Impact of Digital Communication on Marketing

Chapter 1: Introduction

Background Information

1.1.1 Background of the Study

Traditionally, companies addressed their customers using marketing communication tools such as public relations and television ads. A major limitation of such tools is the passive way in which customers received information on products and brands (Qiutong and Rahman 2019). The recent years have seen a steady growth in the share of two-way communication resulting in revolutionary change in the role of customers from passive to active. This change was influenced by the evolution of the World Wide Web, which brought about a new phase in marketing which in turn created an opportunity for customers and business organisations to develop and maintain social relationships (Park et al. 2016). The period after 2003 to 2004 witnessed new eras that are more of extensions of the World Wide Web such as Web 2.0, 3.0, and 4.0: these extensions allow data to be shared and reused across enterprises, applications and community boundaries. The second World Wide Web generation, Web 2.0, has been regarded a more personalised and communicative form of the World Wide Web that emphasised on connectivity, participation, knowledge sharing, collaboration, and sharing of ideas among users and therefore, Web 2.0 technologies helped companies to manage their relationship with customers through the help of external customer blogs, external social networks, wikis, and the RSS filters (Ahmad et al. 2015). It is also in the Web 2.0 era that companies faced new tools of communication, commonly known as social media, which was used alongside traditional websites (Schivinski and Dabrowski 2016).

Since its discovery, social media has changed the way people interact with each other and with companies (Qiutong and Rahman 2019). Social media has helped companies across all industries to online engage with potential customers and to increase their online presences; for example, business organisations are increasingly using social media in their communication and in promoting their business (Marques and Moschatou 2017). Organisations have recognised they need to stay attractive for customers, to build relationships with customers, and to make customers loyal to the organisation and social media has stood out as the vehicle that fosters such relationships (Ngai et al. 2015). Since the era of Web 2.0, there has been increased usage of private computers, the internet, smartphones, e-commerce, and social media technologies, which has drastically changes the strategies and methods of corporate marketing (Park et al. 2016). Today, vast numbers of consumers are social media users and in this reality, it is imperative that marketers influence purchase intentions and customer preferences using the social media networks (Qiutong and Rahman 2019). Through the social media networks, organisations are able to directly communicate with their customers while the customers are able to communicate with other customers on the social media platforms (Schivinski and Dabrowski 2016).

Social media refers to an online place where people who share interest gather to share their opinions, thoughts and comments (Ngai et al. 2015). On the other hand, Park et al. (2016) write that social media are the tools that people and companies use for communication and in particular, the collaborative, participatory, user-empowering, and knowledge sharing tools available on the web. Some of the social media tools that are commonly used are organisation sponsored websites, search engines (such as Google), social networking sites (such as Instagram, Twitter, Facebook, Pinterest, and Myspace among others), content communities (such as Piczo.com), creativity work sharing sites (such as Youtube, Vimeo, and Vine), business networking sites (such as LinkedIn), virtual worlds (such as Second Life), blogs and microblogging sites, social bookmarking, and online gaming sites among other new sites (Qiutong and Rahman 2019). Of these, this study focuses on only one type of social media: social networks.

Social media has affected many aspects of consumer behaviour in the 21st Century including acquiring and sharing information, awareness, purchase, opinions, attitudes, and post-purchase behaviour. In the advent of social media, organisations are able to communicate with their customers and get feedback from them while customers are able to communicate with other customers and share the information about the products and services offered by various business organisations (Ahmad et al. 2015). In the current competitive business world, social media offers an unconventional and effective method for organisations in different industries to engage and communicate with consumers, which is a basis for building strong customer relationships (Schivinski and Dabrowski 2016). One such industry is the fashion industry: ever since the arrival of the internet, the fashion industry has been among the fastest growing industries using social media to communicate with their customers (Park et al. 2016). In the recent past, different social media tools have been actively used by consumers to search, compare, discuss, and purchase clothes (Qiutong and Rahman 2019) thus creating a revolutionising effect on the fashion industry. As a result, most fashion firms have quickly adjusted to the social media revolution for gaining feedback, monitoring trends, engaging, promoting, and making the sale purposes (Marques and Moschatou 2017).

Social media marketing refers to the use of social media together with other communication channels with an aim of achieving organisational goals through creating value for stakeholders who include customers, employees, suppliers, and the government agents (Ngai et al. 2015). In the past few decades, social media marketing has been proved effective in attracting consumers’ attentions, enhancing interaction, improving sales performance, enhancing customer relationship performance, building brand performance, and enhancing operational performance (Qiutong and Rahman 2019). Notwithstanding the widespread use of social media marketing among companies, there is still a lot that remains unknown about the effected of social media marketing on customer loyalty especially in the fashion industry (Park et al. 2016). In this background, the aim of this study is to explore the effect of social media marketing on customer loyalty in the fashion industry.

Social media marketing in the fashion industry

The fashion industry remains innovative and willing to meet the challenges of new technologies. According to Qiutong and Rahman (2019), the use of social media as well as the ability of people to be their own media outlets has significantly changed the way in which fashion is presented, reported, and consumed and more importantly, social media has changed the way fashion is designed. With this marketing ability, many individual fashion designers create their own private labels and become the owners of small and medium-sized enterprises (Ahmad et al. 2015). These independent fashion designers extensively use the features of social media for various reasons including to enter the fashion industry, to assist job functions, to facilitate communication, as well as to promote their performance (Schivinski and Dabrowski 2016). The social media has boosted the drastic growth of private labels in the fashion industry, attracted the attention of major stakeholders including retailers, buyers, and investors, and given these firms more power to compete in the highly competitive fashion industry (Park et al. 2016). Brand communities formed through social networking sites have a strong impact on customer loyalty towards brands in the fashion industry (Qiutong and Rahman 2019). Despite this shifting pattern in the fashion industry, there are only a few studies that measure the impact of social media benefits (communication and interaction) on consumers’ sense of loyalty towards the fashion industry. To address this gap, this study seeks to answer one research question: how do fashion companies use social media marketing to develop sustainable relationships with customers?

The House of CB

The House of CB (Celeb Boutique) opened as an online store in May 2010 from the bedroom of a 17 year old. A few years later, the House of CB owns multiple stores around the UK and with worldwide expansion plans. The company has 5 international offices and a huge social media following of more than 1 million fans (House pf CB 2020). The company has its own in-house studio design where all their pieces are created. The House of CB is rapidly growing and evolving into an international brand (House pf CB 2020). The company has been able to successfully sell to different celebrities such as Jlo and the Kardashians, which has made the company even more popular and as a result, the brand is considered a necessity for the fashion-conscious people (House pf CB 2020). The company’s main brand is bootylicious bodycon dresses, which have become very popular among teenagers. The choice of this company for this study was influenced by the ability of the company to attract the attention of so many fashion consumers as well as the ability of the company to attract a huge social media following.

Research Opportunity

As earlier mentioned, the fashion industry is very competitive and social media marketing is providing an opportunity for businesses to become more competitive, which implies that for House of CB to gain and maintain a competitive advantage, it has to integrate and effectively use social media in its marketing strategies and activities. As an online store, House of CB is affected by the rapid changes in the industry fashion which are influenced by the emergence of more fast-fashion and strong presence of online-only retailers and as such, the company has to pitch its communication strategies correctly (Schivinski and Dabrowski 2016). The effect of the internet is apparent in the UK fashion industry where British web-only retailers Boohoo and ASOS are racing ahead of online sales (Marques and Moschatou 2017). This has consequently affected the sales of fashion retailers in the UK. It is therefore inevitable that these organisations have to modify their marketing strategies to adapt to the digital-led society to target consumers (Ahmad et al. 2015). In the retail environment, social medial has been seen to accelerate the accessibility of information to consumers, which in turn impacts on customer loyalty.

House of CB is one of the organisations in the UK fashion retail industry that increasingly uses social media to engage and manage relationships with its customers and as a result has remained a competitive firm in the UK fashion industry. Therefore, understanding how social media marketing promotes customer loyalty is an apparent research opportunity that this study seeks to explore. In addition, it has been recognised that social media aids the interactions between consumers and fashion companies and this communication is fundamental in influencing consumer awareness, attitudes, behaviour, and loyalty (Qiutong and Rahman 2019). It is therefore important for UK fashion companies to continue researching and developing their understanding of how different social media platforms affect fashion consumers and their loyalty. Many researchers have approved that social media marketing significantly impacts on customer loyalty but that notwithstanding, there is limited research exploring how social media affects customer loyalty in the fashion industry an opportunity that prompts this study.

Research Aim and Objectives

The aim of this study is to explore the impact of social media marketing on customers’ loyalty towards fashion companies with a particular focus on the House of CB. In order to assess this aim and determine that design of the study, the following objectives are formulated:

To investigate the impact of trust in an organisation’s social media content on customer loyalty

To find out the effect of product review ratings by previous customers on perceived satisfaction in a product

To find out the effect of social media engagement on customer loyalty

Scope of the Research

This study will be conducted cross-sectionally due to time and resource limitations. A cross-sectional study focuses on a particular phenomenon or phenomena at a particular time (Saunders et al. 2016). This study is undertaken for academic course and therefore time-constrained, which lends it to investigate the effect of social media marketing on customer loyalty in a snapchat.

In this study, social media is defined as the tools that people and companies use for communication and in particular, the collaborative, participatory, user-empowering, and knowledge sharing tools available on the web. These tools vary from organisation sponsored websites, search engines, social networking sites, content communities, creativity work sharing sites, business networking sites, virtual worlds, blogs and microblogging sites, social bookmarking, and online gaming sites among other new sites. Of these tools, this study focuses on only one type of social media: social networks. Social media marketing is defined as the use of social media together with other communication channels with an aim of achieving organisational goals through creating value for stakeholders who include customers, employees, suppliers, and the government agents. In particular, social media marketing will be defined as using social networks in order to establish sustainable relationship with customers thus the role of marketing on social networks on customer loyalty will be explored.

While a various studies have explored the impact of social media marketing on customer loyalty, this study focuses on the fashion industry and specifically on the House of CB. This particular company has become very popular on social media attracting a very huge social media following (House pf CB 2020) and therefore it is important to explore how marketing on different social networks has helped the company acquire and maintain loyal customers.

Chapter 2: Literature Review

2.1 Social Media Marketing

Traditionally, people joined social media in order to keep contact with their friends, relations, siblings and such but today, companies use social media to avail their products and discounts as well as to ensure consumers remain updated about brands (Zhang and Li 2019). From this perspective, social media marketing is a strategy that has enabled companies to keep their customers associated with the brands they offer and with the company. This has benefited organisations as they are able to improve their brand loyalty and customer loyalty due to the increased positive relationships (Zhang and Li 2019). Through social media marketing, customers get better products/services and preferential treatment and these customers are normally value centric but they also do not waste resources (Iankova et al. 2019). Value for such customers is more important than brand image and the quality of goods during the decision-making process (van Asperen et al. 2018). As such, social media marketing has increasingly helped companies to satisfy their customers which then generates positive word of mouth and eventually leads to customer loyalty and adds value to the company (Novotová 2018).

According to Tatar and Eren-Erdoğmuş (2016), social media serves marketers four purposes: (1) business networking, (2) market research and generation of feedback, (3) branding, publicity and reputation management, and (4) customer service and customer relationship management. Many organisations are yet to realise the benefits of social media especially customer loyalty and brand loyalty given that these firms are not able to build customer relationships and they lack the means to deploy social media marketing strategies (Zhang and Li 2019). Nonetheless, there are many companies that are engaging with social media marketing and their potential customers through social media marketing and they have benefited with loyal customers (van Asperen et al. 2018).

Organisations are actively reducing the efforts of customers in searching for relevant brand information through incorporating social media in their marketing strategies. Integration of social media in marketing strategies has helped companies to satisfy their customers effectively and efficiently, which is attained through continuous engagements with customers (Zhang and Li 2019). The outcomes of customer engagement and relationship have a positive relationship, which in turn improves customer trust, satisfaction and loyalty (Iankova et al. 2019). Further, customer satisfaction leads to customer loyalty and brand loyalty but these cannot be attained without brand awareness, which implies that for a customer to become loyal to an organisation, the organisation must continually advertise itself and its brands among the consumers (Novotová 2018). Therefore, the information that companies share on social media leads to increased consumption of the products, which is influenced by customer loyalty and brand loyalty (Nash 2019). Moreover, loyal customers share information with other customers on social media as per their experience with the product/service (Hsiao et al. 2019).

2.2 Customer Loyalty

Customer loyalty is a fundamental factor that influences the sustainability of any company (Novotová 2018). Loyalty can be defined as a deeply held commitment to rebuy or re-patronise a preferred product or service consistently in the future thus resulting in repetitive same-brand or same-brand-set purchasing regardless situational influences and marketing efforts aimed at making customer to switch to other brands (Iankova et al. 2019). A company that has loyal customers enjoys various benefits. First, loyal customers pay less attention to alternatives and repeatedly buy products from the same organisation (van Asperen et al. 2018). Second, loyal customers have a higher likelihood of generating positive (electronic) word-of-mouth and share their positive experiences with other customers, which increases a company’s customer base (Mas‐Tur et al. 2016). In the same vein, Tatar and Eren-Erdoğmuş (2016) write that companies that gain customer loyalty lock in many profitable relationships with their customers at the expense of the slow-footed competitors. Customer loyalty also has some benefits for customers. According to Iankova et al. (2019), loyal behaviour towards a particular brand or company leads to increased trust, social advantages, reduced uncertainty, and higher likelihood of receiving customised offers and special treatments. Customer loyalty literature identifies two groups of loyalty namely attitudinal loyalty and behavioural loyalty. This study focuses on attitudinal loyalty.

2.2.1 Behavioural loyalty

Behavioural loyalty relates to the number of stores a customer is willing to visit and the willingness to pay more money for a preferred brand or from a favourite company (Iankova et al. 2019). On the other hand, van Asperen et al. (2018) define behavioural loyalty as a customer’s behavioural outcomes such as repurchasing a given product from a specific company. Research shows that behavioural loyalty is influenced by attitudinal loyalty.

2.2.2 Attitudinal loyalty

Attitudinal loyalty incorporates psychological components such as motives and feelings that influence a customer to have a relationship with a certain product or company (Novotová 2018). Attitudinal loyalty is mainly manifested through positive word-of-mouth, customers recommending a brand or company to other consumers, and a customer showing high level of commitment to the brand and the virtues of the company (Iankova et al. 2019). In the same vein, Tatar and Eren-Erdoğmuş (2016) write that attitudinal loyalty relates to a customer’s psychological expression which includes the intention to repurchase and the intention to recommend the brand or company to other potential customers. There are various components to attitudinal loyalty such as cognitive components, affective components, and conative components (van Asperen et al. 2018). Based on these three components, attitudinal loyalty is defined as the process through which customers first become loyal at a cognitive level (knowing), which is followed by an affective level (feeling), then followed by a conative level (willing), and finally at n action level (readiness to act and overcoming obstacle) (Novotová 2018).

Cognitive loyalty represents a customer’s thoughts about a particular brand or company but also reflects commitment to information like price and brand features (van Asperen et al. 2018). Cognitive loyalty is based on a company’s (brand’s) performance levels and aspects although it does not relate to the meaning of attachment or commitment (Novotová 2018). However, Gamma (2016) notes that cognitive loyalty has its basis on cognition which in turn derives from experience-based knowledge and second-hand information which in most cases relates to consumers’ perceptions of a company or brand. This implies that cognitive loyalty is the kind of loyalty that customers attribute to a brand or organisation based on the information or knowledge they have about the brand. Of the three types of attitudinal loyalty, cognitive loyalty is considered the weakest (Iankova et al. 2019). On the other hand, Yao et al. (2019) argue that cognitive loyalty is the baseline of customer loyalty in that it helps consumers evaluate products and services before making a purchase decision. On the contrary, Lee et al. (2015) consider cognitive loyalty as a kind of phantom loyalty thus argues that cognitive loyalty is not a part of attitudinal loyalty. This concurs with the conceptualisation of several researchers who posit that attitudinal loyalty consists of conative and affective components. For example, Thakur and Kaur (2015) define attitudinal loyalty as a positive affect towards the continuance of a relationship while Bilgihan et al. (2016) maintain that attitudinal loyalty is a psychological attachment that arises from a consumer’s desire to continue a relation with a company or brand through identification and affective attachment. Still, Selvarajah (2018) argues that attitudinal loyalty is comprised of commitment to an organisation or brand and the intention to continually purchase the brand or from the company. From these perspectives, attitudinal loyalty consists of effective and conative elements and therefore this study will focus on affective and conative loyalty.

Affective loyalty can be defined as a positive attitude that a customer has towards a brand of company based on cumulative satisfaction (Iankova et al. 2019). In this case, attitude reflects a pleasurable fulfilment and therefore it is recognised as affect. In the same vein, Novotová (2018) writes that affective loyalty relates to the pleasure customers have using a particular brand which makes them prefer that brand over others available in the market. Analogously, Gamma (2016) notes that affective loyalty primarily relates to customers’ loyalty to emotion or preference and as such affective loyalty addresses a lower level of customer loyalty, and is subject to change. On the contrary, Yao et al. (2019) argue that affective loyalty is related to a psychological bond that a customer has with a brand or organisation based on favourable feelings. From the same perspective, Tatar and Eren-Erdoğmuş (2016) write that affective loyalty is an affective attachment to a brand or organisation, which influences repetitive purchases. Further, van Asperen et al. (2018) argue that affective loyalty represents the appraisals or emotional responses of customers towards a particular brand, which substantially influences purchase intentions and the decision to continue using the brand or not. From these perspectives, affective loyalty is related to customers’ subjective perceptions and associations about a brand. Additionally, these perspectives denote that affective loyalty is planted in the mind of consumers as an affect as opposed to a mere cognition and therefore it cannot be addressed as a lower level loyalty, which informs its selection in this study. In this study, affective loyalty is defined as an affective attachment that customers have to House of CB.

Conative loyalty relates to a customer’s behavioural commitment to repurchase products/services of a specific brand (Novotová 2018). Conation is defined as the commitment to behave towards a particular brand in a particular way which contains a statement to repurchase the brand which ultimately turns into action loyalty meaning that the customer will always purchase that brand (Iankova et al. 2019). Analogously, van Asperen et al. (2018) state that conative loyalty relates to a customer’s desire or behavioural intention or willingness to act towards a particular brand and therefore can be seen as a brand-specific commitment to repurchase. Similarly, Tatar and Eren-Erdoğmuş (2016) note that conative loyalty is a customer’s intention to repurchase a specific brans and willingness to recommend that brand to other potential customers as well as the willingness to express positive word-of-mouth about that brand. Conative loyalty represents the deepest component of attitudinal loyalty and has a higher likelihood of leading to re-patronage (Iankova et al. 2019). In this study, conative loyalty is a customer’s intention to repurchase and willingness to recommend House of CB products to other potential customers through positive word of mouth.

2.3 Customer Satisfaction

Customer satisfaction refers to the difference between a customer’s expectations and experience performance after using a particular product or service for a given period (Hsiao et al. 2019). On the other hand, Nash (2019) defines customer satisfaction as an emotional and cognitive evaluation of the experience a customer has with a certain product or service and from this perspective, a customer is satisfied if the product/service achieves the level of performance that inspires a pleasant feeling. Analogously, Novotová (2018) writes that customer satisfaction is the result of comparing expectations with actual performance: if perception is below expectations, a customer achieves dissatisfaction but if the perception matches or exceeds expectations, the customer achieves satisfaction. Still, Mas‐Tur et al. (2016) share in the same thought asserting that customer satisfaction derives from the perceived difference between expectation and performance of a certain product/service and as such, customer satisfaction is a feeling of comfort or frustration depending on whether the product/service operates better or worse than the customer expected. Further, Kaura et al. (2015) share in the same though defining customer satisfaction as the function of pre-purchase expectations and post-purchase perceived performance of a given product/service in which a customer expects a positive effect. Therefore, we conclude that various researchers agree on customer satisfaction being the difference between expectations and perceived product/service performance which results in a feeling of comfort or frustration with the product. In this study, customer satisfaction relates to customers’ comfort or frustration in using House of CB products based on the expectations they had after consuming the marketing information.

In the context of social media marketing, both user-generated content and firm-generated content affect the expectations of a consumer in using a certain product. According to Kim and Park (2017), consumers provide ratings and the reviews that describe their satisfaction level with products thus helping other consumers anticipate their experience with these products. In the same vein, Ramanathan et al. (2017) write that online customer review ratings are a top source of information for consumers and the satisfaction levels expressed through these reviews forms the expectations of the consumer. Additionally, Agnihotri et al. (2016) state that most customers in this digital era make use of store websites to understand previous customer experiences by displaying their feedback as reviews that support shopping decisions. Normally, positive reviews left by previous customers encourage future customers on the basis of perceived satisfaction (Berman 2016).

In the fashion industry, consumers access social media platforms to routinely share their views on store choice, brand choice and their experiences with specific brands; therefore influencing the expectations of other consumers in terms of brand choices (Gautam and Sharma 2017). In other words, information of consumer experience through product reviews on social media informs a customer’s expectations on the basis of perceived satisfaction which ultimately impacts of customer satisfaction. In this background, we expect that previous customers’ feedback on satisfaction expressed in review ratings on social media will inform the expectations of future customers and ultimately affect customer satisfaction.

Extant literature has confirmed a positive link between customer satisfaction and customer loyalty and these studies argue that customer satisfaction drives customer loyalty. According to Khadka and Maharjan (2017), satisfaction with the products or services provided by a particular company may result in loyal customers. Hsiao et al. (2019) also test and confirm that customer satisfaction significantly impacts on customer loyalty. In the same vein, Nash (2019) writes that satisfied customers experience pleasure with a given brand and therefore have a higher likelihood of repurchasing the same brand in order to maintain their feeling of pleasure and comfort. Still, Iankova et al. (2019) maintain that satisfied customers are more likely to maintain a sustainable relationship with a particular brand or company, which relates drives customer loyalty. Further, Tweneboah-Koduah and Farley (2016) write that customer satisfaction enhances the element of trust and assurance in the relationship with customers which is fundamental to gaining customer loyalty. From these perspectives, we conclude that customer satisfaction mediates customer loyalty, which is applicable in the fashion industry and therefore we argue that if customers are satisfied with the products of House of CB, they are likely to become loyal to the company.

2.4 Customer Trust

Tatar and Eren-Erdoğmuş (2016) define trust as a customer’s confidence in an organisation’s or brand’s reliability and relates to a customer’s willingness to engage with the organisation or brand despite the risks that are involved. Similarly, Utami (2015) defines trust as a favourable attitude that reflects the confidence that a consumer has in a company’s reliability and integrity. Novotová (2018) argues that in marketing, an organisation must be able to give consumers a sense of confidence so that the consumer can take action. In the same vein, Utami (2015) writes that trust has a critical role in affecting relational exchanges between an organisation and its customers. A study conducted by Tatar and Eren-Erdoğmuş (2016) shows that consumers are willing to try brand extensions when the brands are highly trusted and at times, brand trust is seen to compensate for lack of knowledge about the new product. This implies that consumers are willing to purchase a product they have no knowledge about as long as they trust the company and other brands provided by the company. In this study, trust is defined as a consumer’s confidence in the integrity and reliability of a particular organisation which reflects the willingness of the consumer to develop a relational exchange with that particular organisation.

Previous literature on customer loyalty has established a positive relationship between trust and customer loyalty. According to Tatar and Eren-Erdoğmuş (2016), customer satisfaction and trust are the most established drivers of loyalty in marketing activities. In the same vein, Iankova et al. (2019) argue that trust is a product or organisation is an important variable in customer satisfaction and therefore organisations should invest in developing trustworthy relationships with customers by incorporating the aspects of trust in order to form psychological bonds with the customers which in turn will influence customers to continually purchase from the organisation. Companies that are able to develop trusting feelings on their customers are likely to gain loyal customers (Hsiao et al. 2019). Influenced by these perspectives, this study concludes that trust has a mediating role in the association between social media marketing and customer loyalty. This implies that customers will only be able to trust House of CB is they have confidence in the reliability and integrity of the company, which will then influence their willingness to continue shopping with the company and recommending the organisation to other potential customers.

The source of information posted on social media by various organisations affects how consumers’ perception of the information in terms of credibility. In this case, social media content can be created by the organisation (firm-generated content) or by consumers (user-generated content) and each of these forms of social media content affected consumer trust.

2.4.1 User-generated content and consumer trust

User-generated content refers to content that is created and publicly made available by end-users in a creative effort (Zhang and Sarvary 2014). Nonetheless, most of studies on this topic consider content creation over content dissemination when conceptualising user-generated content. A study conducted by Adetunji et al. (2017) reveals that the growth of social networking sites and online brand communities have influenced the popularity of user-generated content in social media advertising. Another study conducted by Cheregi (2018) establishes that consumers develop and share content in order to promote themselves, acquire intrinsic enjoyment, and change the existing public perceptions. On the other hand, Skinner (2018) identifies co-creation, empowerment, self-concept, and community as the factors that motivate consumers to generate their content. Halliday (2016) reveals that user-generated content is a rapidly growing driver for brand conversations and consumer insights given that consumers want to express their brand related opinions with their friends and companies. User-generated content is brand-related thus can be categorised as a type of product involvement. A study conducted by Han et al. (2018) reveals that organisations should encourage and share content created by consumers as a way to build relationships with consumers and promote brand awareness. However, Adetunji et al. (2017) note that negative user-generated content can harm a brand’s reputation and equity considering that many consumers believe that user-generated content is more credible than firm-generates content.

Extant research has shown that user-generated content has a positive relationship with customer trust. According to Flanagin and Metzger (2013), user-generated content has the capacity to leverage the highly experiential aspects of consumers’ knowledge and information which significantly impacts on customer trust. In agreement, Choi and Lee (2017) write that users have first-hand knowledge or experience with a brand, and therefore are accurately perceived by consumers to have a great deal of experiential credibility. Analogously, Chari et al. (2016) establish that user-generated online product reviews and electronic word-of-mouth is perceived as more credible as compared to content created by marketers given that user-generated content is informed by experience with the product. Further, the results of a study conducted by Goh et al. (2013) shows that the volume of social information provided by internet users is positively related to the information’s perceived credibility, consumers’ reliance on it and their confidence in its accuracy given that users rate a product they have experienced and based on how satisfied they were with the product. Moreover, Kim and Johnson (2016) write that user-generated content is more credible as it is based on experience while that generated by firms could be intended to manipulate consumers towards purchasing a given product. Under this background, this study expects that consumers will be more confident in the credibility of information posted by users such as product reviews and recommendations as this is based on their experience with the products of the House of CB.

2.4.2 Firm-generated content and customer trust

Firm-generated content refers to the messages posted by an organisation on its official social media pages with an aim of promoting brand awareness and increasing sales. According to Kim and Johnson (2016), firm-generated content has a greater ability to provide information that addressed the needs of consumers but its trustworthiness is questionable given that its messages emphasise on the positive aspects of a product in order to enhance perceptions and attract and encourage consumers. Similarly, Flanagin and Metzger (2013) argue that in order to increase sales, marketers embed positive statements in firm-generated content with an aim of creating a favourable product reputation and image. In the same vein, Chari et al. (2016) assert that customers tend to doubt and resist persuasion by firm-generated content since firms overstate product benefits while concealing or omitting problems or weaknesses in order to persuade customers to purchase the products. Another study conducted by Choi and Lee (2017) compares the effect of user-generated content and firm-generated content on customer trust and reveals that firm-generated content typically describes the product information which lowers the credibility of such information, while user-generated content embeds usage experiences which promotes customers’ trust. In light of this information, this study expects that customers will have little or no trust in firm-generated content and therefore they will tend to rely on recommendations and product reviews made by fellow consumers when making purchase decisions.

2.5 Customer Engagement via Social Media

In an era and society in which consumers easily interact with other consumers and organisations through social media, customer engagement through social media is a fundamental part of customer relationship management (van Asperen et al. 2018). Over years, the role of customer engagement is studied in different fields; for example, engaging customers through advertising and in the fashion industry to understand the behaviour of clothing shoppers. However, up-to-date there is no consensus on the concept of customer engagement and therefore different approaches and definitions exist. Brodie et al. (2011) conducted an overview of customer engagement and found about 50 definitions of customer engagement, which are categorised on behavioural, emotional, and cognitive aspects. In the overview article, definitions of customer engagement varied from very broad which focused of the three aspects to narrow which focussed on only one aspect. An example of a broad definition of customer engagement is provided by Verhoef et al. (2010) as cited in (Brodie et al. 2011) who refer to customer engagement as the level of a customer’s cognitive, physical and emotional presence in their relationship with an organisation. In addition, Iankova et al. (2019) define customer engagement based on the three aspects as a customer’s positively-valenced brand related behavioural, emotional, and cognitive activity during or related to focal brand/consumer interactions.

As already mentioned, several researchers defined customer engagement based on specific aspects and this forms the narrower definitions of customer engagement. From this orientation, Guesalaga (2016) defines customer engagement as a customer’s behavioural manifestations that have an organisations or brand focus, beyond purchase, emanating from motivational drivers. From the same perspective, Hsiao et al. (2019) also emphasise behavioural aspects of customer engagement which are the act of connecting and involving with a brand or organisation. Iankova et al. (2019) also associate customer engagement with actual customer behaviour.

Customer engagement is primarily concerned about developing relations between an organisation and customers along with establishing new and high-value customer relationship (van Asperen et al. 2018). The overriding purpose of connecting and engaging with consumers is to develop that value that these consumers have towards an organisation which in return leads to loyal and more prolonged customers that are willing to spend their money on the products or services of that organisation (Guesalaga 2016). Engagement with a company through the social media has been established to result in a felling of connectedness among customers (Iankova et al. 2019). Additionally, engaged consumers are acknowledge to be of added value for business organisations especially in markets that are dominated by price competition (Nash 2019). Therefore customer engagement is fundamental in generating improved organisational performance.

In the fashion industry a number of studies have focused on the impact of customers’ social media engagement. A study conducted by Novotová (2018) showed a positive relationship between customer engagement on social media and brand/organisation’s image. Another study conducted by Nash (2019) also demonstrates there is a positive association between customer engagement on social media and a company’s reputation. Similarly, the findings of a study conducted by Hapsari et al. (2017) reveal that exposure to social media content has positive effects on the perceived product attractiveness.

Several researchers have studied the relation between customer engagement and social media use. For example Harrigan (2015) investigated the relation between customer engagement and social media use and found out that customers feel more engaged with brands and organisations when they are able to submit feedback, and that higher levels of engagement result in higher likelihood of communication via word-of-mouth or social media among customers are their friends. Given the beneficial effects of customer engagement, many companies have developed programmes to increase customers’ brand engagement with a primary focus on customer value (Novotová 2018).

This study explores customer engagement from an online perspective, that is, social networking sites such as Facebook, LinkedIn and Twitter since these sites are the most popular among brands (Iankova et al. 2019). The study follows the engagement classification of Man and Tsai (2013) who studied the motivations of people to engage in brand-related social media use based two types of online engagement: consuming social media content ( for example viewing, watching, reading) and contributing to social media content (conversing, reacting, sharing, adding, recommending). With a similar typology, Hsiao et al. (2019) argue that many consumer activity on social networking sites ci comprised of two elements namely viewing and posting which can be termed as passive and active social media use. Although other studies classify customer engagement in other elaborate ways, this stud will distinguish only two types of online engagement (passive and active engagement) so that it can draw conclusions more easily by using two extreme ends of the engagement spectrum.

Although scholars are yet to come to consensus on the definition of customer engagement and particularly in online customer engagement, online customer engagement is considered a business practice that is fundamental to social media marketing success (Iankova et al. 2019). Many organisations have recognised engagement as the most important online outcome they should deliver with their social media activities and in return they will achieve competitive advantage through having loyal customers (Harrigan et al. 2015). In a study among eConsultany firms, 80% of the firms mentioned that online engagement is important and essential to the company (van Asperen et al. 2018). Therefore, this study concludes that the consequences of customer engagement include very important relational outcomes such as trust, commitment, emotional attachment to a particular brand, and loyalty.

2.6 Social Media Engagement and Customer Loyalty

A number of researchers suggest that social media engagement is positively correlated to customer loyalty. A study conducted by van Asperen et al. (2018) establishes that engaging customers on Facebook has a positive impact on sales and on word-of-mouth communications. Similarly, A study conducted by Lim et al. (2015) shows that internet users that become fan of a particular company’s Facebook page have increased number of visits to the company and have more positive word-of-mouth as opposed to nonfan internet users. Still, a qualitative study conducted by Nisar and Whitehead (2016) reveals that customers that participate in virtual brand communities are more loyal to these brands as compared to other consumers. In the same vein, Lim et al. (2015) establish that social media brand communities have indirect but positive impact on customer loyalty but trust plays a mediating role. Further, Harrigan et al. (2017) note that the social media activities of any company have a positive effect on sales and customer loyalty.

Some studies within the fashion context show that social media engagement is positively associated with customer loyalty. A study conducted by Geissinger and Laurell (2016) shows that when consumers involved with a social media page of a fashion shop, they had intentions to revisit that particular social media page and continually purchase from the shop. Another study conducted by Ananda et al. (2015) reveals that the attitudes of customers towards a Facebook page of a fashion operator has a positive impact on customer loyalty but insignificant influence on word-of-mouth communications.

As earlier mentioned, this study distinguishes between active and passive social media engagement and therefore the objective of this study under this aspect is to establish whether different forms of engagement (active and passive) with House of CB’s social media activities have different associations with loyalty. In other words, this study seeks to establish whether active and passive social media engagement is related to affective and conative loyalty. Based on studies reviewed above on these concepts, we expect that active and passive social media engagement will have positive impact on affective and conative loyalty.

2.7 Customer loyalty: are customers loyal to retailers or brands?

Existing literature on customer loyalty shows that customers could either be loyal to brands or specific retailers or stores, which would significantly affect small and medium sized entrepreneurs in terms of do they market their brand or the store itself in order to gain loyal customers. In addition, some companies such as House of CB choose some retailers who have a loyal customer base, such as TopShop to sell their brand. This implies that in social media marketing, companies should choose the right content so that they are able to gain customers that are loyal to both the store and the brand. This section reviews literature on customer loyalty towards retailers and brand.

2.7.1 Customer loyalty towards retailers

Consumers can be loyal customers to specific retailers or stores not for the sake of the brands sold in that particular store but influenced by the qualities of the store itself and other factors related to the retailer. If customers do not find their preferred brand in a specific store, they are more likely to buy the brands available in that store because they are more familiar with the retailer as compared to other retailers and appreciate the quality of the brands offered by that retailers and therefore, they will purchase alternative brands because they are loyal to the retailer (González-Benito and Martos-Partal 2012). According to do Vale and Matos (2017), loyalty to the retailer favours loyalty towards the commercialised store brands, which influences customers to buy alternative brands in a store if they do not find their preferred brands because they have trust in the retailer. However, customers are not loyal to a single retailer and therefore are more likely to become familiar with store brands of other retailers without perceiving quality differences between the two retailers, which implies that customers are not loyal to a store itself but to the brands in that store (Rubio et al. 2017). In the same vein, Frasquet et al. (2017) argue that it is loyalty to the store brands that makes customers to be loyal to a particular retailer given that store brands that enjoy brand equity drive customers’ preference and loyalty towards the retailer that sells them which in turn increasing the cost of switching to other retailers. From this perspective, customers are loyal to retailers that provide their preferred store brands and therefore they buy from a specific retailer because in that store they will get their favourite brand. This implies that there is a relationship between the brands offered by a particular retailer and customer loyalty towards that retailer, and therefore, retailers should seek to enhance the quality of the brands they sell so they can benefit with loyal customers.

Numerous studies have explored strategies through which retailers build loyalty towards their stores and the retailer. Sivapalan and Jebarajakirthy (2017) note that although store brands can influence customer loyalty towards a retailer, there are other many factors that contribute to loyalty towards a specific store such as convenience, service quality, and the appearance of the store. Analogously, do Vale and Matos (2017) assert that there are many factors that influence customer loyalty towards a retailer other than store brands offered by the retailer and therefore, customer loyalty towards a specific retailer cannot be analysed without considering the strategies that retailers have adopted to differentiate themselves from other retailers. From this perspective, this study argues that SMEs in the fashion industry can build customer loyalty towards specific retailers by using private labels and securing exclusive rights on the products that are sold under the store. Additionally, the retailer should adopt other factors that influence customer loyalty towards a retailer in order to make sure that customers come to the store not only because of the products sold in that store but also because they prefer purchasing from the retailer and not others in that industry.

The role of retailing service quality in influencing customer loyalty towards a particular store or retailers has been well-researched. A study conducted by Frasquet et al. (2017) concludes that enhancing retailing service quality helps retailers to create greater customer value, which in return makes customers more loyal to this particular retailer or store. Similarly, Rubio et al. 2017) assert that enhancing the retailing service quality is the best strategic tool retailers could use to make customers loyal to the retailers and to their stores. Analogously, Sivapalan and Jebarajakirthy (2017) write that is customers have a favourable evaluation of and attitude towards a particular retailer, they tend to be loyal to that retailer which implies that retailers can benefit with loyal customers through enhancing their service quality. In support of the relationship between service quality and customer loyalty towards retailers, Frasquet et al. (2017) argue that a customer’s long-term relationship with a retailer is strengthened when the customer makes a favourable assessment about the retailer’s service quality, and this relationship is weakened if the customer makes a negative assessment about the retailer’s service quality. In this background, this study argues that retailers can drive customer loyalty towards their stores by enhancing the retailing service quality.

Some studies have investigated the relationship between consumers’ perceptions of retail business ethics and customer loyalty to retailers and the results show a positive link between ethical perceptions and customer loyalty to retail stores. According to Diallo and Lambey-Checchin (2017), the morality of a retailer’s behaviour has an influence over customer loyalty towards that specific retailer. In the same vein, Lu et al. (2013) write that retailers who have developed extensive ethics and CSR-related strategies such as social equity, fair trade and cohesion measures shows that such retailers are commit towards contributing to a better quality of life for consumers, employees, and suppliers and therefore, customers prefer purchasing from such retailers in order to support their sustainability mission. Analogously, Frasquet et al. (2017) argue that trust, corporate reputation and CSR have a mediating effect on the relationship between business ethics and customer loyalty towards retailers. Further, Rubio et al. (2017) establish a direct association between customers’ perceptions of a retailer’s ethical conduct and their level of loyalty: customers are more likely to demonstrate behavioural and attitudinal loyalty to an ethical retailer. Still, Lin et al. (2017) write that customers are more inclined to conduct business with retailers and repurchase their products if they judge those retailers favourably on ethical business conduct. On the other hand, do Vale and Matos (2017) write that retailers influence customer loyalty indirectly through trust: customer perceptions of ethical behaviour influence trust and then customer loyalty through trust. In support of the indirect effect of ethical behaviour through trust, Diallo and Lambey-Checchin (2017) write that ethical perceptions towards a given retailer influences trust, which then enhances loyalty to that specific retailer. Therefore, this study concludes that consumers’ perceptions of retail business ethics have a substantial effect on customer loyalty to the retailer.

Other studies have focussed on the effect of retailer price positioning on customer loyalty towards retailers. A study conducted by Francioni et al. (2018) shows that consumers generally consider the store’s price image when choosing among different stores. In agreement, do Vale and Matos (2017) emphasise that price is one of the most fundamental marketplace cues employed by retailers loyal customers to their stores. Nonetheless, price facilitates customer loyalty towards retailers only when customers are sensitive to prices (González-Benito and Martos-Partal 2012). Analogously, Frasquet et al. (2017) state that price-conscious customers tend to be more loyal to retailers that implement low-price strategies. From this perspective, a retailer’s price positioning only influences customer loyalty if the customers are price sensitive and therefore, this study concludes that price positioning is not an effective strategy for retailers seeking to gain loyal customers.

2.7.2 Customer loyalty towards brands

In many instances, customers will tend to move from one store to other searching for their preferred brand, which implies that customers are not always loyal to stores but at times to the brands sold in those stores. Brand loyal customers are only willing to buy one brand regardless the store or the retailer they will find it from. Customer loyalty towards brands is influenced by experience and familiarity of specific brands given that positive experience with a brand reduces the perceived risk of buying the product and increases the perceived quality, thus encouraging loyalty (González-Benito and Martos-Partal 2012). In support, Hebblethwaite et al. (2017) write that brand loyal customers have greater experience with the brand which allows the customer to move from one store to the other looking for that particular brand. Customer loyalty to brands allows them to evaluate the results of their consumption repeatedly and if sustained over time, such evaluation contributes to developing trust in the retailer who commercialises the brand and in the brand itself (Kamran-Disfani et al. 2017). The higher the level of knowledge that customers have of the brand, the higher their commitment to that brand, which translates into trust in the brand and ultimately to loyalty to that brand. From these perspectives, prior and positive experiences with a brand encourage subsequent evaluations and purchases which ultimately lead to customer loyalty towards the brand.

Brand loyal customers are considered fundamental for the productivity of survival of business organisations especially in this competitive era (Biscaia et al. 2017). Branding products and attracting loyal customers have therefore emerged imperative components of many organisational competitive strategies (İpek et al. 2016). On the other hand, Riebe et al. (2014) note that retaining loyal customers is more cost effective that attracting new customers given that brand loyal customers re willing to pay higher prices for their favourite brands and are also less price sensitive as compared to other customers. Brand loyal customers are also beneficial in increasing the quality of products and services as they provide important information about the needs and preferences of customers.

Brand loyalty literature identifies a number of factors that influence customer loyalty towards brands. Chinomona (2016) argues that the behavioural and perceptional components of brand equity are important elements of branding and thus are extensively used in influencing brand loyal customers. In the same perspective, Jørgensen et al. (2016) write that the symbolic and functional attributes and responsibilities of a brand influences customer loyalty given that consumers perceive a brand and the benefits they receive from consuming it. In the same vein, Dehestani et al. (2013) assert that brand name, brand symbols, and personality significantly affect how customers perceive a brand, which in turn influences their commitment to that particular brand. Analogously, Azad et al. (2014) state that managing the brand perception is an important marketing strategy in that it helps position a brand in a unique way in the minds of customers resulting in sales, margins, profitability, and a continued interest from customers.

Dig deeper into Organizational Culture and Social Media with our selection of articles.

A study conducted by Jørgensen et al. (2016) reveals that brand perception significantly affects customer loyalty. The study identifies different elements of brand perception which affect the behaviour of customers which are perceived quality, brand awareness, brand fondness, brand association, brand image and the image of the country in which the brand is produced. The results of the study reveal that customers prefer the products that correspond to their image, and they express their characteristics or personality through the products that correspond with their self-image. Similarly, Kamran-Disfani et al. (2017) argue that brand perception is major determinant of customer loyalty: when customers perceive a brand to be of high quality, they have increased fondness and associate with the brand which in turn increases loyalty to that brand. In the same vein, İpek et al. (2016) write that brand perception factors are highly related with self-concept and therefore brand perception is based on customers’ perception of the brand and its associated utility rather than other objective indicators such as price. Brand perception management is seen as an opportunity for the retailer to add value to the product and then generate higher revenues from the product (Dehestani et al. 2013).

Foroudi et al. (2018) studied the concept of brand perception from the customer perspective and reveals that customers’ attitudes and perceptions are the major factors that make customers more likely to choose a particular brand over those of the competitors or pay a premium price for a given brand rather than switching to those of competitors. In support of this argument, Dehestani et al. (2013) write that high equity from a consumer perspective generates positive reactions towards a brand which in turn generates positive financial results. The marketing activities adopted by a firm can influence a consumer’s perception towards the image of the brand, thus impacting of customer’s perception of the degree of brand equity (Jørgensen et al. 2016). In the same vein, Azad et al. (2014) write that brand equity is composed of two aspects namely functional and symbolic aspects and retailers should focus on these two aspects when marketing brands in order to benefit with brand loyal customers (Chinomona 2016). From this perspective, the symbolic aspect relates to the non-physical aspects of the brand such as perceived quality, brand image, brand awareness, and brand associations while the functional aspect relates to the physical aspects of the brand and customers satisfaction.

A number of studies have investigated how marketing activities can generate perceptional and behavioural components and they agree that in order to achieve positive brand perception, an organisation must develop a good marketing communication plan (Foroudi et al. 2018). High brand perception is the result of effective marketing strategies given that marketers are responsible for building brand dimensionality through the selected marketing strategies and the message relayed to consumers (İpek et al. 2016). Marketers can also contribute in building a brand’s beliefs and ideals, and therefore generating positive associations in the minds of consumers while creating a positive attitude towards the brand. In this background, this study concludes that firms in the fashion industry can develop ideal marketing communication plans to develop brand perception in the mind of consumers which will lead to the formation of brand loyal customers. Other factors that influence brand perception include brand association, perceived quality, brand awareness, brand image, brand fondness, and product country image (Foroudi et al. 2018).

2.8 Hypotheses and Conceptual Model

H1: Social media marketing has a positive impact on customer loyalty in the House of CB

H2: Customer satisfaction mediates the relationship between social media marketing and customer loyalty in the House of CB

H3: Trust has a mediating role on the relationship between social media marketing and customer loyalty in the House of CB

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