The drivers of electronic word-of-mouth in social media setting; the case of charity organizations

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The drivers of electronic word-of-mouth in social media setting;

the case of charity organizations

Master thesis Marketing Management: The effect of social media on charity

organizations

July, 2010

Author: Janita Ruoko, s1801759

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Management summary

The world of marketing is in a constant change. Developments in Internet technology provide new tools for marketers to reach their goals and plan better strategies. One of the most interesting Internet innovations are social media (SM). SM consists of an increasing amount of different online networks that provide information and interaction to their users. SM are digital, real time and traceable online tools that lack geographical boundaries and give the possibility to connect with other people. SM makes it possible to publish and share information, discuss with others, network, blog, play games, live in virtual worlds and much more. With all the different tools, interaction and communication are free of charge, fast and make contacting consumers easier than before. SM on its own can not do much for companies, but as a tool to electronic word-of-mouth (eWOM) it has a great potential.

This research has an emphasis on SM tools and how their use creates eWOM. The focus is specifically pointed towards charity organizations due to the unique characteristics of the business and the challenges they are facing currently. It is believed that charity organizations can benefit greatly from SM marketing and pursue their missions with low costs. Use of SM in charity organizations is still experimental and it seems that arguments behind their use lack proper research.

The aim of this research is to understand how SM can be used in marketing and how to induce eWOM. In particular, the research question is:

What are the main drivers of electronic word-of-mouth in social media for charity organizations? There are 6 independent variables in the conceptual model, namely recommendation source credibility, consumer motivations, charity’s visibility, involvement with charity, social media behavior in general and social media tools. These independent variables are hypothesized to have an effect on charity eWOM in SM, the dependent variable. The research was done using an online questionnaire among people who are currently active in SM. The questionnaire was distributed via different SM tools and answers were analyzed with SPSS, a statistical analysis software. In total 185 respondents filled in the questionnaire, of which almost 70% were female.

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seems that consumers who are more involved in charity are prone to create more eWOM, but strong activity in SM in general does not lead to more eWOM. 51.9 % of the participants visit charity organizations’ websites and 19.9 % are using SM to search for information about charity organizations. Furthermore, Facebook and blogs are the most popular social media tools, and 23.2 % are member of charity organization’s Facebook group and 14.9 % are reading blogs by charity organizations. Facebook and blogs are also perceived to be the most suitable for charity organizations’ mission.

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Preface

This is the step that finally concludes my Master studies here in the University of Groningen. The past two years have been the most interesting and exciting, but at the same time, the most difficult and stressing of all. I have learned a lot and found lifelong friends. I have made myself familiar with the Dutch culture and learned how to live my everyday life among different people. I have cycled more than ever before and also bought more bikes than ever before.

All this, I could not have done without the support from my family and friends in Finland, but even more without the support of my dear Nahaison. I want to thank you for always believing in me, and helping me when I felt that I don’t have the strength to do all this. You are my rock and I couldn’t live without you. I love you.

I also want to thank my three musketeers here in Groningen, Anutza, Lorena and Maria, you brought back the girl talk to me and helped me relax during the stressful times. I am so proud to be your friend and will always keep you in my heart. I also want to thank prof. dr. J. C. Hoekstra for reading my thesis, and giving constructive feedback during the last steps.

Last, but definitely not least, I want to thank my supervisor dr. J. A. Voerman. Liane, you were the perfect supervisor for me, and provided me with guidance and professional help whenever I needed. Besides this you gave me inspiration and you made me think and question my work. With your help I learned a lot and feel more confident of what I do.

For sure I am going to miss Groningen, but most of all I am happy that this day is finally here.

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1 Introduction

In the first chapter an introduction to the topic of social media is given and the current problems of charity organizations are presented. Further on the problem statement and the research questions are introduced.

1.1 Background

In the past two decades, technological developments have been changing the world, and the effect can be also seen in marketing. One of the most important developments of communication is naturally Internet, and its endless possibilities (Stingl, 2009). Both consumers and businesses are affected by it, and continuous learning is required in order to keep up with new Internet innovations. One of the latest and fastest growing Internet innovations is known as social media (Trusov et al., 2009). In their research, social media are described to be social networking sites that are usually initiated by a small group of founders who invite other people to join the site, and then these new members send the invitations forward in their networks, hence these invitations can be called WOM (word-of-mouth) referrals. Social media is user generated, so users are participating not only in consumption, but also in content creation (Agichtein et al., 2008). With social media one can publish information, share information, discuss with others, network, blog, play games, live in virtual worlds and much more. Social media tools are e.g. Facebook, MySpace, Twitter, Blogger, Wikipedia, Flickr, MSN, Youtube.

1.2 Social media in marketing

Companies are slowly realizing the value of social media for their marketing strategies by creating e.g. Facebook fan groups, using Twitter to inform consumers about the latest news and using famous bloggers to write about their newest innovations (Subramani & Rajagopalan, 2003). Using social media as a marketing tool, i.e. social media marketing, requires skilled people to implement the strategy, but compared to traditional marketing is a much cheaper and faster way to reach target groups (Kane et al., 2009).

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communication (Dellarocas, 2003). This means that social media create the possibility for eWOM, which is considered to be more influential on consumers than any regular commercial (Harridge-March & Quinton, 2009).

So, Internet might provide the right tools for effective eWOM, especially since consumers use it more and more for searching recommendations and information (Li et al., 2006). For instance, the proportion of adult Internet users who have a social media profile has grown from 8% to 35% within three years (Uhrig et al. 2010). Also 83% of these adults have multiple profiles at the same time. Bushey (2010) shows that 60% of Americans use social media and 85% of those users think that companies should be using social media as well in their businesses. So, when high volumes of consumers are exploring social media and show interest towards companies in that environment, it is a good time for companies to start exploring the possibilities that lie in social media and how it can be used to create eWOM.

1.3 Charity organizations

Due to the low cost of implementing social media, there is a special field of business that could benefit from using social media tools in marketing, namely charity organizations. Charity organizations are facing challenges due to the special characteristics of their business (Gallagher & Weinberg, 1991). These organizations differ from “normal” businesses because of their non-financial goals that are driven by their mission, having different types of “consumers” and often working in cooperation with their competitors. Even if charity organizations differ from “normal” organizations, they still follow basic marketing strategies in order to reach their mission. For example, donor behavior varies among different people, so segmenting them into homogeneous groups might help charities to target the right donors with the right tools.

1.3.1 Problems in charity

Lately, charity organizations have been facing problems due to declining direct donations, decreasing governmental support and an increasing amount of new charity organizations making the competition for donations more intense (Peacock, 2000; Liao et al., 2001; Dolcinar & Lazarevski, 2009). These problems are driving charity organizations to explore new ways of getting donations and being noticed. Key issues for these companies are how to reach the right people and how to get information of their current mission to spread around.

1.3.2 New marketing tools for charity organizations

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impact on organizational performance, and Dolcinar & Lazarevski (2009) relate this argument specifically to charity organizations, by stating that market orientation can also have a major impact on achieving their mission.

In light of the recent problems, charity organizations have started to use different marketing concepts, e.g. marketing orientation, segmentation, CRM and loyalty (Hassay & Peloza, 2009; Hankinson, 2001). These are all good marketing tools (Bohling et al., 2006; Day, 1999), but also very traditional tools that are not as cheap or efficient as social media tools (Kaplan & Haenlein, 2010). Moreover, Curtis et al. (2009) and Kaplan & Haenlein (2010) are both acknowledging the benefits of social media use in marketing for charity organizations due to their low costs, and are concluding that social media tools are a good way for charity organizations to communicate and market their mission.

1.3.3 Current use of social media by charity organizations

A content analysis was made concerning the communication of the largest international charity organizations. According to Malhotra (2007) content analysis is a “objective, systematic, and quantitative description of the manifest content of a communication”. The phenomenon observed here are the communication methods of charity organizations. The aim of the observation was to get a clear picture of what charity organizations are currently doing with social media and which SM tools they are using.

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Facebook Twitter Youtube MySpace Flickr Blog Others Unicef X X X X WWF X X X X RedCross X X X X X a Amnesty X X X X Greenpeac e X X X b World Food Program X X X X b & c Save the Children X X X X X d

a = Disaster news room b = FeedBurner c = Wall against hunger d = LinkedIn Table 1 Charity organizations & SM tools An encouraging example of a very successful campaign where social media had a main role is the presidential campaign of Barack Obama (bbc.com; readwriteweb.com). Even if the campaign was not for a charity organization per se, similar characteristics can be seen since the aim was to raise awareness and get people to act, with the help of social media. In the beginning, the campaign had very few resources and barely any name recognition, but with a well planned strategy and the right social media tools, the campaign ended up being a huge success. During the campaign, Obama got 5 million supporters via social networking sites, 15 different online communities were maintained, there were videos on Youtube, blogs and even in-game advertising was used in the Xbox360. $500 million was fundraised and of course the main goal reached, he won the presidency. The campaign aimed and succeeded at mobilizing young people who were not interested in politics and get them to vote. This shows how the right use of social media can really change people’s attitudes and behavior towards a certain topic.

1.4 Problem statement and research questions

The possibilities of social media for marketing are not yet clear or fully explored by scientific literature. This can be easily seen from the fact that the issue has not been fully acknowledged in the top scientific journals1_{. Hence this paper is encouraging researchers to grasp on the topic more}

thoroughly in the near future.

Thus, in this study the main problem is: What are the main drivers of electronic word-of-mouth in social media for charity organizations?

The scientific relevance of this study aims at giving more insights into the usefulness of social

1_{E.g. Journal of Marketing, Journal of Marketing Research, International Journal of Research in Marketing,}

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media on eWOM creation. The practical relevance focuses on giving new direction for charity organizations’ marketing strategy, and helps them find the right tools to continue successfully with their important missions.

To be able to understand the phenomenon of social media and eWOM the following research questions will be answered:

1. How can social media be used in marketing?

2. How is it possible to induce electronic word-of-mouth in general? 3. What are the main drivers of eWOM for charity organizations? 4. Which SM tools are the most suitable for charity organizations?

1.5 Structure of the study

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2 Theoretical framework

In this section social media and electronic Word-of-Mouth are being defined and explained more thoroughly. This is done with the help of existing scientific literature on these subjects. In the end, these topics are being integrated into a conceptual model, which graphically shows the found relationships.

2.1 Social media

Since the use of social media in marketing is considerably new and companies are still learning and experimenting with it, its research is still in its starting point (Harridge-March & Quinton, 2009). The possibilities of social media are vast, but companies should not just jump into it blindly and use everything they can. Companies should know how their consumers are using social media and how they respond to it (Cheung & Lee, 2010). So, companies should start from the very basics, and find out thoroughly what social media encompass.

2.1.1 What are social media

Gentry (2009) defines social media marketing as “connecting, engaging and building relationships with clients, prospects, referral sources through various social networking sites”. These social media, also referred as social networking sites, give the possibility to create a personal profile in online space, connect it to other people and create a personal network (Cheung & Lee, 2010). Social interaction and connections are the objectives of online social networking sites. The existence of online social networks is mainly depended on interactions with other users in the specific personal network.

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appear with complete strangers.

In table 2 this classification can be seen. Lowest social presence and media richness is with blogs and collaborative projects, such as Wikipedia. They usually contain only text and do not allow complex exchange. Content communities, like Youtube, and social networking sites like Facebook are in the medium level of social presence. Highest social presence and media richness is represented by virtual social worlds and virtual game worlds. Interactions are closest to real face-to-face interactions.

Although the terms social media and social networking sites are still a bit mixed in the literature, Kaplan & Haenlein (2010) define social media as all that is described in table 2, with social networking sites also being part of these social media tools. In this thesis social media is limited to tools that have medium level of the dimensions mentioned, with the addition of blogs. The tools are limited to the “average” SM tools because they are considered here to be the most suitable for charity organizations eWOM creation.

Table 2 Social media classification by Kaplan & Haenlein (2010) 2.1.2 Building relationships with consumers

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2.1.3 Choosing a social media strategy

Social media is still very challenging due to the variety of information quality presented, from very high quality to low quality and even abuse (Agichtein et al., 2008); this is why strategy planning and researching are very important. With social media in marketing, like any other marketing method, strategy is very important. Since just bluntly asking to give to charity is a very unexciting way of raising funds, companies should find out what consumers want and offer that (Bushey, 2010). With social media this is easy and cheap to do. A special social media team can help with developing the strategy and policies on how to manage the chosen social networks and channels. With the right social media strategy companies can guide consumers’ social media behavior towards eWOM creation. By giving donors options of charity missions and by showing them results via social media channels, e.g. in Facebook group or Youtube videos, donors will receive situational stimuli, which is a very important determinant of behavior (Hibbert & Horne, 1996). Due to the bi-directionality and the fact that social media function in real time, donors get instant gratification for their contributions and can communicate with the charity organization when desiring further details (Kane et al., 2009). With frequent updates of the ongoing fundraising, donors can see immediate results of giving money, and this way might be more willing to continue donating in the future.

So, clearly social media, when integrated in the marketing strategy, can be used for eWOM creation. But the question still remains what makes eWOM successful.

2.2 Electronic Word-of-Mouth

Already in 1966, Dichter was contemplating why word-of-mouth is so effective on consumer behavior. He concluded that a face-to-face recommendation from a person who one knows is more effective than from a strange salesman. Since then times have changed, and Internet has altered the way word-of-mouth works. The recommendations via Internet do not occur face-to-face anymore and often one does not even know the person making the recommendation. Yet this electronic word-of-mouth is getting more and more popular (Cheung et al., 2009).

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2.2.1 Benefits of eWOM

Word-of-mouth marketing has been even called the world’s most effective marketing strategy (Trusov et al., 2009). WOM strategy is overcoming consumer resistance, with low costs and fast delivery. Besides helping to market the company, eWOM is also more and more important for a company’s reputation management (Jensen et al., 2009). Because eWOM can be positive or negative, it is important that also companies follow the flow of the referrals and conversations that go on in the web, and use that information for developing their businesses and reputation (Kane et al., 2009). So, the benefits of eWOM are: decrease in costs, fast delivery, diminishing consumer resistance and further developing ones’ business by using the word in the web. After understanding the benefits of eWOM, it is important for charity organizations to know what the antecedents of eWOM are and what motivates consumer participation.

2.2.2 Source credibility

Gruen et al., (2005) argue that eWOM is more credible, emphatic and relevant for consumers than other sources on the web. This is important for charity organizations because usually donors have a strong emotional relationship with the charity organization so it is essential that the received information is perceived to be credible (Hassay & Peloza, 2009). This helps maintaining trust between the organization and the donor. Word-of-mouth also has an effect on customer values. Customers that are acquired via WOM tend to be more valuable on the long term when compared to customers acquired via traditional marketing induced methods (Villanueva et al., 2008). So, in order for eWOM to be successful the source has to be credible and the argumentation strong. When these aspects are in place, eWOM can influence the customer purchase decision (Cheung et al., 2009).

Cheung et al. (2009) say that eWOM connects different consumers and widens and opens up the WOM network to entire Internet world. They also say that the sheer amount of information compromises its validity. This is why source credibility is very important for eWOM to work (Cheung et al., 2009). Doh & Hwang (2009) proved that a few negative messages among the positive ones could actually help the message be perceived as more credible. They explain this by saying that if consumers only see the positive message about the company, they might start doubting the credibility, since no company is perfect. It is assumed here that source credibility has an effect on eWOM creation. So, important factors in eWOM creation are source credibility and mutual trust; without these two factors consumers don’t see any reason to believe the recommendations (Cheung et al., 2009). Hence, the first hypothesis is:

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creation

2.2.3 Motivations to participate

Even if Internet has altered WOM to an electronic form and reduced its boundaries of time and place, some of the motivations to create WOM might still be similar (Hennig-Thurau et al, 2004). According to Engel et al. (1969) reasons why consumers generate WOM are because they want to help other consumers in their decision making, they want to warn about bad service or quality and recommend good ones, or they just want to show their knowledge on the subject. Dichter (1966) divided the motivations to four groups: 1) Product-involvement, 2) Self-involvement, 3) Other-involvement and 4) Message-Other-involvement. The results for eWOM motivation of Hennig-Thurau et al. (2004) do not differ that much from the WOM motivations. They found that the main motives that consumers create electronic WOM are social benefits, economic incentives, concern for others and extraversion/self-enhancement.

In case of giving donations and participating in charity it seems likely that the motivations to give recommendations are either product-involved or self-involved. The reason not to consider message-involvement as a motivation is because it is only stimulated by the way advertisement is presented and has no relation to users own opinion. Since donating in charity can often be a very personal act, personal opinions in recommendation are important. Also, it would seem likely that other-involvement is not a motivation for giving recommendations either, since it is related to sharing a pleasure or a hedonic enjoyment of a product or service.

So, the reason to assume that product-involvement is a suitable motivation for giving recommendation is because the donor feels very strongly about the mission at hand and wants to give recommendations to others in order to make the mission more successful. If the motives are self-involved the donor recommends others to participate in the mission, and this way shows other people that she/he is participating in charity activities. This gives a self-gratification to the donor and would be a suitable motivation for making recommendations, too (Dichter, 1966). The second hypothesis assumes that motives to create eWOM about charity organizations are most likely to be product- and/or self-involved. So, the second hypothesis is:

H2= Creating eWOM about a charity organizations’ mission is more motivated by

product- or self-involvement, than message- or other-involvement.

2.2.4 Visibility

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showed how it changed consumer behavior. Consumers who were members of the Facebook group generated positive eWOM more easily, than consumers who were not in the group (Utpal & Durham, 2010). Being visible in the right places in social media helps organizations to interact with consumers in real time, and this way encourages eWOM. Visibility in social media can be enhanced by joining several networks, by investing in good quality photos, by tailoring the sent messages to fit the current mission, being interactive, up to date and prompt when answering consumer questions (Noella, 2009). Being proactive and answering promptly is especially crucial when negative events occur in a company or when a consumer is making a complaint.

Based on these findings it can be assumed that organizations that are visible on social media groups, like Facebook and brand communities, are more likely to generate positive eWOM than others. Hence, the third hypothesis is:

H3= Being actively visible in social media creates more positive eWOM for the

company, than not being actively visible.

2.2.5 Involvement

EWOM is created in social media communities among those consumers who participate to the discussion in that community (Harridge-March & Quinton, 2009). Within these social media communities consumers create strong relationships among each other, which make them more loyal to each other and more likely to trust each others opinions. Social media sites are good for increasing eWOM, due to Internet’s accessibility, transparency and good reach (Kozinets et al., 2010). In different social media communities, creating strong bonds leads to two things: 1) giving direct recommendation about a brand (eWOM) and 2) creating barriers (Harridge-March & Quinton, 2009). Barriers are created due to the social bonding and the feeling of loyalty. This can be beneficial for the companies because it makes consumers more loyal. Researching consumers’ involvement and behavior in social media and charity in general could give insightful information for the charity organizations and make them understand better how eWOM is created.

So, the fourth hypothesis has two parts:

H4 =

a) The more involved consumers are in charity the more they create eWOM

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2.3 Different tools

Based on the social media classification by Kaplan & Heanlein (2010) in table 2, three social media tools are introduced here. These tools are chosen because they represent different “average” social media tools, with medium or low social presence/media richness and both high and low self-presentation/self-disclosure. These tools are online recommendations, blogs and brand communities. Below these, eWOM vehicles are being described in more detail and the question is which SM tools are the best for eWOM creation.

2.3.1 Online recommendations mechanism

One of the most popular ways of eWOM among consumers is the online recommendations mechanism where consumers can give their opinions and thoughts about a specific topic at hand (Cheung et al. 2009). Examples of these mechanisms are eBay’s feedback where buyers and sellers rate each other, Epinions where users give reviews about products and services they have used and Google’s search engine that gives results in the order of the most sited pages (Dellarocas, 2003). Because the amount of different recommendation providers is rapidly increasing, it is important for companies to know which online recommendations are most popular and credible (Bruyn & Lilien, 2008). Due to the online recommendation mechanisms, consumers are more aware, have deeper knowledge and they rely more on the opinions given on feedback forums (Dellarocas, 2003; Gruen et al., 2005).

There are two kind of online recommendation sites, one where the reviews are posted on the brand’s webpage and other where reviews are on an independent webpage (Lee & Youn, 2009). According to their research, consumers’ intentions and product judgments don’t really vary between these two types. They also conclude that argument strength, source credibility and confirmation with receiver’s earlier beliefs affect strongly the credibility of recommendations. The online feedback mechanisms are a low cost and an effective method to acquire and retain consumers and they also affect brand building (Dellarocas, 2003). Recommendations influence consumers’ attitudes toward a product or service and this way increase purchase intentions that in the end affect total sales (Lee & Youn, 2009). Also, online feedback mechanisms are an efficient tool not only to spread information, but also to collect large quantities of relevant consumer data with very low cost (Dellarocas, 2003). Nevertheless, due to charity organizations’ unique characteristics, it seems unlikely that consumers would use online recommendations. Online recommendations are built more for products, than charity.

2.3.2 Brand communities

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often maintained by the companies and they are solely for positive associations. Algesheimer et al. (2005) research brand communities and conclude that brand communities can help create a group feeling of sharing the same interests. Brand communities are groups with organized relationships among people who admire a certain brand. When these brand communities are well maintained they can have positive effects on consumer commitment and enhance positive eWOM. According to Algesheimer et al. (2005) brand communities work best when targeting existing, long-tenured consumers, who have a strong relationship with the brand. Also, brand community for a specific brand can make the relationship between consumer and the whole company stronger. This gives the possibility for cross- and up-selling. But being part of a brand community becomes relevant usually after one is already a donor, so for communicating also with the non-members, brand communities do not give the best possibilities.

2.3.3 Blogs

Even if the idea of blogs is different from online recommendations, they can still have similar effects on consumer behavior. A personal blog is an online diary or a journal where the blog’s author writes about the chosen topic (Lee & Youn, 2009). Often, these are experiences and opinions on different issues, like politics or corporate issues. The reason why blogs have a big impact is their credibility; readers trust them (Bulik, 2007). Blogs can have two different effects; firstly they can positively affect on the buying intentions, and secondly they can make people not buy. According to Thorson & Rodgers (2006) one aspect has a particular importance on a blog’s ability to affect consumer behavior and opinions, namely interaction. They conclude that when a consumer has the possibility to give opinions in the company blog, and when they perceive the blog as interactive, it has a positive impact on the relationship between the company and consumer.

Despite the strong effects of blogging (Kozinets et al. 2010), companies might be jeopardizing the credibility of eWOM, by hiring people to give good blog reviews of their products. Lee & Youn (2009) showed in their research that people are having doubts of the credibility and they might suspect that a company might be behind the blog they read, even when that is not true. Contrary to this, Kozinets et al. (2010) conclude that positive blogger comments have a strong impact on consumer behavior. It seems that blogging works, but companies have to be careful when it comes to paid bloggers.

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fun, but also companies are using it for their communications. Jansen et al. (2009) say that microbloggin is very powerful because it is instant, has a significant reach and is accessible by others. Because microbloggin can happen close to purchase decision or even during, it has a strong effect on the success of a business. For example, during the volcanic ash catastrophe caused by the Icelandic volcano, air companies responded promptly to their consumers’ questions via Twitter (mashable.com). This was a smart move, since all the call centers were immediately full, and consumers were getting frustrated. Via Twitter companies could offer real time information of their flights and the movements of the ash cloud.

Blogs are driven by the personal need to share a certain topic, and is more suitable for broadcasting charity missions due to its credibility. Also from blogs, donors can get immediate responses to their queries and follow the developments of the charity mission. In charity organizations’ case it might also be more effective if the blog is hosted by the charity itself. At Unicef’s webpage an online community expert Mathew Gross says that “blogs can harness collective power to change the world”, and this is mainly due to their interactivity (unicef.org). Hence, the fifth hypothesis is:

H5 = An interactive blog hosted by the charity organization is the most suitable tool

for eWOM creation.

2.4 Conceptual model

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Figure 1 Conceptual model

1.Recommendation

source credibility

1.Recommendation

source credibility

3. CharityÕ

s visibility

3. CharityÕ

s visibility

Charity

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3 Empirical research design

In this chapter the research method is explained including the sampling design and procedures. After this, the data collecting method is presented and finally, the plan of analysis is given.

3.1 Research method

In order to answer the following problem statement: What are the main drivers of electronic word-of-mouth in social media for charity organizations?

An online survey is being implemented as a descriptive research design (Malhotra, 2007). The survey respondents are asked a variety of fixed-alternative questions that give respondents a predetermined set of responses. Advantages of the survey method are that it is simple to administer, obtained data is reliable due to the given alternatives and also coding and interpreting the results is relatively easy.

The answering options in the questionnaire are either yes/no or a 7-point Likert scale. Yes/no and Likert scales are used because they are easy to understand by the respondents and makes the possibility of confusion less likely (Malhotra, 2007).

3.2 Sampling design

The target population consists of people who are currently active within different social media tools. A link to the questionnaire was sent to them via email in Facebook; in LinkedIn the questionnaire was introduced as a new discussion topic in the social media marketing group. Facebook and LinkedIn were chosen due to their popularity among social media users. This way it was assured that the respondents are familiar with social media and are also current users.

3.3 Data collecting method

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(see table 3).

Second, consumer motivations are measured by asking why they use social media and why they would recommend charity organizations in social media. Based on the theory of Dichter (1966) there are four motivations for asking recommendations, namely 1) Product-involvement, 2) Self-involvement, 3) Other-involvement and 4) Message-involvement. These four motivations are used in the questionnaire, by using one motivation at a time as a reason to give recommendation about charity organization.

The third construct to measure is charity’s visibility, which gives an image of what organizations are the most visible in the social media environment and how does being visible effects on eWOM creation. Next, the fourth construct, involvement with charity, is measured by asking general questions about the respondents’ current charity behavior, e.g. are you currently donating on a monthly basis. Because it is also important to know how the respondents use social media, the fifth construct to measure is SM behavior in general. In the questionnaire social media use was divided into passive use and active use. Passive use was determined as one having e.g. Facebook profile or Youtube account but not updating ones information or posting new videos. An active user updates his/her profile information and makes video posts frequently. The sixth construct is the types of SM tools that aim to clarify which tools would be most suitable for charity organizations’ mission in social media, and via which tools would the respondents be part of charity organizations. The last construct is the dependent variable, i.e. charity eWOM in SM, and it is measured with questions on how likely people would participate in eWOM about charities, and how likely they would donate to charity via social media. In table 3 all the constructs, related items and used scales are shown.

Construct Items Scale

1) Recommendation source credibility How likely would you trust a friends/ strangers recommendation about a specific charity

organization? 1 very unlikely/7 very likely

Via social media a friend/ charity

representative/current donor is asking you to donate money how likely is it that you would make a donation?

I find this blog trustworthy 1 totally disagree/7 totally agree 2) Consumer motivations I use SM to stay in contact with friends/find

information about events/products/give information about events/products/because everybody else is them too

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totally agree A reason for me to recommend a charity organization

in social media to a friend is -importance of the mission -it makes me feel good -convincing ads

-received hedonic enjoyment

3) Charity’s visibility Which of the following charity organizations have you come across in SM

List of charities 4) Involvement with charity Are you currently donating on a monthly basis?

Are you an active member in charity, e.g. by being a collector?

Are you donating money to donating collectors on the streets?

Are you donating money to door-to-door collectors?

YES/NO

Suppose you are donating to a certain charity organization. How important is it for you - to know how much money was raised in total -what was done with the money

-to see pictures of the places/people that got help -to be able to express you opinions to the charity organization

1 very unimportant/ 7 very important

5) SM behavior in general Are you currently using one or more social media

tools? YES/NO

Which of the following tools are you currently using passively/actively?

List of SM tools How often do you visit these social media sites 1)every day

2) 4-6 times per week 3)1-3 times per week 4)every two weeks 5)once a month 6) Types of SM tools I find the following SM tools suitable for charity

organizations mission

I would be part of a charity via following SM tools

1 totally disagree/7 totally agree 7) Charity eWOM in SM Do you ever visit charity websites?

Are you a member of a charity org. via Facebook group?

Do you follow any charity org. Twitter posts? Do you read blogs posted by charity org.?

Do you use SM to search information about charities?

YES/NO

How likely would you recommend a charity

organization to a friend in SM? 1 very unlikely/ 7 very likely I would post a comment on this blog

I would forward this blog to a friend 1 totally disagree/totall y agree

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3.4 Respondent issues

In total 185 respondents filled in the questionnaire, but not all the respondents finished it completely (133 complete questionnaires). This is normal for online surveys, due to the low sample control (Malhotra, 2007). Missing values start to appear more systemically in the part of the questionnaire where the 4 blogs were shown and asked to be read. This is probably because respondents might feel unwilling to read longer texts. The questions after these were not always answered fully as well.

3.5 Plan of analysis

Some basic descriptive statistics in SPSS are used to explore the data and to get a general view of the results. To test the hypotheses, tests like Paired sample T-test, Correlation and Regression tests are used in SPSS. In table 4 it can be seen which test is used for each hypothesis and also which variables is tested, too.

Hypotheses Test in SPSS Variables used

H1= Credibility of the recommendation

source has a positive effect on the eWOM creation

Correlation Recommendation

source credibility, Charity eWOM in SM (dep.variable)

H2= Creating eWOM about a charity

organizations’ mission is more motivated by product- or self-involvement, than message- or other-involvement

Paired sample t-test Consumer motivations

H3= Being actively visible in social media

creates more positive eWOM for the company, than not being actively visible

Regression Charity’s visibility in SM and Charity eWOM in SM

H4 =

a) The more involved consumers are in charity the more they create eWOM b) The more involved consumers are in social media the more they create eWOM

Regression a) Charity behavior in general and Charity eWOM in SM b) SM behavior in general and Charity eWOM in SM H5 = An interactive blog hosted by the

charity organization is the most suitable tool for eWOM creation

Paired sample t-test, correlation

Types of tools, active use SM and Charity eWOM in SM

Table 4 Plan of analysis

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satisfactory values of Cronbach’s alpha (Malhotra, 2007). The constructs are created by averaging the scores on the separate items. The variable SM behavior in general was still included in the analyses, but it is expected that the results are insignificant.

New variable Cronbach’s Alpha

Recommendation source credibility .809

Consumer motivations .766

Charity’s visibility .853

Involvement with charity .636

SM behavior in general .170

Types of SM tools .910

Charity eWOM in SM (dependent variable) .709

Table 5 Reliability test

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4 Results

In total 185 respondents filled in the questionnaire, of which 67.8 % are female and 32.2 % male. The average age is 27 years old. The use of social media tools is very high, 98.4 % of the respondents are currently using one or more social media tools.

Below the descriptives and the bivariate results are presented. After that the results of the conceptual model is shown.

4.1 Recommendation source credibility

4.1.1 Credibility descriptive results

Four different blog posts were tested, and the respondents needed to assess three aspects: trustworthiness of the blog, whether they would post a comment and would forward the blogs to their friends. This was done on a 1-7 scale, one being totally disagree and seven being totally agree. Here the amount of respondents (N) is lower than in other parts, as the different blog questions it varied between 138 and 143. Blogs 2 and 3 are significantly the most trustworthy and blog 1 is the least trustworthy (p= .000), see table 6. Furthermore, the respondents are not very likely to post comments or forward the blogs.

Trustworthy Would post a comment Would forward the blog

Blog 2 4.78*** 2.11*** 2.51***

Blog 3 4.60*** 2.13*** 2.53***

Blog 4 3.49*** 1.80** 2.09** Blog 1 3.09*** 1.87** 2.15** * p< .05 ** p< .01 ***p < .001

Table 6 Blog assessment mean values Clearly the respondents have more trust in their friends in social media, than for in current charity donors or strangers. But despite of trusting friends more, the willingness to donate money via social media is very low. On a scale 1 being very unlikely to donate to 7 being very likely to donate, 2.77 is the mean when a friend is asking to donate. 2.03 is the mean when a current donor was asking and 1.92 is the mean when a charity organization representative was asking for the donation.

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4.1.2 Credibility bivariate results

Hypothesis one assumes that “Credibility of the recommendation source has a positive effect on the eWOM creation”. The results of the correlation show that there is a significant positive correlation between the recommendation source credibility and charity Ewom in SM (see table 7)

Correlations

RecommSourc

eCredibility Dep_variable

RecommSourceCredibility Pearson Correlation 1,000 ,442**

Sig. (2-tailed) ,000

N 177 177

**. Correlation is significant at the 0.01 level (2-tailed).

Table 7 Correlation for credibility Furthermore, the results of the bivariate regression show that recommendation source credibility significantly accounts for 19.6 % of the variation in charity eWOM in SM (p< .05). The F-value for the recommendation source credibility is 42.57 and beta is .279. In line with these results, hypothesis 1 is supported here.

4.2 Consumer motivations

4.2.1 Consumer motivations descriptive results

The mean scores on the motivations to visit social media tools can be seen from table 8 (N=185). The answers were given on a scale from 1 to 7, one being “totally disagree” and seven being “totally agree”. The most important reason is to stay in contact with friends (mean 5.9). Also, people seem to look for information about different events via social media (mean 4.4). Product-related use is not very high among the respondents, and general social behavior of others seems to have an average impact on the reasons to use.

Consumer motivations for using SM (mean)

To stay in contact with friends 5.9

To find info of events 4.4

Because everybody else is using 4.0

To give info of events 3.8

To find info about products 2.9

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Table 8 Consumer motivations for using SM On a scale from 1 being very unlikely to 7 being very likely, when asked how likely respondents would recommend a charity organization to a friend in social media, the mean willingness was quite low, i.e. 2.9 (N=176).

4.2.2 Consumer motivations bivariate results

The second hypothesis states that “Giving online recommendations about a charity organizations’ mission is more motivated by product- or self-involvement, than message- or other-involvement“. The most important motivation for recommending charity organization to a friend is the importance of the charity mission (product-involvement) (mean 4.5, see table 9). Received personal feel good (self-involvement) and convincing ads (message-involvement) as a motivation are equally important, the paired t-test shows difference in their score, not significant at p= .686. Hedonic enjoyment (other-involvement) as a motivation scores the lowest. These results prove that hypothesis 2 is moderately supported, but it is also vital to notice the importance of the message-involvement in consumer motivations. The mean values for the motivations can be seen in Table 9.

Motivations to recommend charity org. mean (1=very unimportant/7=very important)

Importance of the mission 4.60

Convincing ads 3.29

Personal feel good 3.25

Hedonic enjoyment 2.60

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4.3 Charity’s visibility in SM

4.3.1 Charity’s visibility descriptive results

Based on the results, the three most visible charity organizations in SM environment are Amnesty by 22.7 %, Greenpeace by 21.5 % and Unicef by 19.5 %. In table 10 a list of all the charity organizations can be seen and the percentages of their perceived visibility.

Charity organization Perceived visibility (%)

Amnesty 22.7 Greenpeace 21.5 Unicef 19.5 WWF 17.1 RedCross 12.2 WFP 7.7 STC 7.2

Table 10 Charity organizations perceived visibility in SM

4.3.2 Charity’s visibility bivariate results

Hypothesis three assumes that “Being actively visible in social media creates more positive eWOM for the company, than not being actively visible”. Regression analysis was used to measure how much visibility in the social media environment of a certain charity explains the dependent variable i.e. charity eWOM in SM. Based on the R², visibility accounts for 6.6 % of the variation in social media behavior in charity (see table 11). The F value is 12.6, which is significant at p= .000. It can be concluded that the regression model is significant and that visibility has a significant effect on charity eWOM in SM (beta .67). Based on these results, it can be concluded that hypothesis 3 is supported. Model Unstandardized Coefficients Standardized Coefficients t Sig. B Std. Error Beta 1 (Constant) 1.040 .057 18.324 .000 Visibility .669 .188 .257 3.561 .000

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4.4 Involvement with charity

4.4.1 Involvement with charity descriptive results

From the ad-hoc ways of donating, giving to street collectors, 27.6%, is more popular than giving to door-to-door collectors, 20.4%. 22.1 % of the respondents are donating on a monthly basis, but only 8.3 % are active members of a charity (see table 12).

Charity involvement YES %

Donating money to the street collectors 27.6

Currently donating on monthly basis 22.1

Donating money to door-to-door collectors 20.4

An active member of a charity 8.3

Table 12 Charity involvement The importance of the charity organizations webpage can be seen in table 13, since 51.9 % visit these sites. Also Facebook plays an important role for charities, 23.2 % of the respondents are a member of a charity organizations’ Facebook group. Almost 20 % are using social media to search information about charity organizations and nearly 15 % of the respondents read blogs posted by charity. Despite the growing popularity of Twitter, only 0.6 % is following charity organizations’ Tweets.

Charity SM behavior YES %

Visit charity organizations’ websites 51.9

Member of charity org. Facebook group 23.2

Using SM to search for information about

charity org. 19.9

Reading blogs posted by charity org. 14.9

Following charity org. Twitter posts 0.6

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The importance of factors when donating μ (1=very unimportant/7=very important)

To know what was done with the money 6.23

To see pictures of people/places that got

help 4.94

To be able to express ones opinion to the

char. org. 4.71

To know how much money was donated 4.64

Table 14 What is important for the donors 4.4.2 Involvement with charity bivariate results

Hypothesis 4a says that “The more involved consumers are in charity the more they create eWOM”. Regression analysis showed that charity behavior accounts significantly for 5% of the charity eWOM in SM (p< .05). The F-value is 9.36 and beta is .676. Based on these results hypothesis 4a is supported.

4.5 General social media behavior

4.5.1 General social media behavior descriptive results

From table 15 one can see that the passive use of SM is very high with Youtube (60.5 %) and very low with Brand communities (3.8 %) (N=185). Clearly, Facebook is the most popular social media tool at the moment, as 84.3% are actively using Facebook.

Social media tool Passive use % Active use %

Facebook 23.2 84.3 Twitter 18.4 5.9 Flickr 14.6 2.2 Youtube 60.5 8.1 Blogs 18.9 8.6 MySpace 21.1 1.6 Online Recommendation 7.0 1.1 Brand communities 3.8 1.6

Average number tools used 3 2

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4.5.2 General social media behavior bivariate results

It is assumed here that being more involved in social media makes consumers more likely to create eWOM. Hence, hypothesis 4b “The more involved consumers are in social media the more they create eWOM”, was tested. Social media use was tested against the dependent variable and the results of the regression show no significance (R² = .004, F= .660 and beta=.441) to the social media behavior in charity and eWOM creation. So, hypothesis 4b is not supported here.

4.6 Different tools

4.6.1 Different tools descriptive results

The results show that all tools are found to be quite suitable for charity, except MySpace. Furthermore, when asked via which tools the respondents would like to be part of charity organizations, Facebook is the only one that stands out with a mean score of 4.08. In table 16 these mean values are shown for each tool, and also the significant difference between the various tools is presented.

Social media tool Suitability Would be part of charity org. via Significantly different from 1 Blogs 5.16 2.68 5,6,7,8 2 Facebook 5.07 4.08 5,6,7,8 3 Youtube 4.89 2.38 6,7,8 4 Twitter 4.86 2.61 6,7,8 5 Flickr 4.83 2.60 1,2,6,7,8 6 Brand communities 4.13 2.13 1,2,3,4,5,8 7 Online recommendation 4.10 2.13 1,2,3,4,5,7,8 8 MySpace 3.62 1.94 1,2,3,4,5,6,7,8

Table 16 Suitability of SM tools for charity

4.6.2 Different tools bivariate results

The earlier results about different blogs (§ 4.1.1), support the last hypothesis, “An interactive blog, hosted by the charity organization, is the most suitable tool for eWOM creation”. The highest mean values were given for blog 2 and 3, which are in fact both interactive and hosted by the charity. The results of the paired sample t-test show that blogs do score the highest in suitability (mean 5.16) (see table 14). But the results also show that Facebook is considered very suitable (mean 5.07).

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five is supported. Types of SM tools have also a significant effect on the dependent variable. The R² show that types of SM tools account for 17.9 % of the social media behavior in charity. The F-value is 30.59 and beta is .212.

4.7 Testing the conceptual model

As it has been already mentioned, the conceptual model was tested with a bivariate regression analysis, to see how much each individual variable at a time accounts for the dependent variable. From the overview in table 17, one can see that recommendation source credibility accounts for 19.6% of the charity eWOM in SM. Types of SM tools and consumer motivations account both for almost 18%. Need for interaction accounts for 7.3% of the dependent variable, charity’s visibility accounts for 6.6% and Involvement with charity for 5%. All the mentioned variables are significant. Only SM behavior in general had p > .05.

Bivariate Regression R² F beta Recommendation source credibility .196 42.57 .279* ** Types of SM tools .179 30.59 . 212* ** Consumer motivations .177 38.46 . 276* ** Charity’s visibility .066 12.68 . 669* **

Involvement with charity .050 9.36 .

676* *

SM behavior in general .004 .660 .441

* p< .05 ** p< .01 ***p < .001

Table 17 Bivariate Regression analysis for the conceptual model

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variables is .316, but it should be noticed that the change from 4 to 5 (including SM behavior) is not large, only from .315 to .316. It can be also seen that all the independent variables are significant, except SM behavior. The standardized betas show that recommendation source credibility and consumer motivations are the most important in explaining the dependent variable, and charity’s visibility and involvement with charity are not that important. These results clearly confirm the results of the bivariate regression and support the hypotheses 1, 2, 3 and 4a. In addition, the multivariate, as the bivariate analysis, emphasizes the importance of recommendation source credibility and consumer motivations in eWOM creation.

Multivariate Regression

beta Standardized beta

Recommendation source

credibility .180* .285

Consumer motivations .155* .239

Charity’s visibility .448* .174

Involvement with charity .424* .140

SM behavior in general .300 .042

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5 Conclusions and recommendations

In chapter 1 of the thesis it was said that social media is one of the fastest growing innovations of our time. Companies have also realized the value of social media for their business, and how they can reach their target groups easily, and pay less than before. This is good news for all businesses, but especially for struggling charity organizations, which face fierce competition and lack governmental support. The problem statement “What are the main drivers of electronic word-of-mouth in social media for charity organizations?” has been the guideline of the research, and in this chapter some answers are given.

The research made in the field of social media is still in its early stage, but the common conclusion of the earlier studies is that social media is the future and a relevant tool for creating electronic word-of-mouth.

Next, based on the results of this research, conclusions are drawn based on the tested hypotheses and managerial recommendations are provided.

5.1 Conclusion

The first hypothesis dealt with credibility and how that affects on the eWOM creation in social media. Based on the results, recommendation source credibility is the most important factor for eWOM creation. This result is in line with the research of Cheung et al. (2009), who stated that due to the sheer amount of information available, the source credibility plays a crucial role in order eWOM to work.

Since recommendations are not made easily in SM, it is also very important for the charity organization to know what the motivations to make recommendations are. The second hypothesis assumed that due to the characteristics of different motivations to give recommendations, product- or self-involvement would be most suitable. Good news for charities is that importance of the product-involvement is clearly most valued reason to recommend. This means that charity organizations have the tools to customize each mission in a way that appeals to the consumers and encourages them to create eWOM. Although it should be noticed, after product-involvement, self-involvement and message-involvement are almost equally important motivations. So, the hypothesis 2 is only moderately supported in this research.

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Next, based on the results, hypothesis 4a is supported. General charity behavior seems to have some effect on the consumer’s social media behavior in charity and on the possibility of eWOM creation. Consumers who are involved in charity are slowly finding their ways to it also via Facebook, blogs etc. and are using social media to find more information. Nevertheless, the social media behavior in general has no effect on eWOM creation for charity organizations; hence hypothesis 4b is not supported here.

The last hypothesis assumed that among all the SM tools, blogs would be the most suitable for charity organizations mission. Blogs are popular among consumers. Blogs that are interactive and hosted by charity organization are considered the most trustworthy; hence they can have the largest impact on ones’ opinions. This finding is in line with earlier research made by Thorson & Rodgers (2006) who concluded that interaction is one of the most important factors of blogs and it affects consumers’ opinions. Blogs can be good tools for eWOM creation due to their trustworthiness and perceived suitability for charity. So, hypothesis 5 is supported here. In addition to blog suitability, it should be noticed that Facebook is clearly the most popular among the users and important for communication. Facebook has the most users among the 8 tested SM tools, and people are also willing to participate in charity groups via Facebook more than via any other tool.

5.2 Recommendations

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events, it could also lead to more donations at the events since ad hoc donations are more popular then monthly donations.

In addition to all the new social media tools, charity organizations should not forget the importance of their webpage. It still is an important tool for information search and can also act as the link between the social media sites and the consumer. Furthermore, more than 60 %of the users visit the social media sites daily, so it is very important to be up to date and provide new information to the consumers. No matter where the information is online, it is crucial that it is always correct, so the potential electronic word-of-mouth is based on facts.

5.3 Limitations and further research

Due to the vast and increasing amount of different social media tools, this research could only measure a few of them. The chosen tools are considered to be one of the most popular at the moment. Yet, including for example Wikipedia, as a low interactivity tool (see table 2), and Second Life, representing a high interaction tool, widens the range of SM tools and might have interesting effects on the results.

Age of the respondents could also be a factor limiting the results. Since the average age was 27 years, it might be that these respondents are still studying and would not have a stable income, which can have an effect on the results, e.g. donation behavior and consumer motivations. Solutions for the age issue would be to replicate the research with other participants with older age group. But it is also important to realize that the young SM users now are the future donors, so their behavior is important, too. It might be also interesting to compare the differences in various countries, and see if SM behavior changes there.

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The drivers of electronic word-of-mouth in social media setting; the case of charity organizations