Journal of Enterprise Information Management

Antecedents of Social Media Usage and Performance Benefits in Small and Medium-sized Enterprises
(SMEs)
Raphael Odoom Thomas Anning-Dorson George Acheampong
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Raphael Odoom Thomas Anning-Dorson George Acheampong , (2017)," Antecedents of Social Media Usage and
Performance Benefits in Small and Medium-sized Enterprises (SMEs) ", Journal of Enterprise Information Management, Vol.
30 Iss 3 pp. -
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 Abstract
Purpose
Despite the blossoming nature of social media marketing, the nuances and implications
among small- and medium-sized enterprises (SMEs) appear to be under-researched in
literature. The purpose of this paper is to progress knowledge and offer extended
understanding of the motivations and performance benefits of social media accrued by SMEs
with an empirical study from an emerging economy.
Design/methodology/approach
Based on past research, the study hypothesizes that interactivity, compatibility and cost
effectiveness are motivations germane to social media usage, which consequently offer
performance benefits. Data from 210 SMEs (having Facebook and/or Twitter accounts) is
employed to investigate the proposed conceptual model using Structural Equation Modelling
with sub-group analysis.
Findings
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Finding from our study demonstrate that the interdependencies of social media motivations,
as well as effects of social media usage are positive but erratic across product-based and
service-based SMEs. Moreover, SMEs who offer physical products are more likely to employ
social media based on cost effective motives while service SMEs are more likely to consider
interactivity as a key motivation. Additionally, findings from the study data suggests that in a
tale of two sites, Facebook proved to edge Twitter in terms of engendering performance
benefits among SME users.
Originality/value
The findings provide evidence to issues of potential research and managerial interest, offering
insightful implications to the academic and practitioner communities. Evidently, irrespective
of some usage bottlenecks, SMEs in emerging markets appears to be reaping enhanced social
media benefits by deploying their marketing campaigns via multiple platforms.

Keywords: Social media, small- and medium-sized enterprises (SMEs), emerging market
Article Classification: Research Paper

1. Introduction
Advances in information technology are resulting in explosions of revolutionary businesses
(Ostrom et al., 2015). Evidently, the prevalence of the Internet has also given consumers a
plethora of uses on the web, resulting in a significant change in the conduct of business by
firms. In recent times, social media and social networking sites have become spearhead
platforms for building and managing both transactional and relational activities in firms
(Kaplan and Haenlein, 2010; Kumar et al., 2016), as well as for managing and
communicating brands (Ashley and Tuten, 2015). The burgeoning nature of the phenomenon
therefore calls for more studies across several business levels, sectors and contexts in

1
 examining the adoption, usage, strategies and outcomes of social media with the aim of
developing theory (King et al., 2014; Ratchford, 2015). A considerable number of empirical
works on the subject of social media, from both firms' perspectives (Ainin et al., 2015;
McCann and Barlow, 2015) as well as consumers' perspectives (Whiting and Williams, 2013;
Dessart et al., 2015) are available in literature. Zeng and Gerritsen (2014) as well as Knoll
(2015), for instance, duly provide systematic reviews on this blossoming concept. Despite its
increasing popularity however, literature exhibits three key deficiencies.
First, disparities exist in existing studies, with inconclusive findings generally based on
contextual differences (Knoll, 2015). Hence, the need for further examinations of the nuances
in social media usage could be interminable, especially with their blossoming applications in
the business world. Secondly, from small and medium-sized enterprises (SMEs) perspectives,
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little evidence exists on the subject, especially from developing and/or emerging markets
(Ainin et al., 2015). Thirdly, a scrutiny into the literature on social media marketing reveals a
dominance of works from Europe, Asia, and the Americas, with little representation from
Africa (Botha et al., 2011; Zeng and Gerritsen, 2014). Although such context is plagued with
chronic shortage nature of resources as well as inadequate infrastructure (Sheth, 2011),
marketing literature also abounds in empirical works that suggest that firms operating in such
economies are circumventing these constraints and employing contemporary and
unconventional marketing practices to succeed in their markets.
Remarkably, scholars are also reflecting on whether present-day marketing will drive
emerging markets in future or the future of marketing practices will be driven by firm
activities from emerging markets (Gu et al., 2008; Sheth, 2011). Quite profoundly, literature
hints that the gross domestic products of most emerging markets are driven by the economic
activities of SMEs (Nieto and Santamaria, 2010). It has therefore become imperative that
literature should be attentive to research on topical marketing issues, especially those from
emerging or less-developed markets. Knowledge and understanding of the tinges and
ramifications of contemporary marketing efforts of SMEs in such contexts is opportune in
marketing research. Abou-Shouk et al. (2012) argue that SMEs, particularly from developing
countries, are slow adopters of technology, especially those related to e-commerce. In recent
times however, avenues such as social media, can and are being used by small businesses in
both developing and developed economies for a range of functions, including but not limited
to marketing and customer relationship management. Some studies suggest it is particularly
suitable for SMEs because of its minimal cost, low barriers to participation, mobility and low

2
 level of IT skills required to use it (Breslauer and Smith, 2009; Toole, 2011; Durkin et al.,
2014).
In a developing economy like Ghana for instance, most SMEs do not have the large
amounts of resources to compete in the marketspace heightened by foreign firms.
Furthermore, there is a shift in media consumption among Ghanaian consumers such that
social media is becoming a key strategic communication platform for both informative and
interactive actions for several firms. As a result, social media adoption and usage today
presents an interesting route for SME competitiveness, especially with its ability to offer
affordable segmentation and targeting purposes for communicating product and service
brands to consumers. The study therefore examines the motivating factors and performance
benefits of social media usage among SMEs in Ghana. We also examine variations in
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hypothesized relationships based on type of product offered as well as the performance

outcomes of the particular types of social media used. The remainder of the paper is
structured as follows. The next section discusses the theoretical context and literature review,
the research model and hypotheses for the study. The methodology for the study also follows,
along with study results, analyses and discussions of findings. The paper ends with some
implications for theory and practice, as well as provides some avenues for future research.

2. Theoretical setting and Hypothesis Development

Theoretical Context
The Diffusion of Innovations (DOI) Theory espouses the process through which an
innovation spreads within organizations or among people over time that can result in its
adoption and use for several purposes (Bass, 1969; Rogers, 1983). The innovation in this
regard may take the form of a product, service, an idea, information or a practice perceived as
new by people (Rogers, 2004). In generic terms, the innovation may be considered as
something new in terms of its application by the adopting organization but not necessarily
new in its own right based on date of item creation (Newby et al., 2014). According to
proponents of the theory, such innovations are characterized by having relative advantages
over existing methods, simple to understand with observable results, ability to be tried out by
potential adopters, as well as compatible with existing values, experiences and needs (Bøving
and Bøker 2003). Research on the adoption and usage of technology innovations generally
tend to originate from the theory of the Diffusion of Innovation (McMaster 2001; Sarosa,
2012).

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 With their advocated potentials over traditional media (Zappe, 2010; Hanna et al.,
2011), usage of social media as an internet-based technology is no exception to the
fundamental idiosyncrasies of the theory. As a business support system employed for several
reasons with varied outcomes in various contexts, we consider the use of social media as a
tech innovation that requires diffusion and alignment with the marketing activities of
enterprises. The concept of social media is consequently defined in this study following the
description by Safko (2010) as an extension of traditional media which employ a more
sophisticated set of tools, techniques and technologies for connecting, building relationships
and social interactions. Therefore, newness is added to existing traditional media employed
by the enterprises via the augmentation of marketing activities with social media platforms.
Following from this, the subsequent sections discusses the antecedents of social media usage,
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and the ways in which they eventually influence performance outcomes for SMES.

Antecedents to social media adoption and usage

Internet-enabled communication media has supported many organizations to conduct their
businesses from anywhere across the globe (Chen et al., 2008). Knoll (2015) for instance
reports that social media has clearly become part of human lives, especially among Internet
users. According to eMarketer (2013), more than a third out of four of the world’s internet-
user population will hook onto social network sites by close of 2016. Other reports reveal that
more than 1 billion internet users have been watching videos on YouTube monthly
(YouTube, 2016). At the firm level, the use of social media among Fortune 500 companies
surged massively in 2012 (Okazaki and Taylor, 2013) with as many as 66% having corporate
Facebook pages and 73% having official corporate Twitter accounts aside the numerous
corporate blogs. Evidence suggests that the figures are on the ascendancy each year (McCann
and Barlow, 2015). This unceasing increase - according to Okazaki and Taylor (2013) -
denotes a long-term trend and/or norm towards social media use among corporations (and
individual brands). Consequently, social media has become an auspicious platform for both
firms and consumers to transact and relate to each other in a conducive and mutually valuable
manner (Kumar et al., 2016).
Known as “user-generated communication,” social media have reformed the tools and
strategies employed by several organizations (Michaelidou et al., 2011) in their
communications with their customers, who wield power in terms of information control. In
effect, Mangold and Faulds (2009) refer to social media as the new hybrid element of the
promotion mix. Reports suggest that over 1.44 billion active monthly users of Facebook

4
 spend over 700 billion minutes on the website, with 500 million tweets sent via Twitter daily
and 70 million photos/videos uploaded on Instagram (Sakyi-Gyinae, 2015). As a result, many
firms are interacting via such tools by offering links and services from their Facebook and
Twitter platforms in creating interactive brand communities (Kaplan and Haenlein, 2010). As
tools used in innovative ways by firms to support existing business systems, the diffusion of
social media in terms of the antecedents toward their adoption, usage and consequences could
best be explained by the tenets of the DOI theory. Following from Ainin et al. (2015), the
study examines two social media (Twitter and Facebook) along three antecedents, given that
recent submissions suggestively rate them as top media used by firms and individuals
(Wamba and Carter 2014; Aladwani, 2015).
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Interactivity
Liu and Shrum (2002) define interactivity as “the degree to which two or more
communication parties can act on each other, on the communication medium, and on the
messages and the degree to which such influences are synchronized” (p. 54). From earlier
discourses on new media platforms, Ha and James (1998) describe interactivity to embrace
the ability of users to provide content in response to a source of communication partner.
Thus, interactivity is characterized by two-way communication between firms and/or among
customers (Goldfarb and Tucker 2011). The “social” context of social media emphasizes the
interaction on individual/interpersonal level or a collective intergroup level (Kietzmann et al.,
2012) which often requires some degree of responsiveness particularly from firms. In such
circumstances, the immediacy of the responsiveness and the degree to which the
communication bear a resemblance of human dialogues becomes imperative (Li et al., 2002).
Thus, the virtual presence requires the need to synchronously communicate and engage with
consumers in real time, as well as obtain effective and impactful interactions (Elaluf-
Calderwood et al., 2005).
Although characterized as “interactive,” differences exist among social media with
regard to the nature of interactions they support (Quan-Haase and Young, 2010), resulting in
a variety of gratifications within several organizations. Sundar et al. (2003) conceptualise two
major classification of interactivity; (1) functional interactivity – which comprises the
features found on a social site that allows users to interact within several modes and (2)
contingency interactivity – which occurs when users’ roles are interchangeable and the
“interactants” are responding to one another. Facebook and Twitter for instance enable
contingency interactivity among its publics by offering a relationship-building kind of

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 communication that is often lacking from websites (Saffer et al., 2013). Cone (2008) suggests
that having a social media presence alone is not enough for organizations. It is argued that
this should be complimented with customer interactions. Lovejoy et al. (2012) in this regard
point out that contingent interactive features like replies and mentions enable organisations to
communicate with their customers. Interactivity ultimately bridges the gap created by
disparity in time and geographical location (Michaelidou et al., 2011) becoming a key
consideration for adopting social media. In the light of this, the following is hypothesized:

H1: Interactivity positively and significantly influences social media usage.

Cost Effectiveness
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Fisher (2009) remarks that among the numerous decisions for marketing managers in recent
times is the pressure to justify preferences for online communications over the use of
traditional advertising tools. Historically, the marketing spends on delivering messages have
often been via cash and are generally viewed as heavy expenses (Weinberg and Pehlivan,
2011). However, a variety of free or low-cost solutions are currently available that can be
effectively used. Comparative to the typically exorbitant traditional media, social media
strategy may not require astronomical budgeting (Hanna et al., 2011). Scholars have
recommended social media outlets as cost effective and efficient platforms available to
marketers (Ainin et al., 2015) granted that such outlets have become relatively free in terms
of accessibility for both firms and consumers (Hanna et al., 2011). In addition, generating
target groups, as well as disseminating systematic advertising and promotions to these groups
is possible at relatively lower costs (Dong-Hun, 2010) via social media. Since most social
media sites are free for signing up, the cost is often associated with the time spent on
posting/blogging status messages, and responding to customer comments (Zappe, 2010).
Aside being relatively cheaper platforms, social media enable effective expansion in
collaborative content sharing to large numbers of people across geographic distances (Korda
and Itani, 2013). The cost of reaching customers beyond such boundaries could be higher via
traditional media. With over 1 billion users on both Facebook and Twitter for instance,
consumers are currently moving away from traditional media as means of obtaining
information on products and services. As such, firms now have the benefit of deploying
innovative strategic brand communications that effectively engage and reach their customers
in countless ways, via platforms that do not require highly priced media spends and creativity
(Hanna et al., 2011). Hello Health for instance is popular and successful, largely because of

6
 the cost-effective way it employs web-based social media to interact with clients, particularly
on their medical prescriptions (Hawn, 2009). With the adoption of social media’s possibly
resulting in real cost savings (Hoffman and Fodor, 2010), it becomes a paramount choice for
most SMES, who are typically peddled with resource constraints. The second hypothesis is
therefore theorized as follows:

H2: Cost effectiveness positively and significantly influences social media usage

Compatibility
Compatibility describes the degree to which an innovation fits with a potential adopter’s
existing values, previous practices and current needs (Severin and Tankard, 2001; Chong and
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Chan, 2012). Within the fundamental framework of the DOI theory, this is an essential
element in the adoption and use of an innovation (Wang et al., 2010), especially with regard
to the newness of characteristics or properties of the innovation (Lai and Chang, 2011).
Social media platforms offer functions/features that previously may not have existed, and
improve upon traditional marketing media in meeting consumer preferences and market
needs. By integrating social media activities in business operations in a manner consistent
with organizational values and objectives, firms are able to niche their target customers
effectively and efficiently via sharing their product/service contents almost instantly (Derham
et al., 2011). Consumers on the other end of the social media landscape, consider such novel
platforms as trustworthy sources of corporate communication and information regarding
products and services (Foux, 2006), especially from verified firm accounts.
Quite profoundly, findings from empirical studies assessing the construct of
compatibility on new technologies have presented both positive and negative results.
Ramdani et al. (2009) for instance found compatibility to be an insignificant factor in
enterprise systems adoption. In a similar vein, Low et al. (2011) also found an insignificant
impact of compatibility on adoption of cloud computing. Yet, findings from some other
studies (such as Brown and Russel, 2007; Hsu et al., 2007; Wang et al., 2010; Ainin et al.,
2015) have also provided contrary evidence, exhibiting positive relationships of compatibility
as an antecedent on adoptions/use of tech innovations. Such works seem to suggest that firms
are more likely to consider adoption and usage of social media based on its compatibility
with firms’ values and goals (Ainin et al., 2015). Although extant findings show
unconvincing results in terms of relationships, we hypothesize a positive association given
that the arguments on compatibility favouring social media adoption/use among firms are

7
 more likely to be depicted in small- and medium-sized enterprise settings. Therefore, the
third hypothesis is set out as follows:

H3: Compatibility positively and significantly influences social media usage

Social Media Usage and Benefits

According to the Uses and Gratification theory, users of media are habitually active, as well
as goal-oriented, and are usually motivated to choose a medium that best gratifies their needs
(Roy, 2009). Thus, a continual usage of a specific media is premised on the gratifications of
these needs, generally typified via user satisfaction. In accord with Burton-Jones and Gallivan
(2007), we operationalize social media usage in the current study following the system-
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centred approach, where the measures of the system usage are based on the variety of tasks
for which the system is employed. Social media researchers have enumerated a number of
uses for social media by most firms. Notable among the uses are the quests to attract new
customers, cultivate relationships, increase awareness, communicate the brand online, as well
as receive feedback from customers and business partners (Michaelidou et al., 2011).
Anecdotal evidence suggest that these are implemented as firms create communities,
distribute content (Kumar et al., 2016) and increase traffic to their websites, in pursuit of
identifying new business opportunities and building direct relationships with existing and
prospective clients (Breslauer and Smith, 2009; eMarketer, 2013).
The benefits associated with its usage are wide and varied. Empirically, Kwok and Yu
(2013) have found that Facebook usage for instance increased sales of a chain of restaurants.
In addition to this, evidence of the benefits for using Twitter has also been provided by other
scholars (see for instance Wamba and Carter, 2013; Aladwani, 2015). However, user
behaviours vary on both social media sites (Hughes et al., 2012), suggesting possible
differences in outcomes across the enterprises. Nevertheless, by synthesizing these usage
outcomes, it is evident that the overarching goal of social media usage is to enhance
organizational performance, in both financial and non-financial terms (Ainin et al., 2015).
These financial and non-financial outcomes ultimately become the resultant benefits firms
obtain from using social media. Thus, our fourth and final hypothesis is as follows:

H4: Social media usage positively and significantly influences performance benefits obtained
by firms.

8
 Based on the above discourses in the literature, the study proposes a conceptual model for the
research hypotheses, depicted in Figure 1.

INSERT FIG 1

3. Methodology
Research design and measures
A quantitative research approach with the use of a structured questionnaire was employed
ahead of a qualitative approach. This was to enable the calculations of actual statistical
measures for the theorized hypotheses on empirical data (Hair et al., 2010). The questionnaire
for the survey consisted of two sections. The first section had questions on the constructs of
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interest to this research (cost effectiveness, interactivity, compatibility, social media usage
and performance benefits). The statements measuring these constructs were measured on a
five-point Likert scale anchored with, “1 = not at all” to “5 = to a large extent” with “3 =
neutral”. Regarding measures, the items for cost effectiveness were adapted from the work of
Ainin et al. (2015). The items for interactivity were also adapted from literature (Kietzmann
et al., 2012; De Vries and Carlson 2014; Ainin et al., 2015), while those for compatibility
were adapted from Chong and Chan (2012), as well as Teo and Pian (2003). Social media
usage items were adapted from Michaelidou et al. (2011) as well as McCann and Barlow
(2015), while items for performance benefits were adapted from Ainin et al. (2015).
The second section of the questionnaire focused on the demographic information on the
firms (nature of product offered, firm ownership type, number of years in business, size based
on number of employees, and type of social media used). The scale items were all
purified/refined using scale generation and purification processes and techniques identified
from scholars (Flynn and Pearcy, 2001; DeVellis, 2003; King et al., 2012), particularly via
exploratory and confirmatory factor analysis. In order to evaluate the various hypotheses
stated earlier in this study, the study employed a structural equation modeling (SEM)
approach. SEM is a preferred modeling method (Bagozzi and Yi, 2012) because it affords
researchers the control for measurement error, provides information on the degree of fit of the
tested model, and is able to test multiple relationships (Byrne, 2013).

Sample
Data was obtained from SMEs selected from a commercial database obtained via the
National Board for Small Scale Industries (NBSSI) in Ghana. We purposively selected

9
 contacted SMEs who had active Facebook and/or Twitter accounts via their emails and phone
numbers stated in their profiles/bios to establish agreements to partake in the study. Prior to
the questionnaire administration, an adequate assessment of the psychometric properties of
the scale items was carried out by testing for face and content validity using academic faculty
involving marketing lecturers and PhD students as well as social media consultants (Bagozzi
and Yi 1988). In order to minimize concerns about common method bias (Podsakoff et al.,
2012), information provided by the SMEs came from two categories of personnel in each
enterprise. Particularly, the CEOs completed the section on enterprise characteristics/profiles
while the marketing officers (in charge of social media accounts) completed the predictor and
outcome measures.
Given the difficulty in using objective financial data as the information may be
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unavailable, unreliable or difficult to crosscheck in most cases (Woodcock et al., 1994),

perceptual responses on performance benefits were obtained for the survey. Such approach is
recognized as reliable, and proven to produce results that are consistent with objective
measures in past research (Dess and Robinson, 1984; Ainin et al., 2015). Out of the 236
SMEs contacted, 216 responses were returned, from which six of the questionnaires had
anomalies and had to be discarded. Hence, the researcher made use of 210 fully filled and
valid questionnaires, which was adequate for the intended analysis. The final usable data
therefore represented an 88.98% response rate.

4. Results and Analyses

Profile of the enterprises
Table 1 presents the profile of the sampled enterprises. The results from the distribution of
firm characteristics reveal that the sampled enterprises were fairly represented. There were
66.7% of enterprises offering physical goods and 33.3% providing services. Sole proprietors
(13.3%), families/households (48.6%) and cooperatives/associations (38.1%) described the
ownerships of the firms. Most of the sampled enterprises (approximately 91%) have been in
business for over 5 years, with the majority of them (54.3%) having more than 20 employees.
Regarding the type of social media used, 53.8% of the sampled enterprises used Facebook
only, 34.3% used Twitter only while 11.9% used both media platforms.

INSERT TABLE 1

10
 Reliability and validity
Reliability of the measurement items was assessed by inspecting the loadings as well as
internal consistencies on their corresponding constructs (Fornell and Larcker, 1981). Results
indicated loadings ranging from 0.730 to 0.944 with internal consistency (Cronbach’s Apha)
values also ranging from 0.887 to 0.937 (see Table 2). Confirmatory Factor Analysis (CFA)
was employed in testing the measurement model. Hair et al. (2010) recommend that most
model-fit indices should reach the acceptable standards in order to be eligible for model
fitness. From Table 2, all CFA indicators exceeded the recommended values, exhibiting an
adequate fit to the data collected. Our five-component CFA model fitted the data well, with
all indices satisfying their respective criteria. Following suggestions by Anderson and
Gerbing (1988), Normed Chi Square (χ2/df) value was 1.98; Comparative Fit Index (CFI) =
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0.97; Normed Fit Index (NFI) = 0.96; Standardized Root Mean-Square Residual (SRMR) =
0.045; Root Mean Square Error of Approximation (RMSEA) = 0.053, 90 Percent Confidence
Interval for RMSEA = (0.047; 0.068). With factor loadings significant at 1 percent for our
sample, convergent validity of the measures was supported (Bagozzi and Yi 1988).

INSERT TABLE 2

In addition to this, Table 3 presents the descriptive statistics, the variances extracted for
each construct and the square of the correlations between each construct and the others.
Diagonal elements represent the average variance extracted (AVE) for the constructs. The
correlation coefficients ranged from 0.340 to 0.537 with AVEs also ranging from 0.569 to
0.710. Discriminant validity was established by comparing the shared AVE values between
pairs of constructs with their squared phi correlations. In all cases, the AVE values were
greater than the shared squared phi correlations associated with each pair of constructs. This
supported discriminant validity (an indication that the constructs are distinct from one
another) as recommended by Fornell and Larcker (1981).

INSERT TABLE 3

Assessment of Hypotheses
The parameter estimates presented in Table 4 and Figure 2 represent the final results, which
best explain the findings of the study in line with the hypotheses proposed early on. The
model-fit indices for the structural model provided evidence of a good model fit (RMSEA =

11
 0.061; GFI = 0.94; NFI = 0.97; CFI = 0.96; AGFI = 0.91; χ2/df = 2.04). Hypothesis 1 states
that the interactive nature of social media positively and significantly influences social media
usage among SMEs. The structural equation modeling results revealed that there was a
significant relationship between interactivity and social media usage (β = 0.72, t-value =
13.34, p<.001). The second hypothesis states that cost effectiveness positively and
significantly influences social media usage. Similarly, this relationship was statistically
significant (β = 0.185, t-value = 3.51, p<.001). The third hypothesis for the study
(compatibility positively and significantly influences social media usage) was also
statistically significant (β = 0.100, t-value = 2.03, p<.05). Finally, Hypothesis 4 posits that
social media usage positively and significantly influences performance benefits obtained by
SMEs. This was also statistically significant in the study (β = 0.737, t-value = 17.90, p<.001).
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As a result, all stated hypotheses for the study were statistically supported.

INSERT TABLE 4

INSERT FIG 2

Given the effect of firm differences as contingencies on enterprises’ social media

strategy (Hughes et al., 2012), we examined group variations for two firm characteristics
(nature of products offered, and type of social media used) via a series of regressions. We
first anticipated possible differences usage motivations based on the types of product offered
by the enterprises (either physical goods or services). Results from Table 5 (Model 1) reveal
that interactivity and cost effectiveness had positive and strong significant effects on social
media usage while compatibility showed a positive but lower strength effect on usage.
Particularly, interactivity exhibited more effects on usage with services than with physical
goods, while cost effectiveness had more effect on usage with physical goods than in
services. Secondly, we examined differences among the type of social media used (Twitter
only, Facebook only, and both) in an attempt to assess their differential effects on
performance benefits. Results from Table 5 (Model 2) reveal that the effects of social media
usage on performance benefits were positive and significant across all groups, although
higher in Facebook only than in Twitter only. Notably, the highest exhibited effect of usage
on performance benefits was demonstrated via the use of both social media.

INSERT TABLE 5

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 5. Discussions and conclusions
This paper sheds light on SMEs’ social media motivations and the performance benefits
associated with their usage. The study examined these relationships grounded on the
Diffusion of Innovations (DOI) Theory. In general, the research found that interactivity, cost
effectiveness and compatibility were factors germane to social media usage, which
consequently result in the realization of some performance benefits for SMEs. The results are
consistent in all dimensions with previous studies conducted in other contexts. First, past
research has shown that the interactive nature of social media is a key consideration for firms
who choose and deploy their marketing activities on such platforms (Cone, 2008;
Michaelidou et al., 2011; Ainin et al., 2015). Interactivity provides a richer rent for firms in
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terms of obtaining feedback via a two-way communication, as well as instilling better

feelings of responsiveness and flow of mutual information (Sundar et al., 2003; Kietzmann et
al., 2012). Thus in congruence with previous studies, this research reinforces the
consideration given to the interactive element of social media as a key antecedent motivating
SMEs towards their usage.
Furthermore, past research has emphasized the indispensable role of cost effectiveness
(Hawn, 2009; Hanna et al., 2011) and compatibility (Hsu et al., 2007; Wang et al., 2010) as
other key factors engendering social media usage. This research in a like manner augmented
this contention by affirming with related empirical results. In consistence with extant
research, it appears social media now offer SMEs a better low-cost option over traditional
media. Consequently, the relatively lower cost associated with using social media presents an
advantageous avenue for SMEs to carry out their marketing activities within their chronic
resource-constrained environments. More profoundly, the degree to which social media fit
firms’ needs and practices (compatibility) become a non-negligible consideration towards
their usage by SMEs. With any form of internet connection (even mobile), Facebook and
Twitter are easily compatible with the infrastructure of most firms since they are very simple
and easily adoptable by any enterprise (Ainin et al., 2015). Moreover, this research in line
with previous studies (Michaelidou et al., 2011; Wamba and Carter, 2014; McCann and
Barlow, 2015) found social media usage to have a strong positive and significant impact on
SMEs’ performance benefits accrued.
Additionally, our findings revealed differential relationships between SMEs who offer
physical products and those who offer services. While interactivity was a higher motivation
among SMEs offering services, cost effectiveness on the other hand was a higher motivation

13
 among SMEs who are into physical goods. Perhaps, the intangible nature of services requires
that service SMEs pursue more interactive endeavours with their customers and clients. As a
result, social media offer adequate recipes to the interactivity dimension. Furthermore, the
point that product-offering SMEs are burdened with manufacturing costs and are likely to
embrace cost-cutting means of communications could lend explanations to the second
scenario. In addition to this, our study found variations with the performance benefits accrued
by SMEs who use Facebook only, Twitter only and a blend of both platforms. Findings from
our data seem to suggest that SMEs who employed both Facebook and Twitter in tandem
reap improved performance benefits than those who employ each media separately. Thus, in
congruence with previous studies, varied outcomes are accruable to SMEs when they embark
on marketing activities via social media (Kwok and Yu, 2013; Tsimonis and Dimitriadis,
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2014; Aladwani, 2015).

Overall, the findings from the study permit us to conclude that despite the peddled
bottlenecks, the use of social media as a strategic tool in optimizing firm performance seem
prevalent among SMEs within an emerging market setting too. In a context where firms are
believed to be slow adopters of technology relating to electronic commerce (Abou-Shouk et
al., 2012), the study results demonstrate that social media is being used to augment marketing
activities of SMEs. In an era where customer-generated stories have stronger voices in brand
advocacy, it has become pertinent for firms to engage end-user parties at various levels and
via unconventional means. The advent of Web 2.0 platforms (such as those examined in the
study) offer novel approaches for enterprises to build and develop relationships, as well as
enhance communications with customers and trade partners. Firms embracing social media
across various business levels and economic contexts now have several possibilities to target
and facilitate superior relationships and interactions with customers. Profoundly, in a tale of
two sites, Facebook proved to edge Twitter in terms of engendering performance benefits
among SME users as per findings from our data. Yet, the two media have in recent times,
become viable avenues for connecting with customers on more personal levels, given their
abilities to offer direct mentions and replies in real time.

6. Implications and limitations

Findings from the study make three key contributions to the literature on social media as well
as enterprise information management among small and medium-sized enterprises. First, we
progress theory by extending the Diffusion of Innovation (DOI) theory on a burgeoning but
seemingly interminable phenomenon – social media marketing. Evidence from extant

14
 literature on the shades of social media marketing among firms shows a dearth of research
grounded on theories. The current study thus offers a modest contribution in that regard by
providing empirical support from a social media perspective for the largely accepted DOI
theory (Rogers, 1983) with a conceptual framework that exhibits good explanatory power.
Secondly, literature on social media exhibits fewer studies that integrate and examine the
relationships among the constructs used in this study, particularly from SMEs perspectives.
Existing works either studied the relationships of the constructs in isolation and/or within
different settings (see for instance Ramdani et al., 2009; Low et al., 2011), calling into
question the need for further empirical examinations for validation and theory building. We
again contribute to literature by presenting results examining multiple interdependencies
among the constructs, as well as using data from SMEs.
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Finally, the current study presents results from an emerging economy in Sub-Saharan
Africa setting. Such context is low in representation with regard to literature on the nuances
and implications of social media marketing especially at the firm level. In a context often
characterized with inadequate infrastructure as well as unbridled competition (Sheth, 2011),
the results illuminate the global marketing literature with findings that are perhaps similar to
or different from those set in other emerging or developed economies. The forgoing
discourses highlight some interesting implications for both researchers and SME managers in
other contexts. Theoretically, the study shows that the interconnections of social media
motivations, as well as the effects of social media usage on performance are erratic across
SMEs who are into physical products and those into services. Therefore, it will be erroneous
to assume that the antecedents and outcomes tested in this study are invariant for all
enterprises. Additionally, the paper departs from previous works by arguing that benefits
reaped by enterprises from their social media marketing activities are enhanced via the use of
multiple platforms. Yet, it is relevant to point out that adopting social media (which provide
firms with a considerable control and choice of marketing message) alone might not be
enough if enterprises are not able to utilize the media in accord with their marketing
objectives.
The practical implication of the ongoing discourse is that, for SME managers/owners
seeking to augment their marketing efforts on social media, multiple platforms should be
employed since each media may offer unique benefits during their usage. The apparent effect
of combining the social media provides enhanced performance benefits. Moreover,
irrespective of the motivating antecedents for adoption and usage, enterprise owners or
managers may not optimally maximize their social media presence if their overarching goal is

15
 just to have an existing account without exploiting them for any marketing activities. The
specific media types examined in this study (Facebook and Twitter) are very cost-effective
and vogue platforms representing unique and compelling channels for SMEs. Their ease of
use, speed, interactive nature, as well as their ability to reach larger customer base regardless
of geographical locations, make such social media essential for SMEs to invest time and
resources in them regularly. Creating and sharing content, engaging existing and prospective
customers, as well as monitoring competitor contents via such media are some possible
benefits available for firms that embrace social media marketing activities.
The current research has some limitations, prompting curious avenues for future
research. First, the paper only makes use of two types of social media; Facebook and Twitter.
As a result, our findings are only within the remit of the two platforms and scholars and
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managers should be cautious in universally generalizing with other social media available for
firms. Secondly, the hypotheses formulated in the study were tested using SMEs from a
single country as well as cross-sectional in nature and therefore do not suggest static effects
in other contexts. Given that firms’ strategic orientations and outcomes may be context-
specific, opportunities exist for further studies to corroborate the construct relationships and
findings from this research. The effects tested in the study are that of relationships and not
causalities. Again, the concepts examined in this research are applicable in both larger and
smaller firm settings across various economic context. The findings consequently open up
further debates on the phenomenon under study, especially the possible disparities that exist
between product-based SMEs and service-based SMEs. Moreover, a comparative study that
examines the research framework using responses from both larger and smaller firms could
unearth interesting results for advancing theory.

16
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Biographical Details (if applicable):

Raphael Odoom is a fellow at University of Copenhagen and currently with the University of Ghana Business
School. His research interests are in the areas of branding, social media marketing and small business
management. He has published in the Journal of Product and Brand Management as well as Services Marketing
Quarterly.
Downloaded by Fudan University At 09:11 15 March 2017 (PT)

Thomas Anning-Dorson is with the Department of Marketing and Entrepreneurship, University of Ghana Business
School. His research interests are in innovation, service management, competition and emerging markets

George Acheampong is a researcher at the University of Ghana Business School and a DANIDA BSU/GEP
scholar. His interests are in how private enterprise can contribute to development in African and emerging
economies and has published in Thunderbird International Review.

22
 Table 1 – Profile of enterprises
Enterprise Characteristics Measures Sample composition
n Percentage
Nature of product offered
Goods 140 66.7
Services 70 33.3
Firm Ownership
Sole proprietor 28 13.3
Family/Household 102 48.6
Cooperatives/associations 80 38.1
Number of years in business
1-5 years 19 9.0
6-10 years 51 24.3
11-15 years 102 48.6
Above 15 years 38 18.1
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Number of employees
20 or less 96 45.7
21-40 50 23.8
41-60 39 18.6
61-80 15 7.1
81-99 10 4.8
Type of Social media used
Facebook only 113 53.8
Twitter only 72 34.3
Both 25 11.9
n=210

Table 2 – Measurement Model

Construct and items Item Factor t (CR) α
Code loading Value
Interactivity .886 .902
Our social media platform offers interactive Int1 .830 Fixed
communication with customers
Offers interactive mechanisms for value co-creation Int2 .863 10.70
with our audience
Ability to engage customers via mentions and replies Int3 .855 10.57
with controlled message contents
Cost Effectiveness .898 .912
We use Twitter/Facebook to cut down cost on Cost1 .888 Fixed
marketing communications
Our social media platform saves costs relating to Cost2 .857 12.01
time and effort in marketing, branding and customer
service
Twitter/Facebook is more cost effective to us than Cost3 .845 11.71
traditional media
Compatibility .894 .903
The chosen social media is compatible with our Compt1 .799 Fixed
existing IT infrastructure

23
 Twitter/Facebook is compatible with our business Compt2 .820 9.30
processes and operations
It is easy to integrate Twitter/Facebook with our Compt3 .848 9.58
existing departmental strategies
Our choice of social media is consistent with the Compt4 .829 9.45
enterprise’s beliefs and values
Usage .936 .937
To attract new customers Us1 .901 Fixed
To nurture relationships with clients and customers Us2 .841 12.29
To communicate firm’s brand online Us3 .800 10.96
Receiving feedback Us4 .850 12.52
Creating awareness of our brand Us5 .835 11.86
Answering queries from customers and respond to Us6 .826 11.71
requests
Performance benefits obtained .908 .887
Increase in sales transactions P1 .944 Fixed
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Increase in number of customers P2 .730 9.71

Improved brand visibility P3 .940 17.23

Table 3 – Descriptive statistics and correlations

Mean s.d Interactivity Cost Compatibility Usage Benefits
Effec.
Interactivity 2.93 .735 .702
Cost Effective 3.05 .806 .461 .646
Compatibility 3.26 .639 .349 .350 .679
Usage 2.92 .712 .503 .397 .530 .710
Benefits 1.53 .525 .427 .340 .389 .537 .569
Average variances extracted (AVE) are on the diagonal; square correlations are off-diagonal

Table 4 – Structural Model Assessment Results

Structural Relationships β Estimate t-Value P-value Std. Err.
Interactivity -----> Usage .722 13.34 .000 .054
Cost effectiveness -----> Usage .185 3.51 .000 .052
Compatibility -----> Usage .100 2.03 .043 .049
Usage -----> Benefits .737 17.90 .000 .041

RMSEA= 0.061 GFI= 0.94 NFI= 0.97 CFI= 0.96 χ2/df= 2.04

24
 Table 5 – Variations in model across enterprise characteristics
Model 1a Model 2
(Goods) (Services) (Facebook only) (Twitter only) (Both Media)

Interactivity 0.574*** 0.759***

(6.07) (13.38)
Cost Effective 0.314*** 0.109**
(3.32) (2.19)
Compatibility 0.140* 0.142*
(1.07) (1.57)
Usage 0.476*** 0.453*** 0.621***
(7.43) (9.07) (18.41)
T-values in parentheses *** p<0.01, ** p<0.05, * p<0.1
a
Dependent variable in Model 1 is Usage; in Model 2 is Performance benefits
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25
 Fig. 1 – Research Model

Interactivity

H1

Cost Performance
effectiveness H2 Social Media H4 benefits
Usage

H3
Compatibility
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Fig. 2 – The Structural Model

 Article Title Page

[Article title]

Antecedents of Social Media Usage and Performance Benefits in Small- and Medium-sized Enterprises
(SMEs)
Author Details:

Raphael Odoom
Department of Marketing and Entrepreneurship
University of Ghana Business School, Legon.

Thomas Anning-Dorson
Department of Marketing and Entrepreneurship
University of Ghana Business School, Legon.
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George Acheampong
Department of Marketing and Entrepreneurship
University of Ghana Business School, Legon.

Corresponding author: Raphael Odoom

rafaelodoom@gmail.com

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Acknowledgments (if applicable):

Biographical Details (if applicable):

Raphael Odoom is a fellow at University of Copenhagen and currently with the University of Ghana Business School. His research
interests are in the areas of branding, social media marketing and small business management. He has published in the Journal of
Product and Brand Management as well as Services Marketing Quarterly.

Thomas Anning-Dorson is with the Department of Marketing and Entrepreneurship, University of Ghana Business School. His
research interests are in innovation, service management, competition and emerging markets

George Acheampong is a researcher at the University of Ghana Business School and a DANIDA BSU/GEP scholar. His interests
are in how private enterprise can contribute to development in African and emerging economies and has published in Thunderbird
International Review.

Structured Abstract:

Purpose
Despite the blossoming nature of social media marketing, the nuances and implications among small- and medium-sized enterprises
(SMEs) appear to be under-researched in literature. The purpose of this paper is to progress knowledge and offer extended
understanding of the motivations and performance benefits of social media accrued by SMEs with an empirical
study from an emerging economy.
Design/methodology/approach
Based on past research, the study hypothesizes that interactivity, compatibility and cost effectiveness are
motivations germane to social media usage, which consequently offer performance benefits. Data from 210 SMEs
(having Facebook and/or Twitter accounts) is employed to investigate the proposed conceptual model using
Structural Equation Modelling with sub-group analysis.
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Findings
Finding from our study demonstrate that the interdependencies of social media motivations, as well as effects of social media usage
are positive but erratic across product-based and service-based SMEs. Moreover, SMEs who offer physical products are more likely
to employ social media based on cost effective motives while service SMEs are more likely to consider interactivity as a key
motivation. Additionally, findings from the study data suggests that in a tale of two sites, Facebook proved to edge Twitter in terms of
engendering performance benefits among SME users.
Originality/value
The findings provide evidence to issues of potential research and managerial interest, offering insightful implications to the academic
and practitioner communities. Evidently, irrespective of some usage bottlenecks, SMEs in emerging markets appears to be reaping
enhanced social media benefits by deploying their marketing campaigns via multiple platforms.

Keywords: Social media, small- and medium-sized enterprises (SMEs), emerging market
Article Classification: Research Paper
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