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THE IMPORTANCE OF SOCIAL MEDIA IN THE
LUXURY FASHION INDUSTRY
Renata Falsarella Hernandez
A dissertation submitted in partial fulfilment of the requirement of the degree of
Bsc Business and Marketing.
Birkbeck, University of London
Malet Street, Bloomsbury
WC1E 7HX
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Acknowledgements
I recognize that this research would not have been possible without the help,
support and patience of many people. I wish to express my sincere gratitude to
all those who assisted and encouraged me during my studies.
I would like to express my gratitude to my supervisor Dr Christine Guo and to
Dr Marion Frenz, whose time and guidance were fundamental during this
project.
I would also like to extend my thanks to all respondents for dedicating the time
to take my survey, which was essential for the completion of this project.
Finally, I would also like to thank my mum for supporting and encouraging me
to complete a bachelor degree abroad. Finally, I would like to thank you my
partner Valerio for his patience and support.
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ABSTRACT
Understanding the application and benefits of social media networks in
increasing brand awareness and driving revenue has become an important topic
for researchers and managers across all industries. The significant and rapid
growth of the Internet and subsequently social media presented a real challenge
for luxury fashion companies, however academic research has been limited in
this area.
The purpose of the research underpinning this dissertation is to identify the role
and impact of social media networks within the luxury fashion industry from a
consumer perspective. A quantitative research method was used to collect data
from luxury fashion consumers and social media users. Analysing data collected
from 136 individuals shows specific positive relationships between factors such
as brand following, levels of satisfaction and usage of social media as a source of
information and the influence they ultimately play in consumer decision making
processes when purchasing goods. The results confirm the importance of an
active and effective presence on social media networks for companies operating
in the luxury fashion business.
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TABLE OF CONTENTS
ABSTRACT..................................................................................................................3
TABLE OF CONTENTS ............................................................................................4
LIST OF TABLES.......................................................................................................6
LIST OF FIGURES.....................................................................................................6
1. INTRODUCTION ..................................................................................................7
2. LITERATURE REVIEW .....................................................................................10
2.1 The Evolution of Marketing and the Internet ........................................................10
2.2 Social Media ..........................................................................................................12
2.3. Luxury Fashion Marketing ...................................................................................16
2.4 The Connection Between Luxury Fashion Marketing and Social Media..............18
2.5 Conceptual Model..................................................................................................26
Conceptual Framework and Hypothesis Development ...............................................26
2.5.1 The relationship between followers and their intention to buy ..........................27
2.5.2 The relationship between social media engagement and their intention to
buy ...............................................................................................................................28
2.5.2:1 Satisfaction ......................................................................................................28
2.5.2:2 Source of Information and Trust......................................................................29
3. METHODOLOGY ................................................................................................30
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4. DATA ANALYSIS AND RESULTS....................................................................33
4.1 Results....................................................................................................................33
4.2 General Findings & Discussion:............................................................................36
5. CONCLUSION ......................................................................................................42
6. REFERENCES ......................................................................................................46
7. APPENDICES........................................................................................................53
Appendix 1: .................................................................................................................53
Responses Summary....................................................................................................53
General Luxury Fashion Consumer Profile on Social Media......................................53
Luxury Fashion Consumer and the Online Purchase...................................................55
Fashion Luxury Consumer and Social Media..............................................................57
Appendix 2: .................................................................................................................64
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LIST OF TABLES
Table 1: Coefficients for H1........................................................................................34
Table 2: Coefficients for H2........................................................................................35
Table 3: Coefficients for H3........................................................................................35
LIST OF FIGURES
Figure 1 . Comparison of Marketing 1.0, 2.0 and 3.0 .................................................11
Figure 2. Internet Users in the World ..........................................................................12
Figure 3: Conceptual framework: the relationship between social media
engagement and intention to buy.................................................................................26
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1. INTRODUCTION
Online marketing is the fastest growing form of communication for business.
The Internet is the most important communication channel due to both the
volume of users and the amount of time they choose to invest in online activities.
A recent study by the research website Internet Live Stats (2015) showed that
more than 40% of the global population is now online with the user count
continuing to climb. Despite this extensive potential customer base, brands such
as Chanel and Céline do not sell their products online and authors such as
Kapferer and Bastien (2012) criticised the extension of luxury brand’s
availability on the online space stating that the Internet, a media mass
communication tool, is not the right medium for luxury brands.
Luxury fashion brands have refrained from investing heavily in online commerce
preferring to target their online investment into brand building initiatives. The
main reason is that the store environment plays a major role in the luxury buying
experience driving up customer satisfaction level. When considering luxury
goods, consumer behaviour and ultimately buying decisions can be positively or
negatively impacted by their reaction to the store design, weather, music and
many other environmental and social factors not replicable online. Hence,
shopping is no longer considered a simple action of purchase, shopping has
become an experience (Solomon 2010). Even more, experience, in luxury brand
marketing, is everything, in fact, experimental marketing is a key for luxurious
brands as consumers, beyond buying for a product or a service; they are paying
for an experience to enjoy memorable moments (Atwal and Williams 2008).
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Technological development and the growth of the Internet led to a change in how
companies and consumers related. This change was largely driven by the use of
social media network channels such as Facebook, Twitter and Instagram. Today,
according to Statista (2015) there is an average of 1.96 billion social network
users around the globe. The explosive growth and ongoing evolution of social
networks and consumer participation in these platforms has been forced
companies to engage and adapt their marketing strategies. Whilst the luxury
fashion industry remains reluctant to actively sell online, they are not immune to
the impact of the web and the amount of time and attention it takes from
potential customers.
Today, companies understand the critical importance of building and maintaining
customer relationships. Marketers are increasingly using social media channels
as a vital tool in forging those relationships subsequently increasing both brand
awareness and profit for companies. Recent studies show that the level of
engagement makes a big difference in the purchase decision process of customer
(Solomon and Tuten 2015). Given these findings it is surprising to observe the
scarcity research on the application of online and social media strategies in the
context of the luxury goods industry.
The apparent gap prompted the research questions behind this dissertation. What
is the role of social media within the luxury fashion industry? Can it affect
consumer behaviour and perceptions? The intention then is to answer these
questions by researching the world of luxury fashion brands and understanding
the behaviour of luxury fashion consumers.
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A review of the academic literature, demonstrates a clear shortage of studies
defining the role of social media in the luxury fashion industry. Most available of
research covers the consumption of non-luxury items, some studies do evaluate
social media usage within the luxury industry, however, they focus solely on the
Asian market with no indication of how these finding might extend to the
perception and behaviour of consumers. Thus, this research will examine
existing literature in consumer behaviour, luxury fashion marketing, social media
and existing studies regarding social media in the mass consumption to identify
if similar patterns apply to the fashion luxury consumer.
In order to understand the role of social media within the luxury fashion industry,
a questionnaire will be distributed to social media users who also qualify as
luxury fashion consumers. The results will be analysed and discussed in order to
establish whether the luxury fashion industry should invest more heavily in
social media as an important marketing channel.
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2. LITERATURE REVIEW
This chapter will first examine literature on the evolution of marketing and the
Internet, social media and luxury fashion marketing. It will then review the
luxury fashion marketing and social media followed by the motivations of
consumers and finally the importance of social media. The chapter will conclude
with a conceptual framework and the hypothesis proposed to direct the research.
2.1 The Evolution of Marketing and the Internet
Today, the Internet is the main channel of mass communication. Many authors
have discussed the growth and the importance of the Internet and its relation to
marketing. Jobber (2010) has stated the importance of the Internet as the fastest
growing and maybe the most important communications tool for marketers to
promote their brands and products.
The growth of the Internet brought a "business revolution", as users become
active in the process of sharing information on their likes and dislikes leading to
a revolution in their role from passive consumers to trend setters amongst their
peer group. Kotler and Armstrong (2014) have debated that today the web is not
only used as a tool for promoting but also for communicating and creating a
relationship with consumers. They also observed that marketers are switching
from a mass-market communications strategy to a more targeted one, in order to
promote stronger relationships. Consumers are not only purchasing products but
are also empowered, through the Web, to participate and share their purchase
experiences and relationship with the brand. They argued that all these changes
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have transformed the way companies conduct their business and marketing
activities and an online presence is now crucial.
The advance of technology had a huge impact and changes on consumers,
markets and marketing. Kotler et al. (2010 p.10) explains the impact that the
technology evolution had on marketing communications strategy:
“Marketing 1.0 was initiated by production technology development during
Industrial Revolution. Marketing 2.0 came into being as a result of
information technology and the Internet. Now, new wave technology
becomes the major driver for the birth of Marketing 3.0”.
Figure 1 . Comparison of Marketing 1.0, 2.0 and 3.0 (Kotler et al. 2010).
One of the main forces of this new wave technology is the penetration of low
cost Internet and the cheap computers and smartphones access. Technology
evolution allows people to express themselves, create, participate, and
collaborate on the same time that they consume. Furthermore, one of the enablers
of this new wave is the growth of social media, which should not be ignored.
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Today, according to Internet Live Stats (figure 2), more than 40% of the global
population is online, and numbers are still climbing. As a consequence, it has
become extremely important for brands to be present on all platforms. Today,
marketers must recognise the need to supplement traditional communication
channels such us print based press, radio, television with an active online
presence.
Figure 2. Internet Users in the World (Internet Live Stats 2015).
2.2 Social Media
“Informal conversation is probably the oldest mechanism by which opinions on
products and brands are developed, expressed and spread.” (Johan Ardnt)
As discussed in the previous section, marketers were delivering their
communications message to a specific audience target. Today, with the
evolution of the Internet, consumers are talking and even participating on the
construction of the brand via for example what researchers call user generated
content (Jones and Ryan 2012).
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The main channel for this phenomenon are the social media channels, where
billion of conversations take place everyday and marketers are now actively
taking part in this conversation, developing a meaningful relationship with their
consumers.
Social media is the term used to define web-based software and services that
allow users to be on the same platform to exchange ideas, discuss and
communicate. Interactions can be in form of text, video, and images in any
combination supported by a given social platform. Vanessa Fox (2009), a social
media expert cited in Jones and Ryan (2009, p.153), described social media as
follows:
“There are all kinds of ways that people talk online, and social
networking really is anywhere people are talking online. From a
corporate perspective what you’re most interested in is where people are
talking about you, talking about your products, and talking about the
topics you care about.”
A common theme uncovered in the literature review was the importance of social
media as an essential tool for the marketing communications strategy of
companies as a medium to increase brand awareness and to develop and nurture
costumer relationships (Jones and Ryan 2009; Dijck 2013, Solomon and Tuten
2015; Kotler et al. 2010). Even the word “social media” defines how these
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platforms are user centred and therefore represent a way to accumulate social
capital with a huge potential to increase profit (Dijck 2013).
In fact, according with a recent report by Strategy Analytics, cited in Bose
(2015), there were more than 2 billions users of social media worldwide and
marketers spent nearly $15.3 billion on social media advertising in 2014. The
numbers clearly show the importance and the potential that social media can
have as a powerful marketing tool and source of revenue.
Social media can be classified into two broad categories: expressive and
collaborative (that implies open sourcing as Wikipedia) (Kotler et al. 2010). This
study will focus on the following expressive social media channels: Facebook,
Twitter, Instagram, Youtube, GooglePlus and Pinterest as they are the most
commonly adopted social media channels worldwide.
As discussed earlier, it is clear that social media is increasing in number of users
worldwide and most brands are adopting social media as part of their marketing
strategy. Social media is considered as a powerful and cost effective “brand
community” which are adopted and highlighted by many marketers. It is
believed that the level of engagement makes a big difference in the buying
decision process and that the higher the engagement, more benefits will be seen
by brands (Solomon and Tuten 2015).
In fact, a study conducted by DEI Worlwide (2008) showed that consumers rely
on different types of social media channels to search for product and brand
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information online: 70% of consumers visited social media websites to gather
information, 49% of those made a purchase decision based on the information
gathered after the visit and 57% who visited social media website are more likely
to purchase.
From a social media perspective, brands want, at least, consumer to become
friends with the brand’s online presence. A recent study by Razorfish, cited in
Solomon and Tuten (2015, p. 351), found that 40% of online consumers are
following brands on online social networks sites and even more are engaging in
different ways with a brand, 70% confirmed to have read a company’s blog and
67% watch branded videos on Youtube.
Another study found that purchase intention was higher among brands with
interactive profiles on social medias in comparison with brands without such
profiles, the study by Syncapse, cited in Solomon and Tuten (2015, p. 358),
revealed that people spend an average of $72 more on products or brands which
they follow on social media channels than on the ones they do not follow,
followers of a brand are 28% more willing to keep using that brand and 41%
stated they would be more willing to recommend a brand they already followed
and they also said they feel connect to the brands they are following.
Although there are marketing researchers in luxury fashion marketing in the
online sphere, there is little or no empirical evidence on what types of social
media engagement influence western luxury consumer behaviour. A study
compared the luxury consumer behaviour in-store and online (Liu et al. 2013),
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other study did a comprehensive exploratory study on the importance of social
media within the luxury industry (Berlendi 2011) and a research even draw
empirical evidence on whether social media networks influence luxury
consumers or not in Asia (Kim and Ko 2012). Most researchers studied the
influence of social media networks on mass-market consumers (Ionas and Stoica
2014; Akrimi and Khemakhem 2012; Agnihotri et al. 2012; Carolyn and Parasis
2011; Hajli 2014). Therefore the subject is relevant new and is still a current
challenge to the industry.
2.3. Luxury Fashion Marketing
Kapferer (2012) explains that luxury is related with a sociological issue in any
society, the definition of luxury correlates with the type of society the consumer
lives in. From the 20th,
century the author argues that luxury became highly
accessible for many reasons including increasing spending power and
globalization.
Branding is an extremely important concept in the fashion luxury industry, it is
not only connected with the logo of the brand but it is related with its identity
and with the experience of the consumer who buys the brand (Okonkwo 2007).
As Okonkwo (2007, p. 103) observed:
“A brand is the sum of all the feelings, perceptions and experiences a
person has as a result of contact with a company and its products and
services.”
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Luxury fashion brands have at the heart of their business positioning and
marketing strategies developed in line with their branding in order to gain
recognition amongst target consumers. Okonkwo (2007) cites the core
characteristics of luxury brands as: brand strength, differentiation, exclusivity,
innovation, product craftsmanship and precision, premium pricing and high
quality.
Furthermore, it is argued that the key for a successful luxury fashion brand is the
differentiation and the emotional appeal, and in particular, the intangible aspects
is always present in all marketing activities of luxury fashion brands (Okonkwo
2007).
Atwal and Williams (2008) have argued that creating a strong brand and
marketing luxury goods become highly complex as consumers are not seeking
only quality and authenticity in products, but also an experience, which matches
their expectations and lifestyle. Luxury, traditionally, is synonym of exclusivity,
status and quality however, modern consumers also seek a sense of belonging
and the key to luxury brands marketers is to bring a holistic approach,
incorporating entertainment outside the immediate experience. Consumers want
to enjoy a memorable moment and also participate in the process of value
creation.
Additionally, luxury fashion brands have high brand awareness from consumer
due to its marketing activities in the right channels. The most common channels
are advertising, sponsorship and sales promotions. To increase brand awareness
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while keeping the brand positioning, the marketing strategy of luxury brands
needs to be done with attention and precaution, always utilising the right
channels of communications (Okonkwo 2010).
As discussed earlier, the success of a brand is achieved through skilful brand
management and its ability to align the organization values of the brand with the
brand identity, brand image, brand positioning and how well the brand conveys
its image to the consumer. Kapferer (2012) stated that a brand can be defined as
an influential name and its power can be measured by the following factors:
aided brand awareness, spontaneous brand awareness, evoked set, consumption.
It is clear that marketing communication strategy is important for any brand,
especially for luxury brands as they need to explain and give emotional and
rational reasons for consumers to purchase an expensive item. Luxury fashion
companies adopt a broad communication strategy, making use of diverse tools.
The most common channels for luxury fashion marketing to advertise their
products are catwalks, magazines, television and celebrities endorsement
(Berlendi 2011). However, luxury brands have been faced with the challenge of
keeping the status of “exclusivity” by the growth of the Internet and in particular
of the social media.
2.4 The Connection Between Luxury Fashion Marketing and Social Media
The slow and reluctant adoption of a digital marketing strategy and of an online
presence by luxury fashion companies has been noticed by many authors
(Okonkwo 2007; Okonkwo 2010; Berlendi 2011). The reason behind this
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slowness and reluctance is the connection between the concept of luxury fashion
marketing and social media. As discussed previously, they are diametrically
opposed, social media is “inclusive rather than exclusive, democratic rather then
selective” (Berlendi 2011, p.20).
Kapferer and Bastien (2012) were opposed to luxury brands selling their
products online and on social media employing the arguments that luxury
purchases needs time and effort, a one-to-one relationship with the shop assistant
and that core factor of the brand experience. They described the Internet dilemma
as follows:
“Digital is noisy, crowded and flashy; luxury is quiet and sleek. Digital is
about impermanence, immediately, availability, accessibility, easiness;
luxury is about timelessness, culture, heritage, rarity, effort. Digital is
about crowd-sourcing; luxury is about creation. Digital is about price –
good deals and discounts; luxury is beyond price – no sales, no
discounts. Digital is about automation; luxury is about one-to-one and
human relation” (Kapferer and Bastien 2012, p.247).
All the reasons and arguments are valid, it is clear that there is a huge pressure on
luxury companies to adopt a digital strategy from the demands of wealthy and
digital savvy consumers they also know how difficult is to transfer the
prestigious atmosphere and the experience delivered in store to the digital world,
however it is possible and there are brands already succeeding (Osonko 2010).
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Furthermore, that’s the biggest challenged faced by the luxury fashion industry
and going or not going online is no more in question, best practices, strategies
and tool need to be discussed as it is argued that luxury products can be
successfully positioned online (Osonko 2009).
It is clear that the possibility of losing the feel of exclusivity and the prestigious
allure associated with fashion luxury brands are the main fears for such brands to
go online and adopt social media channels in their marketing communications
strategy. Louis Vuitton is a great example of a prestigious luxury brand which
embraced technology without fear, consumers are able to buy their products
online and their website connects users to the following social media channels:
Facebook, Youtube, Google+, Twitter, Instagram, Pinterest and Foursquare. On
the other hand, brands like Chanel and Dior are still reluctant to sell their good
online despite being present on social media channels. Furthermore, even though
luxury fashion brands are following the global trend and adopting the use of
social media channels to increase brand awareness, they are still reluctant to
engage in conversations with their followers and consumers on social networks,
in fact, one-third of brands do not allow their fans to post or comment on their
Facebook walls as an example (Morphy 2012).
One of the main theories regarding consumer behaviour was proposed by the
psychologist Abraham Maslow, whom believed that people are motivated by the
urge to satisfy needs. He organised human needs hierarchically from bottom to
top as follows: physiological, safety, belongingness, ego needs and self-
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actualization, arguing that they are satisfied from biogenic to psychogenic needs,
with each level being increasingly difficult to attain (Solomon 2010).
Many authors have stated the importance of satisfying all needs from luxury
consumers as in the luxury space the whole buying experience are key factors for
consumer satisfaction and loyalty as luxury brands provide subjective intangible
benefits (Osonko 2007; Atwal and Williams 2009; Kapferer and Bastien 2012).
A study by Vigneron and Johnson (1999) proposed that luxury consumers have a
prestige-seeking behaviour with multiple motivations but the most common
motivations that lead to purchase are motives of sociability and self-expression,
luxury consumers purchase premium brands to impress others, to feel exclusive
and for self-fulfilment.
The growth of the Internet changed consumer behaviour, including luxury
consumers. In fact, a recent research conduct by Liu et al. (2013) compared and
contrasted the online and in-store shopping behaviour towards luxury goods and
found that consumers are influenced by different motivational factors in both
environments. The study found that 42.1% of online luxury consumers are
looking for convenience and 23% of them stated that they want to purchase
luxury items with a better price, using the Internet to compare prices and find
deals. The result of the research contradicts the traditional behaviour of luxury
consumers.
The growth of social media networks also impacted consumer behaviour, in fact,
today the term ‘social consumers’ is used to refer to tech-savvy consumers that
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make use of social media networks. Henri Tajfel and John Turner introduced the
concept of social identity and explained how individuals behaved in groups,
originally formulated the Social Identity Theory (SIT) in the 1980s. The SIT has
been highlighted as an important factor for consumer behaviour in online brand
communities and has been identified as:
“The essence of one’s self-identification relies on the membership to a
social group (or groups) and also on the value and the emotional
significance attached to such membership” (Druica and Musso 2014,
p.15).
The social identity theory provides a rational to explain why community users
search for relationships within the community. Social media communities help
consumers to find self-esteem and feel the “belongingness” of a group in which
they share values and interests (Meister 2012). The social identity is a term also
used to explain and define the profile, the activities and all information users
provide on social media channels.
The social identity theory contributed to the development of the Consumer-brand
identification theory (CBI). The CBI transferred the concept of the SIT into the
consumer sphere and its relationship with brands, arguing that people are able to
identity themselves with brands even in the case of an absence of a membership.
Consumer-brand identification theory (CBI) refers to individual’s sense of parity
with a particular brand and argues that people who identify themselves with such
brands are more likely to take actions that will benefit the brand and it has been
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increasingly used in marketing literature (Elbedweihy and Jayawardhena 2014).
Consumers tend to find themselves similar to brands and tend to create a
association between them which lead to consumer to feel close and engaged with
a brand (Aaker 1997).
Several researches found that CBI plays an essential role in building and
nurturing relationship with consumers, influencing consumers on the purchasing
decision making process, increasing loyalty, satisfaction and leading to a positive
word-of-mouth (Druica and Musso 2014; Elbedweihy and Jayawardhena 2014).
Solomon and Tuten (2015) explain the motivations that lead to users to use social
media as follows:
• Affinity Impulse: social media is used as a social function to maintain
and develop relationships
• Personal Utility Impulse: this motivation relates with the usefulness of
social media, whether users are seeking information, convenience or
entertainment
• Contact Comfort and Immediacy Impulse: the need to feel close to
others
• Altruistic Impulse: the necessity of doing something good
• Curiosity Impulse: people may feel curious about others and may use
social media to satisfy this curiosity
• Validation Impulse: to feed their ego
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Marketers need to understand the motivations behind social media users in order
to make strategic decisions about their digital presence. Understanding the social
identity and the motivations of consumers on social media enables brand to learn
more about their consumers and adopt the best approaches to consumer
engagement as social media can do more than just engage, social media can
influence sales (Solomon and Tuten 2015).
The Customer Engagement Behaviourial (CEB) concept has been defined as:
“Customer engagement behaviors go beyond transactions, and may be
specifically defined as a customer’s behavioral manifestations that have
a brand or firm focus, beyond purchase, resulting from motivational
drivers” (Van Doorn et al. 2010, p.3).
From a customer perspective, the factors that can affect CEB the most are:
customer satisfaction, brand commitment, trust, brand attachment, and brand
performance perceptions. It is believed that low or high levels of these factors
can generate consumer engagement, which can be classified as positive or
negative (Van Doorn et al. 2010).
Today, companies understand that to sustain a competitive advantage they must
build, sustain and nurture customer relationships. Marketers are using social
media as an important marketing tool for building customer relationship and
engagement. Engagement is the heart of social media. People can engage in
different ways, from a customer perspective, engagement is the customer
behaviour towards brands; it is more than just the action of purchase. Engaged
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consumers not only have greater purchase intention but they become a brand
ambassador, sharing information, writing reviews and producing positive word-
of mouth (Solomon and Tuten 2015).
The purchase intention of a consumer is a concept based on different aspects and
motivations that lead to the consumer to buy that product and many studies relate
the purchase intention towards the preference to a brand or a product, and
measuring purchase intention is about predicting future consumer behaviour
based in their atttitudes (Kim and Ko 2012).
People can engage in different ways on social media, consumers can follow
brands on social media networks (connecting with brands by liking, following –
different terms are used in each social network), comment, share, contribute with
their own content (user-generated content), they can have a two-way
conversation with brands and even use social networks for customer service
purposes. They can be influenced to buy or they can influence others to buy via
positive e-word-of-mouth.
In order to direct the research, the study focused on the six most commonly used
social media networks website which are: Facebook, Twitter, Instagram,
Youtube, GooglePlus and Pinterest and focused only on western consumers. The
researcher decided to explore the role of social media within the luxury industry
by analysing the different types of engagement and if they can influence on the
purchase decision process of consumers, addressing a gap in the current research.
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2.5 Conceptual Model
Based on the literature review, this research paper formulated hypothesis in
regards to the types of engagement on social media and the impact on purchase
intention, within the luxury fashion industry.
Figure 3: Conceptual framework: the relationship between social media
engagement and intention to buy.
Conceptual Framework and Hypothesis Development
As the topic is relative new and there is a scarcity of data, the researcher used the
literature review to build up knowledge and develop the conceptual framework.
The review included available literature covering social media, luxury fashion,
consumer behaviour and consumer engagement. The researcher has attempted to
synthesize the relevant threads from the literature review into a coherent
conceptual framework upon which to base the study.
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2.5.1 The relationship between followers and their intention to buy
As previously discussed, according to the Social Identity model and the
consumer-brand identification theory, users of communities identity themselves
with brands and being part of a brand community helps customers to increase
self-esteem and feel the sense of belongingness (Meister 2012). Furthermore,
different studies of the consumer-brand identification theory establish that these
feelings plays an important role in the purchasing decision making process of
consumers (Druica and Musso 2014).
Solomon and Tuten (2015) advocate that social media engagement is crucial and
the minimum level of engagement brands must expect from consumers is
‘following’ as the fan base is an indicator of the brand’s success in establishing a
well-known social media community. A study by Razorfish, cited in Solomon
and Tuten (2015, p.351) revealed the benefits of brands having social profiles,
40% of online consumers are following brands on social networks sites and are
more willing to interact in other ways with the same brands.
Thus, following this reasoning, the research expects to find a positive
relationship between followers of their favourite brands on social media channels
and their intention to buy and therefore posits:
Hypothesis 1 = There is a positive association between followers of their
favourite brand on social media and their intention to buy
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2.5.2 The relationship between social media engagement and their intention to
buy
The Customer Engagement Behaviourial (CEB) theory stated that engaged
customers can lead to positive or negative actions from customers and the factors
that can affect consumers the most are: customer satisfaction, brand
commitment, trust, brand attachment, and brand performance perceptions (Van
Doorn et al. 2010).
Based on the consumer engagement behaviourial theory and by the fact that
consumers can engage in different ways on social media networks, this study
formulated the following hypotheses:
2.5.2:1 Satisfaction
Customers will only interact and continue to engage with brands if the
relationship between them and the brand results in satisfaction, so marketers
need to satisfy costumers as this represents an essential factor in order to increase
engagement. Furthermore, levels of satisfaction can influence the purchase
process and even result in customer exit (Sashi 2012).
A satisfied customer is more likely to engage with brands and will even feel
more willing to buy its products while a dissatisfied customer may look for
alternatives, based on this the researcher propose the following hypothesis:
Hypothesis 2 = There is a positive association between the level of satisfaction
with brands on Social Media and their intention to buy
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2.5.2:2 Source of Information and Trust
Trust is a critical factor in consumer behaviour and it is clear that if consumers
who are already engaging with brands on social media have a certain level of
trust towards the brand. One way that brands can enhance consumer trust is
openly providing them with information about themselves and their associated
products. Social media provides a perfect communication tool to achieve that
(Laroche et al. 2012). Also as discussed previously, Solomon and Tuten (2015)
explained that the personal utility impulse is one of the most motivating factors
for users to engage on social media.
Furthermore, as previous discussed in the literature review, many luxury fashion
brands are still reluctant to sell their goods online and are using social media
only to engage customers. Laroche et al. (2012, p. 1757) suggests:
“The communities that are formed for the purpose of sharing information
rather than for mere commercial reasons exert the greatest influence on
members’ opinions and purchase intentions”
Based on this and on the customer engagement behaviourial theory, the
researcher expects to find a positive relationship between the usage of social
media to follow fashion trends by consumers and their intention to buy. This
would justify social media efforts and therefore proposes the following
hypothesis:
Hypothesis 3 = There is a positive association people who use social media to
keep up with trends and their intention to buy
! 30!
3. METHODOLOGY
A research paradigm is a philosophical framework used to guide researchers in
how to conduct their projects and to help them clarify their assumptions. There
are two main research paradigms: positivist and phenomenological. For the
purpose of this research, the researcher concluded that it was more appropriate to
adopt the positivist position. As the main question to answer is “What is the role
of social media in the luxury fashion industry?” and according to Collis and
Hussey (2003) the positivist approach investigates, in an objectivist manner, the
facts and causes of social phenomena therefore using a logical approach in the
research process, stating that the study of human behaviour should be done
exactly as in the natural sciences. However, is important to emphasize that “the
positivistic and phenomenological paradigms are two extremes and very few
people would operate within their pure forms” (Collis and Hussey, 2003, p.51).
The aim of the research is to test and measure the importance of social media
within the luxury fashion industry, thus the rational aspects are important still, as
the research investigated the consumer behaviour towards luxury brands and its
subjective motivations, some subjectivists aspects were evaluated.
According to Saunders, Lewis and Thornhill (2012) the deductive approach starts
with an existing theory identified in the literature review leading to an evaluation
of propositions or hypothesis usually measured qualitatively. On the other hand,
an induction approach starts with observation and data collection to generate or
to build a theory. This research is mainly deductive as existing literature were
used to develop a conceptual framework and to test whether existing propositions
about social media and consumers applied in non-luxury consumers industry
! 31!
could have similar results within the luxury fashion consumer. However, there
are some appearances of inductive logic as the subject is relatively new, there is a
scarcity of data and the literature review was used to build up knowledge from
the theory and guide the researcher. Many authors state the commonality of using
both approaches (Collis and Hussey 2003; Blackmon and maylor 2005;
Saunders, Lewis and Thornhill 2012; Lewis and Saunders 2012).
The researcher selected the survey format as the most appropriate approach to
answer the research questions. Surveys are highly popular in business and
management research projects as they are “particularly suitable for asking
question such as: ‘who?’ ‘what?’ ‘where?’ ‘how much?’ and ‘how many?’”
(Lewis and Saunders 2012, p.116). As quantitative approach was applied, the
researcher personally designed and distributed a questionnaire due to the lack of
time and resources.
The non-probability sampling technique of self-selecting was used as the total
population was unknown. Participants were invited to respond via the
appropriate media. The questionnaire was designed using online software,
Survey Monkey, and carried the logo of Birkbeck University. All respondents
were assured that all answers would remain confidential and anonymous in order
to comply with ethical requirements.
In order to achieve a high response rate and meet the researcher’s interest in
collecting data from a variety of sources, respondents were invited to take the
questionnaire via all of the following social media channels: Twitter, Facebook
! 32!
and Linkedin. The invite included an embedded link and a brief explanation of
the survey. The researcher choose this method as it was cost effective and
aligned well with the objective of the research.
The questionnaire consisted of 22 questions (see Appendix 2), the first five
evaluated the respondent’s personal profile, asking questions such as their age,
salary, if they use Social Media and with what frequency. The other questions
were used to establish an understanding of their behaviour in the online sphere
and their feelings towards brands and their online presence. The researcher used
rating (Likert-style rating and likehood) and category types of questions.
According to Lewis and Sanders (2012) the design of each question should be
implemented according to the data needed and researchers can adopt or adapt
questions used previously or even develop their own questionnaire. As the
subject is new and there was not any specific legacy research to reference on the
subject, the researcher designed a new questionnaire referencing previous
research on similar topics as a guide (Razorfish 2008, Lux Hub 2015, DEI
Worlwide 2008, Liu et al. 2013).
In total, 136 responses were captured, however, upon review only 116 were
found to be fully complete, therefore, 20 incomplete questionnaires were deleted
from the analysis to ensure statistical accuracy.
! 33!
4. DATA ANALYSIS AND RESULTS
This chapter covers the results of statistical analysis of data collected from 116
questionnaire respondents. Statistical descriptive analysis was applied to test the
four hypotheses proposed. The data analysis and results will cover measures and
the results overview followed by the researcher’s own commentary on the
results. The response rate was at the higher end of the researchers initial
expectations. All survey responses were transferred from the Survey Monkey
software and analysed using the statistical analysis tool SPSS (see Appendix 1).
4.1 Results
As previously discussed, all responses collected were analysed to find potential
associations using the statistical package for the social sciences (SPSS).
The chi-square test was used to analyse all three hypothesis, as all variables were
categorical data. Internal validity was considered, as the validity of a chi-square
test depends on the sample size and the number of cells, the approximation is
considered adequate if the sample size is greater than 40 and if no more than
20% of the expected frequencies are less than 5 and none is less than 1 (Berkman
and Reise 2012). Therefore, the validity of the chi-square tests adopted is
considered acceptable and valid.
When testing H1, a chi-square test was performed to test the null hypothesis
“there is not a relation between followers of their favourite brand on social media
and their intention to buy”, the results are presented in table 1.
! 34!
The results confirm that there is an association between followers of their
favourite brand on social media and their intention to buy (x2= 24.183, and p <
0.001), therefore the null hypothesis is rejected as p < 0.05 (in fact p < 0.001).
This supports the initial hypothesis that there is a positive association between
followers of their favourite brand on Social Media and their intention to buy.
Table 1: Coefficients for H1
Chi-Square Tests
Value df
Asymptotic
Significance
(2-sided)
Pearson Chi-
Square
24.183a
1 .000
For H2, the Chi-square test was also used to test the null hypothesis “There is not
a relation between people who are satisfied with their brand on social media and
their intention to buy”, the results illustrated on table 2.
The results confirm that there is an association between people who are satisfied
with their favourite brands on social media and their intention to buy (x2=
18.788, and p < 0.005), therefore the null hypothesis is rejected as p < 0.05 (in
fact p = 0.002). This supports the initial hypothesis that there is a positive
association between people who are satisfied with their brand on social media
and their intention to buy.
! 35!
Table 2: Coefficients for H2
Chi-Square Tests
Value df
Asymp. Sig.
(2-sided)
Pearson Chi-
Square
18.788a
5 .002
Chi-square test was also used to test the H3 and the null hypothesis “there is not
a relation between people who use social media to keep up with trends and their
intention to buy” and the results were illustrated on table 3.
The results confirm that there is an association between people who use social
media to keep up with trends and their intention to buy (x2= 15.398, and p <
0.001), therefore the null hypothesis is rejected as p < 0.05 (in fact p < 0.001).
This supports the initial hypothesis that there is a positive association between
people who use social media as a source of information and their intention to
buy.
Table 3: Coefficients for H3
Chi-Square Tests
Value df
Asymptotic
Significance
(2-sided)
Pearson Chi-
Square
15.398a
1 .000
! 36!
4.2 General Findings & Discussion:
This research contributes to an improved understanding of the application of
online marketing for the luxury fashion industry in a number of ways. First, it
addresses an existing gap by applying previous research on traditional consumer
behaviour to the luxury fashion industry. Second, the study was based on an
empirical research method to ensure the analysis and conclusions are evidenced
upon which should also lead to more effective decision making if the research
outcomes are applied in a commercial context.
The literature review analysed the main role of social media as an important
marketing tool for building customer relationships and engagement and
ultimately driving revenue. Furthermore, the review examined the advance of
web technology and particularly the growth of social media channels and their
role in revolutionizing the marketing communication process. The available
literature clearly recognises the shift from traditional one-way company to
consumer communication to a new paradigm where today’s consumer,
empowered through online social media tools, actively engages and shapes the
dialogue around a brand.
The research identifies that social media offers significant opportunities for
luxury fashion companies to pursue marketing activities and engage consumers
as most of the luxury consumers studied actively use social media on a daily
basis (79.3%), see Appendix 1.4, and a considerable amount of consumers are
following their favourite brand on social media (44.8%), see Appendix 1.9.
Marketers need to maximise this opportunity whilst remaining sensitive to the
! 37!
impact that over exposure may have on consumers in the luxury fashion space. It
was identified that almost half of the consumers in this study do buy luxury
fashion items online (see Appendix 1.6), confirming the ongoing importance of
selling items online in order to satisfy consumer expectations and preferences as
observed by Okonkwo (2010). Furthermore, the research results complement the
Luxury Institute findings, cited in Atwal and Williams (2009, p.340) that stated
that 38% of luxury consumers prefer to buy online while 33% prefer face-to-face
purchases and the study by Liu et al. (2013) that found out that consumers are
purchasing online for convenience and product availability.
The start findings open up some challenges to Kapferer and Bastien’s (2012)
assertion that criticises the online presence of luxury companies stating that is
not the right communication medium for the industry. For 68.9% of participants
in this study, even too much exposure on social media made no difference to
their intention to buy (see Appendix 1.22).
The research found out that the main reason for consumers to not buy online is
the necessity to try and see items as stated by 63.5% of respondents (see
Appendix 1.8). The result is consistent with the Liu et al. (2013) findings that the
aesthetic appeal is a dominant theme and it is very important for luxury
consumers to see and touch products, identifying a challenge to be addressed and
overcame by luxury brands with innovative technologies. The results can be
contrasted with prior research by Atwal and Williams (2008) who suggested that
the main motivation for luxury consumers to purchase products is the whole in-
store shopping experience.
! 38!
Addionaly, 80,1% of the consumers studied do agree, at some level, with the
importance of a social media presence for luxury fashion brands (as per
Appendix 1.19), a much higher percentage in comparison with a recent study by
Lux Hub (2015) that found out that just over half of respondents (57%) felt
luxury brands should engage with social. Further analysis into the construction of
the respective study groups would be required to determine if this variance is
significant.
Additionally, a considerable amount of people feel influenced to buy (44.83%)
items after seeing on social media (see Appendix 1.13), (40.52%) stated they had
already bought an item after seeing it on social showcasing the potential for
social media to directly influence purchasing decisions (see Appendix 1.11). This
may support ongoing discussions that social media is an important marketing
tool for the luxury fashion industry (Berlendi 2011; Kim and Ko 2011; Okonkwo
2010).
The research suggests that not all social are equal when viewed in the context of
online marketing and selling. Marketers need to identify and leverage the most
influential social network for consumers in their niche. Whilst the majority of
people in the study spend more time on Facebook (56.9%), as per Appendix 1.5,
Instagram was the favourite medium in terms of engagement (following) and the
most influential channel in the purchase decision process, confirming a report by
Deloitte (2014), which showcased Instagram as a powerful global trend for the
fashion luxury industry (see Appendix 1). This is not entirely surprising as the
! 39!
strong visual element of Instagram fits well with being able to see fashion items
in context i.e. viewing your friends and celebrities wearing a particular item.
The researcher also supported, with empirical evidence, the fear held by brands
and the proposition of authors, such as Kapferer and Bastien (2012), that going
online or being too exposed in mass media communication channels can lead to a
loss of the sense of exclusivity and prestige as 48.3% (see Appendix 1.22) of
respondents replied that they believe that too much exposure on social media can
damage a luxury fashion brand. The result suggests that luxury brands should
develop a digital marketing strategy with caution to avoid alienating a significant
chunk of their target audience and damaging their brand identity.
In order to evaluate the role of social media as a medium for marketing
communications of luxury fashion enterprises five hypotheses were tested. The
gathered data suggests that there is a significant relationship between followers
of their favourite brand on social media networks and their intention to buy (x2=
24.183, and p < 0.001). This supports Druica and Musso (2014) quote that states
that the feeling of belongingness and identification that consumers feel when
participating in brand communities are important factors, which can affect the
purchasing decision process. Additionally, it supports a recent study by
Razorfish, cited in Solomon and Tuten (2015, p.351) found out that 40% of
consumers that are following their brand on social media channels are more
willing to interact with the same brands in different ways. Therefore, it could be
concluded that following the brand on social media can lead to purchase thus
reaffirming the importance of luxury fashion brands to be on those social
! 40!
networks. Although, the literature agrees that having a profile on social media
channels is important for brands, most of the available research is based on
traditional consumers, this evidence is therefore a significant contribution to the
body of knowledge relating to the luxury fashion industry.
The results also suggest that the level of satisfaction with brands on social media
networks also can affect their intention to buy as a positive relationship between
both variables was discovered (x2= 18.788, and p < 0.005). This supports Sashi’s
(2012) research that showed a positive relationship between the levels of
satisfaction in consumers and their intention to buy and that dissatisfaction can
result in customer exit. The researcher also suggests that there is room for
improvement in terms of customer satisfaction on social media networks for
luxury fashion brands as levels of satisfaction are not as high as expected. Given
luxury fashion consumers are paying a premium price for their goods, a
reasonable assumption would be that luxury brands would invest heavily in
customer care to keep these customers happy and retaining their loyalty.
The use of social media networks (SMN) as a source of information also can lead
to purchase as a significant relationship between consumers that use social media
networks to keep up with trends and their intention to buy was found (x2=
15.398, and p < 0.001). Therefore this would support Laroche et al. (2012) claim
social media is a perfect communication tool that allows brands to provide more
information about their products and brands, enhancing consumer trust and as a
result increasing purchases. This evidence also is in line with the study by Kim
and Ko (2012) indicating that a luxury brand’s marketing activities on social
! 41!
media can offer a variety of free content enabling information searching and
sharing leading to word-of-mouth and influence purchases. As a result, it can be
concluded that SMN is a valuable channel for providing brand and product
information and to influence consumer’s purchasing intention process,
emphasising even further the importance of social media networks for the luxury
fashion industry.
! 42!
5. CONCLUSION
This study contributes to the body of research knowledge on social media by
confirming its importance as a marketing medium and sales channel for the
luxury fashion industry. The results show a direct impact on the intention to buy
for a segment of the study population. The evolution of marketing activities in
association with the development of technology innovation brought, without any
doubt, impact and challenges to the fashion marketing industry. The growth of
social media networks usage across the world forced brands to adopt and
embrace those channels in their marketing communications strategy in order to
attend the demand of the “social consumers” (Solomon and Tuten 2015). It is
clear that even though many luxury fashion brands are still reluctant to go online
they will need to adapt themselves as “going online” is not even in discussion
anymore (Okonkwo 2010).
The response summary confirmed the importance of social media for the luxury
fashion industry from a consumer perspective as 80,1% of consumers believe
that luxury fashion brands should have an online presence on social media, a
considerable number feel social media influences their buying decision process
(44.8%) and they would like to purchase items straight from social media
(65.52%).
As marketing literature evolved, where once it mainly focused on the buyer-
seller relationship, it was now clear that the focus turned onto customer and its
participation (Jobber 2010; Kotler and Armstrong 2014; Kotler et al. 2010).
Customer identification with the brand can increase customer self-esteem and
! 43!
feel the sense of belongingness (Meister 2012) and those feelings can influence
the customers purchase intention (Druica and Musso 2014). It is clear that social
media plays an important role onto customer participation and that different
levels of social media engagement can influence into the consumer buying
decision process (Solomon and Tuten 2015; Van Doorn et al. 2010). This study
found a positive relationship between followers of a brand on social media and
their intention to buy. A positive relationship between level of satisfaction with
their brand on social media and consumer’s intention to buy was also found.
Finally, there was a relationship between people who use social media as a
source of information and their intention to buy. These results suggest that
different levels of engagement on social media can influence consumers buying
decision process and that consumers are expecting a social media presence from
luxury fashion brands. Thus, it is clear that social media is an important tool for
the luxury fashion industry. However, levels of satisfaction with brands on social
media were not as high as they should, the main barrier for consumer to purchase
online is still the need to see and try products and consumers are concerned with
too much exposure on social media from luxury fashion brands. Perhaps
Kapferer and Bastien’s (2012) suggestion that brands should adopt a digital
marketing presence carefully is valid.
This study has some limitations. Even though the researcher used empirical
evidence and tested whether social media networks are effective marketing tools,
qualitative data, including in-depth interviews with consumers and marketing
managers, are needed in order to understand the role of social media and the
impacts on luxury fashion consumer behaviour further. Questionnaire design was
! 44!
another concern. Reliability issues such as subject bias and observer bias may
have distorted results. Another limitation of the research was survey distribution
method adopted. The research was mainly promoted on Twitter, Facebook and
Linkedin social media networks, which might have affected the results.
Furthermore, this research collected data only from western consumers therefore
general conclusions on the applicability of this data in other regions should be
made with care. Nevertheless, it gives an opportunity for other academic
researchers to adapt or verify the presented theories in different regions and
industries. The author believes there is a rich seam of potential research in this
area such as what type of content used on social media leads to improved
conversion rates, the impact of user-generated content and contests have on
luxury fashion consumers and measuring return on investment of luxury fashion
social media campaigns.
Finally, as a manager it is of upmost importance that they truly understand what
drives positive actions from customers active on social media channels. The
findings of this study confirmed the importance of social media within the luxury
fashion industry. I would therefore advise a manager’s of brand who have yet to
venture online to revisit their online strategy and search for opportunities to
engage consumers online without alienating the existing customer base.
Additionally, I would recommend an increase in investment in solutions that
allow people to buy directly from social media channels that overcome one of the
major barrier exposed in this research i.e. the need to try before buying.
Examples could include CGI and Virtual 3D modelling technologies that
superimpose a garment onto a virtual model of the consumer or flexible returns
! 45!
policies (Burn 2014). Finally, managers of luxury fashion should keep in mind
that too much exposure on social media can negatively affect brand image, thus,
social media presence should always have a touch of “exclusiveness”. The author
suggests future research into online closed invitation only communities, which
meet the convenience needs of luxury consumers whilst retaining the vital
perception of exclusivity.
!
! 46!
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Deloitte. 2014. Global Powers of Luxury Goods 2014 In the hands of the
consumer. [Online]. Available at:
! 52!
http://www2.deloitte.com/content/dam/Deloitte/it/Documents/about-
deloitte/GP_Luxury_2014.pdf [Accessed: 25 February 2015].
Havas Media. 2015. LuxHub focus: Luxury super brands still dominate for
luxury consumers, with 64% preferring them to niche luxury brands. [Online].
Available at: http://www.havasmedia.com/press/press-releases/2015/luxhub-
focus-luxury-super-brands-still-dominate-for-luxury-consumers-with-64-precent-
preferring-them-to-niche-luxury-brands [Accessed: 03 March 2015].
Internet Live Stats. 2015. Internet Users in the World. [Online]. Available at:
http://www.internetlivestats.com/internet-users/ [Accessed: 25 February 2015].
Luxury Institute. 2013. Luxury Institute’s Wealthy and Luxury Trends 2014 and
Beyond. [Online]. Available at: http://www.marketwired.com/press-
release/luxury-institutes-wealth-and-luxury-trends-2014-and-beyond-
1843281.htm [Accessed: 02 March 2015].
Morphy, E. 2012. Luxury Brands and Social Media: A Frenemies Story.
[Online]. Available at:
http://www.forbes.com/sites/erikamorphy/2012/06/18/luxury-brands-and-social-
media-a-frenemies-story/ [Accessed: 27 March 2015].
Shabat, H.,B. 2015. The New Luxury Consumer? Think: Multiple Consumers.
[Online]. Available at: http://therobinreport.com/the-new-luxury-consumer-
think-multiple-consumers/ [Accessed: 03 March 2015].
! 53!
7. APPENDICES
Appendix 1: Responses Summary
General Luxury Fashion Consumer Profile on Social Media
Females constituted the highest responding gender representing 57.8% of the
overall sample set.
1.1 Question: What is your gender?
1.2 Question: What is your age?
The respondents from 30-40 age group where most keen in participating in the
survey followed by 20-30 year olds.
! 54!
1.3 Question: What is the average household income?
The largest group of luxury fashion consumers using social media from the
survey sample set claim to have a household income in excess of £50.000 per
annum (47.4%).
1.4 Question: How often do you log into social media networks?
The majority of consumers represented in the survey are using social media more
than once a day (79.3%).
! 55!
1.5 Question: What is your favourite social media channel?
Facebook stands out as the most popular channel by some way chosen by 56.9%
of respondents with the second most popular channel, Instagram, trailing at
21.6%.
Luxury Fashion Consumer and the Online Purchase
1.6 Question: Do you buy luxury fashion items online?
From 116 respondents, 51.7% confirmed that they buy luxury fashion items
online, while 48.9% of them do not buy online.
! 56!
1.7 Question: If yes, how often?
According to the survey, the largest single group of respondents (35%) buy
luxury fashion items once every quarter. Not so far behind go people who buy
once every six months (30%) and people who buy once a month (25 %). Just
10% of respondents buy luxury fashion items only once a year.
1.8 Question: If no, why?
From the respondents who confirmed that they do not buy fashion luxury items
online, 63.5% confirmed that the main reason is because they need to see and try
items, while 22.2% prefer the experience of buying in-store followed by 14.3%
who like to feel the “sense of power” in store.
! 57!
Fashion Luxury Consumer and Social Media
1.9 Question: Do you follow your favourite brand on social media?
According to the results, 55.17% of the respondents do not follow their brand
against 44.83%.
1.10 Questions: If yes, which channel?
Among those who follow their favourite brand on social media, 60.4% follow
their brand on Instagram, followed by 58.5% on Facebook, 37.7% on Twitter,
18.9% on Youtube and 13.2% on GooglePlus. Note: Each user was allowed to
select multiple options for this question.
! 58!
1.11 Question: Have you ever bought a luxury fashion item after seeing it on
Social Media?
Although the majority of respondents stated they never bought an item after
seeing on social media (59.48%), the group actively purchasing is still significant
standing at 40.52%.
1.12 Question: If yes, which channel?
The highest percent of cases is Instagram (56,3%), followed by Facebook (50%),
Pinterest (18.8%), Twitter (14.6%) and Youtube (10.4%), respectively. The least
considered social media was Googleplus, which received no response from all
respondents.
! 59!
1.13 Question: Do you feel influenced to buy luxury fashion clothes via
Social Media?
55.17% said they do not feel influenced to buy luxury fashion clothes via social
media against 44.83%, which are.
1.14 Question: If yes, which channel influences you the most?
Again, the majority of respondents (48.2%) said they feel more influenced on
Instagram, followed by 32.1% on Facebook, Pinterest (10.7%), Twitter (7.1%)
and Youtube (1.8%) .The least influential social media was Googleplus, which
received no response from all respondents.
! 60!
1.15 Question: What is your level of satisfaction with your favourite brand
on Social Media?
The largest group of respondents are neutral satisfied with their brand on social
media (46.7%) followed by 28.6% which are somewhat dissatisfied, 14.3%
which are very satisfied, 7.6% somewhat dissatisfied, 1.9% very dissatisfied, 1%
dissatisfied.
1.16 Question: Have you ever used any social media channel for customer
service?
Just over half of the respondents do not use social media as a customer service
medium (52.59%) against 47.41%.
! 61!
1.17 Question: If yes, what is your level of satisfaction?
The largest group of respondents are neutral satisfied (39.3%) with the level of
customer service provided on social media followed by 31.1% who are
somewhat satisfied, 14.8% are very satisfied, 6.6% are somewhat dissatisfied,
4.9% are dissatisfied and 3.3% are very dissatisfied.
1.18 Question: Do you use Social Media to keep up with fashion trends?
The majority of respondents (66.38%) stated that they use social media channels
as a medium of fashion information against 33.62%.
! 62!
1.19 Question: Do you agree that it is important for luxury fashion brands
to be on social media channels?
The survey found out that 49.1% strongly agree that is important for luxury
fashion brands to be on social media channels, followed by 31% that agree, 8.6%
that neither agree or disagree, 5.2% that somewhat agree, 3.4% that somewhat
disagree and 2.6% that disagree.
1.20 Question: Would you like to be able to buy straight from social media
channels?
The majority of consumers stated that they would like to buy items straight from
social media (65.52%) against 34.48%.
! 63!
1.21 Question: Do you believe that too much exposure to buy on social
media can damage a luxury fashion brand image?
20.7% agreed that too much exposure to buy luxury fashion items on social
media can damage a luxury fashion brand, followed by, 18.1% that somewhat
agree, 18.1% that neither agree nor disagree, 14.7% that disagree, 10.3% that
strongly agree, 9.5% that strongly agree and 8.6% that somewhat disagree.
1.22 Question: Would you stop buying a luxury fashion brand if too
available on social media?
Curiously, even though 48.3% either somewhat, agreed, or strongly agreed that
too much exposure on social media could damage the image brand of a luxury
fashion brand, 68.97% stated that they would not stop buying it against 31.03%.
! 64!
Appendix 2:
Questionnaire
Dear Respondents, my name is Renata Falsarella Hernandez and I am writing my
dissertation for my Bsc Business and Marketing at Birkbeck University of
London. I am currently researching the Role of Social Media in the Luxury
Fashion Industry and the impact of Social Media on its customers. In order to
support my project I will need to collect data trough a questionnaire which will
ask questions around your profile, your usage of Social Media and your
perception around it, all in regards with the luxury fashion industry. So, if you
are a consumer of luxury fashion items, I would like to kindly ask you to answer
my survey hosted on Survey Monkey, it will take no longer than 3 minutes of
your time. I assure that all answers will remain confidential and treated with
anonymity. Your participation is voluntary and you have the right to skip any
question asked or withdraw it at anytime. Thank you for taking part and helping
me.
If you have any questions, please do not hesitate in contacting me on: Renata
Falsarella Hernandez 00447577281049 renatafalsarella@hotmail.com Best
Wishes, Renata Falsarella Hernandez.
1. What is your gender?
Female
Male
2. What is your age?
Below 20
20 to 30
! 65!
30 to 40
40 to 50
Over 50
3. What is your approximate average household income?
Under £20.000
Between £20.000 and £30.000
Between £30.000 and £40.000
Between £40.000 and £50.000
Over £50.000
4. How often do you log into social media networks (e.g. Facebook, Google+,
etc.)?
Less than a few times a month
A few times a month
A few times a week
About once a day
More than once a day
5. What is your favourite Social Media channel?
Facebook
Twitter
Instagram
GooglePlus
Youtube
! 66!
Pinterest
6. Do you buy luxury fashion items online?
Yes
No
7. If yes, how often?
Once a year
Once every six months
Once every quarter
Once a month
8. If no, why?
I like the shopping experience of a physical store
I need to try and see items
I like to feel the “exclusivity” of buying in the store
9. Do you follow your favourite brand on social media channels?
Yes
No
10. If yes, which channel? (You can choose more than 1)
Facebook
Twitter
Instagram
! 67!
GooglePlus
Youtube
Pinterest
11. Have you ever bought an luxury fashion item after seeing it on Social
Media?
Yes
No
12. If yes, which channel? (Can choose more than one)
Facebook
Twitter
Instagram
GooglePlus
Youtube
Pinterest
13. Do you feel influenced to buy luxury fashion clothes via Social Media?
Yes
No
14. If yes, which channel influences you the most?
Facebook
Twitter
Instagram
! 68!
GooglePlus
Youtube
Pinterest
15. What is your level of satisfaction with your favorite brand on Social
Media?
Very Dissatisfied
Dissatisfied
Somewhat Dissatisfied
Somewhat Satisfied
Neutral Satisfied
Very Satisfied
16. Have you ever used any social media channel for customer service?
(Complain/ask question etc)
Yes
No
17. If yes, what is your level of satisfaction?
Very Dissatisfied
Dissatisfied
Somewhat Dissatisfied
Somewhat Satisfied
Neutral Satisfied
Very Satisfied
! 69!
18. Do you use Social Media to keep up with fashion trends?
Yes
No
19. Do you agree that it is important for luxury fashion brands to be on
social media channels?
Strongly Agree
Agree
Somewhat Agree
Neither Agree nor Disagree
Somewhat Disagree
Disagree
Strongly Disagree
20. Would you like to be able to buy straight from social media channels
(link directly to website?)
Yes
No
21. Do you believe that too much exposure to buy on social media can
damage a luxury fashion brand image?
Strongly Agree
Agree
Somewhat Agree
! 70!
Neither Agree nor Disagree
Somewhat Disagree
Disagree
Strongly Disagree
22. Would you stop buying a luxury fashion brand if too available on social
media?
Yes
No

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  • 1. ! 1! THE IMPORTANCE OF SOCIAL MEDIA IN THE LUXURY FASHION INDUSTRY Renata Falsarella Hernandez A dissertation submitted in partial fulfilment of the requirement of the degree of Bsc Business and Marketing. Birkbeck, University of London Malet Street, Bloomsbury WC1E 7HX
  • 2. ! 2! Acknowledgements I recognize that this research would not have been possible without the help, support and patience of many people. I wish to express my sincere gratitude to all those who assisted and encouraged me during my studies. I would like to express my gratitude to my supervisor Dr Christine Guo and to Dr Marion Frenz, whose time and guidance were fundamental during this project. I would also like to extend my thanks to all respondents for dedicating the time to take my survey, which was essential for the completion of this project. Finally, I would also like to thank my mum for supporting and encouraging me to complete a bachelor degree abroad. Finally, I would like to thank you my partner Valerio for his patience and support.
  • 3. ! 3! ABSTRACT Understanding the application and benefits of social media networks in increasing brand awareness and driving revenue has become an important topic for researchers and managers across all industries. The significant and rapid growth of the Internet and subsequently social media presented a real challenge for luxury fashion companies, however academic research has been limited in this area. The purpose of the research underpinning this dissertation is to identify the role and impact of social media networks within the luxury fashion industry from a consumer perspective. A quantitative research method was used to collect data from luxury fashion consumers and social media users. Analysing data collected from 136 individuals shows specific positive relationships between factors such as brand following, levels of satisfaction and usage of social media as a source of information and the influence they ultimately play in consumer decision making processes when purchasing goods. The results confirm the importance of an active and effective presence on social media networks for companies operating in the luxury fashion business.
  • 4. ! 4! TABLE OF CONTENTS ABSTRACT..................................................................................................................3 TABLE OF CONTENTS ............................................................................................4 LIST OF TABLES.......................................................................................................6 LIST OF FIGURES.....................................................................................................6 1. INTRODUCTION ..................................................................................................7 2. LITERATURE REVIEW .....................................................................................10 2.1 The Evolution of Marketing and the Internet ........................................................10 2.2 Social Media ..........................................................................................................12 2.3. Luxury Fashion Marketing ...................................................................................16 2.4 The Connection Between Luxury Fashion Marketing and Social Media..............18 2.5 Conceptual Model..................................................................................................26 Conceptual Framework and Hypothesis Development ...............................................26 2.5.1 The relationship between followers and their intention to buy ..........................27 2.5.2 The relationship between social media engagement and their intention to buy ...............................................................................................................................28 2.5.2:1 Satisfaction ......................................................................................................28 2.5.2:2 Source of Information and Trust......................................................................29 3. METHODOLOGY ................................................................................................30
  • 5. ! 5! 4. DATA ANALYSIS AND RESULTS....................................................................33 4.1 Results....................................................................................................................33 4.2 General Findings & Discussion:............................................................................36 5. CONCLUSION ......................................................................................................42 6. REFERENCES ......................................................................................................46 7. APPENDICES........................................................................................................53 Appendix 1: .................................................................................................................53 Responses Summary....................................................................................................53 General Luxury Fashion Consumer Profile on Social Media......................................53 Luxury Fashion Consumer and the Online Purchase...................................................55 Fashion Luxury Consumer and Social Media..............................................................57 Appendix 2: .................................................................................................................64 !
  • 6. ! 6! LIST OF TABLES Table 1: Coefficients for H1........................................................................................34 Table 2: Coefficients for H2........................................................................................35 Table 3: Coefficients for H3........................................................................................35 LIST OF FIGURES Figure 1 . Comparison of Marketing 1.0, 2.0 and 3.0 .................................................11 Figure 2. Internet Users in the World ..........................................................................12 Figure 3: Conceptual framework: the relationship between social media engagement and intention to buy.................................................................................26 !
  • 7. ! 7! 1. INTRODUCTION Online marketing is the fastest growing form of communication for business. The Internet is the most important communication channel due to both the volume of users and the amount of time they choose to invest in online activities. A recent study by the research website Internet Live Stats (2015) showed that more than 40% of the global population is now online with the user count continuing to climb. Despite this extensive potential customer base, brands such as Chanel and Céline do not sell their products online and authors such as Kapferer and Bastien (2012) criticised the extension of luxury brand’s availability on the online space stating that the Internet, a media mass communication tool, is not the right medium for luxury brands. Luxury fashion brands have refrained from investing heavily in online commerce preferring to target their online investment into brand building initiatives. The main reason is that the store environment plays a major role in the luxury buying experience driving up customer satisfaction level. When considering luxury goods, consumer behaviour and ultimately buying decisions can be positively or negatively impacted by their reaction to the store design, weather, music and many other environmental and social factors not replicable online. Hence, shopping is no longer considered a simple action of purchase, shopping has become an experience (Solomon 2010). Even more, experience, in luxury brand marketing, is everything, in fact, experimental marketing is a key for luxurious brands as consumers, beyond buying for a product or a service; they are paying for an experience to enjoy memorable moments (Atwal and Williams 2008).
  • 8. ! 8! Technological development and the growth of the Internet led to a change in how companies and consumers related. This change was largely driven by the use of social media network channels such as Facebook, Twitter and Instagram. Today, according to Statista (2015) there is an average of 1.96 billion social network users around the globe. The explosive growth and ongoing evolution of social networks and consumer participation in these platforms has been forced companies to engage and adapt their marketing strategies. Whilst the luxury fashion industry remains reluctant to actively sell online, they are not immune to the impact of the web and the amount of time and attention it takes from potential customers. Today, companies understand the critical importance of building and maintaining customer relationships. Marketers are increasingly using social media channels as a vital tool in forging those relationships subsequently increasing both brand awareness and profit for companies. Recent studies show that the level of engagement makes a big difference in the purchase decision process of customer (Solomon and Tuten 2015). Given these findings it is surprising to observe the scarcity research on the application of online and social media strategies in the context of the luxury goods industry. The apparent gap prompted the research questions behind this dissertation. What is the role of social media within the luxury fashion industry? Can it affect consumer behaviour and perceptions? The intention then is to answer these questions by researching the world of luxury fashion brands and understanding the behaviour of luxury fashion consumers.
  • 9. ! 9! A review of the academic literature, demonstrates a clear shortage of studies defining the role of social media in the luxury fashion industry. Most available of research covers the consumption of non-luxury items, some studies do evaluate social media usage within the luxury industry, however, they focus solely on the Asian market with no indication of how these finding might extend to the perception and behaviour of consumers. Thus, this research will examine existing literature in consumer behaviour, luxury fashion marketing, social media and existing studies regarding social media in the mass consumption to identify if similar patterns apply to the fashion luxury consumer. In order to understand the role of social media within the luxury fashion industry, a questionnaire will be distributed to social media users who also qualify as luxury fashion consumers. The results will be analysed and discussed in order to establish whether the luxury fashion industry should invest more heavily in social media as an important marketing channel.
  • 10. ! 10! 2. LITERATURE REVIEW This chapter will first examine literature on the evolution of marketing and the Internet, social media and luxury fashion marketing. It will then review the luxury fashion marketing and social media followed by the motivations of consumers and finally the importance of social media. The chapter will conclude with a conceptual framework and the hypothesis proposed to direct the research. 2.1 The Evolution of Marketing and the Internet Today, the Internet is the main channel of mass communication. Many authors have discussed the growth and the importance of the Internet and its relation to marketing. Jobber (2010) has stated the importance of the Internet as the fastest growing and maybe the most important communications tool for marketers to promote their brands and products. The growth of the Internet brought a "business revolution", as users become active in the process of sharing information on their likes and dislikes leading to a revolution in their role from passive consumers to trend setters amongst their peer group. Kotler and Armstrong (2014) have debated that today the web is not only used as a tool for promoting but also for communicating and creating a relationship with consumers. They also observed that marketers are switching from a mass-market communications strategy to a more targeted one, in order to promote stronger relationships. Consumers are not only purchasing products but are also empowered, through the Web, to participate and share their purchase experiences and relationship with the brand. They argued that all these changes
  • 11. ! 11! have transformed the way companies conduct their business and marketing activities and an online presence is now crucial. The advance of technology had a huge impact and changes on consumers, markets and marketing. Kotler et al. (2010 p.10) explains the impact that the technology evolution had on marketing communications strategy: “Marketing 1.0 was initiated by production technology development during Industrial Revolution. Marketing 2.0 came into being as a result of information technology and the Internet. Now, new wave technology becomes the major driver for the birth of Marketing 3.0”. Figure 1 . Comparison of Marketing 1.0, 2.0 and 3.0 (Kotler et al. 2010). One of the main forces of this new wave technology is the penetration of low cost Internet and the cheap computers and smartphones access. Technology evolution allows people to express themselves, create, participate, and collaborate on the same time that they consume. Furthermore, one of the enablers of this new wave is the growth of social media, which should not be ignored.
  • 12. ! 12! Today, according to Internet Live Stats (figure 2), more than 40% of the global population is online, and numbers are still climbing. As a consequence, it has become extremely important for brands to be present on all platforms. Today, marketers must recognise the need to supplement traditional communication channels such us print based press, radio, television with an active online presence. Figure 2. Internet Users in the World (Internet Live Stats 2015). 2.2 Social Media “Informal conversation is probably the oldest mechanism by which opinions on products and brands are developed, expressed and spread.” (Johan Ardnt) As discussed in the previous section, marketers were delivering their communications message to a specific audience target. Today, with the evolution of the Internet, consumers are talking and even participating on the construction of the brand via for example what researchers call user generated content (Jones and Ryan 2012).
  • 13. ! 13! The main channel for this phenomenon are the social media channels, where billion of conversations take place everyday and marketers are now actively taking part in this conversation, developing a meaningful relationship with their consumers. Social media is the term used to define web-based software and services that allow users to be on the same platform to exchange ideas, discuss and communicate. Interactions can be in form of text, video, and images in any combination supported by a given social platform. Vanessa Fox (2009), a social media expert cited in Jones and Ryan (2009, p.153), described social media as follows: “There are all kinds of ways that people talk online, and social networking really is anywhere people are talking online. From a corporate perspective what you’re most interested in is where people are talking about you, talking about your products, and talking about the topics you care about.” A common theme uncovered in the literature review was the importance of social media as an essential tool for the marketing communications strategy of companies as a medium to increase brand awareness and to develop and nurture costumer relationships (Jones and Ryan 2009; Dijck 2013, Solomon and Tuten 2015; Kotler et al. 2010). Even the word “social media” defines how these
  • 14. ! 14! platforms are user centred and therefore represent a way to accumulate social capital with a huge potential to increase profit (Dijck 2013). In fact, according with a recent report by Strategy Analytics, cited in Bose (2015), there were more than 2 billions users of social media worldwide and marketers spent nearly $15.3 billion on social media advertising in 2014. The numbers clearly show the importance and the potential that social media can have as a powerful marketing tool and source of revenue. Social media can be classified into two broad categories: expressive and collaborative (that implies open sourcing as Wikipedia) (Kotler et al. 2010). This study will focus on the following expressive social media channels: Facebook, Twitter, Instagram, Youtube, GooglePlus and Pinterest as they are the most commonly adopted social media channels worldwide. As discussed earlier, it is clear that social media is increasing in number of users worldwide and most brands are adopting social media as part of their marketing strategy. Social media is considered as a powerful and cost effective “brand community” which are adopted and highlighted by many marketers. It is believed that the level of engagement makes a big difference in the buying decision process and that the higher the engagement, more benefits will be seen by brands (Solomon and Tuten 2015). In fact, a study conducted by DEI Worlwide (2008) showed that consumers rely on different types of social media channels to search for product and brand
  • 15. ! 15! information online: 70% of consumers visited social media websites to gather information, 49% of those made a purchase decision based on the information gathered after the visit and 57% who visited social media website are more likely to purchase. From a social media perspective, brands want, at least, consumer to become friends with the brand’s online presence. A recent study by Razorfish, cited in Solomon and Tuten (2015, p. 351), found that 40% of online consumers are following brands on online social networks sites and even more are engaging in different ways with a brand, 70% confirmed to have read a company’s blog and 67% watch branded videos on Youtube. Another study found that purchase intention was higher among brands with interactive profiles on social medias in comparison with brands without such profiles, the study by Syncapse, cited in Solomon and Tuten (2015, p. 358), revealed that people spend an average of $72 more on products or brands which they follow on social media channels than on the ones they do not follow, followers of a brand are 28% more willing to keep using that brand and 41% stated they would be more willing to recommend a brand they already followed and they also said they feel connect to the brands they are following. Although there are marketing researchers in luxury fashion marketing in the online sphere, there is little or no empirical evidence on what types of social media engagement influence western luxury consumer behaviour. A study compared the luxury consumer behaviour in-store and online (Liu et al. 2013),
  • 16. ! 16! other study did a comprehensive exploratory study on the importance of social media within the luxury industry (Berlendi 2011) and a research even draw empirical evidence on whether social media networks influence luxury consumers or not in Asia (Kim and Ko 2012). Most researchers studied the influence of social media networks on mass-market consumers (Ionas and Stoica 2014; Akrimi and Khemakhem 2012; Agnihotri et al. 2012; Carolyn and Parasis 2011; Hajli 2014). Therefore the subject is relevant new and is still a current challenge to the industry. 2.3. Luxury Fashion Marketing Kapferer (2012) explains that luxury is related with a sociological issue in any society, the definition of luxury correlates with the type of society the consumer lives in. From the 20th, century the author argues that luxury became highly accessible for many reasons including increasing spending power and globalization. Branding is an extremely important concept in the fashion luxury industry, it is not only connected with the logo of the brand but it is related with its identity and with the experience of the consumer who buys the brand (Okonkwo 2007). As Okonkwo (2007, p. 103) observed: “A brand is the sum of all the feelings, perceptions and experiences a person has as a result of contact with a company and its products and services.”
  • 17. ! 17! Luxury fashion brands have at the heart of their business positioning and marketing strategies developed in line with their branding in order to gain recognition amongst target consumers. Okonkwo (2007) cites the core characteristics of luxury brands as: brand strength, differentiation, exclusivity, innovation, product craftsmanship and precision, premium pricing and high quality. Furthermore, it is argued that the key for a successful luxury fashion brand is the differentiation and the emotional appeal, and in particular, the intangible aspects is always present in all marketing activities of luxury fashion brands (Okonkwo 2007). Atwal and Williams (2008) have argued that creating a strong brand and marketing luxury goods become highly complex as consumers are not seeking only quality and authenticity in products, but also an experience, which matches their expectations and lifestyle. Luxury, traditionally, is synonym of exclusivity, status and quality however, modern consumers also seek a sense of belonging and the key to luxury brands marketers is to bring a holistic approach, incorporating entertainment outside the immediate experience. Consumers want to enjoy a memorable moment and also participate in the process of value creation. Additionally, luxury fashion brands have high brand awareness from consumer due to its marketing activities in the right channels. The most common channels are advertising, sponsorship and sales promotions. To increase brand awareness
  • 18. ! 18! while keeping the brand positioning, the marketing strategy of luxury brands needs to be done with attention and precaution, always utilising the right channels of communications (Okonkwo 2010). As discussed earlier, the success of a brand is achieved through skilful brand management and its ability to align the organization values of the brand with the brand identity, brand image, brand positioning and how well the brand conveys its image to the consumer. Kapferer (2012) stated that a brand can be defined as an influential name and its power can be measured by the following factors: aided brand awareness, spontaneous brand awareness, evoked set, consumption. It is clear that marketing communication strategy is important for any brand, especially for luxury brands as they need to explain and give emotional and rational reasons for consumers to purchase an expensive item. Luxury fashion companies adopt a broad communication strategy, making use of diverse tools. The most common channels for luxury fashion marketing to advertise their products are catwalks, magazines, television and celebrities endorsement (Berlendi 2011). However, luxury brands have been faced with the challenge of keeping the status of “exclusivity” by the growth of the Internet and in particular of the social media. 2.4 The Connection Between Luxury Fashion Marketing and Social Media The slow and reluctant adoption of a digital marketing strategy and of an online presence by luxury fashion companies has been noticed by many authors (Okonkwo 2007; Okonkwo 2010; Berlendi 2011). The reason behind this
  • 19. ! 19! slowness and reluctance is the connection between the concept of luxury fashion marketing and social media. As discussed previously, they are diametrically opposed, social media is “inclusive rather than exclusive, democratic rather then selective” (Berlendi 2011, p.20). Kapferer and Bastien (2012) were opposed to luxury brands selling their products online and on social media employing the arguments that luxury purchases needs time and effort, a one-to-one relationship with the shop assistant and that core factor of the brand experience. They described the Internet dilemma as follows: “Digital is noisy, crowded and flashy; luxury is quiet and sleek. Digital is about impermanence, immediately, availability, accessibility, easiness; luxury is about timelessness, culture, heritage, rarity, effort. Digital is about crowd-sourcing; luxury is about creation. Digital is about price – good deals and discounts; luxury is beyond price – no sales, no discounts. Digital is about automation; luxury is about one-to-one and human relation” (Kapferer and Bastien 2012, p.247). All the reasons and arguments are valid, it is clear that there is a huge pressure on luxury companies to adopt a digital strategy from the demands of wealthy and digital savvy consumers they also know how difficult is to transfer the prestigious atmosphere and the experience delivered in store to the digital world, however it is possible and there are brands already succeeding (Osonko 2010).
  • 20. ! 20! Furthermore, that’s the biggest challenged faced by the luxury fashion industry and going or not going online is no more in question, best practices, strategies and tool need to be discussed as it is argued that luxury products can be successfully positioned online (Osonko 2009). It is clear that the possibility of losing the feel of exclusivity and the prestigious allure associated with fashion luxury brands are the main fears for such brands to go online and adopt social media channels in their marketing communications strategy. Louis Vuitton is a great example of a prestigious luxury brand which embraced technology without fear, consumers are able to buy their products online and their website connects users to the following social media channels: Facebook, Youtube, Google+, Twitter, Instagram, Pinterest and Foursquare. On the other hand, brands like Chanel and Dior are still reluctant to sell their good online despite being present on social media channels. Furthermore, even though luxury fashion brands are following the global trend and adopting the use of social media channels to increase brand awareness, they are still reluctant to engage in conversations with their followers and consumers on social networks, in fact, one-third of brands do not allow their fans to post or comment on their Facebook walls as an example (Morphy 2012). One of the main theories regarding consumer behaviour was proposed by the psychologist Abraham Maslow, whom believed that people are motivated by the urge to satisfy needs. He organised human needs hierarchically from bottom to top as follows: physiological, safety, belongingness, ego needs and self-
  • 21. ! 21! actualization, arguing that they are satisfied from biogenic to psychogenic needs, with each level being increasingly difficult to attain (Solomon 2010). Many authors have stated the importance of satisfying all needs from luxury consumers as in the luxury space the whole buying experience are key factors for consumer satisfaction and loyalty as luxury brands provide subjective intangible benefits (Osonko 2007; Atwal and Williams 2009; Kapferer and Bastien 2012). A study by Vigneron and Johnson (1999) proposed that luxury consumers have a prestige-seeking behaviour with multiple motivations but the most common motivations that lead to purchase are motives of sociability and self-expression, luxury consumers purchase premium brands to impress others, to feel exclusive and for self-fulfilment. The growth of the Internet changed consumer behaviour, including luxury consumers. In fact, a recent research conduct by Liu et al. (2013) compared and contrasted the online and in-store shopping behaviour towards luxury goods and found that consumers are influenced by different motivational factors in both environments. The study found that 42.1% of online luxury consumers are looking for convenience and 23% of them stated that they want to purchase luxury items with a better price, using the Internet to compare prices and find deals. The result of the research contradicts the traditional behaviour of luxury consumers. The growth of social media networks also impacted consumer behaviour, in fact, today the term ‘social consumers’ is used to refer to tech-savvy consumers that
  • 22. ! 22! make use of social media networks. Henri Tajfel and John Turner introduced the concept of social identity and explained how individuals behaved in groups, originally formulated the Social Identity Theory (SIT) in the 1980s. The SIT has been highlighted as an important factor for consumer behaviour in online brand communities and has been identified as: “The essence of one’s self-identification relies on the membership to a social group (or groups) and also on the value and the emotional significance attached to such membership” (Druica and Musso 2014, p.15). The social identity theory provides a rational to explain why community users search for relationships within the community. Social media communities help consumers to find self-esteem and feel the “belongingness” of a group in which they share values and interests (Meister 2012). The social identity is a term also used to explain and define the profile, the activities and all information users provide on social media channels. The social identity theory contributed to the development of the Consumer-brand identification theory (CBI). The CBI transferred the concept of the SIT into the consumer sphere and its relationship with brands, arguing that people are able to identity themselves with brands even in the case of an absence of a membership. Consumer-brand identification theory (CBI) refers to individual’s sense of parity with a particular brand and argues that people who identify themselves with such brands are more likely to take actions that will benefit the brand and it has been
  • 23. ! 23! increasingly used in marketing literature (Elbedweihy and Jayawardhena 2014). Consumers tend to find themselves similar to brands and tend to create a association between them which lead to consumer to feel close and engaged with a brand (Aaker 1997). Several researches found that CBI plays an essential role in building and nurturing relationship with consumers, influencing consumers on the purchasing decision making process, increasing loyalty, satisfaction and leading to a positive word-of-mouth (Druica and Musso 2014; Elbedweihy and Jayawardhena 2014). Solomon and Tuten (2015) explain the motivations that lead to users to use social media as follows: • Affinity Impulse: social media is used as a social function to maintain and develop relationships • Personal Utility Impulse: this motivation relates with the usefulness of social media, whether users are seeking information, convenience or entertainment • Contact Comfort and Immediacy Impulse: the need to feel close to others • Altruistic Impulse: the necessity of doing something good • Curiosity Impulse: people may feel curious about others and may use social media to satisfy this curiosity • Validation Impulse: to feed their ego
  • 24. ! 24! Marketers need to understand the motivations behind social media users in order to make strategic decisions about their digital presence. Understanding the social identity and the motivations of consumers on social media enables brand to learn more about their consumers and adopt the best approaches to consumer engagement as social media can do more than just engage, social media can influence sales (Solomon and Tuten 2015). The Customer Engagement Behaviourial (CEB) concept has been defined as: “Customer engagement behaviors go beyond transactions, and may be specifically defined as a customer’s behavioral manifestations that have a brand or firm focus, beyond purchase, resulting from motivational drivers” (Van Doorn et al. 2010, p.3). From a customer perspective, the factors that can affect CEB the most are: customer satisfaction, brand commitment, trust, brand attachment, and brand performance perceptions. It is believed that low or high levels of these factors can generate consumer engagement, which can be classified as positive or negative (Van Doorn et al. 2010). Today, companies understand that to sustain a competitive advantage they must build, sustain and nurture customer relationships. Marketers are using social media as an important marketing tool for building customer relationship and engagement. Engagement is the heart of social media. People can engage in different ways, from a customer perspective, engagement is the customer behaviour towards brands; it is more than just the action of purchase. Engaged
  • 25. ! 25! consumers not only have greater purchase intention but they become a brand ambassador, sharing information, writing reviews and producing positive word- of mouth (Solomon and Tuten 2015). The purchase intention of a consumer is a concept based on different aspects and motivations that lead to the consumer to buy that product and many studies relate the purchase intention towards the preference to a brand or a product, and measuring purchase intention is about predicting future consumer behaviour based in their atttitudes (Kim and Ko 2012). People can engage in different ways on social media, consumers can follow brands on social media networks (connecting with brands by liking, following – different terms are used in each social network), comment, share, contribute with their own content (user-generated content), they can have a two-way conversation with brands and even use social networks for customer service purposes. They can be influenced to buy or they can influence others to buy via positive e-word-of-mouth. In order to direct the research, the study focused on the six most commonly used social media networks website which are: Facebook, Twitter, Instagram, Youtube, GooglePlus and Pinterest and focused only on western consumers. The researcher decided to explore the role of social media within the luxury industry by analysing the different types of engagement and if they can influence on the purchase decision process of consumers, addressing a gap in the current research.
  • 26. ! 26! 2.5 Conceptual Model Based on the literature review, this research paper formulated hypothesis in regards to the types of engagement on social media and the impact on purchase intention, within the luxury fashion industry. Figure 3: Conceptual framework: the relationship between social media engagement and intention to buy. Conceptual Framework and Hypothesis Development As the topic is relative new and there is a scarcity of data, the researcher used the literature review to build up knowledge and develop the conceptual framework. The review included available literature covering social media, luxury fashion, consumer behaviour and consumer engagement. The researcher has attempted to synthesize the relevant threads from the literature review into a coherent conceptual framework upon which to base the study.
  • 27. ! 27! 2.5.1 The relationship between followers and their intention to buy As previously discussed, according to the Social Identity model and the consumer-brand identification theory, users of communities identity themselves with brands and being part of a brand community helps customers to increase self-esteem and feel the sense of belongingness (Meister 2012). Furthermore, different studies of the consumer-brand identification theory establish that these feelings plays an important role in the purchasing decision making process of consumers (Druica and Musso 2014). Solomon and Tuten (2015) advocate that social media engagement is crucial and the minimum level of engagement brands must expect from consumers is ‘following’ as the fan base is an indicator of the brand’s success in establishing a well-known social media community. A study by Razorfish, cited in Solomon and Tuten (2015, p.351) revealed the benefits of brands having social profiles, 40% of online consumers are following brands on social networks sites and are more willing to interact in other ways with the same brands. Thus, following this reasoning, the research expects to find a positive relationship between followers of their favourite brands on social media channels and their intention to buy and therefore posits: Hypothesis 1 = There is a positive association between followers of their favourite brand on social media and their intention to buy
  • 28. ! 28! 2.5.2 The relationship between social media engagement and their intention to buy The Customer Engagement Behaviourial (CEB) theory stated that engaged customers can lead to positive or negative actions from customers and the factors that can affect consumers the most are: customer satisfaction, brand commitment, trust, brand attachment, and brand performance perceptions (Van Doorn et al. 2010). Based on the consumer engagement behaviourial theory and by the fact that consumers can engage in different ways on social media networks, this study formulated the following hypotheses: 2.5.2:1 Satisfaction Customers will only interact and continue to engage with brands if the relationship between them and the brand results in satisfaction, so marketers need to satisfy costumers as this represents an essential factor in order to increase engagement. Furthermore, levels of satisfaction can influence the purchase process and even result in customer exit (Sashi 2012). A satisfied customer is more likely to engage with brands and will even feel more willing to buy its products while a dissatisfied customer may look for alternatives, based on this the researcher propose the following hypothesis: Hypothesis 2 = There is a positive association between the level of satisfaction with brands on Social Media and their intention to buy
  • 29. ! 29! 2.5.2:2 Source of Information and Trust Trust is a critical factor in consumer behaviour and it is clear that if consumers who are already engaging with brands on social media have a certain level of trust towards the brand. One way that brands can enhance consumer trust is openly providing them with information about themselves and their associated products. Social media provides a perfect communication tool to achieve that (Laroche et al. 2012). Also as discussed previously, Solomon and Tuten (2015) explained that the personal utility impulse is one of the most motivating factors for users to engage on social media. Furthermore, as previous discussed in the literature review, many luxury fashion brands are still reluctant to sell their goods online and are using social media only to engage customers. Laroche et al. (2012, p. 1757) suggests: “The communities that are formed for the purpose of sharing information rather than for mere commercial reasons exert the greatest influence on members’ opinions and purchase intentions” Based on this and on the customer engagement behaviourial theory, the researcher expects to find a positive relationship between the usage of social media to follow fashion trends by consumers and their intention to buy. This would justify social media efforts and therefore proposes the following hypothesis: Hypothesis 3 = There is a positive association people who use social media to keep up with trends and their intention to buy
  • 30. ! 30! 3. METHODOLOGY A research paradigm is a philosophical framework used to guide researchers in how to conduct their projects and to help them clarify their assumptions. There are two main research paradigms: positivist and phenomenological. For the purpose of this research, the researcher concluded that it was more appropriate to adopt the positivist position. As the main question to answer is “What is the role of social media in the luxury fashion industry?” and according to Collis and Hussey (2003) the positivist approach investigates, in an objectivist manner, the facts and causes of social phenomena therefore using a logical approach in the research process, stating that the study of human behaviour should be done exactly as in the natural sciences. However, is important to emphasize that “the positivistic and phenomenological paradigms are two extremes and very few people would operate within their pure forms” (Collis and Hussey, 2003, p.51). The aim of the research is to test and measure the importance of social media within the luxury fashion industry, thus the rational aspects are important still, as the research investigated the consumer behaviour towards luxury brands and its subjective motivations, some subjectivists aspects were evaluated. According to Saunders, Lewis and Thornhill (2012) the deductive approach starts with an existing theory identified in the literature review leading to an evaluation of propositions or hypothesis usually measured qualitatively. On the other hand, an induction approach starts with observation and data collection to generate or to build a theory. This research is mainly deductive as existing literature were used to develop a conceptual framework and to test whether existing propositions about social media and consumers applied in non-luxury consumers industry
  • 31. ! 31! could have similar results within the luxury fashion consumer. However, there are some appearances of inductive logic as the subject is relatively new, there is a scarcity of data and the literature review was used to build up knowledge from the theory and guide the researcher. Many authors state the commonality of using both approaches (Collis and Hussey 2003; Blackmon and maylor 2005; Saunders, Lewis and Thornhill 2012; Lewis and Saunders 2012). The researcher selected the survey format as the most appropriate approach to answer the research questions. Surveys are highly popular in business and management research projects as they are “particularly suitable for asking question such as: ‘who?’ ‘what?’ ‘where?’ ‘how much?’ and ‘how many?’” (Lewis and Saunders 2012, p.116). As quantitative approach was applied, the researcher personally designed and distributed a questionnaire due to the lack of time and resources. The non-probability sampling technique of self-selecting was used as the total population was unknown. Participants were invited to respond via the appropriate media. The questionnaire was designed using online software, Survey Monkey, and carried the logo of Birkbeck University. All respondents were assured that all answers would remain confidential and anonymous in order to comply with ethical requirements. In order to achieve a high response rate and meet the researcher’s interest in collecting data from a variety of sources, respondents were invited to take the questionnaire via all of the following social media channels: Twitter, Facebook
  • 32. ! 32! and Linkedin. The invite included an embedded link and a brief explanation of the survey. The researcher choose this method as it was cost effective and aligned well with the objective of the research. The questionnaire consisted of 22 questions (see Appendix 2), the first five evaluated the respondent’s personal profile, asking questions such as their age, salary, if they use Social Media and with what frequency. The other questions were used to establish an understanding of their behaviour in the online sphere and their feelings towards brands and their online presence. The researcher used rating (Likert-style rating and likehood) and category types of questions. According to Lewis and Sanders (2012) the design of each question should be implemented according to the data needed and researchers can adopt or adapt questions used previously or even develop their own questionnaire. As the subject is new and there was not any specific legacy research to reference on the subject, the researcher designed a new questionnaire referencing previous research on similar topics as a guide (Razorfish 2008, Lux Hub 2015, DEI Worlwide 2008, Liu et al. 2013). In total, 136 responses were captured, however, upon review only 116 were found to be fully complete, therefore, 20 incomplete questionnaires were deleted from the analysis to ensure statistical accuracy.
  • 33. ! 33! 4. DATA ANALYSIS AND RESULTS This chapter covers the results of statistical analysis of data collected from 116 questionnaire respondents. Statistical descriptive analysis was applied to test the four hypotheses proposed. The data analysis and results will cover measures and the results overview followed by the researcher’s own commentary on the results. The response rate was at the higher end of the researchers initial expectations. All survey responses were transferred from the Survey Monkey software and analysed using the statistical analysis tool SPSS (see Appendix 1). 4.1 Results As previously discussed, all responses collected were analysed to find potential associations using the statistical package for the social sciences (SPSS). The chi-square test was used to analyse all three hypothesis, as all variables were categorical data. Internal validity was considered, as the validity of a chi-square test depends on the sample size and the number of cells, the approximation is considered adequate if the sample size is greater than 40 and if no more than 20% of the expected frequencies are less than 5 and none is less than 1 (Berkman and Reise 2012). Therefore, the validity of the chi-square tests adopted is considered acceptable and valid. When testing H1, a chi-square test was performed to test the null hypothesis “there is not a relation between followers of their favourite brand on social media and their intention to buy”, the results are presented in table 1.
  • 34. ! 34! The results confirm that there is an association between followers of their favourite brand on social media and their intention to buy (x2= 24.183, and p < 0.001), therefore the null hypothesis is rejected as p < 0.05 (in fact p < 0.001). This supports the initial hypothesis that there is a positive association between followers of their favourite brand on Social Media and their intention to buy. Table 1: Coefficients for H1 Chi-Square Tests Value df Asymptotic Significance (2-sided) Pearson Chi- Square 24.183a 1 .000 For H2, the Chi-square test was also used to test the null hypothesis “There is not a relation between people who are satisfied with their brand on social media and their intention to buy”, the results illustrated on table 2. The results confirm that there is an association between people who are satisfied with their favourite brands on social media and their intention to buy (x2= 18.788, and p < 0.005), therefore the null hypothesis is rejected as p < 0.05 (in fact p = 0.002). This supports the initial hypothesis that there is a positive association between people who are satisfied with their brand on social media and their intention to buy.
  • 35. ! 35! Table 2: Coefficients for H2 Chi-Square Tests Value df Asymp. Sig. (2-sided) Pearson Chi- Square 18.788a 5 .002 Chi-square test was also used to test the H3 and the null hypothesis “there is not a relation between people who use social media to keep up with trends and their intention to buy” and the results were illustrated on table 3. The results confirm that there is an association between people who use social media to keep up with trends and their intention to buy (x2= 15.398, and p < 0.001), therefore the null hypothesis is rejected as p < 0.05 (in fact p < 0.001). This supports the initial hypothesis that there is a positive association between people who use social media as a source of information and their intention to buy. Table 3: Coefficients for H3 Chi-Square Tests Value df Asymptotic Significance (2-sided) Pearson Chi- Square 15.398a 1 .000
  • 36. ! 36! 4.2 General Findings & Discussion: This research contributes to an improved understanding of the application of online marketing for the luxury fashion industry in a number of ways. First, it addresses an existing gap by applying previous research on traditional consumer behaviour to the luxury fashion industry. Second, the study was based on an empirical research method to ensure the analysis and conclusions are evidenced upon which should also lead to more effective decision making if the research outcomes are applied in a commercial context. The literature review analysed the main role of social media as an important marketing tool for building customer relationships and engagement and ultimately driving revenue. Furthermore, the review examined the advance of web technology and particularly the growth of social media channels and their role in revolutionizing the marketing communication process. The available literature clearly recognises the shift from traditional one-way company to consumer communication to a new paradigm where today’s consumer, empowered through online social media tools, actively engages and shapes the dialogue around a brand. The research identifies that social media offers significant opportunities for luxury fashion companies to pursue marketing activities and engage consumers as most of the luxury consumers studied actively use social media on a daily basis (79.3%), see Appendix 1.4, and a considerable amount of consumers are following their favourite brand on social media (44.8%), see Appendix 1.9. Marketers need to maximise this opportunity whilst remaining sensitive to the
  • 37. ! 37! impact that over exposure may have on consumers in the luxury fashion space. It was identified that almost half of the consumers in this study do buy luxury fashion items online (see Appendix 1.6), confirming the ongoing importance of selling items online in order to satisfy consumer expectations and preferences as observed by Okonkwo (2010). Furthermore, the research results complement the Luxury Institute findings, cited in Atwal and Williams (2009, p.340) that stated that 38% of luxury consumers prefer to buy online while 33% prefer face-to-face purchases and the study by Liu et al. (2013) that found out that consumers are purchasing online for convenience and product availability. The start findings open up some challenges to Kapferer and Bastien’s (2012) assertion that criticises the online presence of luxury companies stating that is not the right communication medium for the industry. For 68.9% of participants in this study, even too much exposure on social media made no difference to their intention to buy (see Appendix 1.22). The research found out that the main reason for consumers to not buy online is the necessity to try and see items as stated by 63.5% of respondents (see Appendix 1.8). The result is consistent with the Liu et al. (2013) findings that the aesthetic appeal is a dominant theme and it is very important for luxury consumers to see and touch products, identifying a challenge to be addressed and overcame by luxury brands with innovative technologies. The results can be contrasted with prior research by Atwal and Williams (2008) who suggested that the main motivation for luxury consumers to purchase products is the whole in- store shopping experience.
  • 38. ! 38! Addionaly, 80,1% of the consumers studied do agree, at some level, with the importance of a social media presence for luxury fashion brands (as per Appendix 1.19), a much higher percentage in comparison with a recent study by Lux Hub (2015) that found out that just over half of respondents (57%) felt luxury brands should engage with social. Further analysis into the construction of the respective study groups would be required to determine if this variance is significant. Additionally, a considerable amount of people feel influenced to buy (44.83%) items after seeing on social media (see Appendix 1.13), (40.52%) stated they had already bought an item after seeing it on social showcasing the potential for social media to directly influence purchasing decisions (see Appendix 1.11). This may support ongoing discussions that social media is an important marketing tool for the luxury fashion industry (Berlendi 2011; Kim and Ko 2011; Okonkwo 2010). The research suggests that not all social are equal when viewed in the context of online marketing and selling. Marketers need to identify and leverage the most influential social network for consumers in their niche. Whilst the majority of people in the study spend more time on Facebook (56.9%), as per Appendix 1.5, Instagram was the favourite medium in terms of engagement (following) and the most influential channel in the purchase decision process, confirming a report by Deloitte (2014), which showcased Instagram as a powerful global trend for the fashion luxury industry (see Appendix 1). This is not entirely surprising as the
  • 39. ! 39! strong visual element of Instagram fits well with being able to see fashion items in context i.e. viewing your friends and celebrities wearing a particular item. The researcher also supported, with empirical evidence, the fear held by brands and the proposition of authors, such as Kapferer and Bastien (2012), that going online or being too exposed in mass media communication channels can lead to a loss of the sense of exclusivity and prestige as 48.3% (see Appendix 1.22) of respondents replied that they believe that too much exposure on social media can damage a luxury fashion brand. The result suggests that luxury brands should develop a digital marketing strategy with caution to avoid alienating a significant chunk of their target audience and damaging their brand identity. In order to evaluate the role of social media as a medium for marketing communications of luxury fashion enterprises five hypotheses were tested. The gathered data suggests that there is a significant relationship between followers of their favourite brand on social media networks and their intention to buy (x2= 24.183, and p < 0.001). This supports Druica and Musso (2014) quote that states that the feeling of belongingness and identification that consumers feel when participating in brand communities are important factors, which can affect the purchasing decision process. Additionally, it supports a recent study by Razorfish, cited in Solomon and Tuten (2015, p.351) found out that 40% of consumers that are following their brand on social media channels are more willing to interact with the same brands in different ways. Therefore, it could be concluded that following the brand on social media can lead to purchase thus reaffirming the importance of luxury fashion brands to be on those social
  • 40. ! 40! networks. Although, the literature agrees that having a profile on social media channels is important for brands, most of the available research is based on traditional consumers, this evidence is therefore a significant contribution to the body of knowledge relating to the luxury fashion industry. The results also suggest that the level of satisfaction with brands on social media networks also can affect their intention to buy as a positive relationship between both variables was discovered (x2= 18.788, and p < 0.005). This supports Sashi’s (2012) research that showed a positive relationship between the levels of satisfaction in consumers and their intention to buy and that dissatisfaction can result in customer exit. The researcher also suggests that there is room for improvement in terms of customer satisfaction on social media networks for luxury fashion brands as levels of satisfaction are not as high as expected. Given luxury fashion consumers are paying a premium price for their goods, a reasonable assumption would be that luxury brands would invest heavily in customer care to keep these customers happy and retaining their loyalty. The use of social media networks (SMN) as a source of information also can lead to purchase as a significant relationship between consumers that use social media networks to keep up with trends and their intention to buy was found (x2= 15.398, and p < 0.001). Therefore this would support Laroche et al. (2012) claim social media is a perfect communication tool that allows brands to provide more information about their products and brands, enhancing consumer trust and as a result increasing purchases. This evidence also is in line with the study by Kim and Ko (2012) indicating that a luxury brand’s marketing activities on social
  • 41. ! 41! media can offer a variety of free content enabling information searching and sharing leading to word-of-mouth and influence purchases. As a result, it can be concluded that SMN is a valuable channel for providing brand and product information and to influence consumer’s purchasing intention process, emphasising even further the importance of social media networks for the luxury fashion industry.
  • 42. ! 42! 5. CONCLUSION This study contributes to the body of research knowledge on social media by confirming its importance as a marketing medium and sales channel for the luxury fashion industry. The results show a direct impact on the intention to buy for a segment of the study population. The evolution of marketing activities in association with the development of technology innovation brought, without any doubt, impact and challenges to the fashion marketing industry. The growth of social media networks usage across the world forced brands to adopt and embrace those channels in their marketing communications strategy in order to attend the demand of the “social consumers” (Solomon and Tuten 2015). It is clear that even though many luxury fashion brands are still reluctant to go online they will need to adapt themselves as “going online” is not even in discussion anymore (Okonkwo 2010). The response summary confirmed the importance of social media for the luxury fashion industry from a consumer perspective as 80,1% of consumers believe that luxury fashion brands should have an online presence on social media, a considerable number feel social media influences their buying decision process (44.8%) and they would like to purchase items straight from social media (65.52%). As marketing literature evolved, where once it mainly focused on the buyer- seller relationship, it was now clear that the focus turned onto customer and its participation (Jobber 2010; Kotler and Armstrong 2014; Kotler et al. 2010). Customer identification with the brand can increase customer self-esteem and
  • 43. ! 43! feel the sense of belongingness (Meister 2012) and those feelings can influence the customers purchase intention (Druica and Musso 2014). It is clear that social media plays an important role onto customer participation and that different levels of social media engagement can influence into the consumer buying decision process (Solomon and Tuten 2015; Van Doorn et al. 2010). This study found a positive relationship between followers of a brand on social media and their intention to buy. A positive relationship between level of satisfaction with their brand on social media and consumer’s intention to buy was also found. Finally, there was a relationship between people who use social media as a source of information and their intention to buy. These results suggest that different levels of engagement on social media can influence consumers buying decision process and that consumers are expecting a social media presence from luxury fashion brands. Thus, it is clear that social media is an important tool for the luxury fashion industry. However, levels of satisfaction with brands on social media were not as high as they should, the main barrier for consumer to purchase online is still the need to see and try products and consumers are concerned with too much exposure on social media from luxury fashion brands. Perhaps Kapferer and Bastien’s (2012) suggestion that brands should adopt a digital marketing presence carefully is valid. This study has some limitations. Even though the researcher used empirical evidence and tested whether social media networks are effective marketing tools, qualitative data, including in-depth interviews with consumers and marketing managers, are needed in order to understand the role of social media and the impacts on luxury fashion consumer behaviour further. Questionnaire design was
  • 44. ! 44! another concern. Reliability issues such as subject bias and observer bias may have distorted results. Another limitation of the research was survey distribution method adopted. The research was mainly promoted on Twitter, Facebook and Linkedin social media networks, which might have affected the results. Furthermore, this research collected data only from western consumers therefore general conclusions on the applicability of this data in other regions should be made with care. Nevertheless, it gives an opportunity for other academic researchers to adapt or verify the presented theories in different regions and industries. The author believes there is a rich seam of potential research in this area such as what type of content used on social media leads to improved conversion rates, the impact of user-generated content and contests have on luxury fashion consumers and measuring return on investment of luxury fashion social media campaigns. Finally, as a manager it is of upmost importance that they truly understand what drives positive actions from customers active on social media channels. The findings of this study confirmed the importance of social media within the luxury fashion industry. I would therefore advise a manager’s of brand who have yet to venture online to revisit their online strategy and search for opportunities to engage consumers online without alienating the existing customer base. Additionally, I would recommend an increase in investment in solutions that allow people to buy directly from social media channels that overcome one of the major barrier exposed in this research i.e. the need to try before buying. Examples could include CGI and Virtual 3D modelling technologies that superimpose a garment onto a virtual model of the consumer or flexible returns
  • 45. ! 45! policies (Burn 2014). Finally, managers of luxury fashion should keep in mind that too much exposure on social media can negatively affect brand image, thus, social media presence should always have a touch of “exclusiveness”. The author suggests future research into online closed invitation only communities, which meet the convenience needs of luxury consumers whilst retaining the vital perception of exclusivity. !
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  • 53. ! 53! 7. APPENDICES Appendix 1: Responses Summary General Luxury Fashion Consumer Profile on Social Media Females constituted the highest responding gender representing 57.8% of the overall sample set. 1.1 Question: What is your gender? 1.2 Question: What is your age? The respondents from 30-40 age group where most keen in participating in the survey followed by 20-30 year olds.
  • 54. ! 54! 1.3 Question: What is the average household income? The largest group of luxury fashion consumers using social media from the survey sample set claim to have a household income in excess of £50.000 per annum (47.4%). 1.4 Question: How often do you log into social media networks? The majority of consumers represented in the survey are using social media more than once a day (79.3%).
  • 55. ! 55! 1.5 Question: What is your favourite social media channel? Facebook stands out as the most popular channel by some way chosen by 56.9% of respondents with the second most popular channel, Instagram, trailing at 21.6%. Luxury Fashion Consumer and the Online Purchase 1.6 Question: Do you buy luxury fashion items online? From 116 respondents, 51.7% confirmed that they buy luxury fashion items online, while 48.9% of them do not buy online.
  • 56. ! 56! 1.7 Question: If yes, how often? According to the survey, the largest single group of respondents (35%) buy luxury fashion items once every quarter. Not so far behind go people who buy once every six months (30%) and people who buy once a month (25 %). Just 10% of respondents buy luxury fashion items only once a year. 1.8 Question: If no, why? From the respondents who confirmed that they do not buy fashion luxury items online, 63.5% confirmed that the main reason is because they need to see and try items, while 22.2% prefer the experience of buying in-store followed by 14.3% who like to feel the “sense of power” in store.
  • 57. ! 57! Fashion Luxury Consumer and Social Media 1.9 Question: Do you follow your favourite brand on social media? According to the results, 55.17% of the respondents do not follow their brand against 44.83%. 1.10 Questions: If yes, which channel? Among those who follow their favourite brand on social media, 60.4% follow their brand on Instagram, followed by 58.5% on Facebook, 37.7% on Twitter, 18.9% on Youtube and 13.2% on GooglePlus. Note: Each user was allowed to select multiple options for this question.
  • 58. ! 58! 1.11 Question: Have you ever bought a luxury fashion item after seeing it on Social Media? Although the majority of respondents stated they never bought an item after seeing on social media (59.48%), the group actively purchasing is still significant standing at 40.52%. 1.12 Question: If yes, which channel? The highest percent of cases is Instagram (56,3%), followed by Facebook (50%), Pinterest (18.8%), Twitter (14.6%) and Youtube (10.4%), respectively. The least considered social media was Googleplus, which received no response from all respondents.
  • 59. ! 59! 1.13 Question: Do you feel influenced to buy luxury fashion clothes via Social Media? 55.17% said they do not feel influenced to buy luxury fashion clothes via social media against 44.83%, which are. 1.14 Question: If yes, which channel influences you the most? Again, the majority of respondents (48.2%) said they feel more influenced on Instagram, followed by 32.1% on Facebook, Pinterest (10.7%), Twitter (7.1%) and Youtube (1.8%) .The least influential social media was Googleplus, which received no response from all respondents.
  • 60. ! 60! 1.15 Question: What is your level of satisfaction with your favourite brand on Social Media? The largest group of respondents are neutral satisfied with their brand on social media (46.7%) followed by 28.6% which are somewhat dissatisfied, 14.3% which are very satisfied, 7.6% somewhat dissatisfied, 1.9% very dissatisfied, 1% dissatisfied. 1.16 Question: Have you ever used any social media channel for customer service? Just over half of the respondents do not use social media as a customer service medium (52.59%) against 47.41%.
  • 61. ! 61! 1.17 Question: If yes, what is your level of satisfaction? The largest group of respondents are neutral satisfied (39.3%) with the level of customer service provided on social media followed by 31.1% who are somewhat satisfied, 14.8% are very satisfied, 6.6% are somewhat dissatisfied, 4.9% are dissatisfied and 3.3% are very dissatisfied. 1.18 Question: Do you use Social Media to keep up with fashion trends? The majority of respondents (66.38%) stated that they use social media channels as a medium of fashion information against 33.62%.
  • 62. ! 62! 1.19 Question: Do you agree that it is important for luxury fashion brands to be on social media channels? The survey found out that 49.1% strongly agree that is important for luxury fashion brands to be on social media channels, followed by 31% that agree, 8.6% that neither agree or disagree, 5.2% that somewhat agree, 3.4% that somewhat disagree and 2.6% that disagree. 1.20 Question: Would you like to be able to buy straight from social media channels? The majority of consumers stated that they would like to buy items straight from social media (65.52%) against 34.48%.
  • 63. ! 63! 1.21 Question: Do you believe that too much exposure to buy on social media can damage a luxury fashion brand image? 20.7% agreed that too much exposure to buy luxury fashion items on social media can damage a luxury fashion brand, followed by, 18.1% that somewhat agree, 18.1% that neither agree nor disagree, 14.7% that disagree, 10.3% that strongly agree, 9.5% that strongly agree and 8.6% that somewhat disagree. 1.22 Question: Would you stop buying a luxury fashion brand if too available on social media? Curiously, even though 48.3% either somewhat, agreed, or strongly agreed that too much exposure on social media could damage the image brand of a luxury fashion brand, 68.97% stated that they would not stop buying it against 31.03%.
  • 64. ! 64! Appendix 2: Questionnaire Dear Respondents, my name is Renata Falsarella Hernandez and I am writing my dissertation for my Bsc Business and Marketing at Birkbeck University of London. I am currently researching the Role of Social Media in the Luxury Fashion Industry and the impact of Social Media on its customers. In order to support my project I will need to collect data trough a questionnaire which will ask questions around your profile, your usage of Social Media and your perception around it, all in regards with the luxury fashion industry. So, if you are a consumer of luxury fashion items, I would like to kindly ask you to answer my survey hosted on Survey Monkey, it will take no longer than 3 minutes of your time. I assure that all answers will remain confidential and treated with anonymity. Your participation is voluntary and you have the right to skip any question asked or withdraw it at anytime. Thank you for taking part and helping me. If you have any questions, please do not hesitate in contacting me on: Renata Falsarella Hernandez 00447577281049 renatafalsarella@hotmail.com Best Wishes, Renata Falsarella Hernandez. 1. What is your gender? Female Male 2. What is your age? Below 20 20 to 30
  • 65. ! 65! 30 to 40 40 to 50 Over 50 3. What is your approximate average household income? Under £20.000 Between £20.000 and £30.000 Between £30.000 and £40.000 Between £40.000 and £50.000 Over £50.000 4. How often do you log into social media networks (e.g. Facebook, Google+, etc.)? Less than a few times a month A few times a month A few times a week About once a day More than once a day 5. What is your favourite Social Media channel? Facebook Twitter Instagram GooglePlus Youtube
  • 66. ! 66! Pinterest 6. Do you buy luxury fashion items online? Yes No 7. If yes, how often? Once a year Once every six months Once every quarter Once a month 8. If no, why? I like the shopping experience of a physical store I need to try and see items I like to feel the “exclusivity” of buying in the store 9. Do you follow your favourite brand on social media channels? Yes No 10. If yes, which channel? (You can choose more than 1) Facebook Twitter Instagram
  • 67. ! 67! GooglePlus Youtube Pinterest 11. Have you ever bought an luxury fashion item after seeing it on Social Media? Yes No 12. If yes, which channel? (Can choose more than one) Facebook Twitter Instagram GooglePlus Youtube Pinterest 13. Do you feel influenced to buy luxury fashion clothes via Social Media? Yes No 14. If yes, which channel influences you the most? Facebook Twitter Instagram
  • 68. ! 68! GooglePlus Youtube Pinterest 15. What is your level of satisfaction with your favorite brand on Social Media? Very Dissatisfied Dissatisfied Somewhat Dissatisfied Somewhat Satisfied Neutral Satisfied Very Satisfied 16. Have you ever used any social media channel for customer service? (Complain/ask question etc) Yes No 17. If yes, what is your level of satisfaction? Very Dissatisfied Dissatisfied Somewhat Dissatisfied Somewhat Satisfied Neutral Satisfied Very Satisfied
  • 69. ! 69! 18. Do you use Social Media to keep up with fashion trends? Yes No 19. Do you agree that it is important for luxury fashion brands to be on social media channels? Strongly Agree Agree Somewhat Agree Neither Agree nor Disagree Somewhat Disagree Disagree Strongly Disagree 20. Would you like to be able to buy straight from social media channels (link directly to website?) Yes No 21. Do you believe that too much exposure to buy on social media can damage a luxury fashion brand image? Strongly Agree Agree Somewhat Agree
  • 70. ! 70! Neither Agree nor Disagree Somewhat Disagree Disagree Strongly Disagree 22. Would you stop buying a luxury fashion brand if too available on social media? Yes No