Impact of Social Media on Strengthening Brand Loyalty in the Austrian Wine Industry


Bachelor Thesis, 2018
27 Pages, Grade: 1,00

Excerpt

Table of Contents

1 Introduction

2 Research Question

3 Methodology

4 Literature Review & Analysis
4.1 Social Media and its Growing Impact
4.1.1 Brands on Social Media
4.1.2 Social Media in Austria
4.2 Social Media Engagement
4.2.1 Effects of Social Media Engagement
4.2.2 Social Media Community: Engagement & Trust
4.3 Social Media Impact on Brand Loyalty
4.4 Social Media Utilization in the Wine Industry
4.5 Content Strategies of Wineries on Social Media

5 Conclusion & Further Research

6 Table of Content BA II

7 Timetable / Project Plan BA II

8 Bibliography

ANNEX

1 Introduction

In past couple of years, social media has shaped the way of communication between brands and consumers and has opened the door for more interactive, personalized and engaging marketing strategies to increase not only brand awareness but also to build stronger customer-brand relationships that lead to brand loyalty (Yoshida, Gordon, Nakazawa, Shibuya, & Fujiwara, 2018, p. 208; Muntinga, Moorman, & Smit, 2011, p. 34-36).

There is a lot of literature on engagement in brand-related online content and social media. Yoshida et al. (2018, p.216) define brand-related social media engagement as a voluntary contribution of an individual to the interaction between her/his favourite brand and other fellow brand users by sharing information, activating and co-creating content related to the specific brand. A customer’s voluntary contribution that is brand and/or product related is known as consumer engagement (Verhoef, Reinartz, & Krafft, 2010, p. 247)

Wine is often consumed within a social gathering. The product can be easily approached by engaging intuitive senses like the sense of taste and sense of smell. Therefore, it is a product to effortlessly strike up a conversation, get emotionally involved with, and exchange impressions within a social group. Consumers are very likely to have an opinion about the wine they tasted and are often enthusiastic to share it. This makes a wine-related brand seem predestined to gain from social media and might create new beneficial opportunities in the wine industry (Szolnoki et al., 2014b, p. 81). Social media enables brands to communicate on more layers and give the customer insights into the business’ history, philosophy and values in combination with descriptive information about the product/brand itself (Dolan & Goodman, 2017, p. 24). Interactive environments on social networking sites enable a two-way communication between consumers and brands which has a positive impact on the brand relationship, trust and also brand loyalty (Enginkaya & Yilmaz, 2014, p. 220).

Introduction

The paper is structured the following way. The first section (the research question) gives more detail on the topic and identified research gaps in the literature. The methodology summarizes the specific ways research has been concluded for this paper. The focal point lies on the literature review and analysis of several case studies and findings. It summarizes and combines two main research topics, brand loyalty on social media and social media utilization in the (Austrian) wine industry. This literature review contributes to further research about specific impacts of social media on the wine industry. In this case with a focus on Austrian wine producers. Furthermore, this BA1 includes a table of content and a rough project plan for the proposed BA II.

2 Research Question

Research Question: Does the utilization of social media by Austrian wine producers has an impact on strengthening the consumer-brand loyalty?

The aim of this research paper is to determine the influence social media has on strengthening brand loyalty and if this also applies to the Austrian wine industry. There has been a lot of research done on social media in general, specific social media networking sites and marketing strategies that show an impact on a customer’s loyalty to brands they interact and engage with on social media (on a regular basis). This paper analyses different strategies on social media that have shown to deepen brand loyalty as well as examines what brand loyalty actually is, what impact brand loyalty has on a customer’s purchasing behaviour and how it might benefit a brand/business to reach a new set of potential customers.

Social media has been used as a marketing tool in almost any industry including businesses and organisations revolving around the product wine. Although there is a lot of research published regarding the topics mentioned above, many papers focus on different industries or specific data of certain countries and regions. Little to no research focuses on Austrian businesses. A research gap can also be found within the Austrian wine industry. No literature examines the influence of social media utilized by wineries or wine regions in Austria.

Research conducted about other worldwide (wine) businesses or regions lay the groundwork for this paper. Case studies and findings about how social media influences brand loyalty in Australia, the USA, France, Italy or Germany sets a basis to develop hypothesis that might also apply for Austria. Especially data from Germany could give insights into how the utilization of social media in the Austrian wine industry influences brand loyalty, as these two countries share many cultural qualities and characteristics. Still, Austria is a different country and it is necessary to conduct research to draw final conclusions. Furthermore, it is essential to determine if social media strategies applied by other countries are relevant for the Austrian wine industry, if they need to be adapted and to clarify (if needed) the required adaption in detail.

3 Methodology

The research for this paper was conducted over a time period of 4 months and comprises a literature review. The main focus was set to find research papers that elaborate the influence of social media on brand loyalty in the wine industry. Keywords such as social media, brand loyalty, wine, social media engagement, social media communication, digital communication, wine industry, brand identity, social media community, consumer engagement, Austria, Austrian wine and various combinations of these keywords were used for the search in online databases. These databases include Science Direct, Emerald and Business Source Complete and were accessed from the IMC Krems Libary. All these databases set the focus on business-related research and therefore cover the main topic of this paper - marketing and more in-depth social media.

In addition to searching for keywords, the time frame for the search included only papers that were published in the last 2 years (2016-2018). This is important to mention because social media, its networking platforms and features are evolving and changing in a fast pace and research that has been conducted 5 years ago might already be outdated and not relevant anymore.

The search of the above-mentioned keywords was also conducted in specific journals to find even more relevant and valuable literature. Among those journals were the Journal of Interactive Marketing, the International Journal of Wine Marketing, the International Journal of Wine Research and the Journal of Business Research.

References within certain papers were other starting points to the research that has been gone into writing this paper. Most definitions and more general background came from papers which were referenced by recently published ones. The databases or Google Scholar provided the access to these referenced research papers or books.

A brief review of the most relevant literature can be found in the annex ( Table 1: Brief Literature Review).

4 Literature Review & Analysis

A relevant literature review and analysis is fundamental to approach an academic project. It is the foundation for future research projects to build upon developed theories and findings. Furthermore, an effective analysis of scientific literature uncovers areas where there is a lack of previous research (Webster & Watson, 2002, p. xiii). This literature examines the growing impact of social media, how wine brands utilize social networking platforms (worldwide and in Austria) and which effects social media might have on brand loyalty. Elements such as brand trust and engagement on social media are in close relation to brand loyalty and therefore are also considered and investigated for this literature review.

4.1 Social Media and its Growing Impact

Social media has changed the way businesses operate, organizational communication and public relations. Organizations utilize the easy accessibility and the possibility to reach and interact with a large crowd and helps to understand the needs of consumers (Brogan, 2010; Tajudeen, Jaafar, & Ainin, 2018, p. 308). Social Media might be best described as a group of Internet-based applications such as mobile apps or online communities. It enables users to create, share and engage with content (Kaplan & Haenlein, 2010, p. 62). These platforms enable direct consumer-brand interactions (Osei-Frimpong & McLean, 2018, p. 12). Its rapid growth has been pushed by the availability of mobile portable devices and the introduction of 3G internet surfing speed. (Alarcón, Sepúlveda, Valenzuela- Fernández, & Gil-Lafuente, 2018, p. 104) The most popular forms of social media are blogs and microblogs, Social/Business Networks like Facebook or LinkedIn or Media-Sharing Sites such as Instagram or YouTube (Alarcón et al., 2018, p. 104; Saravanakumar & SuganthaLakshmi, 2012, p. 4444).

Findings of Alarcón et al. (2018, p. 107) show that social media has the capability to influence a consumer’s purchasing behaviour. To enable the beneficial interactive communication between consumers and organizations and consumers, businesses started to integrate social networking features into their websites. These features

Literature Review & Analysis also reinforced the site’s credibility to visitors. Also because of its ability to reach a mass audience at minimal cost and time, organizations and businesses expand to social media platforms and add or partially replace their traditional marketing strategies with communicating and engaging with customers online (Tajudeen et al., 2018, p. 315). The low-cost aspect, the power of customization and uncomplicated handling of these platforms increase the relevancy for not only large firms but also for small and medium-sized companies and sole proprietors (Enginkaya & Yilmaz, 2014, p. 220; Tajudeen et al., 2018, p. 314)

4.1.1 Brands on Social Media

The development of social media platforms such as Facebook, Instagram or YouTube brought a new form of brand-consumer interaction with it. Brands are able to create their own channel/profile which then can be followed by other users of the individual platform (Breitsohl, Kunz, & Dowell, 2015, p. 1042). Social media profiles personify a brand. This brand profile interacts with other profiles in the same way as friends or other human participants would. They use the same level and pattern of communication and therefore consumers can relate and react to the brand as if they were talking to a person (Barcelos, Dantas, & Sénécal, 2018, p. 67). It is important to create a sense of community and a connection between the consumer and the brand (Enginkaya & Yilmaz, 2014; p. 220). This online environment serves firms in the same way as other marketing approaches. Businesses use it to maintain and establish profitable and lasting customer relationships. Brand-hosted media profiles make it possible to provide product information, special offers, customer service and share a brand’s philosophy and culture in various ways (Breitsohl et al., 2015, p. 1047). Still, different platforms require different approaches to achieve a strengthened customer loyalty (Coelho, Rita, & Santos, 2018, p. 104).

The findings of Nisar & Whitehead (2016, p. 747) list the most popular reasons why individuals follow brand pages on social networking sites. Among them are: obtaining general information about new products, read reviews and product rankings and follow the latest events and happenings related to the specific brand. Social media provides a two-way communication between a brand and the public (Simon & Tossan, 2018, p.181; Tajudeen et al., 2018, p. 314). This makes it easier

Literature Review & Analysis to innovate and adapt strategies to improve the relationship with current followers and enhance the attractiveness of the brand’s profile to potential new consumers (Tajudeen et al., 2018, p.314). It is not only a two-way communication between a customer and the brand but also a conversation between two or more customers about the brand. This allows users to better understand the brand’s public relations and communication practices (Simon et al., 2018, p. 181).

4.1.2 Social Media in Austria

Social media is defined as either a social network, multimedia content sharing websites, blog or microblog. Only very little is known about the implementation of social media Austrian households and businesses. In 2013, 39% of the enterprises registered in Austria used some sort of social media. Four years later, in 2017, it was already 53% (Statistics Austria, 2017). Therefore, this explicit percentage increase in Austria reflects international statistics and support numerous findings, that the use of social media is becoming increasingly important.

Among the various social media platform, Facebook appears to be the most popular one in Austria but also in Germany and Switzerland (Martin, 2017, p. 265). The results of a cross-cultural study by (Makri & Schlegelmilch, 2017) also found out that Austrian are more likely to engage on social networking sites in comparison to Chinese or citizens of Uruguay.

The statistics of the year 2017 present the following data: The presence on social media increases with the size of an enterprise. Only 51% of small enterprises, 61% of medium-sized and already 75% of large enterprises utilize social media in some way (Statistics Austria, 2017). According to Szolnoki et al. (2014a, p. 5) about 44% of the wineries use social media to communicate with customers. Facebook is seen as the most important platform followed by Youtube, Twitter and Google Plus. Social media is already an important marketing tool in Austria and the majority of businesses plan to extend their online activity.

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Details

Title
Impact of Social Media on Strengthening Brand Loyalty in the Austrian Wine Industry
College
University of applied sciences
Course
International Wine Business
Grade
1,00
Author
Year
2018
Pages
27
Catalog Number
V433231
ISBN (eBook)
9783668772076
ISBN (Book)
9783668772083
File size
468 KB
Language
English
Tags
impact, social, media, strengthening, brand, loyalty, austrian, wine, industry
Quote paper
Melanie Hahn (Author), 2018, Impact of Social Media on Strengthening Brand Loyalty in the Austrian Wine Industry, Munich, GRIN Verlag, https://www.grin.com/document/433231

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