Social Media and Customers Purchasing Behavior The Macau Hotels Case Study

SOCIAL MEDIA INFLUENCE

How Social Media Influence Customers Purchasing Behavior in the Macau Hotels Sector

Data Analysis

After surveying the travelers who have visited Macau for their traveling plans, the data is obtained in a comprehensive graphic manner to interpret the results easier. Initially, keeping the ethics of research in mind, the respondents obtained informed consent. The pie chart showed that all 113 participants agreed and accepted to participate in the research after explaining the study’s purpose. The demographics showed that approximately 60 percent of them were males while the remaining 40 percent were females. The respondents of age 18-19 years were 7 percent of the total sample, 20-25 years were 59.3 percent, 26-30 years were 11.5 percent, 31-40 years were 8 percent, 41-50 years were 4.5 percent, and 51-60 years were 9.7 percent while above 60 years was none. The socio-economic status of the respondents revealed that people who earned less than $5000 were 27.4 percent of the entire sample, people earning $5001-$10,000 were 15 percent, people earning $10,001-$20,000 were 24.8 percent, people earning $20,001-$30,000 were 15 percent, people earning $30,001-$40,000 were 8.8 percent. In comparison, people earning above $40,000 were 8.8 percent as well.

Further, the number of times respondents have lived in a hotel in Macau was also asked. The highest number of respondents’ sub-group who stayed in Macau hotel said ‘sometimes,’ the second-highest sub-group was those respondents who said they ‘seldom’ stayed over there. The third highest sub-group was those who ‘frequently’ stayed in Macau hotels. The last two sub-groups were for ‘never’ and ‘always’ based on the number of stayed, respectively.

The survey’s first question revealed that when researching travel destinations on the Internet, 84 percent of the respondents believed that Covid 19 influenced their travel plans and relevant decisions for staying in Macau hotels. However, the remaining 16 percent did not believe the same way.

The survey’s second question disclosed that while selecting a destination in the Eastern portion of the world, which encompasses China, Japan, Australia, etc., 85 percent of the respondents first use social media to gather information. The remaining 15 percent did not use social media platforms for this purpose, though.

The third question of the survey discovered that 71 percent of the respondents felt that social media has a disproportionate impact on their travel decisions, while 29 percent did not think so.

The response to the fourth question showed that Instagram was the most frequently used social media account for influencing their purchase decisions about hoteling. At the same time, they traveled, accounting for up to 42 percent of the sample respondents. Facebook came after it with 40.5 percent of the votes and small portions of the pie charts dedicated to Twitter, Tik Tok, LinkedIn, YouTube, etc.

The fifth question revealed that 88.5 percent of the respondents agreed that the direct experience of others impacted their decision to stay at a certain traveling destination. In comparison, the remaining 11.5 percent did not get influenced.

The sixth question discovered the important elements that respondents considered while making their travel purchase decision. The elements included price, value, location, activities, online reviews, facilities, safety, and multiple elements out of the given ones. Price was the most esteemed element for which 78.8 percent of the respondents voted. Value came the next, for which 51.3 percent of the respondents gave their consent. After the first two elements, location, activities, and online reviews earned their respective marks in this order. The lowest three elements were facilities, safety, and multiple options.

The seventh question asked for other sources of information, excluding social media, that travelers use while deciding about the travel destination. The responses comprised several reputations, friends’ and family’s feedback, magazines, official websites, travelling books, newspapers, T.V. shows, season, image of the destination, personal feelings about a place, word of mouth, and YouTube videos, vlogs, and blogs, etc.

The eighth question exposed that the timing of the social media posts greatly influenced the purchasing decision of the travelers. For this, 91.2 percent of the sample respondents agreed, while the remaining 8.8 percent did not.

The ninth question was aimed to seek the influence of social media on their purchasing decision with a rating between 1 to 10, 1 being the least influential and ten being the most. 26.5 percent of the participants gave an 8 rating, 17.7 percent gave a rating of 9, 16.8 percent gave a rating of 10, 17.7 percent gave a rating of 7, 11.5 percent rated on a scale of 6, and the rest of people rated for 5, 4, 3, 2 and 1 respectively.

The tenth and the last question asked about their perceptions of Macau travel destination. The list comprising of their responses was again an exhaustive one, including factors like gambling, casino, local attraction, good viewpoints, small places, success, wonderful, an amalgamation of Western and Chinese culture, boring, entertainment and leisure, festivals and food, cultural diversity, depiction of world’s heritage, and a renowned international travel destination, etc.

Discussion

The consumer decision-making process is complex and requires time and energy from the consumer’s side. It is done to maximize accuracy in the final decision about his purchase and minimize the risk, which would be for time and finances (William-Iivarinen, 2017). It would not be wrong to say that people usually want fast and accurate decisions for which digital platforms have come in quite handy. The amount of time, energy, and attention the online research requires depend on the decision goals about a specific product or service. The situation dependency is one of the factors that could influence the online research as the amount of time and willingness the buyer would be ready to invest would matter. Concentration or attention levels vary while doing such a task as some people might not be willing to conduct hours of research on online sites and check social media posts. Also, time pressure would suggest a different scenario in decision-making since before a certain time and date, the buyer would have to make a purchase. He would look for choices, options, and attributes relevant to them. With more time pressure, the buyer would be in a hurry and would make fewer researchers omit the information that might be required, creating a possibility of making irrational decisions about a product’s final purchase.

While formulating the questionnaire, three concepts and theories were kept in consideration to impact the results. Questions 1, 6, 7, and 10 were framed using ZMOT. Questions 2, 4, 8, and 9 were articulated using the social impact theory. Questions 3 and 5 were formulated by using the herding effect. The selection of these theories for connecting with the survey formation helped in answering the research question and even in the choice of research method. The articulation of the research question and the elements and factors to be scrutinized were intellectually transitioned from the foundation provided by these theories. The final results are generalized by detecting the various aspects of the theories and then witnessing their functioning within the phenomena.

ZMOT Phenomenon

Zero Moment of Truth (ZMOT) is considered a significant phenomenon to explain how customers make their informed decisions (Bicer, 2020, p. 156; Ertemel and Peyk, 2018, p. 124; Wolny and Charoensuksai, 2014). With easy access to the social media platforms these days, it has become convenient for buyers to first look online for existing buyers’ comments and feedback about a product or service and then reach their final decision (Ertemel and Basci, 2015, p. 526). The exponential growth of user-generated data has become a credible source of information for buying for the first time and somehow creates prevention for impulse buying. In marketing terms, there is a specific moment of truth for the consumer when the brand meets the buyers’ expectations with its captivating offers, quality parameters, and interest points that the customer is looking for.

The traditional model of the mental decision-making process typically consists of stimulus, the first moment of truth, which according to Procter and Gamble, comprises the first seven seconds by the buyer to make his final decision about a product. Then the last stage is the second moment of truth, which includes the experience (Ertemel and Basci, 2015, p. 528). It must be noted that impulse buying is the urgent urge created after seeing the product, and the customer decides on his own that he needs it while stimuli could be created through advertising (Ertemel, 2017, p. 465). However, with digital technology that has become an integral part of our lives, digitally empowered consumers are involved in a systematic process of making buying decisions after research. It has modified the above-given traditional model into a new one: the new mental model of the decision-making process. It includes the ZMOT stage right after the stimulus phase, and the rest of the subsequent stages remain the same.

For certain age groups, such as Generation X, Y, and Z, the use of social media is different with a difference in intergenerational response to social media advertising (Roth-Cohen, Rosenberg and Lissitsa, 2021, p. 3; Hysa, Karasek and Zdonek, 2021, p. 12). Since Generation Y has been more into using digital technology and is more familiar with social media platforms than the older individuals of Generation X, they are more comfortable researching online before shopping (Martinelli, 2021, p. 22). Research indicated that 35 percent of the Millennials (Generation Y) would research the product in-store compared to the 15 percent of Baby Boomers (Generation Z) who would do the same. Similarly, the Millennials are highly dependent on word-of-mouth, accounting for up to 82 percent of the time. In comparison, Baby Boomers would purchase their product after getting only 52 percent of the word-of-mouth feedback for the same item (Martinelli, 2021, p. 22). The research also suggested that different geographical regions impacted these percentages for age and generations. However, the global pandemic that has negatively affected in-store sales has created a more upsurge in online sales. All the generations now focus on researching online as well.

For the same reason, people who visited Macau were reliant on the ZMOT phenomenon on which a few questions of the survey were based. It was done to see the customer’s journey for obtaining information regarding their place of visit and the actual buying decision. Philip Kotler has detected five stages of a customer’s journey in which they come across the information they seek and then make up their minds. The customer’s journey consisted of becoming aware, creating an appeal for the product, asking about the brand or product, acting after evaluations, and advocating for the final purchase decision (Martinelli, 2021, p. 23). It could imply that the consumers of Macau hotels went through all of these stages for which they responded; taking the example of question 1 when Covid influenced their decision to stay in Macau while researching online, they must have been aware of the places beforehand; they would have sensed an appeal for the likelihood that they would stay in Macau, they would have then asked and evaluated their options from credible sources over the Internet, they would have taken their time to take their final action on their selected choice, and then they would have advocated the final visiting place in Macau for which there are chances that they would become loyal and make a re-purchase (Gu et al., 2021, p. 2263; Jamunadevi et al., 2021, p. 8).

It would be even further interesting to dig that when the customers are going through the ZMOT phenomenon, they are gathering information about a certain product online and gaining perspectives for the real purchase that they would later share with others (Martinelli, 2021, p. 28). For instance, in question 6, they were asked about the elements that helped them make the travel purchase decision. These elements would later be transferred into their feedback and rating about where they stayed in Macau. They might add elements like price, value, and facilities after they had experienced their stay at a specific hotel and taken advantage of their services (Bucko, Kakalejcik and Ferencova, 2018, p. 7).

Theory of Social Impact

Theory of social impact embeds in itself the belief that despite the differences in thoughts, feelings, and emotions of all human beings, the human mind still tends to believe the bundles of opinions that are combined with the experiences of others (Fink, 1996, p. 6; Isa, Mohd Salleh, and Aziz, 2016, p. 356). Latane defined the theory as a persuasion over the thoughts, feelings, and behavior imposed by the real or fictional presence or activities of others (Nowak, Szamrej and Latane, 1990, p. 363). The structure inconsistency still intermingles with locally consistently held beliefs and shares them. Even if the opinions held are by those in the minority, the majority of people who seek their viewpoints still tend to find a similarity that would match their thoughts and make it easily interpretable (Rahman et al., 2018, p. 1). The invisible yet meaningful communication between an already consumer of a product giving his opinions about the quality and the likely consumer of the same consumer is about the association between the two types of buyers (Krastel, 2015, p. 28). This communication creates value within the minds of the new consumers by the already existing ones. It is dynamic since it is meant to influence or change attitudes towards buying a specific product. It is expected that a change in attitude would be observed with the convergence of beliefs.

At any given time, the social impact theory is likely to influence either one individual or a group of people (Nowak, Szamrej, and Latane, 1990, p. 364). The strength, instancy, and the number of sources that created an impact are resided within the working of this theory, especially when social impact over a person’s purchase decision is investigated (Daliri, Rezaei, and Ismail, 2017, p. 440). The magnitude of influence is to be measured along the lines of this theory for gauging the activity of participants for shaping other people’s thoughts and formulating the entire social environment (Mir and Zaheer, 2012, p. 10; Perez, Waite and O’Gorman, 2016, p. 310).

For the change in behavior to take place, the influence should be powerful enough with persuasiveness and supportiveness (Nowak, Szamrej, and Latane, 1990, p. 365). Persuasiveness means the extent to which a person could be convinced to change his position in relevance to the opposing one. In contrast, supportiveness means creating resistance from others’ influence and helping them do so. Persuasion could occur in verbal and non-verbal cues so that at least one change in behavior could be made possible (Gonzalez, 2016, p. 10). Persuasion could be mass media or interpersonal level that would depict to what extent behavior change has taken place. They both could be perceived as to present a correlation between both of them since a person belonging to high status could be the one who would persuade the other to buy a smartphone, for example, and in the same place could be the one opposing the decision to buy a specific phone. The credibility and stimulus play their respective parts here as well. Therefore, the change in attitude would highly depend on these elements when they come together to help the customer make his final decision.

Keeping the discussion on social impact theory in mind, it could be deduced that Macau respondents took cues from social media platforms that created a massive media impact on their final buying decisions. Their selection of destination and making the final payment for visiting the place depended largely on the persuasion and support factor from this theory since most of them used social media first to gather information about Macau, as stated in question 2. The same stands true for question 4, in which the social media platform having the highest persuasion and support factor was noted for Instagram. Instagram is one of the most widely used social media platforms where people give comments and feedback about their travel destinations and post pictures. The pictures could have added to the credibility of the information present online that was related to Macau. The survey respondents who might have taken the help of those pieces of information to make an accurate decision was the real; change in attitude that could have taken place under the light of social impact theory.

Additionally, the source’s credibility would have affected the survey respondent’s decision after online research for Macau destinations. For instance, if a friend of the survey respondent is a social media influencer or a traveler and has posted his reviews about the finest Macau destination places, the survey respondent would likely have opted for his viewpoint based on the social impact theory (Dang, Wang, and Vu, 2020, p. 13).

As far as finding a similarity that should match one’s own beliefs and supportiveness tends to create a resistance for the opposing lookouts, the survey respondents would have been influenced by the timing of social media reviews and posts for the particular decision asked in question 8. The respondent would have come across those minority opinions, for instance, that might not have been in unity with what the respondent thought was a perfect choice for a Macau destination. He would have been resistant in diverging his opinion and matching his own opinion with the majority or to those similar to his.

Herding Effect

The herding effect occurs when individuals decide whether they should follow others and copy what their actions have been rather than acting independently and autonomously (Baddeley, 2010; Ali, Amir, and Shamsi, 2021, p. 347). The information could have been obtained privately through which decision could have been made without imitating others; however, this is not the case in herding effect. Following the crowd is inevitable besides and uncertainty of the purchase results in consumer behavior terms (Chen, 2007, p. 1977).

Herding is based on the uncertainty factor as well as the belief of the person that the herd he is following is well-informed. It does not suggest whether he would be able to make or rational decision after following the herd. The socio-psychological influence is strong enough to manipulate his mental decision-making process when he is about to purchase. Though, it might denote that the person following others would have developed this behavior after realizing some positive externalities that forged his behavior into an effort of herding. This might seem to exploit his independent mental capacity to make the right and informed decision; he only focuses on the current benefit and its even distribution for all.

A notable phenomenon in the hindsight of herding effect is the Bayesian learning process. In this process, the individuals following the herd or society seem to formulate a sophisticated logic for their herd mentality. Their sequential decision-making process comprises constant signals from each person within the same herd or society that would influence his decision (Fang et al., 2020; Baddeley, 2015, p. 904). It should be noted that each individual in the society or herd has a complex thought process, completely different from others; still, an eternal connection from the continuous signals is developed to form the final opinion. It is the foundation of the Bayesian social learning model, leading to the herding effect.

In herding effect, the psychological inclination refers to that the individuals might want to maintain their good reputation by doing what others are doing. It might not matter to them whether the person being followed is rationally right or unconventional. It is deemed to be on the safe side by imitating their actions and agreeing on their opinions (Fang et al., 2020). The new trends, bubbles, and mania of certain products and services are not well-researched by the individual who is following others and has insufficient knowledge along with scarce information for well-thought processing in his decision-making progression (Mohy ud Din et al., 2021).

Keeping the impact of the herding effect in mind, it seems that Macau respondents also took effect of it. For example, for question 3, approximately 71 percent of the respondents admitted a disproportionate impact on their travel decisions based on their social media research. Similarly, for question 5, the respondents disclosed that 89 percent of them were influenced by direct experiences of others on social media that shaped their decisions about Macau destinations and its purchase. There is a possibility that this occurred when there was insufficient information present to the respondents to make their final decisions. They took the help of social media and the feedback present over there. They had to rely on some form of information for which the Internet is the handiest of all.

Research has corroborated that the presence of information reduces the risk of making an inappropriate decision (Mohy ud Din et al., 2021). The presence of relevant information matters for herding since, in the case of Macau respondents, if the information were not available regarding hotels, facilities, prices, environment, etc., the decision made after social media research and an influence of herding would have been low. Herding takes place when the private comments of people based on their own and similar shopping experiences are posted on social media, especially those that have upsurge during Covid-19 (Duan, Gu, and Whinston, 2005, p. 3514). The Internet has served as a persuasive provider of information that favors a certain decision that the online researcher or potential buyer of a product or service is looking for (Pavlovic-Hock, 2022, p. 1). Only when the information is pertinent and is similar to the researcher’s needs (in this case, it was the Macau respondent) then the herding effect takes its form and influences the final decision after going through social media posts.

Research has supported that the herding effect influences in two ways; first that when detailed information is available about the product’s quality and features, people make choices based on those opinions, making herding more fitting- secondly, when more information is available, then herding becomes less desirable as there are forums on social media platforms where people discuss a product’s quality and features that do not keep the charm of the product (Duan, Gu, and Whinston, 2005, p. 3514). In the Macau respondents’ case, it could be hard to discern which of the two cases occurred when they benefited from social media information. However, if most of them agreed that social media definitely influenced their decisions, the level of trust put on social media feedback and comments, and the public’s risk perception of the products they already bought, Macau respondents entrusting on social media for making final decision purchase is verified.

Reference List

Ali, M., Amir, H. and Shamsi, A.F. (2021) ‘Consumer herding behavior in online buying: A literature review,’ International Review of Management and Business Research, 10(1), pp. 345-360. doi:10.30543/10-1(2021)-30