Recent Trends in Business and Tourism

ABSTRACT
IJRTBT IMPACT OF SOCIAL MEDIA IN SMALL BUSINESS
INDUSTRY: A STUDY ON FACEBOOK
1Calcutta University, West Bengal, India
2Seacom Skills University, West Bengal, India
*Corresponding Author’s E-mail: [email protected]
International Journal on Recent Trends in Business and Tourism | Vol. 2 (3) 2018 JULY | 33
Today in the rapidly moving world scenario, we can see ‘Change’ in every moment. With the upgradations of
new technologies, use of Android phone, I-Phone, I-Pad, etc., people’s lifestyles have been changed. Digital
marketing is one of the best ways where marketers can improve their businesses through Social Media. This
paper is an attempt to study the impact of Social media in the Small-scale industry. This study also examined
how Small Business owners are motivated to use social media applications.
In the present study, the researchers have done the research in a single area in the field of social media, i.e.,
facebook.com. An attempt has been made to analyze customer perceptions, their preference factors that
increase the adoption rate of FB users, changing their buying pattern from traditional to online through social
media, facebook.com and lastly finding the most important factors which influences more, that helps the
entrepreneur to set their Decision Support System as well as to improve the obtainable Business (Hyde et al.,
2017).
For the analysis, Factor Analysis is applied to identify the factors that influenced Facebook users for buying
the product through Facebook, also the same analysis is used to find out the maximum and minimum variance
of the factors which helps the researchers to reach their destination and examined how Small Business owners
are motivated to use social media applications to improve their business. For this study, researchers have
collected 100 samples and given a helpful conclusion from the consumer view regarding demographic factors
from the city of Kolkata, West Bengal, India.
Keywords: Demographic Profile, Social Media Applications, Customer Preferences, Psychological
Factors, Small Business.
INTRODUCTION
The main aim of this paper is to determine the impact of
Facebook on the growth of small businesses and how
Facebook can facilitate small businesses to spread out
their businesses by using Facebook applications or
Facebook business page. On the other hand, with
growing usage of internet as well as mobile
applications, social media penetration has become an
official part of our professional and personal life.
Now we are going to discuss about social media and
social networking service company, Facebook, because
we have done our research in facebook.com. Facebook
profiles are more detailed than the other social
networks. Facebook provides great marketing and
business opportunities. Facebook pages help in great
ways to build relationship with the targeted clients and
customers in a more casual way and can prioritize them
in the top of the customer’s mind.
Facebook business pages are now more equipped to
provide benefit to small businesses. It helps in sharing as
well as targeting our businesses to billions of customers
in a less expensive way than other advertisement in
social media. Apparently, the increased exposure is very
much necessary for the increased growth of business.
Besides these, Facebook provides the platform for
gathering business leads so that they can be
communicated outside Facebook. Rather than these, it
also helps in specific targeting and provides analysis of
business by Facebook insights and increases web traffic.
Social media networks like Facebook are gateways for
companies to profit and grow in the industry.
Companies are increasingly becoming keen to use
social media for business tenacities as part of their
communication, marketing and recruitment strategy
(Kietzmann et al., 2011). Small business entrepreneurs
use social media applications to spread their businesses
by using large range of weak ties. The significance of
weak ties in the network of small business owners are
identified by Granovetter (1973) and Burt (1992). The
purpose of weak ties is to collect information regarding
business by small business owners. It helps to
Moumita Dey Sarkar , Indrajit Ghosal 1 2*
IJRTBTSOCIAL MEDIA IN SMALL BUSINESS INDUSTRY
34 | Vol. 2 (3) JULY 2018 | International Journal on Recent Trends in Business and Tourism
RESEARCH METHODOLOGY
Data collection methodology and sample plan
Research type: Pragmatic in nature
Population: Customers who have the Facebook
Account and buy the product through Facebook media
and all the users’ demographic characteristics.
Research design: The study has been partly
descriptive and partly analytical. The study is based on
both primary and secondary data.
Sampling method: Multistage Sampling and
Purposive Sampling technique were used to collect the
data for this study. The questionnaire was distributed
among only the Facebook users for online-marketing. A
total of 100 questionnaires were distributed among the
customers/users of different areas of Kolkata City
(West Bengal, India).
Tools for data Collection: Questionnaire was based on
a 5-point Likert Scale and Questionnaire consists of 20
questions and distributed among male and female
online users.
Sampling Area: The urban area around the city of
Kolkata, (West Bengal, India) were the sampling area
of this survey.
Sampling Frame: Used the concept of Random
sampling from the different areas of Kolkata.
Sample Units: Facebook Users.
Sample Size: 100
Data Collection Methodology:
The study was consisting of both primary and
secondary data. They are as follows:
i) Primary data Collection: This data was collected
through well-structured closed ended questionnaire
from those customers who buy the products through
Facebook portal.
ii) Secondary data Collection: The data from
secondary sources was collected through books,
journals, research studies, internet sources.
Sampling: Multistage sampling technique was used
for this study. Based on the single district, it has been
classified into 2 subdivisions and each subdivision has
3 blocks. Out of four sub divisions, researchers have
taken only two sub divisions randomly and the lottery
method data was collected for each division. That’s why
100 respondents have been collected for the sample
size. The District is divided into 2 Stratum: Stratum1:
North Kolkata, Stratum 2: South Kolkata. Each sub
division was divided into 3 blocks. Use of Stratified
communicate between customers (current and
potential) in terms of feedback, product development,
customer service and support leading way for business
growth. However, Shabbir, Ghazi & Mehmood (2016)
elaborates that market innovation is a comprehensive
tool to meet the needs and wants of their target
customers.
LITERATURE REVIEW
Hunt (2010) in his article has investigated that social
media plays an important role for the recruitment of
employees amongst companies. They have researched
that Corporates are using social media like Twitter and
Facebook to recruit and communicate to the talented
and targeted candidates about their value propositions
as well as enhance their brand equity (Bruhn,
Schoenmueller & Schäfer, 2012). Employer branding
is very important to recruit right candidates, and not
simply the masses. If employer branding is not done, it
will affect the branding process badly.
Aula (2010), in his study, emphasized the importance
of social media’s impact on organization’s strategic
reputation management. They also emphasized that
reputation management should begin before the
reputation crisis. Besides these, the research depicted
the significant impact on maintaining ambient publicity
to maintain the organization’s reputation. Many
organizational strategies like strategy of absence,
strategy of presence, strategy of attendance, strategy of
omnipresence have been depicted.
Bashar, Ahmad & Wasiq, (2012) have depicted that
social media is now indispensable part of marketing
mix as well as promotion mix to sustain the business
rather than traditional style of pure-bricks business
model. They have depicted that social media plays a
greater role in buying decision making of the
consumers.
Gunther et al., (2014), explained that there is a new
trend of using Facebook by small business users due to
cost-saving as well as time-saving to promote their
products. They have also depicted that Facebook helps
in connecting business with weak ties and helps in the
growth of business by increasing exposure to targeted
customers with less expense.
Objectives
§ To explore the factors which influences the
customers to buy products through Facebook
Platform.
§ To find out to what extent the descriptive factors are
influencing and motivating the users more for buying
products through Facebook portal.
SOCIAL MEDIA IN SMALL BUSINESS INDUSTRY IJRTBT
International Journal on Recent Trends in Business and Tourism | Vol. 2 (3) 2018 JULY | 35
random sampling researcher has collected data from 3
sub divisions.
Sampling design through a diagram
Figure 1: Diagram of Sample Design
Applied Stratified random sampling technique and
district is divided into three stratum random sampling.
Data Analysis Methodology
The data were collected from the survey from those who
buy products through Amazon portal and will be
subjected to data cleaning to identify missing value, data
redundancy, sample characteristics and meet the
assumptions of normality. After the data redundancy
Descriptive statistics is used to summarize the
respondents’ demography. The researcher will safeguard
that all items meet the acceptable limit level.
Reliability test on 20 variables

N	%
Cases	Valid	100	100.0
Excludeda	0	0.0
Total	100	100.0

Table 2: Reliability Statistics

Cronbach’s Alpha	No. of Items
0.714	20

Table 3: KMO and Bartlett’s Test
After KMO test on 100 respondents with 20 variables it
has been observed that Sampling Adequacy result is
0.644. So, it is >0.50, means acceptable.
Sample Design for the objective 1
§ To explore the factors which influencing the
customers to buy products through Facebook Platform.
Table 4: Sample Design

Sample Size	100
Sample unit	Facebook Users
Test	Factor Analysis test through SPSS 19.0

Table 1: Case Processing Summary
Table 5: Correlation Matrix

Kaiser-Meyer-Olkin Measure of Sampling Adequacy	0.644
Bartlett’s Test of Sphericity	Approx. Chi-Square	348.707
Df	190
Sig.	0.000

a = Listwise deletion based on all variables in the procedure.
IJRTBTSOCIAL MEDIA IN SMALL BUSINESS INDUSTRY
36 | Vol. 2 (3) JULY 2018 | International Journal on Recent Trends in Business and Tourism
Total Variance Table
The variance table explained by the initial solution,
extracted components, and rotated components is
displayed.
Table 6: Total Variance Explained

Comp onent	Initial Eigenvalues	Extraction Sums of Squared Loadings	Rotation Sums of Squared Loadings
Total	% of Variance	Cumulative %	Total	% of Variance	Cumulative %	Total	% of Variance	Cumulative %
1	3.476	17.382	17.382	3.476	17.382	17.382	2.470	12.348	12.348
2	1.823	9.117	26.500	1.823	9.117	26.500	1.824	9.122	21.469
3	1.721	8.606	35.106	1.721	8.606	35.106	1.725	8.627	30.096
4	1.412	7.060	42.166	1.412	7.060	42.166	1.633	8.165	38.261
5	1.256	6.278	48.444	1.256	6.278	48.444	1.555	7.773	46.035
6	1.206	6.032	54.476	1.206	6.032	54.476	1.384	6.922	52.957
7	1.063	5.317	59.793	1.063	5.317	59.793	1.367	6.836	59.793
8	0.949	4.747	64.540
9	0.931	4.654	69.194
10	0.832	4.161	73.355
11	0.808	4.039	77.394
12	0.701	3.505	80.899
13	0.647	3.235	84.135
14	0.599	2.995	87.129
15	0.556	2.780	89.909
16	0.534	2.670	92.579
17	0.414	2.072	94.651
18	0.397	1.985	96.636
19	0.344	1.721	98.357
20	0.329	1.643	100.00

Scree Plot
The Scree Plot displays the number of Factors versus its
corresponding Eigen Value when no rotation is done,
the Eigen values of the correlation matrix equal the
variances of the factors.
Figure 2: Scree Plot
Scree plot showing 7 factors have been extracted from
the graph after the factor analysis. The following matrix
SOCIAL MEDIA IN SMALL BUSINESS INDUSTRY IJRTBT
International Journal on Recent Trends in Business and Tourism | Vol. 2 (3) 2018 JULY | 37
showing 7 factors which are taken out from 20
variables.
Rotated Component Matrix
This table contains the rotated factor loadings (factor
pattern matrix), which represent both how the variables
are weighted for each factor and the correlation
between the variables and the factor. Because these are
correlations, possible values range from -1 to +1.
Table 7: Rotated Component Matrix

Component
1	2	3	4	5	6	7
Activity	-0.188	0.120	0.131	0.079	0.720	0.128	-0.058
Out of touch	0.142	-0.117	0.058	0.708	0.257	0.037	0.163
Shutdown	0.271	-0.285	0.040	0.226	0.642	-0.249	-0.031
New People	-0.025	-0.003	0.495	0.457	0.025	-0.004	-0.299
Communication	-0.085	0.272	0.251	0.183	0.335	-0.653	-0.105
New Products	0.207	0.309	0.139	0.601	-0.046	-0.057	0.080
Fb Ads	0.141	-0.275	0.325	0.323	0.184	0.273	0.210
Promoted Post	-0.111	0.258	0.130	0.122	0.117	0.717	-0.155
User review	0.662	0.082	-0.104	0.295	0.113	-0.004	-0.198
Trendy	0.238	-0.478	0.345	-0.291	-0.015	-0.157	0.043
New companies	0.247	0.057	0.644	0.032	0.192	0.031	-0.011
Convenient	0.649	0.106	0.061	0.057	-0.180	-0.009	0.013
Easy use	-0.115	0.032	0.034	0.168	-0.084	-0.024	0.832
Life style	0.656	0.072	0.098	0.183	-0.077	-0.112	0.308
Brand Awareness	-0.023	0.191	0.728	0.107	-0.003	-0.016	0.156
Advertising Product	0.175	0.431	0.186	-0.284	0.368	-0.018	0.467
Promotional offer	0.666	-0.044	0.241	-0.104	0.133	0.033	-0.219
New entrepreneurs	0.123	0.610	0.248	-0.070	0.109	0.214	-0.031
Modernity	0.548	0.174	0.064	0.000	0.353	0.435	0.158
Commercialized	0.217	0.721	0.080	0.081	-0.098	-0.103	0.125

Descriptions of 7 Factors
1) Customer-centric Web Design: This factor is
created by the online portals where they designed the
web according to the needs of customers. The products
and services are displayed according to the customer
preference.
2) Startup Platform: Sometimes social media provides
a business platform for startups and entrepreneurships.
It helps them to reach to the millions of consumers with
minimal investment. Thus, Social media acts as a
launching ground for startup business.
3) Brand Cognizance: As surfing Social media has
become part and parcel of the daily life. So, it has become
an area where familiarity with the brand can be
increased. Thus, it helps in increasing Brand Cognizance.
The increasing brand cognizance will ultimately lead to
brand recall and brand recognition.
4) Product Adoption: Social media platforms help in
increasing the product adoption ratio. Through
prolonged surfing and using social media platforms,
customer’s awareness of the product increases. This
helps the Small and Medium Scale business industry to
increase their product adoption and accelerate their
business.
5) Dependency-Based Buying: The popularity of
social media platforms has increased widely among its
users. As a result, it has become a habitual dependency
among its users. The users not only depend on but also
trust Facebook. Due to this reason people often buy or
purchase through commercial business links given in
Facebook posts.
6) Value-Based Post: Sometimes commercial posts
are made in such a way that it targets the consumer’s
values and ethics. It changes the approach from
product-centric to customer-centric. It helps in
projecting trust-based advertisement which helps in
winning loyalty to the customer.
7) User-Friendly: The social media platforms are
designed in a technically friendly way, so that they can
be used and operated in a very easy way. The web
interface is designed in such a way that various social
activities as well as commercial links can be accessed
very easily without any technical hazard.
Sample Design and Analysis of objective 2
§ To find out to what extent the descriptive factors are
influencing and motivating the users more for buying
products through Facebook portal.
Table 8: Sample Design and Analysis
IJRTBTSOCIAL MEDIA IN SMALL BUSINESS INDUSTRY
38 | Vol. 2 (3) JULY 2018 | International Journal on Recent Trends in Business and Tourism
Table 9: Total Variance Explained

Comp onent	Initial Eigenvalues	Extraction Sums of Squared Loadings	Rotation Sums of Squared Loadings
Total	% of Varian ce	Cumulati ve %	Tot al	% of Varian ce	Cumul ative %	Total	% of Varian ce	Cumul ative %
1	3.476	17.382	17.382	3.476	17.382	17.382	2.470	12.348	12.348
2	1.823	9.117	26.500	1.823	9.117	26.500	1.824	9.122	21.469
3	1.721	8.606	35.106	1.721	8.606	35.106	1.725	8.627	30.096
4	1.412	7.060	42.166	1.412	7.060	42.166	1.633	8.165	38.261
5	1.256	6.278	48.444	1.256	6.278	48.444	1.555	7.773	46.035
6	1.206	6.032	54.476	1.206	6.032	54.476	1.384	6.922	52.957
7	1.063	5.317	59.793	1.063	5.317	59.793	1.367	6.836	59.793
8	0.949	4.747	64.540
9	0.931	4.654	69.194
10	0.832	4.161	73.355
11	0.808	4.039	77.394
12	0.701	3.505	80.899
13	0.647	3.235	84.135
14	0.599	2.995	87.129
15	0.556	2.780	89.909
16	0.534	2.670	92.579
17	0.414	2.072	94.651
18	0.397	1.985	96.636
19	0.344	1.721	98.357
20	0.329	1.643	100.000

Total variance explained
Through the result of Factor Analysis, we can explain
the total variance and the proportionate variance of
each factor in our study which is stated here. From the
above table, it is very clear that with the help of the 1st
component (Customer-centric Web Design) we can
explain 12.348% of the total variance followed by
2 component nd (9.122%), 3 component rd (8.627%),
4 component th (8.165%), 5 component th (7.773%),
6 component th (6.922%) and last one (6.836%). In our
study, we have explained total 59.793% of variance.
So, from the above analysis, the first component
(Customer-centric Web Design) having the highest
influencing power on the Nature of FB Users. We can
also say that the last component (User Friendly) of the
variance table has the lowest influencing power on the
Nature of FB users.
Table 10: User Friendly Variance

Sl. Number	Name of the Factor	% of variance
1	Customer centric Web Design	12.348%
2	Startup Platform	9.122%
3	Brand Cognizance	8.627%
4	Product Adoption	8.165%
5	Dependency Based Buying	7.773%
6	Value Based Post	6.922%
7	User Friendly	6.836%

CONCLUSION
From the objective 1 it has been observed that five factors
have been generated out of 15 variables, they are:
1) Customer Centric Web design
2) Startup Platform
3) Brand Cognizance
4) Product Adoption
5) Dependency Based Buying
6) Value Based Post
7) User Friendly
From the objective 2 it is found that two factors with
having highest influencing and lowest influencing
power on Buying behavior of FB users on FB platform.
These are:
1) Customer-Centric Web Design (12.348%) having
highest influencing power and
2) User Friendly (6.836% of variance) having lowest
influencing power.
LIMITATION AND FUTURE SCOPE OF THE
STUDY
The study was confined in Kolkata and its surrounding
areas in the field of Buying behavior and their
preferences of FB users. In future, Researchers can
extend their area of study to other districts or even other
states. Future Researchers can also explore their
innovative ideas and continue to find more influencing
factors that motivates the FB users to buy products
through Facebook portal and help the small-scale
industry to reach their destination by promoting their
products, changing their marketing strategies and by
giving their ideas to the startup level companies to
increase their businesses
SOCIAL MEDIA IN SMALL BUSINESS INDUSTRY IJRTBT
International Journal on Recent Trends in Business and Tourism | Vol. 2 (3) 2018 JULY | 39
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