A Research Framework for Social Commerce Adoption

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A research framework for socialcommerce adoption

Mahmood Hajli Department of Management, University of London, London, UK

Abstract

Purpose – Social relationships on the internet through the emergence of Web 2.0 applications creatednew opportunities for business. This is mainly because of the growth of social networking sites, whichhas also developed e-commerce. The current development in e-commerce opened a new stream, entitledsocial commerce, which is using social technologies to create an environment for generating socialinteractions. These social interactions can drive online social support in e-commerce, which in turn iscreating trust and an increased intention to use social commerce.

Design/methodology/approach – This research used social support theory and related theories on

intention to use to propose a theoretical framework for the adoption of social commerce.Findings – The model predicts that forums and communities, ratings, reviews, referrals andrecommendations are helping to introduce new business plans for e-vendors. The model also showstrust is an on-going issue in e-commerce and can be built through social commerce constructs.

Research limitations/implications – There is limited research in the area of social commercewhich this study seeks to redress. This study proposes a new model which can be extended by otherconstructs. However, the research needs to empirically test the constructs of the proposed model andtheir relationship.

Originality/value – This paper introduces social commerce constructs, namely; recommendationsand referrals, forums and communities and rating and reviews. The bases of the model proposed inthis research are IT adoption and literature in the area such as PU and intention to buy or trust. Thesehighlight the key role of ICT in the behaviour of online customers. This can be a development fore-commerce adoption models and the results signify that IS has a reference discipline for the behaviour

of online consumers. This is an issue in marketing where not enough attention is paid to theimportance of IT and IS.

Keywords Social commerce, Social commerce adoption, Electronic commerce, Trust, Social media

Paper type Research paper

IntroductionThe emergence of Web 2.0 applications transferred human approach to the web andinterconnectivity among users (Mueller et al., 2011). Virtual world is the otherdevelopment of Web 2.0, enabling people to interact on the internet (Mueller et al., 2011).The social interactions of people on the internet, especially in social networking sites(SNSs), have created a new stream in e-commerce. This new stream is social commerce.Social commerce is the use of Web 2.0 and social technologies to support interactions in

an online context to support consumers’ acquisition of services and products on theinternet (Liang and Turban, 2011). Web 2.0 is a phenomenon that has transferredinternet and the WWW to a social environment, creating platforms where peoplecan interact and create content online (Lai and Turban, 2008). This advancement hasalso elevated online communities to a level where new business plans can be developedand implemented (Lu et al., 2010). The co-create environment has changed the passivebehaviour of users to become active content creators on the internet (Hajli, 2012;Zwass, 2010).

The current issue and full text archive of this journal is available at

www.emeraldinsight.com/0968-5227.htm

Received 11 April 2012Revised 4 July 201221 August 201213 September 2012Accepted 10 October 2012

Information Management &

Computer Security

Vol. 21 No. 3, 2013

pp. 144-154

q Emerald Group Publishing Limited

0968-5227

DOI 10.1108/IMCS-04-2012-0024

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In this environment consumers are not only buying a product or service, but theyare creating content which can be a two-way value creation for customer and seller(Do-Hyung et al., 2007). Consequently, today’s customer is displaying active behaviourwhile participating in a business process.

Consumers are active and they have social relationships with other friends, membersof other communities and e-vendors. They communicate, rate other products, reviewothers’ opinions, participate in forums, share their experiences and recommend productsand services. Hence they are supporting each other, both in an informational andemotional context.

Literature suggests that the next generation of online businesses will be based oncommunities to attract new customers (Bagozzi and Dholakia, 2002; Ridings and Gefen,2004). Therefore, it is important for businesses to have a business model adapted tosocial commerce (Lorenzo et al., 2007; Liang and Turban, 2011). Some research hasshown that potential consumers are more interested in other people’s recommendationsrather than merely vendor generated product information (Ridings and Gefen, 2004).This can best be achieved by online rating, recommendation and voting in an onlinecontext (The Nielsen Company, 2007). Additionally, these interactions might help toincrease the level of trust and reduce perceived risk. Trust is an on-going issue ine-commerce (Gefen et al., 2003) and can be increased by social commerce and socialsupport. In fact, to endorse trust in an online context, there is a need to provide crediblesignals to re-assure e-vendors (Ba and Pavlou, 2002). Social commerce constructs (SCCs)can provide these indications and give sellers inducements to be trustworthy. SCCs suchas communities, ratings and reviews can facilitate this.

Trust has the mediating role in an electronic market (Ba and Pavlou, 2002) and in theproposed model, trust plays a part as a mediated construct. The present paperinvestigates the limitations of current literature and tries to develop a theoreticalframework for the future of e-commerce and social commerce. The research explains a

theoretical framework for social commerce drawing on social support theory and SCCs,which in this research focused on forums and communities, ratings and reviews,recommendations and referrals.

Literature review and theoretical frameworkSocial commerceSocial commerce is a new stream in e-commerce, emerging recently through thedevelopment of information and communication technologies (ICTs) and Web 2.0technologies. The emergence of Web 2.0 technologies, along with the introduction of wikis, blogs, communities and social networks, has dramatically changed the structureof the web (Lai and Turban, 2008). Some authors believe social commerce is affected bythe expansion of social networking (Leitner and Grechenig, 2007; Liang and Turban,

2011). Many of the technological advancements like RSS, AJAX or APIs offer onlineshoppers an interactive system which enables them to make connections with otherplatforms. This, in turn, has had an effect on business models such as B2C and C2C,which give new opportunities as communication channel (Do-Hyung et al., 2007).

Social commerce refers to the delivery of e-commerce via social media, whichemerged through Web 2.0 (Liang et al., 2011). Social media is a social technologyintroduced by Web 2.0 via SNSs such as Facebook, Twitter and Linkedin. Thepopularity of SNSs is the main reason for the current transformation (Liang et al., 2011;

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Liang and Turban, 2011; Fue et al., 2009). This phenomenon is shaping new businessmodels based on communities wherethe objective is to bringfeatures of social commerceto e-commerce in order to design customer-oriented businesses. This provides addedvalue for customers and will improve marketing strategies (Liang and Turban, 2011).

Social support and SCCsThe experience of the user in an online context is different to that offline, as the user hassocial interactions with other people. In an online context, consumers do not have actualhuman contact and sociability (Gefen et al., 2003). In fact, the relationship betweenvendor and consumer is anonymous and impersonal as well as automated (Wang andEmurian, 2005). In a high street shop, customers spend their time in store and interactwith the staff whereas in an online shop it is a major challenge to create an online storewhich is socially rich (Kumar et al., 2010; Do-Hyung et al., 2007). The social technologiesand applications of web technologies can influence social perception. People canparticipate in forums and communities, share their experiences and knowledge and

leave their advice for other users. Through these SCCs, people receive social support.These supports can be informational or emotional. These can increase trust andconsequently the likelihood that consumers will buy the product. With the advancementin e-commerce technologies like online forums and communities, recommendationsystems and chat rooms, actual interactions with other users may influence consumers’behaviour in an online market.

Social support is defined as:

The social resources that persons perceive to be available or that are actually provided tothem by non-professionals in the context of both formal support groups and informal helpingrelationships (Gottlieb and Bergen, 2010).

Social support has been thoroughly investigated in psychology, sociology and health

studies. With the emergence of Web 2.0 and social relationships in social technologies,it is now being welcomed into business studies.Members of online communities are able to participate in different group activities

and support other members through their social interactions and communications on agiven platform (Bagozzi and Dholakia, 2002). They use social technologies, such associal media, online communities and other Web 2.0 applications to support othermembers through their experiences and information sharing. When people join onlinecommunities and participate in group work, they are enhancing existing social supportsand networks throughout the community (Ridings and Gefen, 2004). These socialinteractions are facilitated by SCCs such as forums and communities, social media,ratings, reviews and recommendations (Hajli, 2012).

In online shopping, as consumers do not have first-hand experience of a product, such

as touching it or smelling it, reviews provided by other customers become ever morevaluable, especially if these customers do have hands-on experience of the product orservice (Do-Hyung et al., 2007). Their comments, reviews and ratings become vitalsupports for other potential customers (Do-Hyung et al., 2007).

Research model and hypothesesIn this research a social commerce adoption model to address the whole issue of socialcommerce hasbeen developed. Thereare six predictors forthis model as shown in Figure 1.

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According to the literature in this area they were identified to be important inunderstanding and explaining consumers’ intentions to make purchases.

In this research a social commerce adoption model has been developed in order toincrease our understanding of social commerce. Along with the SCCs, recommendationsand referrals, forums and communities and rating and reviews, the researcheradded trust as an ongoing issue in e-commerce, perceived usefulness and intention to

buy.

Trust Many researchers argue that trust is a key element in the online environment (Mutz,2005; Gefen et al., 2003; Pavlou, 2003). There is also an emphasis on social trust, associal trust is important because it reduces “transaction cost” in business interactions(Mutz, 2005). It reduces the tendency to monitor other parties’ activities, and is anelement in sanctioning systems as reliable (Mutz, 2005). Therefore, it is widely believedthat establishing trust will promote economic growth.

Social trust varies among people. Research shows, a customer who has neverundertaken online shopping, increasing the level of social trust makes it more likelythey will shop online (Mutz, 2005). Similarly, a lower level of trust makes the customer

less likely to shop online.Many different practitioners and researchers on e-commerce believe that social trust

is a key component in a country’s economic expansion and whether they can benefitfrom economic potential introduced by e-commerce (Mutz, 2005). Now the importanceof trust needs to be tested in social commerce.

In situations where people do not know each other, a high level of social trust cansmooth the progress of exchange between them, thus creating growth in the economydue to a reduction in transaction cost.

Figure 1.Social commerce

adoption model

Social Commerce Constructs

Rating and

Reviews

Forums and

CommunitiesTrust

Recommendation

and Referrals

Intention to Buy

Perceived

Usefulness


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Trust improves the efficiency of a society by facilitating coordinated actions. Socialtrust facilitates expansion of businesses in the market by attracting more customersleading to economic growth. Many believe the market in a digital economy is based onreducing face to face meetings. Here, trust plays a key role in online interaction.

Nowadays with the proliferation of the internet and the emergence of a digitaleconomy, countries which are concerned about economic growth have greater concernfor social trust. Trust is more important when risks are perceived to be high, as in thecase of e-commerce (Mutz, 2005). This area has been widely studied by researchers(Mutz, 2005). It has been shown that trust plays an important role in the e-commerceadoption process (Aljifri et al., 2003). People are concerned about buying products on theinternet if they have to leave their private information and credit card details. It is also aconcern in SNS. Disclosing personal information is a big concern in e-commerceadoption and now the same issue has arisen in s-commerce. The problem is that in somecountries, such as the USA, people are also concerned about the organizations andinstitutions which provide security for online shops.

Research shows that some advances in ICT have been used by companies to increase

social trust within the marketplace and online shops, as well as decreasing their riskperceptions in online behaviour (Grazioli and Jarvenpaa, 2000). This has tackled issuessuch as deceiving consumers by building unreal trust methods and systems of riskreduction (Grazioli and Jarvenpaa, 2000). This study uses trust as a foundation to testSCCs.

It has been confirmed that trust has a significant role in a customer’s intention to buy(Shin, 2010; Han and Windsor, 2011; Lu et al., 2010). Having confidence in the providerand with less perceived risk, a customer will search for new items or services in theonline environment and be more likely to make a purchase (Hassanein and Head, 2007;Shin, 2010). Hence, it is important to investigate the role of trust on a social commerceadoption system.

Given the concerns and risks about e-commerce, there is a significant relationshipbetween trust and online commerce behaviour (Ba and Pavlou, 2002). Trust plays a keyrole in determining a consumer’s behavioural intention and actual behaviour (Shin, 2010;Gefen etal., 2003; Ming-Hsien etal., 2009). Social commerce andthe emergence of Web 2.0can help customers to reduce their risk and increase social trust. Applications onWeb 2.0, such as customer ratings and review, would be a good solution to overcome thisbarrier. Social technologies enable consumers to have social activities in SNSs (Han andWindsor, 2011), where interactions among the connected users can increase trust amongthe participants (Han and Windsor, 2011; Swamynathan et al., 2008). Trust is animportant determinant in considering a consumer’s intention to buy (Roca et al., 2009;Han and Windsor, 2011). In fact, the more trust the consumers have, the more likely it isthat they will buy (Han and Windsor, 2011). Additionally, information obtained from

customer reviews is more trustworthy than information provided by an e-vendor(Do-Hyung et al., 2007). Consequently:

H1. User’s trust in s-commerce web sites has a positive effect on the user’sintention to buy on SNS.

Social commerce constructsThere are different constructs for social commerce. These constructs can becategorized as social media, ratings and reviews, social shopping, social advertising,

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recommendations and referrals and forums and communities. Companies use themas a platform to communicate with customers and to enable customers to communicatewith each other (Lai and Turban, 2008), which becomes a new channel for CRM. Theycan thus use social commerce to increase sales and decrease marketing costs.

The impact of social technologies in the market can be recognized from howe-vendors now provide more opportunities than before to interact with consumers(Amblee and Bui, 2011). These social interactions give consumers the opportunity togain more knowledge, which in turn will increase their trust (Lu et al., 2010). Onlinevendors create the platforms that allows businesses to take part in consumers’ socialinteractions using social technologies (Amblee and Bui, 2011). Social commerce, with theaid of Web 2.0 and social media technology, facilitates consumers’ ratings and reviewsand recommendations and referrals (Hajli, 2012). Members of SNSs can re-assure eachother through their information exchange and experiences, thus increasing theirconfidence and consequent willingness to buy (Han and Windsor, 2011).

The other construct of social commerce is ratings and reviews. Customers can accessfriends’ reviews, where there is an emotional aspect that adds a personal touch to thedecision-making process of buying. Brand reputation can also be affected by feedbackfrom reviews (Davidson and Copulsky, 2006). The consumer can turn to onlinerecommendation systems, which seem to have a big influence on the buyer. However,such systems are often biased according to different markets (Riemer and Lehrke, 2009;Senecal and Nantel, 2004). Yet the quality and quantity of information provided fromsome sources such as customer reviews certainly do influence purchasing intention(Do-Hyung et al., 2007).

Kumar et al. (2010) examined the evolution of structure of Yahoo! 360 and Flicker,both examples of social networks (Kumar et al., 2010). They discovered that althoughthere are some isolated users and communities in these two social networks, there arealso a large number of powerfully connected sections which span the whole network.

The research also shows social context or social support do influence trust(Weisberg et al ., 2011). When an e-commerce platform has social presence(Weisberg et al., 2011) and social applications, consumers feel more secure andconsequently they have more intention to buy (Hajli, 2012):

H2. The user’s forums and communities in s-commerce have a positive effect onthe user’s trust.

By welcoming friends and other users to join and offer positive support, people in SNSscan increase their ratings. With these interactions the level of trust will increase andconsequently, sales will too (Swamynathan et al., 2008). Ratings will also increase usersatisfaction when they undertake a transaction (Swamynathan et al., 2008). Accordingly:

H3. User’s rating and reviews in s-commerce have an effect on the user’s trust.

H4. User’s recommendation and referrals in s-commerce have an effect on theuser’s trust.

Perceived usefulness“People tend to use or not use an application to the extent they believe it will helpthem perform their job better” (Davis, 1989). This is perceived usefulness thatwas first introduced by Davis in 1989 and has been tested and validated by many


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researchers since. Perceived usefulness, along with perceived ease of use, is twovariables of technology acceptance model (TAM), which is one of the most successfultheories in predicting an individual’s intent to employ a technology. There are two coretheories to test and predict an individual’s intention to utilize an information system (IS)

(Mathieson, 1991). These two theories are the TAM, introduced by Davis (1989) and thetheory of planned behaviour (TPB) which was introduced by Ajzen (1985). Perceivedusefulness is an important element of TAM and has been tested and validated by manyresearchers.

However, TAM is a development of the theory of reasoned action (TRA). TRA wasoriginally designed to describe virtually any human interactions (Davis et al., 1989),whereas TAM was intended “to provide an explanation of the determinants of computeracceptance across a broad range of end-user computing technologies and userpopulations” (Davis et al., 1989). Many authors believe that perceived usefulness affectsusers’ intentions to use e-commerce (Gefen and Straub, 2000). This construct is appliedhere in social commerce as well.

Han and Windsor (2011) examine the user’s willingness to pay on SNSs. They usedthe new construct “perceived value of online connection” instead of perceivedusefulness. They found a significant positive effect of the user’s perceived value of onlineconnection on their willingness to pay other members of SNSs (Han and Windsor, 2011).

Useful and straightforward information on a web site increases the level of online trustand consequently increases intention to use a system (Yu-Hui and Barnes, 2007; Mei etal.,2005). Research shows the more useful functions that a web site provides, such as goodinformation and content, the more trust a customer will have in it (Yu-Hui and Barnes,2007). Albeit, the design of a web site can have great influence on the success of e-commerce (Song and Zahedi, 2005). A web site should have an attractive appearanceand should be easy to navigate around (Katos, 2012; Song and Zahedi, 2005). If so,consumers will assume a positive outlook and be more likely to engage. In addition,

when consumers feel comfortable with a web site, they will have more trust in thatplatform (Roca et al., 2009). Accordingly, it should be a significant variable in theproposed model:

H5. The user’s perceived usefulness in s-commerce web sites has a positive effecton the user’s trust.

H6. The user’s perceived usefulness has a positive effect on the user’s intention tobuy on SNS.

Research methodologyThe recommended methodology for this research is structural equation modelling (SEM)of the data analysis. Other authors (Gefen and Straub, 2000) believe this approach has

many advantages over other methods, for instance multiple regression. SEM is also goodin terms of path and factor analysis, especially when we are looking for reliability andvalidity of a research outcome from different angles. This is available through thisapproach. Using a SEM approach, a partial least squares (PLS) method was selected.This has advantages compared to others, for example LISREL. Moreover, PLS is alsorelevant for exploratory research (Chin, 1998; Gefen and Straub, 2004), which is thenature of this research. This method is also suitable fortesting a new model andtheory asit can be used for both confirmatory and exploratory research (Gefen and Straub, 2000).

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Given that this study is designed to test a proposed model and is also an exploratorywork, it is felt that this is the most appropriate method.

Discussion, implications and future research Implications for researchersThere is limited research in the area of social commerce which this study seeks toredress. This study proposes a new model which can be extended by other constructs.This research shows that SCCs influence trust and the consequent intention to buyamong users. The variable “trust” is shown to have a strong influence and its effect shallbe significant in reassuring consumers in social commerce. Accordingly, the position of trust in the proposed model is seen to be important.

Implications for ISsThe bases of the model proposed in this research are IT adoption and literature in thearea such as PU and intention to buy or trust. These highlight the key role of ICT in the

behaviour of online customers. This can be a development for e-commerce adoptionmodels and the results signify that IS has a reference discipline for the behaviour of online consumers. This is an issue in marketing where not enough attention is paid to theimportance of IT and IS. Customers are now interacting with ICT advancement ine-commerce and new platforms. This has highlighted the new role of IS in managementand attracted practitioners to look at IS from a managerial angle. Moreover, the fact isthat in the near future, with the development of Web 2.0, the role of IS will become moreimportant in predicting online consumer behaviour.

ConclusionThe social relationships of consumers, enhanced by the emergence of Web 2.0technologies, enable them to support each other and take an active role working on the

internet. This advancement has emerged through social commerce and is primarilybecause of Web 2.0. Web 2.0 has increased communication between consumers withthe introduction of new channels such as blogs, social networks, social media andcommunities. There are also new channels for businesses to get in touch withcustomers. This research discusses the role of social technologies and uses socialsupport theory to propose a research framework for the adoption of social commerce.The model covers SCCs and justifies them by social support theory.

Trust is an on-going issue in e-commerce and also now in social commerce. Thisconcern is of rising importance among consumers as social commerce platforms likeFacebook become more widespread. The model investigated the role of trust and itsimpact on intention to buy. Trust is seen to be a key factor to increase the intention tobuy and through the support of SCCs, social presence can be enriched. In addition a

web site’s perceived usefulness by consumers is likely to increase the trust andintention to buy.

The present study adopts TAM constructs and proposes a model which shows thatboth trust and perceived usefulness are likely to influence consumer behaviour. Theresearch discusses how trust can be challenged in a social commerce environment bythe use of SCCs. It also describes the potential role of each SCC on increasing the levelof trust in an e-commerce environment. In a follow-up research this work withempirical validation will consider by the author.


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About the authorMahmood Hajli is a researcher at Birkbeck, University of London. His research concerns theimpact of social relationships on business. He believes it comes at a time when theories of socialsupport from Psychology and Sociology are now being adopted by Management Studies, due tothe emergence of Web 2.0 and 3.0 applications and social technologies. In his research, he isdeveloping social commerce constructs and a model for the adoptionof technology, based on socialrelations within business. His main area of research is the adoption of e-commerce and socialcommerce, but he is also applying his model to e-health and e-learning. Mahmood Hajli can becontacted at: [email protected]

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A Research Framework for Social Commerce Adoption

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