Marketing in virtual platforms and in social media can be defined as ânetwork-enhanced word of mouthâ (Jurvetson 1.5.2000) or as âa piece of content so good that people want to pass ..... companies in Finland by email via local tourist offices.
SOCIAL MEDIA PERCEPTIONS ON FINNISH TOURISM SECTOR Published in Interdisciplinary Studies Journal Vol 1. No 3.2011 Vantaa Regional Unit, Laurea University of Applies Sciences ISSN 1799‐2702
ABSTRACT The Internet has become an important part of our daily lives. Almost 60 % of Finns use the Internet many times a day and over 40 % of them are registered on some social media platform. Over half of the Finns buy from web shops, most frequently flight tickets, accommodation or other tourism services. Therefore it would be natural that tourism companies would use social media, which are both effective and cheap. This paper has studied customers’ and companies’ attitudes towards social media. Two quantitative researches were made online: one involving companies and the other involving customers. The results reveal the existence of several gaps between companies’ and customers’ views about the use of social media. For instance, companies are not aware of their customers’ buying habits in the Internet or their wishes of social media services. Companies do not have proper follow up or measurement systems to know if their social media strategies have been successful or if their customers are satisfied. Companies implement their old marketing strategies in social media and do not let customers show their opinions or create the content. Based on the results from the quantitative analysis, the author discusses the key underlying causes for such gaps and other suggestions on how these gaps could be closed. Keywords: social media, customer encounter, tourism sector Biography of the author Johanna Heinonen. M.Sc. (econ.), MA has worked as a Senior Lecturer in marketing and entrepreneurship in HAAGA‐HELIA University of Applied Sciences since 2009. She has a long experience as a consultant on tourism sector and as an educator in marketing. Heinonen writes her dissertation on customer encounters in social media of tourism sector.
INTRODUCTION One of the most critical elements in producing services is a customer encounter, a situation where the customer and the server meet face to face. This is especially true for small and medium‐sized tourism firms, where the distinctive competitive core would be about services and the firm’s ability to provide them. Furthermore, the challenge is not only to provide qualitative services as such but also to communicate with customers in such a manner, that they feel overwhelmed by good service. However, we live in an era of the Internet and various forms of digital communication where a personal face‐to‐face contact is minimal or does not exist at all. An increased use of the new media among customers makes it essential for tourism companies to know how to use the media and how to create an atmosphere of caring and trust, just as in a face to face contact. It is worth knowing what happens in service situations on‐line and across social media, and the kinds of aspects that should be taken into consideration while determining how successful the encounter has been. Unfortunately, quite often in traditional media companies seem to forget the customer’s point of view. When encountering a customer in a new medium, the social one, the company finds itself in a quite unfamiliar situation, where the old ways do not work anymore. Such are some of the future challenges that companies face, and this paper aims to give several ideas about how and where company’s activities can go wrong and discusses some strategies companies could adopt in order to improve the situation. Research problem and objective This paper aims at mapping out the situation and at rising company´s awareness about the potential of using social media in their marketing efforts (or strategies). Furthermore, the results of this study will serve as a base to suggest how companies could act to close some of the common gaps found in the use of social media. To achieve the above objectives, the study aims at finding answers to the following research questions: How do tourism companies in Finland perceive social media as their communication channels? How are social media channels used in terms of customers’ understanding the role of social media and in terms of how customers would like companies to use social media? What are the critical points when communicating in social media from both customers’ and companies’ perspectives? How customers’ views and customer service are taken into consideration when developing communication strategies that involve social media? Which strategies could be used to enhance a better use of social media in tourism sector in Finland?
By finding answers to these research questions the intention is to help SME’s especially in tourism sector in Finland, to improve their communication strategies to reach their potential customers.
LITERATURE REVIEW Definition of social media Social media is a term describing web services that receive most of their content from users. Blogs, wikis and online journals offer unique ways to capture, share and store accumulated knowledge about the employees of a company. A social media website interacts with its users while sending them requested information and invites people to interact with the site and other visitors. (Kaplan – Haenlein 2010, 60; OECD 2007.) These definitions fall under the general term of an online community, which, according to Hanson (2000, 295), focuses on online social gatherings where the communication is multidirectional and repeated. Marketing in virtual platforms and in social media can be defined as “network‐enhanced word of mouth” (Jurvetson 1.5.2000) or as “a piece of content so good that people want to pass it on” (Bonello 2006, 38). Customers’ opinions are highly affected by communal experiences given by their network in social media. Communal experiences are becoming even more important than personal ones. (Jacobs 2010, 1.)
Figure 1.
The conversation prism in Web2.0 (Solis 2009)
Presented in Figure 1 is one model of the divisions in social media and it shows why people use social media. As it can be seen the uses are various and refer to sight, hearing, verbal and non‐ verbal communication, feelings, views and opinions. (Solis 2009; Kaplan – Haenlein 2010, 61). Social media are basically about social interaction and dialogue by different tools and different channels in the Internet and that each time, when a customer is in contact with the company, is a moment of truth in terms of image building, marketing and customer service (Dutta 2010, 2; Black 2010, 206). This means companies can’t concentrate on one channel strategy anymore. (Evans 2008,3). The existence of social media and their influence on peoples’ lives is accepted. People wish to use the Internet and get involved in services offered through the online network. Therefore actively working social media are the answer to people’s needs. The question arises however about how this fulfillment of needs is done and how it should be done to function as a tool helping human beings’ development and not destroying societies. (Fletcher, Bell & McNaughton 2004, 133.) Every age group, society, and the business world at large use social media. Especially universities and companies are beginning to embrace social media. They are realizing their full potential and implications for using them as a component of their overall marketing mix. Social media are also used as a source of information between the company and its clients and encourage clients to share information among themselves. (Solis 2008; Kaplan – Haenlein 2010, 59.) Even though social media give an individual an opportunity to be faceless and impersonal, they also give many ways to emphasize one’s individuality and many users wish to be respected and recognized, which leads to the personalization of orders, mails, etc. By anonymity the media however encourage people to express themselves more freely without paying attention to the quality of the expression. (Hanson 2000, 292; Kaplan – Haenlein 2010, 61‐62.) Social media offer activities that involve socializing and networking online through words, pictures and videos. Social media redefine how we relate to each other as humans and how we as humans relate to the organizations that serve us. Media are about dialogue, two‐way discussions, bringing people together to discover and share information (Solis 2008; Kaplan – Haenlein 2010, 61‐62). The possibilities online and in social media are borderless. They can help find new friends, keep up with the existing ones and even rebuild the old, lost connections. They develop new ways for information sharing and studying and they can offer experiences and relaxation. (Hanson 2000, 292; Kaplan – Haenlein 2010, 61‐62.) In a virtual world people are equal because of the non‐existing personal contact and the symbols tightly connected to the face‐to‐face encounters, such as age, gender, title, feelings, mimes etc. The disadvantage with this is that the lack of hierarchy and feelings can easily cause misunderstandings and confusion. It is also easy to be impolite and react in ways that would not be possible in the real world. (Hanson 2000, 107‐ 108.) This impersonality can also cause trouble, because it is easy to steal one’s identity and affect one’s private life. Therefore, it is important to notice that caution is advisable also in social media. (OECD 2007, 95.)
There are many ways of being successful in social media. Still, there are some common elements for a company to notify when planning their social media strategy. The most important is to remember that the whole idea of social media concentrates on discussion and openness. This means that the customers should be allowed to express their feelings in companies’ social media platforms and companies shouldn’t be afraid of negative feedback. That only gives an opportunity to show how much a company cares for its customers. (Kaplan – Haenlein 2010, 65 ‐67; Mangold – Faulds 2009.) Another important thing is to let go of the old traditions; to be relaxed, humble and honest. This pressures companies to be creative and find new ways of engaging customers and find activities for them. Being in social media is a constant work, which means that the company must be active and bring up new topics for discussion. (Kaplan – Haenlein 2010, 65 ‐67; Mangold – Faulds 2009.) Because social media ideology is very different from the traditional promotional mix, a company must follow up its and customers’ actions continuously and systematically. Measurement is one of the keywords if a company wants to be successful in social media. (Evans 2008,4.) Keywords are also keeping up conversation, giving information, being interesting and relaxed, engaging customers, reliability, openness, frequent updating and gathering feedback. (Kaplan – Haenlein 2010, 65; Mangold – Faulds 2009, 357‐359; Evans 2008,3‐5.) By planning social media actions carefully and by measuring the success, companies can gain good results, reach many potential customers and create widely known image with quite small financial effort. However, because of it active and lively nature social media require time from the company and its employees. (Evans 2008,3‐5.) Customer encounter and service quality Service is a process that is longer than a momentarily encounter (Grönroos 2001, 229; Zeithaml – Bitner 2000, 3). Therefore a service can be defined as an extended service offering, which includes accessibility of service, communication (the encounter) with service organization and customer’s participation in a service process (Grönroos 2001, 299; Storbacka et al. 1999, 16). Therefore service quality can be defined in many various ways. Quality depends on how customer’s experiences are equivalent to customer’s expectations. Therefore a customer is always the one who decides whether the service is good or bad and this judgment can vary from a customer to another. (Grönroos 1998; Zeithaml – Bitner 2000; Parasuraman et al. 1985.) Service quality can be defined as with five variables: tangibles, reliability, responsiveness, assurance and empathy (Zeithaml – Bitner 2000, 82 – 85; Parasuraman et al. 1988; Berry et al. 1993). Service quality is always a combination of the expected service and the experienced service. External marketing and marketing communication are the main elements that affect the expected quality. Also corporate image, mouth‐to‐mouth communication and customer’s personal needs have distinct meanings in expectations. The experienced quality is emphasized by corporate image, the service or product itself and the way it was delivered to a customer (the encounter and face to face communication). It can be concluded that the main issue in producing qualitative services is to fulfill customer’s expectations or even exceed them. (Grönroos 1998, 65‐66, 311.)
The creation of service quality with its different aspects can be described as Grönroos (1998) has done in Figure 2. Five dimensions can be outlined while studying how customers perceive service quality. The first of these dimensions is reliability, i.e. company’s capability to perform the service it promises to its customers. Another one is responsiveness, which means the company will give customers the help they need in order to provide the demanded service. The third one is assurance, which is an outcome of employees’ professionalism, knowledge and polite behavior as well as the way they create trust and confidence. The fourth one is empathy including caring and personal and tailor‐made attention to each separate customer. The last, the fifth one is tangibles by which the place where service is produced, the equipment that is used, personnel and written materials are meant. (Zeithaml – Bitner 2000, 82).
Figure 2.
How good service and communication are created in a service organization (Grönroos 1998, 483.)
Services are thus unique situations in which a customer and a server actively participate (Lehtonen et al. 2002, 48; Zeithaml – Bitner 2000). Both employee’s and customer’s expectations and behaviour have their effect on the moment of truth and thus in the success of a service encounter (Parasuraman et al 1985; Gummesson 2002, 67). A bad communication and encounter with the organization can spoil a good service product altogether. (Grönroos 2001, 299). Customer encounter can be considered as the core competence of a service business (eg. Day 1990; Möller & Anttila 1987; Carson et al 1995; Johannisson 1996). Customer encounter is thus crucial for a firm and service quality, it gives an impression of a company and its way of handling things. Every employee participates in customer encounter by his or her own behaviour and in this way strengthens or weakens the corporate image and customer relationship. (Poikolainen 1994; Pesonen et al. 2002, 7.) This behavior is targeted as well to internal customers (colleagues,
contractors, stakeholders etc.) as to external customers (Grönroos 2001). Therefore it is important that everyone in the firm understands the customer expectations that have been created by corporate image, external marketing or previous service experiences (Jokinen et al. 2000, 228‐229; Lundberg et al. 2000). Furthermore a qualitative service experience demands professional servant (Lämsä – Uusitalo 2002, 119). Social media, customer service and tourism There are almost 6 million foreign visitors to Finland annually and their origin lies all over the world (MEK 2010). When tourists are seeking for information about destinations, they rely on personal experiences, the Internet and discussions with their relatives, friends etc. These discussions can happen face to face but also via different platforms and social media channels in the Internet (MEK 11.8.2010; Steinbauer – Werthner 2007, 65ff). Thus, one could say that social media is a new opportunity to tourism. A big amount of companies – actors – in tourism business are small and medium‐sized without so much money to spend, while the potential customers – tourists – lie all around the globe. There is a distinctive need for cheap and effective way to reach customers and engage them. There is a clear tendency in tourism industry, which changes the marketing platform from traditional media towards the Internet and social media. Virtual platforms like TripAdvisor and LonelyPlanet have gathered thousands of followers and they have changed towards social media platforms, where people can discuss and change views of destinations and other travel purposes. (Gretzel & Yoo 2008; Vermeulen & Seegers 2008; Xiang & Gretzel 2010.) Tourism is considered to be a knowledge intensive business where marketing depends on the images companies create and on the tools that are used to deliver these images. This means that marketers in tourism industry should understand the challenges and possibilities given by this new technology and take it into consideration while planning actions. (Xiang – Gretzel 2010, 179 & 186 – 187.) Service encounters can be divided into three different types: remote encounters, phone encounters, and face‐to‐face encounters (Zeithaml and Bitner 2003, 102‐104). While talking about social media, the remote encounters, i.e. the encounters without little if any human contact, are the ones that appear most frequently. In remote encounters a special emphasis should be put on the technical quality of the service (Zeithaml and Bitner 2003, 102‐104), because it is the only visible thing for the customer. In social media a special feature is the creation of trust, which is no longer created and ruled by companies, but by the users and their recommendations and inputs. This means that contents in social media is user generated and negative feedback cannot be hidden anymore; something that can be challenging as well as rewarding for companies. Furthermore, social media encourage customers to become more engaged with a company and its products and by this way strengthen its brand. (Harris – Rae 2009, 24‐26.)
By putting the user – the customer – into the center of action, social media change the view of traditional view of marketing and customer service. Instead of giving information, companies should divide opinions and encourage their followers to take action and give feedback, which can be used then in developing brands and products as well as correcting the possible mistakes made by the company. Customer’s role in customer service becomes dominant and active. (Harris – Rae 2009.) Summary of the literature review Based on the theory presented earlier, one could apply social media dimension to the Grönroos’ model of Moment of Truth (Figure 3).
Figure 3.
Modified model of The Moment of Truth
Because of the special nature of social media, moment of truth does not require the presence of the employee or manager anymore. Still, personnel and management have an important role, while they are responsible for that the contents on social media platforms contribute in achieving the company’s goals. They are also responsible for following up the social media actions and the overall success of social media strategy. This means that they have to understand the social media as a tool and have a wide network on different social media platforms.
Customers are active in the moment of truth and they rely more on the communal experiences than the individual ones. Their expectations are created by the traditional media as well as the word of mouth in social media environment. In order to guarantee a successful service in social media, a company must pay attention to the functionality of the platform, the contents there, reliability, interactivity, openness. It is also important to have a working follow up system, clear measurements and gather actively feedback from the users.
RESEARCH APPROACH AND METHOD The initial idea of this research was to identify how tourism companies could use social media successfully, so that the customer satisfaction would become attainable. This research offers a practical view of the differences that customers and companies have in tourism sector. The study uses quantitative methods to create a general view of the tourism industry and how social media are used in tourism. Two different target groups were studied: tourism companies and their customers. In order to reach both target groups an online survey was chosen, as it distributed the questionnaire to a large sample effectively and economically. The questionnaire was based on the theoretical background of studies in social media, tourism and customer satisfaction. It was divided into four sections (the questionnaire for companies) and into 3 sections (the questionnaire for customers). The four sections in the company questionnaire were Background questions, Use of social media in the company, Follow‐up of the social media and Measurement of social media. In the customer questionnaire the sections were Background questions, Use of social media, and Companies’ opinions of social media actions. The question types used in the questionnaires varied from selection and multiple choice questions to Likert scale from 1 to 5 in order to achieve a view as wide as possible. Also open‐ended questions were used when necessary to give depth to the answers. No information about the respondents, their whereabouts etc. was gathered which ensured that the respondents remained anonymous. The online questionnaire was coded. The data were gathered in a numeric and verbal form as a file in CSV‐format. This file was transferred to the statistics program SPSS and then analyzed. The research was carried out during February 2011. The questionnaire was distributed to tourism companies in Finland by email via local tourist offices. It was distributed to private persons via different channels in Social Media (Facebook, Twitter, LinkedIn, tourism related discussion forums and groups etc.). The total number of company respondents was 595, which is 2,5 % of all the Finnish tourism companies. Most of the respondents (76 %) used social media in some form and almost half of those who did not had thought it as a possibility. The number of private respondents, i.e. customers’ representatives, was 406. All the companies divided among all different business fields and all the regions in Finland. Among private
respondents there were 62 % males, all age groups between 20 – 70 years were represented and the division into different areas in Finland was quite equivalent to companies’ division. The reliability of this research is based on several grounds. One is the anonymity of the responses; the respondents could answer freely about their practices and hopes. The amount of respondents was critical: in both groups the aim was to gather at least 300 responses to ensure the statistical reliability. One of the goals was to get responses from companies of different regions, business fields and different sizes. Customers’ profiles showed both genders, different regions and different age groups. The questions were tested beforehand, so that there weren’t any ambiguities or mistakes. The online‐questionnaire and its functioning were also tested beforehand.
DISCUSSION OF RESULTS In the following chapter the results of the quantitative research are explained. Questions on were formulated based on the modified model of Grönroos’ Moment of Truth. Thus there are question about the channels used, the purpose to which they are used, how important certain issues are experiences in social media and a few question about updating and follow up systems. Most frequently used social media
Figure 1.
Use of different social media channels
When comparing the answers from companies and private persons some interesting differences were found. As for the channels of communication, companies prefer homepages and Facebook, while other channels are used less. Customers use mostly Facebook and homepages as well, but
their selection of media is much wider; for instance text messages, YouTube, Webshops and Wikis are used by 40 % or more of respondents while the similar figure among companies lies around 30 % or less (Figure 4). Purpose of social media One issue where some interesting points could be found was the purpose of social media use among companies and customers. One fourth of companies considered giving information as the most important purpose in their social media strategies. Also giving information of offers and answering questions was considered valuable. Customers think mostly the same way as companies, but they also value blogs and shopping opportunities besides the plain information (Figure 5).
Figure 2.
Purpose of social media use
Important issues in social media When asked, which issues were considered most important, the customer service, reaction speed and reliability were in the top three of both groups (Table 1). However, companies valued more the image, atmosphere and other things attached to brand creation in the company. Customers instead experienced clearness, interesting contents, feedback possibilities and sharing company’s
personal view more important than companies themselves. Specific differences could be found in such topics as Atmosphere, Closeness and Storytelling, which companies valued more than customers. On the other hand, customers considered feedback, clearness of social media site and sharing management’s views more important than companies.
Table 1. Importance in social media
This small difference can also be the reason why companies feel that they have got good results in social media in such areas as sharing information, creating image and reacting fast, while they are dissatisfied with their results in gathering feedback and using it, increasing understanding of customers, strengthening customer loyalty and creating discussion. Creation of the contents in social media Another interesting difference comes up when the respondents were asked who should create the contents of social media (Figure 6). Largely the results are quite similar, but while 16 % of customers see that anyone should be capable of creating contents the corresponding figure for the companies is 4 %. Also the share of customer impact is considered bigger among customers than companies.
Figure 3.
Creator of the contents in social media
Over 64 % of the customers think that companies’ social media sites should be updated at least couple of times in a week and 50 % of the companies announce doing that. However, almost 10 % of the companies tell that they update their information more seldom than once a month. (Figure 7)
Figure 4.
Updating contents in social media
These results are also supported by the question where people were asked, if they consider companies’ social media sites to be planned and organized, when 78 % of those companies claim this to be the situation, to which only 46,5 % of customers agrees. Awareness of customer behavior Companies were quite unaware of their customers’ behavior in the Internet; almost half of the respondents did not know, how often their followers visited their social media sites (Figure 7). In the research 47 % of the companies were not measuring their social media impacts and 65 % of respondents did not know what their customers thought of their social media strategy.
Figure 5.
Companies’ knowledge of customers’ frequency to visit social media sites
CONCLUSIONS AND RECOMMENDATIONS The research can be considered quite reliable. There were many respondents: 595 companies and 406 private persons. Companies were divided to all regions in Finland, to all business fields in tourism industry and they were of all sizes. Private persons were of both genders, all age groups
and respondents came from all regions in Finland. There were few complaints about problems in the network connections, but even these were solved. No one considered the questionnaire to be too long or hard to understand. Therefore one can say, that respondents are representatives for the population and their answers can be considered reliable. Based on the results we can consider that there are significant gaps between management perceptions and the actual situation. Most of this is due to the fact that companies do not have a working follow up system or a proper measurement system for their social media actions. Only half of the companies use some sort of measurement to follow the social media. About 40 % of the companies follow up social media at least once a week, 20 % once a month and almost 40 % more seldom. This means that even updating social media platforms happens more seldom than customers would have hoped. In social media, which is an active media requiring fast reaction, even once a week is too seldom. It can also be asked what the good results in reaction speed would be according to the companies considered good among customers. Naturally, the reaction speed is faster than by using a traditional way. Companies are also quite unaware of how often their customers follow their pages. Almost 50 % of the company respondents do not know how often their followers visit their sites and 65 % of respondents do not know what their customers think about their sites. These results show clearly that companies do not have enough knowledge of their customers and their wishes in order to produce social media services customers expect. This research concentrates on the company – customer relationships and does not provide enough information for handling internal problems in a company. By starting a social media campaign or a site, due to the nature of social media, a company gives a clear sign to its stakeholders that it is interested in its customers and customers’ opinions and it wants to share daily actions in the company with them. If the social media reality is then old‐ fashioned, administrated and controlled by the company without any possibility to user impact, the external communication given to the customers becomes false and misleading. According to the results of the research one can consider that tourism companies are really interested in social media as their marketing tool and that the media are considered as a good addition to the traditional marketing tools. Still, it is difficult for companies to realize the differences between traditional marketing channels and social media. Social media are seen as a channel to distribute information and strengthen corporate image; the way companies use traditional media for advertising. Customers also feel that social media give new possibilities to companies and are worth using. However, customers would like to take a more active and uncontrolled role, which is characteristic of the social media. This would enhance the customer loyalty, increase the discussion and enable an easy and reliable way for customer feedback, which could be used for developing the company and its products. Companies could also reconsider their media mix in social media. At the moment the traditional forms like home pages and text messages are used with Facebook, but the variety of channels
customers use is much wider. This can also cause misunderstanding and dissatisfaction among customers. The expectations differ from the reality, the experiences from the social media. Social media seem to be an easier and cheaper way to get publicity for a company than the traditional media, like newspapers, television, radio etc. However, they require engagement and time from the company and the company must have a plan as much as in other media. The biggest difference and the greatest challenge in social media is the customer impact. By giving customers free hands and letting them make their voice heard, a company can gain much in forms of publicity, customer loyalty, brand creation and finally, profits. The results of this research were clear. Companies are interested in social media, but they have not yet realized their challenges and the new way of working. The most important issues and ways to improve service in social media would be the increase of user impact and a more efficient and planned follow up. The first one would help to enhance the encounters with customers in the moment of truth in social media and the latter one would help in improving the media, its use and product development.
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