of the world together online.
Besides that, Kirtiş and Karahan (2011) found social media networks to be a relatively more cost-efficient and convenient advertising and marketing channel than traditional advertising methods, including both broadcast (television and radio) and print media advertising. The researchers further note that after the great economic recession, many businesses have been increasingly adopting social media advertising to not only profitable and consumer-responsive but also lower their costs. Hoffman and Fodor (2010) agree that social networks provide business with cheaper and dependable platforms because firms incur very low costs on marketing and promoting their products via these channels. Similarly, Castronovo and Huang (2012) describe social media as a cost-effective advertising alternative that also deliver measurable business results. Consistently, an empirical research undertaken by Ainin et al. (2015) found strong positive impact on financial and non-financial performance of small and medium enterprises including reducing the cost of marketing and promotional activities and customer service, improving customer relations, and enhancing access to useful information to be major factors driving adoption of social media advertising in SMEs. Dehghani and Tumer (2015) believe that these features make social media to be not only very influential on the purchase decision process young consumers, but also a unique and powerful means of interacting and sharing information with prospects and current customer.
2.2.2 Social Media Advertising
Many firms and marketers leverage these characteristics to promote and sell their products. Alalwan (2018) noted that many corporate enterprises are increasingly turning to social media technologies as effective tools for interacting and connecting with prospects and existing clients. Jones, Borgman, and Ulusoy (2015) observed a similar trend across SMEs and note that these enterprises are also increasingly embracing social media advertising. Miller and Lammas (2010) agree that with more and more people joining social media and logging onto these sites more regularly, many corporate enterprises are increasingly leverages these channels to bolster their advertising and marketing campaigns. Khasawneh (2017) shares the same sentiments by asserting that social media has emerged as a powerful advertising tool and is significantly challenging traditional and mainstream advertising and marketing media such as television, radio, and newspapers as many firms and marketers are increasingly experimenting with social media channels to generate more business, connect with their target customers, and serve them more effectively and efficiently.
Dehghani and Tumer (2015) hold consistent opinions about the adoption of social emdia advertising. The scholars noted that business enterprises of all sizes are spending considerable amount of time and money creating and sharing content on these networks to bolster their advertising and branding activities. This trend has also been reported in the systematic review by Alalwan (2017) and research by Alalwan (2018) which observed an increase in the adoption of use of social media networks in many enterprises and marketers as an effective way of driving audience engagement and persuading prospects and their current customers to buy their products and services. Therefore, the rapid adoption of social media advertising coupled with increased investment in social media promotional activities suggests that social media platforms hold a greater potential in marketing and advertising.

2.2.3 Impact of Social Medial Advertising
Existing literature and empirical evidence indicate that social media advertising has numerous implications on businesses. Notably, several studies have found that social media advertising positively affects consumer purchase intentions. Hutter et al. (2013) found a positive relationship between user activities and interactions on a Facebook page of an auto manufacturing firm and brand perception and consumers purchase decision. Hutter et al. (2013) argued that social media activities and interaction positively impacted consumers’ brand awareness, WOM, and purchase intentions. The scholars further identify that annoying sites were found to be detrimental to overall degree to which consumers were committed and got involved with the Facebook site and word-of-mouth. Dehghani and Tumer (2015) opine that social media ads are effective in increasing consumer purchase intentions. After studying 315 Sapienza University students, Dehghani and Tumer (2015) found that social media ads are entertaining, informative, and customizable. The researchers believe that these attributes have a positive impact on awareness and consumer purchase intentions, consequently making social media to be an effective advertising tool. Alalwan (2018) found consistent findings. The scholar argue that the interactive, informative, and perceived relevant nature of social media ads have a positive effect on consumer buying decision and intentions. Zhang and Mao (2016) conquer that the entertaining and informative nature of social media ads motivates internet consumers to click on them, which in turn positively influence their purchase intentions. Zhang and Mao (2016) further explain that ad clicks positively influence consumers to not only buy a particular product but also spread positive word-of-mouth.
Jones, Borgman, and Ulusoy (2015) established that social media platforms benefit small and medium enterprises in many ways, including improving relationships with their customers, attracting more new clients, increasing their ability to reach clients from different regions of the world, and co-promoting their businesses with more established corporations to improve their reputation in their regions. Ainin et al. (2015) agree that advertising products via social media platforms has a positive impact on product awareness and customer loyalty. Similarly, Poturak and Softić (2019) found that social media content positively influence consumer purchase intentions, confirming previous studies indicating that social media advertising positively impact brand awareness which in turn positively influence purchase decision (Hutter et al., 2013; Ainin et al., 2015; Jones, Borgman, and Ulusoy, 2015). However, Poturak and Softić (2019) established that relationship between social media promotion and consumer purchase intentions is mediated by brand equity.
2.3 Research Gaps
Effect use and impact of social media advertising on consumer purchase intentions has attracted a lot of attention from many parties, including consumers, businesses, marketers, researchers and academic scholars (Alalwan, 2017). However, research and knowledge on how social media advertising characteristics affect the purchase intentions of consumers from different generations, including millennials, remains scanty. A few studies have attempted to explore how social media features influence the decision-to-purchase among millennials.
 
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