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Chapter 1
THE PROBLEM AND ITS BACKGROUND
Introduction
In this chapter we introduce to the reader the research area by presenting a
snapshot of social media marketing and conventional marketing practices in
the background section of the study. The new challenges for marketers and
opportunities for business establishments are incorporated in problem
discussion which tries to build a foundation for the consequent purpose of
the study and research questions.
Social Media Marketing (SMM) on sites like Facebook, Twitter, Stumbleupon
and Digg has exploded in the past year. But what exactly is it? And whats in
it for you?
How Social Media works? When a user of a social media website discovers
your story and likes it, they have the option to share it with their friends. This
can cause the story to 'go viral' and be shared with even more people. This
can deliver hundreds of thousands of visitors, launch a website or new
product and bring significant inbound links. Those inbound links will directly
bring your site visits and indirectly help your SEO. Your social media
marketing can support your search engine optimization (SEO) by including
target keywords in headlines. Then when your story goes viral and other
sites use your headline to link back to your site Bingo! - you get keywordrich inbound text links.
Social Media Marketing is bigger than TV, radio, newspapers, magazines and
books. 18-34 year olds now spend 4.3 times more time on social media than
with TV, radio, newspapers, magazines and books combined. This is
happening because social media allows users to talk to each other (which
they prefer to being talked to) and choose for themselves what they see and
read. Social media is a many-to-many conversation and not a one-to-many
communication.
Facebook is growing faster than Google ever did. Facebook is the biggest
social site with over 250 million users. It took Google ten years to reach 50
million users something Facebook achieved in just 19 months. Facebook is
the worlds online scrapbook and meeting place in one. Friends, customers,
stars, fans, and anyone who crashes the party use Facebook to stay in touch,
swap photos, pay homage and talk to each other.

Twitter might be the ultimate networking site. Twitter is a microblogging site

on which each post is no more than 140 characters long. Friends, colleagues,
admirers and the interested all follow each other and can read each others
posts. The result is a collection of thousands of different conversations and
mini monologues. This can seem like a mad mess but that chaos is like the
hum of chatter at a lively party - narrow your focus and you find that people
are amusing each other, helping each other, sharing ideas, making
connections and doing business.
Social media are media for social interaction, using highly accessible and
scalable publishing techniques. Social media uses web-based technologies to
turn communication into interactive dialogues. Andreas Kaplan and Michael
Haenlein also define social media as "a group of Internet-based applications
that build on the ideological and technological foundations of Web 2.0, which
allows the creation and exchange of user-generated content." Businesses
also refer to social media as consumer-generated media (CGM). Social media
utilization is believed to be a driving force in defining the current time period
as the Attention Age. A common thread running through all definitions of
social media is a blending of technology and social interaction for the cocreation of value.
People gain information, education, news, etc., by electronic media and print
media. Social media are distinct from industrial or traditional media, such as
newspapers, television, and film. They are relatively inexpensive and
accessible to enable anyone (even private individuals) to publish or access
information, compared to industrial media, which generally require
significant resources to publish information.
One characteristic shared by both social media and industrial media is the
capability to reach small or large audiences; for example, either a blog post
or a television show may reach zero people or millions of people. The
properties that help describe the differences between social media and
industrial media depend on the study. Some of these properties are: First,
Reach - both industrial and social media technologies provide scale and
enable anyone to reach a global audience. Second, Accessibility - the means
of production for industrial media are typically owned privately or by
government; social media tools are generally available to anyone at little or
no cost. Third, Usability - industrial media production typically requires
specialized skills and training. Most social media does not, or in some cases
reinvent skills, so anyone can operate the means of production. Fourth,
Recency - the time lag between communications produced by industrial

media can be long (days, weeks, or even months) compared to social media
(which can be capable of virtually instantaneous responses; only the
participants determine any delay in response). As industrial media are
currently adopting social media tools, this feature may well not be distinctive
anymore in some time. Fifth, Permanence - industrial media, once created,
cannot be altered (once a magazine article is printed and distributed
changes cannot be made to that same article) whereas social media can be
altered almost instantaneously by comments or editing.
The most popular platforms include: Facebook, YouTube, LinkedIn, Twitter,
MySpace, Reddit and Delicious.
Social Media: A New Era of Marketing was one of the popular hits found on
Google when looking for the phrase Social Media Marketing.
More than 400 million users are active on Facebook today, fifty percent of
them use the platform on any given day and for a total of 700 billion minutes
per month. Each user is connected to an average of 130 friends, which
means that if a company induces one person to post something about their
brand they have the potential of reaching 130 more persons. There are over
160 million objects that people interact with (i.e. pages, groups, and events).
An average user is connected to 60 pages, groups and events and creates 70
pieces of content each month. More than 25 billion pieces of content (i.e.
web links, news stories, blog posts, notes, photo albums, etc.) are shared
every month. Facebook have a very wide global reach, more than 70
translations are available on the site, about 70% of the users are outside the
United States, and over 300,000 users helped translate the site through the
translations application, which means that language differences are no
longer hindrance of communication. There are more than one million
developers and entrepreneurs from more than 180 countries. More than 70%
of users engage with Platform applications every month, more than 550,000
active applications currently on Facebook Platforms, more than one million
websites have integrated with Facebook Platform and more than 150 million
people engage with Facebook on external websites every month. Two-thirds
of comScores U.S. Top 100 websites and a half of comScores Global Top 100
websites have integrated with Facebook. There are more than 100 million
active users currently accessing Facebook through their mobile devices.
People that use Facebook on their mobile devices are twice more active on
Facebook than non-mobile users. There are more than 200 mobile operators
in 60 countries working to deploy and promote Facebook mobile products.
These statistics speak for themselves, and one can understand why

companies around the world are drooling over the endless marketing
possibilities presented by the Facebook Platform.
However, the attractiveness of Social Media as marketing platform is not only
to be understood in terms of statistics. The way businesses promote their
products and the marketing strategies used for their brands to be known to
the market is evolving, a never ending change in which social media is
playing a central role. All of us are familiar with the old fashion and usual
marketing technique used by some companies, like the last time wherein a
salesperson called and interrupted your lunch. Consumers are also evolving,
following with the current trends, learning how to screen innovative and
disruptive communication attempts, which is why this way of marketing is
being replaced by the more modern, advance and technologically based form
of permission marketing. The advertiser is no longer the one who decides
when, how, and to whom to communicate. Nowadays, it is the consumer who
decides which company and what information to take part of.
The younger consumers are the most proactive when it comes to this new
way of gathering, screening and spreading information over the Internet. It is
the younger segment that is most active on social media and also the most
difficult to reach in the increasing media buzz. In the Philippines, there are
14, 600, 300 registered users on Facebook, making our country in its 2nd
place in Asia, and 8th place in the whole world. The two dominant age groups
are 18-24 with 44.38% and 25-34 with 23.93%. Facebook is thus very
attractive, useful, and fastest marketing channel to reach the younger
consumers, and specifically interesting and cheaper for start-up companies
that do not have an extensive marketing budget.
An honest practitioner who puts the following marketing practices to work
will become successful in the all around arena of private practice.
Focus on Helping, Instead of Selling - You shouldn't be trying to force people
into purchasing your product or service. You should find people who want
your product or service and then focus on offering any helpful information to
them so that they can make an informed decision.
Target - If you're trying to target everybody, then chances are, you're not
targeting anybody. State your target clearly in all of your marketing
materials. Stop Spending Money on Ineffective Marketing - One great way to
save money is to stop wasting it on marketing and advertising that isn't
producing for you. Don't forget to track the number of responses you are
getting from whatever method you use. If you're not reaching your goals,
then your strategy needs to be revised.

Network - Networking is a great way to get your message out to a large

number of people, for free. Set Goals and Deadlines - Collect your thoughts
for a moment or two, and set goals and deadlines. These are vital to your
business success. State your goals as specific numbers. Focus on Benefits
Not on Features - Spend your time focusing on how your prospects will
benefit if they purchase your product or service. Write Tips Articles Newspapers and other publications are always looking for helpful tips articles
that would be of benefit to their readers. Submit simple, problem/solution
type articles related to your product or service. State the problem, and then
share some insightful tips that can help to solve the problem.
Be Persistent - Persistence is power when it comes to increasing your sales
and profit. Far too many firms fail because they don't follow-up long enough
to produce results. Most sales are made after the seventh or eighth contact-the sale is rarely made after just one contact. Submit Press Releases - Press
releases are a very cost-effective way to get your message out to many
people . . . for free. Submit your press releases to a wide variety of
publications for immediate release. Offer to be a Speaker - Business and civic
organizations are always looking for speakers for their meetings and get
togethers. Make yourself available by contacting these groups and offering to
talk about your area of expertise. Give a Free Demonstration - If possible,
give free demonstrations of your product or service to those that might be
interested. Follow-up with these prospects in a timely manner to attempt
sales conversion. Distribute Samples - If possible, get samples into the hands
of people who may be potential customers. People like to try before they buy.
Distribute Informative Literature - Make sure that you get your product
benefits, features and ideas into the hands of your prospects. Use the
Telephone - The telephone can be one of your most effective, and least
expensive, sales tools. Call people who you would like to do business with.
Ask for a few minutes of their time so you can show them how your services
can help them save time, cut costs, increase sales, etc. Generate Referrals Referrals are a great way to generate new business. Don't just wait for
people to refer you. Proactively ask for referrals from existing customers,
acquaintances, family and friends. Don't forget to graciously thank anybody
who refers your business to someone. Have Fun - Frustration and stress will
slow you down. You will succeed far better when you're doing something that
you love. Talk to Your Customers About Them and Their Needs - Most
company publications, ads, letters and sales literature are filled with words,
photographs and information that do nothing more than toot the company's
horn. Talk about your customers needs instead. Rather than using the words,
"I," "me," "my," use "you" and "your." Develop Customer-Oriented

Relationships - Take an interest in your prospects and customers. Send them

helpful articles that you think would interest them. If you know of an event
that your prospect or customer will be celebrating, such as an anniversary or
birthday, send them a card or small gift. They will appreciate your generosity
and will think of you when they need your service, or if they know someone
else who may need your service. Tell Your Prospects and Customers What to
Do - Getting your message into the marketplace is important, but getting
prospects/customers to respond is the real test. Tell your prospects exactly
what you want them to do next. Take Advantage of Testimonials - Whenever
an existing or potential customer says something positive about your
company, ask them if you could use their statement in your marketing
materials. Your company's credibility will increase with the use of
testimonials from happy customers. Make it Easy for People to do Business
with You - Your customer is not going to work for you. You have to work for
them. Do anything you can to make doing business with your company easy
and a pleasure. Content First, Form Second- When developing your sales
materials and literature, spend less time worrying about the graphics and
colors, and more time working on the content -- what's in it for your
customers. As long as your message is enticing, black ink on white paper
could work just as effectively as expensive four-color materials. Give to Get There's an old saying, "You can get everything you want, by helping enough
people get what they want." Listen carefully to your prospects and customers
so you'll know exactly what they want and be generous in your offers. That
way you'll be sure to reap the maximum rewards. Learn a New Marketing
Technique Every Day - Read, go to seminars, listen to audio tapes.
Continuously improving your sales and marketing skills will help you to
increase your sales and profits.
Associate with Positive, Successful People - Talking to and learning from
people who are always striving for and meeting their goals, will help you
commit to and achieve your own objectives. Believe in the Product or Service
You Sell - If you don't believe in the quality and benefits of your product and
service, your prospects won't either. Present the benefits of your
product/service with confidence and enthusiasm. Focus on the Lifetime Value
of Your Customers - Don't focus on generating one-time customers. Build a
relationship so that a prospect becomes a repeat, lifetime customer. Learn
from Someone Who Has Experience - Marketing is an important skill based
on both knowledge and experience. The fastest way to gain that knowledge
is to find someone who knows what works and has done it successfully. Ask
about his or her specific experience in generating marketing results, as well
as references, or testimonials. Reasonably priced marketing materials, like

books, courses, workbooks, newsletters, audio cassettes, etc. can be

excellent resources, that allow you to learn and apply effective marketing
systems at your own pace.
We want to determine the choice of social media as a marketing tool among
business establishments. Our study will also determine the comparison
between prevalent marketing practices and social media as a marketing tool
among selected business establishments in Quezon City. We also want to
determine which of the two types of marketing (Traditional Marketing
Practices and Social Media Marketing) is more effective in terms of targeted
segment coverage and expenditure. We also want to know which marketing
approach enables business establishments to maintain better relationship
with their customers. And lastly, we want to know whether or not it is the
right time for business establishments to adapt social media marketing
practices.

Background of the Problem

In hindsight it becomes clear that marketing has undergone two notable
changes in the past few decades. The first phase was predominantly driven
by manufacturers; while the second by retailers. The former drove the
market by aggressive promotional strategies while the latter exploited
closeness to consumers (Schultz & Schultz 1998). Ever since then marketing
has entered a third phase, influenced by the increased role of information
technology (IT) in consumer lifestyles which has led to a consumer dominant
marketplace (Jim Blythe, 2006) and in the new landscape consumer really is
king (Rob, 2009).
Social media is defined as, A social trend in which people use technologies
to get information they need from one another, rather than from traditional
institutions like corporations (Charlene, 2009). Social media is interactive in
nature and is therefore known as consumer-generated-media, new media or
citizen media (Rob, 2009). Conventional media is company-generated and
information flows in one direction i.e., messages are broadcast from
company to target audience (one-to-many) and in social media (many-tomany) in multiple directions.
Dave Evans in his ground breaking study (2008) defines social media as,
The democratisation of information, transforming people from content
readers to content publishers. It is the shift from a broadcast mechanism to a

many-to-many model, rooted in conversations between authors, people and

peers.
The rise of new social media can be seen from the fact that in first decade of
21st century several words from social media have entered lexicon as word
of the year such as Blog (2004), Podcast (2005), Facebook (2007) and
most recently a verb Unfriend which means to remove a friend on social
network site (SNS) such as Facebook was chosen as the word of year 2009
by New Oxford American Dictionary.
A joint survey conducted by Forrester and the Association of National
Advertisers (ANA) in the United States demonstrate the importance of social
media as it depicts how marketers plan on advertising spending in 2010.
Most marketers intend to increase marketing budgets to Social media by a
whopping 77%, Web advertising 73%, and Search engine marketing 59%.
Alternately, marketers plan to increase spending on conventional marketing
only by 13% in magazines, 9% increase on radio advertising, and a dismal
7% raise in newspaper advertising.
These changes have created several opportunities for micro firms to adopt
social media marketing as they are often cash-strapped and lack marketing
expertise for carrying out expensive marketing campaigns.
Small firms are moving from conventional marketing practices such as
television advertising, newspapers, radio, magazines, word of mouth
marketing (WOMM), public relations (PR) and relationship marketing towards
more affordable and interactive social media marketing.
We researched about a qualitative study showing how Social Media
Marketing sites enhance the perception of brand associations and traditional
communication effects. And found out that Social Media Marketing site is an
effective marketing tool. Communication professionals, business marketers
and company owners praised social media as the future marketing channel
and that thesis had gave us the idea of performing a similar study, but
applied on Social Media Marketing sites. Finding out that there is still no
accurate research had been previously conducted exploring the effectiveness
of Social Media as a marketing medium, and well aware of the platform being
the greatest worldwide, we believed to have found the subject for our thesis.
As Marketing students, being passionate about the latest and current trends
of marketing a product, we believed that a practical guide explaining how

small businesses could build their brand at practically no cost at all would be
a great value for many.
Social Media Marketing is still one of a fairly young communication platform
and there are not that many studies concerning its effectiveness as means of
marketing. Selling online doesnt help entrepreneurs to enhance their ability
on promoting their products and being persistent to get their target markets.
Online selling differs from person-to-person selling. Online selling example in
Social Media Marketing sites, sellers dont have the opportunity to interact
personally to their consumers, does not have enough capacity to experiment
or be creative enough to sell products and interact with their customers.
People just come to your site and expose to a one-way reading of your
message and scanning flyers or pictures of the products which on the part of
the seller can be impersonal. Fan pages are also one of the useful medium on
promoting or advertising products and sites. Creating fan pages should also
have business strategies and the brand of the product should communicate
with their consumers. Building loyalty and getting trust from your consumers
is also one problem to consider. Some consumers are hesitant to shop online
because they probably think that it is a scam, vice versa for the sellers,
online sellers are prone to bogus-buyers .
Recently, there has also been a debate concerning the effectiveness of
Traditional Marketing Practices versus Social Media Marketing. (Kover and
Goldberg, 1995; Sasser and Koslow,2008). This debate has been supported
fuelled by extensive research and according to several studies, traditional
approach is to be preferred (Colliander, Erlandsson and Modig 2010).
However, these results have yet to be tested.
As mentioned above, Social Media Marketing is fairly a new marketing
communications channel and has not yet been fully explored. The
contribution of this study is thus to provide whether Social Media Marketing
shall be used for marketing purposes and give them useful insights and
information regarding on its effectiveness, as well. We also want to provide
what is the appropriate approach when targeting the consumers. The study
will hopefully also contribute with some qualitative evidence to debate
concerning the effectiveness of Traditional Marketing Practices and Social
Media Marketing.
Theoretical Framework
An interesting way to describe social media marketing is to compare it with
conventional marketing practices. Social media marketing has created new

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challenges for advertisers, companies and strategists. Due to the increasing

popularity of rapidly evolving social media marketing worldwide it would be
interesting to know that whether it is the right time for small firms to adopt
the social media bandwagon.
Every day we are exposed to about 1,500 brand-related messages (Lucas &
Dorrian, 2006) and had developed what Blackwell (2001) calls selective
attention, or advertising skepticism. These mental barriers are a necessary
reaction of consumers to the increased advertising noise and that marketers
must find new ways to break through these barriers. In other words,
increasingly difficult for companies to stand out and get consumers to pay
attention to their company. In this new marketing landscape advertisers must
surprise consumers and adopt methods around which mental barriers have
not yet been developed.
Having been exposed to so much advertising, consumers have learned to
recognize and recall any attempt of persuasion (Friestad & Wright 1994) and
that is why the old form of interruption marketing has been replaced by
something new(Godin, 1999). Instead of interrupting consumers and trying
desperately to control consumer perceptions, marketers are today looking for
ways to engage consumers and interact with them (Meadows-Klue 2007).
Social Media Marketing is yet highly unexplored by the marketing research
community and many questions on its marketing effectiveness still remain
unanswered. Advertising activities on social media sites are however
increasing, even if its effectiveness and its effects on brand perceptions are
still uncertain. This can be explained as social media sites offer brands the
means to interact with consumers in a communication that is no longer
single-tracked. The advertiser can instead engage consumers in a dialogue, a
two-way communication that has been proven to be very effective (Kocken
and Skoghagen 2009). Furthermore it is the consumer that comes to the
brand when marketing via fan pages and news feeds, thus being very
receptive. With this in mind we can assume Social Media Marketing to be one
perfect modern marketing platform.
Conceptual Framework
Micro firms are always short of money and money is spent on activities that
can bring maximum benefits to the firms. In the back drop of all this hype
about social media as a marketing tool we got the clue to find the right tools
of marketing for these cash strapped micro firms regarding the choice of
conventional tools and social media as a new marketing tool. The purpose of

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our thesis is to compare and contrast conventional marketing practices with

social media marketing in the context of micro firms and then suggest these
micro firms as which tools are more suitable for them.
According to McCarthy and Perrault Jr. (1987), there are many possible ways
to satisfy the needs of target customers. A product can have many different
features and quality levels. Service levels can be adjusted. The package can
be of various sizes, colors, or materials. The brand name and warranty can
be changed. Various advertising media newspapers, magazines, radio,
television, billboards, flyers, the Internet may be used. A companys own
sale force or other sales specialists can be used. Different prices can be
charged. Price discounts may be given, and so on. With so many possible
variables, the question is: is there any way of simplifying the selection of
marketing mixes? And the answer is yes.
It is useful to reduce all the variables in the marketing mix to four basic ones:
Product, Price, Place and Promotion.
The product area is concerned with developing the right product for the
target market. This offering may involve a physical good, a service, or a
blend of both.
Place is concerned with getting the right product to the target markets
place. A product reaches customers through a channel of distribution.
Promotion is concerned with telling the target market about the right
product. Promotion includes personal selling, mass selling, and sale
promotion.
Personal selling involves direct face-to-face communication between sellers
and potential customers. Personal selling lets the salesperson adapt the
firms marketing mix to each potential customer.
In addition to developing the right Product, Place, and Promotion, marketing
managers must also decide the right Price. In setting a price, they must
consider the kind of competition in the target market. They must also try to
estimate customer reaction to possible prices. Besides this, they also must
know current practices as to markups, discounts, and other terms of sale.
Further, they must be aware of legal restrictions on pricing. If customers will
not accept the Price, all of the planning effort will be wasted. So, one can see
that Price is important for a marketing manager.

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All four Ps are needed in marketing mix. In fact, they should also be tied
together. But is any one more important than the others? Generally
speaking, the answer is no all contribute to one whole. When a marketing
mix is
being

developed, all decisions about the four Ps should be made at the same time.
That is why four Ps arranged around customer C in a circle to show that
they all are equally important.
In the case of the present day study, Social Media Marketing has all the
potential to be one of the best market place for a company who wants to sell
their product online because social media sites are well known around the
globe. But marketing and pre-selling here is not easy. Despite how good the
quality or well-known your product is, you will find difficult and challenging to
sell your product. It is not just a matter of showing a good product because it
will not sell itself, since most customers prefer a direct selling because they
can easily acquire the product compare to online shopping which take time
to deliver the product.
Given the concept regarding marketing mix as presented above, it is
therefore the objective of the researcher to come-up with a marketing tool
that business establishments can use.

Research Paradigm
Figure 1 illustrates the research paradigm of the study.

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Figure 1 Research Paradigm

The paradigm illustrates the operational concept of the study. Specifically, it
present how the study progresses. These are two main areas to be described
in this research. First, which is labeled (1), is the Marketing Practices of
Business Establishments.
Second, pertains to the interview among business establishments. This is
labeled (2) in the research paradigm.
The outcome of the study is to develop a Marketing Tool for business
establishments. This is indicated by the cylinder figure, which is labeled (3)
in the paradigm.
Statement of the Problem
The study seeks to determine the choice of social media as a marketing tool
among business establishments. The study also seeks to determine the
comparison between prevalent marketing practices and social media as a
marketing tool among selected business establishments in Quezon City.
Specifically it seeks answers to the following questions:
Which of the two types of marketing is more effective in terms of targeted
segment coverage and expenditure?
Which marketing approach enables business establishments to maintain
better relationship with their customer?
Whether or not it is the right time for business establishments to adapt social
media marketing practices?
Research Hypothesis
There is no significant difference in the factors considered in the
measurement of the qualitative effectiveness of Traditional Marketing
Practices and Social Media Marketing.
Significance of the Study
Social Media Sites were use as means of communication, because of its
popularity many people tends to use it as a means of communication. For
that reason many companies entered Social Media Marketing and used it as

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an alternative source of advertisement because they believe as social media

sites popularity occur, many people can see their product and get more
customers. In this study we determine on how effective of Traditional
Marketing Practices and Social Media Marketing through individuals.
Trinity University of Asia. This study will serve as a guide for future students
of Trinity University of Asia in making of their thesis.
College of Business Administration. This study tends to supplement the CBA
students wisdom about the world of business and how to construct business
strategies which they can use in their future carreer.
Faculty Members of CBA. This study will give the faculty members additonal
information about web marketing business werein they can apply or use in
their class disscussion especially to the faculty members.
Marketing Students. This study will give marketing students knowledge on
how products being advertise and by the use of Social Media Sites, it will
give them techniques on how to communicate with different people among
other countrys.
Product Consumers. Social Media Marketing will be a good source of products
selection to the consumers. In here, consumers can identify the right
products of their best that will suite their needs and taste.
Business Investors. The popularity of Social Media Sites to all the web surfers
and web browsers will give interest to the business investors choose the site
to be one of their advertisement instrument.
Social Media Sites Users. Aside from searching for new set of friends and old
batchmates and colleague, Social Media Sites users can also earn income by
advertising products to their accounts.
Scope and Delimitation of the Study
There are certain delimitations to our study which we would like to mention
before proceeding further. The first delimitation is the time constraint. In
order to complete our thesis we had to really keep ourselves from spreading
out in the study and complete in time as per requirement of the submission
of the study in time.
Further, the subject is very new and there is very scant material written on
the subject. We did our best to get a hand on every possible material related

15

to the subject. However, we have tried our best to contribute to the existing
marketing literature in the context of business establishments.
The other delimitation is that we have conducted this study from one
perspective only, from the perspective of the businesses only.
This study is limited to determining the Marketing Practices Employed by
Business Establishments in Quezon City most specifically along E. Rodriguez
Avenue. More specifically, they will be analysed according to the marketing
tool used.
The study will also be focused at E. Rodriguez Avenue Quezon City. The
reason for the selection of the research locale is because the researchers are
students of Trinity University of Asia. Thus, it will be more convenient for us
to conduct interviews because of our proximity to the place. A total of 3
business establishments will be included as subject of the study.
Additionally, Social Media Marketing and Prevalent Marketing Practices will
only be the focus of the study. This study is limited to analysing and
assessing the qualitative effectiveness of Traditional Marketing and Social
Media Marketing. It is worth pointing out that Social Media Sites offer many
different alternatives to marketers and that fan pages are one of many
possible ways for a brand to market itself on websites. In an effort to
measure the effect of Social Media on key advertisement indicators, we have
chosen to look at brand attitude, seller intention, and word-of-mouth.
Lastly, we will choose to limit our research to the Philippine market and the
study is also limited with regards to the data sample. We will investigate and
observe the effects of Social Media Marketing to business establishments and
other individuals, making our results most suitable for brands with a similar
target audience.
Definition of Terms
Advertising: is a form of communication intended to persuade an audience
(viewers, readers or listeners) to purchase or take some action upon
products, ideas, or services.
Blog: is a type of website or part of a website. Blogs are usually maintained
by an individual with regular entries of commentary, descriptions of events,
or other material such as graphics or video.

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Blog Marketing: is the process of reaching a business' prospects through the

use of a blog.
Bogus Buyers: refers to fraudulent buyers.
Direct Marketing: is a form of advertising that reaches its audience without
using traditional formal channels of advertising, such as TV, newspapers or
radio.
Facebook: A global social platform with millions of members worldwide.
Facebook works as a social networking website enabling users to
communicate and share information with friends and brands from around the
globe.
Fan page: A Facebook fan page is a public profile used by brands to share
information with other Facebook users.
Fan: A fan is a Facebook user that has chosen to become a member of a
brands Facebook Fan Page.
Flickr: is a popular photo sharing website that allows members to upload
their own photos into customizable albums that can then be labelled,
organized, tagged, and publicly posted.
Friend list: A friend list is a personalized news feed where the consumer
himself chooses which friends (i.e. members within the personal network)
status updates to show.
Friendster: Social networking website that connects individuals across the
world with the hopes of helping them develop friendships.
Google: is the world's most popular search engine.
The term "Google" is now often used as a verb, synonymous with "search."
Internet: called simply "the Net," is a worldwide system of computer
networks - a network of networks in which users at any one computer can, if
they have permission, get information from any other computer (and
sometimes talk directly to users at other computers).
Like: Members might like a status update by clicking on a like-button below
the update.

17

LinkedIn: is a social networking website geared towards companies and

industry professionals looking to make new business contacts or keep in
touch with previous co-workers, affiliates, and clients.
Marketing: is the process of performing market research, selling products and
or services to customers and promoting them via advertising to further
enhance sales.
Marketing Mix: Planned mix of the controllable elements of a product's
marketing plan commonly termed as 4P's: product, price, place, and
promotion.
Marketing Practice: tended to be seen as a creative industry in the past,
which included advertising, distribution and selling.
News Feed: The Facebook news feed is a long list of status updates that each
member has visible on his/her profile.
Personal Selling: Face to face selling in which a seller attempts to persuade a
buyer to make a purchase.
Post: To post is the action of uploading a status update.
Public Relations: is a field concerned with maintaining public image for
businesses, non-profit organizations or high-profile people, such as
celebrities and politicians.
Sales Promotion: Activities, materials, devices, and techniques used to
supplement the advertising and marketing efforts and help coordinate the
advertising with the personal selling effort.
Social Media: are media for social interaction, using highly accessible and
scalable publishing techniques. Social media uses web-based technologies to
turn communication into interactive dialogues.
Social Media Marketing: which is known as SMO Social Media Optimization
benefits organizations and individuals by providing an additional channel for
customer support, a means to gain customer and competitive insight, and a
method of managing their reputation online.
Social Networking Sites: places on the Internet where people meet in
cyberspace to chat, socialize, debate, and network.

18

Status Update: A Facebook status update is a short message that users can
upload on their profile and that will be visible to other members within their
network.
Twitter: is a website, owned and operated by Twitter Inc., which offers a
social networking and microblogging service, enabling its users to send and
read other users' messages called tweets.
YouTube: A very popular video sharing Web site that lets anyone upload short
videos for private or public viewing.

Chapter 2
REVIEW OF RELATED LITERATURE AND STUDIES
The review of related literature is considered a difficult task but plays an
essential part in the completion of the study. This will also strengthen and
prove the validity of a certain study. Since the study, must be based on facts,
it should involve the systematic identification, location and analysis of
documents containing information related to the research problem.
Local Literature
According to Carlo S. Oples book entitled Social Media Guide For Filipino
Entrepreneurs (2010), Internet Marketing is all a joke. This is a common
sentiment among Filipino entrepreneurs and businessmen. Some even go as
far to think that the internet is a waste of time, saying it doesnt generate
return-on- investment. Who can blame them? Theyve gotten used to the

19

success that was brought about by traditional marketing initiatives that

theyve been doing for years.
But this is good news for you. This gives you the rare opportunity to break
into an untapped market and build a very cost-effective business in a very
fun way.
Its already 2010 and the landscape has drastically changed over the last
decade. Technology has made gigantic strides forward, providing you with
new tools and platforms that you can use to bring your business or career to
the next level. If you have a business right now and youre still marketing it
as if it was still the 1990s, then you have one big problem.
What are the numbers? Your first question would be How big is the potential
for growth?, and my answer is Massive. Various studies show that there
will be around 28 million Filipino internet users by the end of 2010. Thats
bigger than the entire population of Malaysia! The primary growth drivers
here are the combination of the aggressive marketing and sales of leading
broadband providers like PLDT, SMART, Globe, and Bayantel, combined with
the proliferation of internet cafes all over the country. Online gaming industry
experts say that there are around 10,000 internet cafes operating in the
Philippines as of this writing. If youre still not satisfied with these numbers,
lets take a closer look at one of the more popular social networks being used
by a lot of Filipinos: Facebook. Care to venture a guess how many Filipinos
are actually signed up?
As of 4:45PM, April 1, 2010, there are approximately 11,468, 880 registered
Filipinos on Facebook.
According to the website Alexa, 8 out of the top 10 websites visited in the
Philippines are social networks. If you want to tap the internet to build your
business, then be where everyone is. Setting up a website and leaving it
there hanging is tantamount to putting a gigantic billboard in the middle of a
farm. Being in social media, on the other hand, is like being the giant
billboard along Guadalupe in Makati where everyone can see you.
According to the Cartoon Network New Generations 2009 Philippines Study, 6
out of 10 Filipinos aged 7-14 years old are already online. The same study
reveals that the internet is also now the second most popular activity of the
same age bracket, next only to watching television. And if you give these
kids a few more years, they will eventually be the major decision makers.

20

The study Digital Philippines: Internet Media Habits Decoded by Yahoo and
Nielsen shows that bulk of Filipino internet users are actually within the 15 29 year old range. These already include young professionals--decision
makers in themselves.
What about ROI? Now this is my favorite topic when it comes to social media.
Let me start by asking you these questions: how much does it take for you to
acquire one customer? How about social media? Does it have an effect on
purchase intent? Do internet campaigns actually convert to sales and how
are they compared to traditional media?
The average businessman will probably say it takes somewhere around 100200 pesos to acquire a customer using traditional methods. But for social
media, consider this: 67% of people who follow brands on Twitter and 51%
who become fans of brands in Facebook are actually more likely to buy
products from you. For the sake of argument lets say those numbers are
overstated for the Philippines so lets peg it at just around 30%. How much
does it cost you to get a fan on Facebook? Roughly around P10 pesos per fan
using their CPC advertising platform. Using dirty math, youll end up
spending P30 pesos to get one sale if we will use the 30% mark--thats a lot
cheaper than the 100-200 pesos we assumed for traditional methods.
You see, the moment someone becomes a fan or a follower of your product,
it means that they are interested already in buying. All you have to do is to
provide them with a gentle nudge to actually get them to go to your store
and do it.
New Media is the darling of Traditional Media. Another growing trend is that
traditional media is giving new media a giant push into the mainstream.
Popular media stations in print, radio, and television have aggressively been
using and integrating social media platforms into their operations.
FM Station Magic 89.9 is one of the most popular stations in Metro Manila.
Theyre actually one of the first stations to aggressively push for building a
Facebook online community.
As of 5:19 PM, April 1, 2010, theyve amassed more than 98,000 fans on
Facebook. Im not talking about passive fans here. These guys actively
participate in the promos and discussions on the social network as well as
the radio show. The DJs constantly promote their Facebook accounts on-air.
If you think about it, Magic 89.9 is giving Facebook insane amounts of media
mileage. Its time that you also jump in and take advantage of that. Note that

21

Im not saying that you spam Magic 89.9s fan profile. That would be rude,
unethical, and will backfire. What I am saying is that you should be in the
game. If youre not there, you dont exist in their world.
Another media station thats pushing social media and the internet is ABSCBN. Theyve integrated Facebook and Twitter into their news programs and
special events like the recently concluded HARAPAN: Vice-Presidential
Debates. I was even interviewed by Ces Drilon for TV Patrol to discuss the
impact of social media in the 2010 campaign.
What does this all mean? Traditional media is pushing people to create
accounts on Facebook, Twitter, and other forms of social media so that they
can connect and interact with one another. ABS-CBN and Magic 89.9 are part
of the reasons why there are now more than 11,000,000 Filipino Facebook
users. These stations have integrated social media in their broadcast which
means that they acknowledge that the number of Filipino social media users
will continue to sky rocket over the longer term.
I Google You... do you Google me? In the past, when people needed to know
about whether a product is good or not, they would have to talk to people
whove bought it before. Theyd have to either give those people a call via
telephone or meet up with them. Today its totally different. You can easily go
online and type the name of the product on Google and check out the
reviews of other customers.
The power of search is expected to grow tremendously within the next few
years, as more Filipinos get access to the internet through their mobile
phones.
To get on Google, its not enough to make your own website. Thats just one
result in the 10 that come out on the first page. Get into social media,
because the good thing about these social media sites is that they are
properly optimized for search engines. If you have company pages in
Facebook, Twitter, LinkedIn, etc. then theres a good chance that these pages
will pop out on the first page as well.
Remember that one of the strongest powers of the internet is that it allows
you to focus the eyes of potential customers to good things about your
product.
The internet is like a giant marketplace filled with billions of vendors
interacting with customers. Marketers dont just talk, they have to listen.

22

The internet is surrounded by REAL people. What they say matters, and the
biggest factor behind this is the speed at which what they say spreads.
Finding out whats being said about your product wont even take much
effort. The internet has a lot of really good and free tools which allow you to
monitor your online temperature.
Google Alerts is by far one of my favorite monitoring and listening tools. As
with almost all Googles products, its very simple and user-friendly. All you
have to do is type in key words, and voila, Google sends you a notice via email every time that word is mentioned online.
Google Reader is another insanely great tool at no extra cost. Ive been using
this for a long time now because, for me, education never stops. The web is
so rich with information and insights which can help you give your career or
business a much-needed boost. Google Reader allows you to track all the
blogs and websites that have RSS feeds in one page.
Another cool feature is the Explore section. You can click Recommended
Items and Sources for blogs that Google thinks you might find interesting.
Google also lists down how many other people are subscribed to those other
sites and blogs which gives you an indication of their popularity and
authority.
With Google Reader, you only take in the information thats relevant,
interesting, and important to you.
Most of you probably know by now that Twitter is steadily gaining a huge
following here in the Philippines. Its actually the 10th most visited site
according to the research site Alexa. To hear about what people say about
you, your brand, your competitor, or your industry, you can go to Twitter
Search and just type the keyword there. The Advanced Twitter Search option
opens up to a more detailed form where you can put parameters for your
search. You can filter the search via date and location, and even based on
the smileys used in the tweets (negative or positive). You might also want to
get Tweet Deck. This will allow you to monitor tweets about a particular topic
real time.
Search Engines is another way of monitoring your online presence is just to
key in the name of your product, your company, your competitor on search
engines.

23

The web is one giant free market research machine that anyone can tap. Its
just a matter of investing time and effort. Believe me, the benefits outweigh
the costs by miles (hey, these tools are for free!).
The objective of your Facebook campaign will determine your over-all
strategy and execution. Each objective will require different tactics,
resources, and manpower to pull off.
For eBook, the three common objectives: awareness, customer support, and
community building.
Awareness is probably your objective if youre part of a start-up. You need to
get the word out to the 11,000,000 Filipino Facebook users that you exist.
There are several ways to do this. The first and more obvious one is to
advertise on Facebook. You can dot his either by directing the advertisement
link straight to your website, or to your companys Fan Profile. The former
needs less resources than the latter. If you want to have a Fan Profile,
however, note that this will take considerable resources and effort. A Fan
Profile is meant for more than just adding fans, it requires constant
engagement between you and your customers. Theyll want answers to their
comments, and to give them that youll need to get someone to manage
customer relations.
Customer Support ties in with the Fan Profile concept. The danger with social
media is that your channels can quickly turn from promotional vehicles to
customer support outlets. If you allow users to post comments on your Fan
Profile, expect to get a mix of good and bad feedback from them. When this
happens, you better make sure you have someone replying and coordinating
with your sales and marketing so you can resolve issues quickly. Always
remember that you should reply as fast as you can. If you dont have a
resolution yet, then just let them know that you got their complaint and that
youre working on it. Dont forget to update them later on once you actually
find out what went wrong.
One thing that Id like to recommend is that you come up with rules and
regulations for posting comments on your Facebook Fan Profile. Theres
nothing wrong with moderation because there are clear and present dangers
which can go after your brand. Constructive criticism is welcome but not at
the cost of disrespecting the administrator and their fellow fans.

24

The strongest feature of social media platforms is the ability to build,

nurture, and mobilize communities. Its a long term relationship which grows
over time. More than that, it needs time, effort, and sincerity.
You need to have a deliberate strategy for your social media campaign. Start
asking the difficult questions before you get into this. Set objectives.
Someone has to man the ship. You cant leave your social media channels
immoderate.
Social Media is long term. You earn your customers, you dont buy them off.
However with enough prodding and patience they will become brand
ambassadors and evangelists.
Its all about COMMUNITY.
To set-up an official page, log on to
http://www.facebook.com/pages/create.php. Once you fill in the initial
information, youll land on a very boring, empty, and blank page. The
challenge now is to make this page interesting enough so that you can
actually build a community using this platform, and keep users coming back
for more.
Step 1: Create a Profile Picture - The profile picture is very important
because this is the face of your company for Facebook. Its also the first thing
that theyll see if they get an invitation, message, or when they land on your
wall. Get a graphic artist to come up with a decent stylized logo or product
photo.
The main message that I want to get across to you now is that you shouldnt
be limited to the conventional Facebook profile for the picture. Use an image
that best suits your objective. If you want to make an impression quick and
fast, then you might want to consider this approach.
Step 2: Edit Settings - After uploading a good profile picture, the next task is
to edit the settings for your page. The first setting tab will be country
limitations. You can set what countries can only view your page. If you dont
input any, the default is that all countries can see your page. If your business
is just based here in the Philippines, then I strongly recommend that you just
limit the viewing here so that you wont encounter any problems and mixups. At the end of the day theres no point in getting international visitors
especially if you have a brick- and-mortar operations (unless youre going to
do online selling).

25

Step 3: Content - The first thing you need to fix is the Info Tab. There will be
several information slots youll need to fill up with basic company
information. After that, edit the Note Box which is located under your Profile
Picture. Since this is the second most visible thing after the Profile Pic, you
might want to put the URL of your website here or something important
which will help you get your fans to your storefront. Next we have the media
that you will be uploading. Select very good photos and videos that you can
use to promote your brand. Pick only the best and the more viral ones so
that users can share them with their personal networks.
Step 4: Add Applications - Facebook has a lot of applications that you can use
to spice up your official page. Focus them on just one channel. Instead, a
good default app to add is the Events app. You can use this to invite your
fans for your major promos and events and actually schedule it in their
calendars so they dont forget.
Add a Landing Page to your Official Page - One app that everyone should get
is the Static FBML application. This allows you to create a beautiful and
effective landing page for your profile. Why is this important? Because you
can control what users will see when they first visit your page. The Static
FBML landing page capability lets you focus the eyes of your potential fan to
one singular, strong, and quick marketing message that you control.
Step 5: Promote, promote, promote! Now that youve built a proper Facebook
Official Page for your business, the next task is to drive traffic to it.
Integrated Marketing - One of the best and most affordable ways to drive
sign-ups is to use your actual offline business to promote your Facebook
Official Profile. Have tarpaulins or those table menus printed announcing that
youre on Facebook and that youd like your customers to sign-up as fans. Let
them know that youll be running contests and promos exclusive to your
Facebook community. Give them a good reason to log-in when they get home
and search for your page so that they can sign-up.
If your business is online, all you have to do is put banner ads on your site.
Its even simpler if you have an e-mail or SMS database. Just send out a
broadcast announcing your Facebook Official Page and wait for them to start
trickling in.
Your community has to be alive and kicking. Your Facebook Official Page has
to offer value to your customers because if it doesnt, then its as good as
spam.

26

Facebook Advertising is one of the most cost-effective platforms available to

Filipino entrepreneurs. The great thing about the Facebook Ad Platform is
that its very user-friendly and it gives you a lot of options so that you get the
maximum exposure possible for your target market. You also get to pick the
method of payment and theres a tracking mechanism built-in which will
allow you to monitor the performance of your campaigns.
Facebook Advertising is not as simple as it looks like. You really have to put
even more effort in coming up with phenomenal creative because you have
such a small space for both the image and your copy. Youre also contending
with two other ads as well as the social stream on the wall of your prospects.
But Facebook Advertising can bring your business to a whole new level if you
leverage on the built-in targeting features of the platform.
ADD VALUE. Thats the single most powerful tip I can give to you before you
start doing social media, especially Twitter. The more value you give, the
more value you add to yourself and your company. Social Media is not about
buying, its about earning via giving.
Secondly, Twitter is not just about talking - its also about listening and
learning. Theres so much information and insights that you can get via
Twitters search mechanisms that will have a profound impact on your
business and career.
Connecting Smiles with Friendster - People say Friendster is already
yesterday but the fact of the matter is that a lot of Filipinos are still using
the pioneer social networking website. The traffic theyre getting is still high
enough to get anyones attention, especially companies who want to tap
Filipino netizens - more specifically young Filipinos.
Building your Friendster Fan Profile - To start, you need to create a regular
account for your brand or company. Head on over to www.friendster.com and
sign-up for an account.
The Friendster Self-Advertising platform DIY(Do It Yourself) Ads offers a lot
of advantages in advertising compared to Facebook. The most obvious is the
ad placement and the ad size. Friendster gives you a large canvass of
300x250. The placement of the ads is also optimal since it usually pops up at
the upper right section of the profile. Another amazing feature thats not
available in Facebook is the ability to target up to the locality of the target
market (you can pick cities, regions, etc).

27

Friendsters definitely still in the game, especially if were talking about the
Philippines. The marketing tools that you have at your disposal on Friendster
are quite formidable especially if you leverage it properly.
Blog Marketing 101 - Bloggers are starting to gain more prominence as great
ways to raise awareness. Some bloggers here in the Philippines have more
monthly readers compared to national best-selling glossies!
A blogger has one thing that all ads dont - credibility. They have a
relationship with their readers that makes them an authority and subject
matter experts.
According to the book of Lloyd Luna entitled The Internet Marketing
Handbook ( Principles and Strategies for Corporate Sales, Personal Branding
and Business Success, 2009), There is no denying that the world has evolved
swiftly. The old rules have changed and it happened without a warning. What
seemed to be a perfect business model in the last century no longer holds a
healthy cash flow.
Most people who have done their business in the past were caught with one
unique question in their mind: What happened?
In recruitment, traditional way of headhunting has changed unbelievably.
Door-to-door job application was replaced with an online resume submission
eliminating a human interaction during the first level of screening. Most
jobseekers dont have a clue on how an applicant is selected. They, too, are
caught with one unique question in mind: What happened?
In education sector, teachers in primary, secondary, and tertiary education
no longer get due respect from students who claim to be far better than they
are. Information has been made available in the Internet and every
assignment can simply be solved with a power CTRL+C (Copy) and CRTL+V
(Paste). Students, in theory, can now be literally better than their teachers.
And so people in the academe are left with a unique question in mind, too:
What happened?
Those whove been doing traditional marketing and selling face the same
difficult challenge. Gone are the days where businesses get an impressive
number of responses from people using cold calling and facsimile
transmittals.

28

The days of door-to-door selling was replaced with something else more
economical. Businesses can cut personnel and still get the same sales result.
Obviously, the rules have changed and so have the tools.
It occurs to me that there are things that no longer work however we try our
very best. There are things in the past that simply cannot be an effective tool
to help us improve or develop the way we live our lives. Those old school
tools become more burdensome rather than it is irrelevant.
People who belong in the older generation continuously struggle to catch up.
Most of them developed an irrational fear called Technophobia, the fear or
dislike of advanced technology or complex devices, especially computers. On
the other hand, the younger generation appears to be more welcoming on
technological developments.
The new generation of business people wanted to innovate and adapt the
new technology but the old generation seems to still hold on with what
made us successful in the past.
It seems to me like the young is moving forward while the old is moving
backward. Result? Status quothe most dangerous side you can ever be!
The Internet Marketing Handbook is effective only to people who are ready
for it. If you fail to get the message, then the philosophy is lost.
According to Juanita P. Roxas in her book entitled Marketing Practices in the
Changing Philippine Macroeconomic Environment, Marketing strategies of
Philippine corporations are highly adapted to the obtaining macroeconomic
conditions. Manufacturing companies were more dynamic than the service
sector in their pricing, product and research and development practices
when stagflation - a period of shortages, inflation and recession - hit the
country due to the 1990 Persian Gulf crisis. The applicability of the
stagflation model outside of the US was also validated.
Over the years, Facebook has increase its popularity in the Philippines and it
kept growing time and time again. Latest figures from CheckFaceBook.com
show that the Philippines is now among the Top Ten Largest Countries in
terms of Facebook population with close to 15.3 million users (as of July 22,
2010). The Philippines is the 8th largest worldwide and the 2nd largest in
Asia, next only to Indonesia whose Facebook population currently stands at
close to 26.3 million. Facebook is the number 1 Website in the Philippines in
terms of audience and search traffic.

29

Number of users on Facebook in Philippines is: 15,284,460. Male users are

about 7,247,000; while Female users are 7,950,540. Philippines-based users
yields around 611,000 to 612,000 logon every day since March. Majority of
that are women at 353,000. Majority of that are in the age group - 18 to 34
years old (around 260,000). Dominant are college students or yuppies at 1824 years old (around 150,000++), according to All Facebook.
Facebook is a popular name among those who are so into it. Filipinos who
have an account in Facebook are now using more of their time to socialize
with other people amidst the distance and lack of time. And even if a
community like Facebook serves numerous advantages, it also proves to
have certain disadvantages as well. There are now series of improvements in
the system just to make up with the shortcomings. Arguments regarding the
different advantages and disadvantages of Facebook for the Filipinos are
stated below.
The advantages of Facebook are: Allows user search for new and old friends,
Accessible to chosen universities having a high level of security, Makes it less
awkward when communicating with people you are not familiar with, Love
attraction - can be used as a dating service system, Makes it easier to join
groups having similar likes and dislikes, and it allows members to check
students who are taking the same class, living within the same area, or
coming from the same academy.
On the other hand, its disadvantages are: Overcrowding, Weakening long
distance relationship, Unsupported by physical adjacency, Contributes widerange procrastination, Rampant addiction, Stalking is possible and
Acquaintances be labeled as friends.
Surely, the disadvantages don't pose a threat just by merely looking at it.
Someone else has to prove that what users do with their profile is directly in
proportion with what can happen to them. A user must understand what he
is trying to give out otherwise things might get messy and people will
mistook them as someone else.
It is quite obvious that a trade-off is happening between the advantages and
disadvantages of Facebook. While it increases the communication and
connection between friends and the online community it also increases the
risk of procrastination and makes it easier for others to stalk a user. Worse,
some are actually punished for what they put on their profile and would
claim that it was there only for fun.

30

Despite the above mentioned advantages and disadvantages of an online

networking service, it still is gaining demand and popularity among the
young Filipinos. There are about 10,000 students (professionals and young
professionals not yet included) who are joining into Facebook every day. This
is regardless of the age or any demographic profile of individuals. Some are
now trying to criticize the status of professionalism of this site whether it's
just another fad like other online networking services are.
As media sees the early smell of elections in the air, networks have also
cited the significant role of Facebook.com in most politicians campaigns.
According to abscbnNEWS.coms article entitled Politicians using Facebook
for 2010 election preparations it is said that politicians are among the top
users of said social networking site even if the 2010 elections was just a year
away. The article also states that according to information technology expert
Jaime
Garchitorena of Youth Vote Philippines, several social networking sites which
includes Facebook.com, Friendster.com and Multiply.com voters to know
more about the candidates.
In the article Pres l Campaign to Spread in Facebook, My space by the
Herald News Team, certain facts regarding the maximization of social
networking sites which cites that politicians who are running for post have
hired full-time staffers to maintain their online presence in social networking
sites especially the presidential candidates. The article also expects muchawaited discoveries that presidentiables might see and maximize by using
Facebook.com. Yet the news team recognized the fact that candidates have
just started to tap the full potential of cyberspace and other social
networking sites.
Lynn Lopez of Gmanews.tv criticized the attachment of the candidates
themselves in networking accounts that they have in her article
POLITICIANS ONLINE: A one way street?. She shared actual experiences
and said feedbacks are very necessary to be critical about because users
dont even know if they are really in touch with the politicians. She said:
One thing that hasnt changed much is the websites sheer indifference to
feedback. Those e-mail addresses you see? And those contact forms? Thats
all for show, people. Write to them and wait weeks for a response, or sit back
and watch awestruck as your messages bounce to you instantly.

31

As what media practitioners see, Philippine politicians have, in a way,

patterned their campaigns the way United States President Barrack Obama
has in his presidential campaign, thus, creating a statement of challenge
whether Facebook.com will be effective when used by politicians in the
country. The criticisms that praises and negates at the same time shows how
the pros and cons of presidentiables being visible online creates another idea
whether people will still be pulled by the bandwagon of Facebook.com
accounts of candidates.
According from a book article written by Lloyd A. Luna entitled Social Media
Marketing in the Philippines, Ten years ago, it wasnt like this. We didnt
have much rapport with the Internet technology especially that the
Philippines was just starting to adapt with the trend. Perhaps because at the
time, it was still unclear what it is for. Today, its obviously important for us to
be in social networks such as Twitter, Facebook, Plurk, Multiply, and
Foursquare among many others.
Social Media Marketing in the Philippines isnt in its peak yet. And my
observation is that Filipinos are still in the consumer of the technology
rather than user of it. Now, the difference is that consumers spend and
users profit.
As an Internet marketing specialist in the Philippines and Asia, I think
transformation from being consumers to users isnt really an easy move. We
love being entertained and get connected with friends. This isnt like America
or any other developed countries, where standard of living prohibits them
from spending 3 hours a day on Facebook and other social networking
websites.
We are still lucky to be in this country, but mind you, sooner or later, the
name of the game will be Users of Internet Technology.
Social Media as a tool, whether you are in Manila, Cebu, Davao, or anywhere
else in the Philippines, is something that we cant afford not to have. We
should have the knowledge on how to read the signs as well as the meaning
over as many clicks as have. Our performance in social networks and media
as part of our internet marketing campaign or identity should be more than
what we have now.
According to the article of Rob Angeles entitled 5 Valuable Social Media
Marketing Tips For Small Businesses, Many business owners are still
concerned about partaking in marketing in the social web. Some of the

32

common concerns include budget and time constraints. These are valid
concerns considering that small businesses are usually tight on finances and
require the owners to be hands-on in all aspects of the company. But social
media marketing isnt all that expensive and time-consuming. It may start off
that way as youre learning the ropes, but as you progress itll all be easier.
Here are some tips on how you can make social media marketing easier for
small businesses: First, You dont have to jump immediately into hiring a
social media expert. You can try reading about it yourself. Allot an hour or so
a day to read and absorb the basics of social media, then practice it bit by
bit. Remember that you dont have to go full out immediately. And also, the
more you understand what goes on in social media, the lesser the likelihood
of you getting fooled by so-called social media experts. Second, You dont
have to spend on high-tech gadgets. Your tried-and-tested video camera,
even your cellphone camera, can be a very useful tool in making promotional
or instructional videos which you can post on social video sharing sites like
YouTube. Third, To help you maximize your allotted time for social media
marketing, dont spread yourself too thin. Instead of being everywhere at
once, why not choose a select few that you can concentrate on. Make sure
that those sites youve chosen are ones that actually matter. Fourth, If youre
worried about tracking ROIs for your social media effort, you can simply ask
new customers where theyve heard about your business. Its quick, its
personal, and it gives you the chance to get to talk to your clients a little
more. Fifth, To make it easier for you to stick to your allotted time, it helps to
set up an alarm clock for when you need to start working and when your
time is up for doing your social media marketing. Knowing that youre only
supposed to work within the said hours can really keep you focused on work.
According by Dani Babb in his article entitled Make Sure your Facebook
Strategy is the One that Works Best for your Business, In today's social
media-driven marketing frenzy, online business owners are expected to be
top in their game in using tools like Facebook and Twitter to their advantage.
These free tools are increasing in popularity but also in saturation--many
people report not reading updates anymore because of "information
overload." It's important to keep information fresh, useful and purposeful
while adding, if your brand allows, some humor and interesting information.
One of the most common questions I get about Facebook is, "What options
should I use? Groups or regular pages?" This is a more complicated question
than it seems on the surface, but important for making certain you spend
your hard-earned money and precious time in areas that will give you the

33

most bang for your buck. You can certainly have both, but it's important to
know what you can and can't do with each.
First, let's take a look at a standard Facebook fan page and some of the
options available to you. Pages can be viewed by unregistered users, though
you will need to set your security preferences for this. A viewer does not
need to be a Facebook member to view your fan page either. You can add
extra applications to make your page more personal and send messages to
all members using the updates feature. Pages also allow you to see statistics.
You can create a corporate "person" page. There are tighter security options
now in Facebook than in the past, so be sure to explore what each of those
does. I recommend logging out and seeing what you can and can't view
while not logged in as a registered user. Fan pages can be useful in helping
the viral aspect of social media because "Joe became a fan of." pops up on
each persons wall (unless they turn it off or remove it) when they become a
fan of your business.
Groups, on the other hand, allow you to send out bulk invitations (for
instance, you can ask all of your friends to join the group) and any of your
group members can also invite their friends. If you have "friends" on your
Facebook page who are acquaintances or just share common interests this is
a good way to market.
A group, however, has a limitation of 5,000 members if you wish to send a
message. They are generally considered to be best for more personal
interaction. I use a group, for example, to help people find online teaching
jobs called "Make Money Teaching Online" where members share
experiences, job tips and who's hiring. Group pages allow you to set other
administrators to see who is requesting to join the group. If you post
something to the group page, it will also show up on your personal wall.
Some people don't like this because it ties them to their businesses, but this
can be useful in creating a "person behind the online business" feeling with
your customers. You have more control over participants and permissions
with group memberships.
Both groups and fan pages allow you to create discussions and others to
reply. Both have a wall for people to write on. Both allow you to share videos
and pictures. Both require you to manually remove posts as an administrator
if something does not meet your standards or purpose for the page. Both
also allow you to create events.

34

Regardless of which one you choose (of course, you can have both), be sure
to update regularly, keep your audience engaged and offer something of
value. If you use your page or group purely for promotional reasons, you are
far less likely to build loyalty, and there's a good chance that your members
and friends won't be returning to your pages anytime soon.
According from the site www.voicevilleinc.com, an article by Rhyza, entitled
Facebook Marketing, we all know why Facebook is topping the charts. With
over millions of visitors a day, Facebook sure knows its way into the social
media frenzy. We have come to know Facebook as one of the major portals
of social connectivity but other than that, Facebook is leading us into a
different world called Facebook marketing. What Facebook marketing offers
matter to peoples businesses; which is why as a Global Marketing Specialist
for Voice Ville, we utilize Facebook to connect to thousands of people
worldwide. Not only that, we literally make friends with everybody.
Facebook is here for a reason; businessmen take advantage of this social
medium to engage or to use it as an outlet to feel a social vibe. With the help
of Facebook, we allow people to be who they are and we indulge in their
interests to show that we respect their individualism.
According by Glen, on his article entitled, 10 Ways to Create a More Engaging
Facebook Page (Online Marketing, Social Media), Facebook pages can be a
huge way to connect to audiences. Facebook statistics tell us that the
average user (at the time of this writing) is connected to 60 pages, groups
and events. This means that aside from all the other Facebook friend activity
that goes on, your page is one of 60 trying to grab attention a fans
attention. For a more effective social media marketing program, ten things
that you can do to turn your Facebook page into a dynamic and engaging
destination for your Facebook fans. First, Be unique - Theres nothing worse
than a bland Facebook page. Think long and hard about how your page can
be different. Remember, your page is one of at least 60 things that an
average Facebook user is giving attention to. Its insanely important that
your page is unique and stands out from the rest. Second, Dont use a
generic landing page - Facebook allows you to customize what page different
types of users land on. You can show people who have never been to your
page before a completely different message than people who are already
fans on your page. Its a great idea to show potential users a page
specifically tailored for them. It might give a little background about your
company or site, and would give them a great reason for joining, Third, Give
something away quickly - Your die-hard followers wont need any reason for
joining your fan page. But if youre trying to really grow your Facebook

35

presence, consider giving resources back to your community and niche. This
allows you to reach other potential fans within your niche that might not
have known about your Facebook page, Fourth, Use a large profile picture People on Facebook want to see photos. After all, Facebook is far and away
the biggest photo sharing site on the web. So make sure your page has a
large photo of your company or brand as the profile picture. This helps with
branding and adds trust to your profile, Fifth, Tag fans in photos - This is a
great tip if youre a brick and mortar business. If youre somehow able to
take pictures of your customers, tag them within the picture. Many people
have Facebook notifications that alert them when theyve been tagged in
photos, and this will bring them back to your page, Sixth, Use contests Contests are a great way to make your fan page more engaging, and they
also give incentive for potential fans to join. Contests that include giveaways
can be excellent marketing tools if theyre done properly, Seventh, Integrate
multiple social networks
You can use multiple Facebook applications to pull in your other already
existing accounts from other social networking sites. With the help of some
nifty applications, you can pull in Twitter, Flickr, and many others fairly
quickly, Eighth, Thank people for becoming your fans - When someone
becomes a fan on Facebook, immediately thank them! Give them something
in return, like an e-book or coupon, or at the very least send them a quick
thanks! message, Ninth, Dont treat your fans like kids - In case you
havent noticed, Facebook has grown up a lot in the past few years. What
used to be a place for college students and younger is now a place for
everyone. According to this report from strategy labs, the fastest growing
demographic on Facebook in 2009 was adults aged 55 and over. The largest
overall demographic on Facebook is ages 35-54, which makes up 29% of all
Facebook users and Tenth, Keep at it - Oftentimes people will create their
pages and leave them. Facebook pages are breeding grounds for excellent
feedback and engagement. Many people are starting to find that Facebook
pages have excellent discussions and high interaction rates, oftentimes
higher than Twitter and other social networks. Photos and contests are great
interaction tools, and posting stories and articles also add lots of value to the
community
Foreign Literature
In his 2006 book, The Wealth of Networks: How Social Production Transforms
Markets and Freedom, Yochai Benkler analysed many of these distinctions
and their implications in terms of both economics and political liberty.

36

However, Benkler, like many academics, uses the neologism network

economy or "network information economy" to describe the underlying
economic, social, and technological characteristics of what has come to be
known as "social media".
Social media are media for social interaction, using highly accessible and
scalable publishing techniques. Social media uses web-based technologies to
turn communication into interactive dialogues. Andreas Kaplan and Michael
Haenlein also define social media as "a group of Internet-based applications
that build on the ideological and technological foundations of Web 2.0, which
allows the creation and exchange of user-generated content." Businesses
also refer to social media as consumer-generated media (CGM). Social media
utilization is believed to be a driving force in defining the current time period
as the Attention Age. A common thread running through all definitions of
social media is a blending of technology and social interaction for the cocreation of value.
Andrew Keen criticizes social media in his book, The Cult of the Amateur
(2007), writing, "Out of this anarchy, it suddenly became clear that what was
governing the infinite monkeys now inputting away on the Internet was the
law of digital Darwinism, the survival of the loudest and most opinionated.
Under these rules, the only way to intellectually prevail is by infinite
filibustering."
There are various statistics that account for social media usage and
effectiveness for individuals worldwide. Some of the most recent statistics
are as follows: Social networking now accounts for 22% of all time spent
online in the US; A total of 234 million people age 13 and older in the U.S.
used mobile devices in December 2009; Twitter processed more than one
billion tweets in December 2009 and averages almost 40 million tweets per
day; Over 25% of U.S. internet page views occurred at one of the top social
networking sites in December 2009, up from 13.8% a year before; Australia
has some of the highest social media usage statistics in the world. In terms
of Facebook use Australia ranks highest with almost 9 hours per month from
over 9 million users.
One of the key components in successful social media marketing
implementation is building "social authority". Social authority is developed
when an individual or organization establishes themselves as an "expert" in
their given field or area, thereby becoming an "influencer" in that field or
area.

37

It is through this process of "building social authority" that social media

becomes effective. That is why one of the foundational concepts in social
media has become that you cannot completely control your message
through social media but rather you can simply begin to participate in the
"conversation" in the hopes that you can become a relevant influence in that
conversation.
Thus, using social media as a form of marketing has taken on whole new
challenges. As the 2010 Trust Study indicates, it is most effective if
marketing efforts through social media revolve around the genuine building
of authority. Someone performing a "marketing" role within a company must
honestly convince people of their genuine intentions, knowledge, and
expertise in a specific area or industry through providing valuable and
accurate information on an ongoing basis without a marketing angle overtly
associated. If this can be done, trust with, and of, the recipient of that
information and that message itself begins to develop naturally. This
person or organization becomes a thought leader and value provider setting themselves up as a trusted "advisor" instead of marketer. "Top of
mind awareness" develops and the consumer naturally begins to gravitate to
the products and/or offerings of the authority/influencer.
As a result of social media and the direct or indirect influence of social
media marketers today, consumers are as likely or more likely to make
buying decisions based on what they read and see in platforms we call
"social" but only if presented by someone they have come to trust. That is
why a purposeful and carefully designed social media strategy has become
an integral part of any complete and directed marketing plan but must also
be designed using newer "authority building" techniques.
Social media can take many different forms, including Internet forums,
weblogs, social blogs, microblogging, wikis, podcasts, pictures, video, rating
and social bookmarking. By applying a set of theories in the field of media
research (social presence, media richness) and social processes (selfpresentation, self-disclosure) Kaplan and Haenlein created a classification
scheme for different social media types in their Business Horizons article
published in 2010. According to Kaplan and Haenlein there are six different
types of social media: collaborative projects, blogs and microblogs, content
communities, social networking sites, virtual game worlds, and virtual
communities. Technologies include: blogs, picture-sharing, vlogs, wallpostings, email, instant messaging, music-sharing, crowdsourcing, and voice
over IP, to name a few. Many of these social media services can be

38

integrated via social network aggregation platforms. In Communication:

Blogs: Blogger, ExpressionEngine, LiveJournal, Open Diary, TypePad, Vox,
WordPress, Xanga; Microblogging: FMyLife, Foursquare, Jaiku, Plurk,
Posterous, Tumblr, Twitter, Qaiku, Yammer, Google Buzz; Location-based
social networks: Foursquare, Gowalla, Facebook places, The Hotlist; Social
networking: ASmallWorld,Cyworld, Facebook, Hi5, LinkedIn, MySpace, Orkut,
Tagged, XING; Events: Eventful, The Hotlist, Meetup.com, Upcoming;
Information Aggregators: Netvibes, Twine (website); Online Advocacy and
Fundraising: Causes, Kickstarter. In Collaboration/authority building: Wikis:
PBworks, Wetpaint, Wikia, Wikimedia; Social bookmarking (or social tagging):
CiteULike, Delicious, Diigo, Google Reader, StumbleUpon, folkd; Social news:
Digg, Mixx, NowPublic, Reddit, Newsvine, MyWeboo; Social navigation:
Trapster, Waze; Content Management Systems: Wordpress; Document
Managing and Editing Tools: Google Docs, Syncplicity, Docs.com, Dropbox. In
Multimedia: Photography and art sharing: deviantArt, Flickr, Photobucket,
Picasa, SmugMug, Zooomr, BetweenCreation; Video sharing: sevenload,
Viddler, Vimeo, YouTube, Dailymotion, Metacafe, Nico Nico Douga, Openfilm,
TubeMogul; Livecasting: Justin.tv, Livestream, OpenCU, Skype, Stickam,
Ustream; Music and audio sharing: ccMixter, Pandora Radio, Last.fm,
MySpace Music, ReverbNation.com, ShareTheMusic, The Hype Machine;
Presentation sharing: scribd, SlideShare. In Reviews and opinions: Product
reviews: epinions.com, MouthShut.com; Business reviews: Customer Lobby,
Yelp, Inc.; Community Q&A: Askville, EHow, Stack Exchange, WikiAnswers,
Yahoo! Answers. In Entertainment: Media and entertainment platforms: Cisco
Eos; Virtual worlds: Active Worlds, Forterra Systems, Second Life, The Sims
Online; Game sharing: Kongregate, Miniclip. In Brand monitoring: Social
media measurement: Attensity, Statsit, Sysomos, Vocus.
Social media marketing is a recent addition to organizations integrated
marketing communications plans. Integrated marketing communications is a
principle organizations follow to connect with their targeted markets.
Integrated marketing communications coordinates the elements of the
promotional mix; advertising, personal selling, public relations, publicity,
direct marketing, and sales promotion. In the traditional marketing
communications model, the content, frequency, timing, and medium of
communications by the organization is in collaboration with an external
agent, i.e. advertising agencies, marketing research firms, and public
relations firms. However, the growth of social media has impacted the way
organizations communicate. With the emergence of Web 2.0, the internet

39

provides a set of tools that allow people to build social and business
connections, share information and collaborate on projects online.
Social media marketing programs usually center on efforts to create content
that attracts attention and encourages readers to share it with their social
networks. A corporate message spreads from user to user and presumably
resonates because it is coming from a trusted source, as opposed to the
brand or company itself.
Social media has become a platform that is easily accessible to anyone with
internet access, opening doors for organizations to increase their brand
awareness and facilitate conversations with the customer. Additionally, social
media serves as a relatively inexpensive platform for organizations to
implement marketing campaigns. Organizations can receive direct feedback
from their customers and targeted markets.
Social media marketing which is known as SMO Social Media Optimization
benefits organizations and individuals by providing an additional channel for
customer support, a means to gain customer and competitive insight, and a
method of managing their reputation online. Key factors that ensure its
success are its relevance to the customer, the value it provides them with
and the strength of the foundation on which it is built. A strong foundation
serves as a stand or platform in which the organization can centralize its
information and direct customers on its recent developments via other social
media channels, such as article and press release publications.
Building on the principles in his bestselling book, "Social Media Marketing: An
Hour a Day (2010)," social media leader Dave Evans have indicated in his
book that social media plays a vital role in business, taking customer
engagement and collaboration to new levels that help improve company's
products, and services.
Dave Evans, author of "Social Media Marketing: The Next Generation of
Business Engagement (2010)" wrote that implementing Social Media in
business is perfect for marketers, business unit managers and owners, HR
professionals and anyone else looking to better understand how to use social
technologies and platforms to build stronger businesses. He reveals that
social technology, when applied to business, can spur collaborative
innovation and drive winning programs to improve products, services and
your prospects for long-term profits and growth. He also gives insightful
insights on how to become successful marketers using Social Media through
the following: Understand the new social business ecosystem and how it

40

affects your current and future business; Craft a scalable, connected social
media marketing strategy that enables you to incorporate what you learn to
improve your products and services; Gear up for customer-led collaboration!
Explore a host of best practices for involving your social contacts in product
design; Discover software and analytical tools from firms like Radian6,
Sysomos, BuzzStream, Rapleaf, Lithium Technologies, Socialtext, Microsoft,
IBM, and others to help you monitor and quantify your social business; Think
analytics, analytics, analyticssee how to select and use social metrics,
analyze results, and produce solid insights as you implement a social media
based business plan; Find out how other companies implement, manage, and
monitor their social business strategies, including consumer-facing firms like
Philips and New Belgium Beer, nonprofit organizations like Found Animals of
Los Angeles, and the business-to-business units of American Express and
Element.
According to Paul Gillin in his book entitled Secrets of Social Media Marketing
(2009), Social media has quickly moved from the periphery of marketing into
the forefront, but this is a new and quickly-evolving field and there are few
established formulas for success.
Research on new advertising formats such as advertorials etc. shows that
they may be more effective than traditional advertising formats. While
building on underlying assumption that the advertising formats blur the
boundaries between the advertising and surrounding content. (Dahlen &
Edenius 2007; Friestad & Wright 1994) We are every day exposed to about
1,500 brand-related messages (Lucas & Dorrian, 2006)and have developed
what Blackwell (2001) calls selective attention, or advertising scepticism if
we are to use the words of Obermiller and Spangenberg (2005). The fact is
that these mental barriers are a necessary reaction of consumers to the
increased advertising noise(Dahlen & Edenius 2007; Friestad & Wright 1994)
and that marketers must find new ways to break through these barriers. It is,
in other words, increasingly difficult for companies to standout and get
consumers to pay attention to their company (Granlund and Grenros, 2007).
In this new marketing landscape advertisers must surprise consumers and
adopt methods around which mental barriers have not yet been developed.
We are approaching a time when the ability will exist to contact individuals at
any time, at any place. This is due to the ubiquity of mobile devices,
particularly mobile phones with GPS functionality. The technology holds the
potential for marketers to send information and offers to consumers based
on their proximity to places where the marketers' products are available.

41

Given the growing ability to reach people in a much more targeted manner
than was possible in the past, the next question one must ask is, what do
consumers think about it? If consumers have generally positive attitudes
toward such advertising, then this could be the very technology that allows
m-commerce to kick into high gear. If consumers are generally negative
about it then advertisers will have to sell the medium first before they can
successfully use it to sell other things. Mobile advertising in general is only
beginning to receive scholarly examination. A specific type of mobile
advertising, location-based advertising (LBA), has received even less
scholarly attention.
Politicians have their own strategies when it comes to their advocacies.
Various gimmicks are being done. According to the article to the article The
Transformation of Political Modernity by John Street:
A common place to observe how politicians and parties exploit the
techniques and icons of popular culture to promote their ideas and images.
Politics has been transformed to accommodate new media and forms of
communication. (Franklin, 1994; Jamieson)
Richard Huggins, on the other hand, stated in his article The Transformation
of the Political Audience that:
In recent years the emergence of new media forms and practices have
excited both optimism and pessimism about the ability of the media to
reinvigorate the public sphere and political discourse and communication.
In a blog created by Stan Schroeder in his site Mashable.com, Schroeder
stated that Facebook.com is yet to be largest online social network.
Schroeder further stated that Facebook.com campaigns is yet to be the most
cost-efficient in the part of the running candidates since it does not require
hefty amount of money to post or campaign ones and advocacies or
propagandas. The results, says, Schroeder, are astonishing because with
blinks of the eye, members or supporters mount up to thousand to millions.
He, in a way, puts it as if online battle will decide who will win in the
elections when he wrote:
This is the strongest example of social network usage for political promotion
yet. By spending very little time and money, Colbert has managed to gather
one million supporters. Whether or not theyll all vote for him is another
matter, but its obvious that these (and all following) elections will largely be
fought online.

42

Philippines, like the United States has a very large population of internet
users among its population. Facebook.com being the number one site
worldwide, gives a big avenue for Philippine politicians to follow the Obamas
lead in getting votes and influencing their target audience thru their
advocacies in Facebook.coms Fan Pages or Causes.
Another related article is by Julian entitled Will Obama Use Facebook
Politics? published in CNNs website. The Princeton University professor
wrote that after being successful in using the social networking site in
elections, it is a challenge Obamas side if the effectively of Facebook.com is
still applicable if he is in government. He also said:
If President Obama follows through on his promise of suing the tools of his
campaign for the challenges of governance, we will learn just how strong the
net-roots really is. The ambition for many who put this network together is to
provide the same sort of political support that political machines offered in
the late 19th and early 2oth century organizational powerhouses that
brought people into office and built support for their legislation.
This article questions how Obama would treat the machinery that he used,
Facebook.com, to get the votes and convert it for his campaign. Now Zelizer
cites that Obama did not rely solely on Facebook.com. Obama, according to
Zelizer, also came down to the people. When analyzed, its contributory angle
to the study could be the advantages of the Facebook.com campaign when
Obbama came down to the people and what could be the possible effects
that had been laid out with the use of Facebook.com
Linnie Rawlinson, also from CNN cited in his article Will the 2008 USA
election be won on Facebook? that networking sites have made a great leap
for the format of campaigning. She cites that:
This marks a crucial development in the Internets history: Far from being a
place where geeks go to hang out with other geeks, the Internet is now as
vital part of the average college students world as Spring Break. No longer a
virtual refuge for lonely nerds, these sites are used daily by bright young
things, keen to arrange the latest hot club/bar/gig to visit.
Though Rawlinson praised the concept that presidentiables have explored
the web to reach larger demographics, she explained that politicians should
be

43

very careful when they go online because having accounts on the sites
doesnt actually make them in or cool.
In Sam Goldfarbs blog, he wrote such article on the strategies of political
campaign entitled Top 10 Strategies for Running A Facebook Political
Campaign which cites:
Facebook is more than just hype every online business and politician
needs to know how to use this social platform... From our experience,
Facebook pages tend to experience a Snowball effect once a critical mass of
supporters has been obtained.
Having such posted strategies, this would reflect the innovations done by
previous users of Facebook.com in their campaigns. It also includes the
impact of the said strategies towards the masses. In the study, we could use
the strategies in constructing our questionnaires and interviews with the
respondents.
Writer J.P. Preirie also has a say in the political arena wherein Facebook.com
plays its role. In his article Facebook Pitches Its Political Benefits he says
that having Facebook.com accounts has many perks on the part of the
politicians. It is an apt opportunity for them since campaigning online is a lot
easier than posting signs over target places. He said:
Direct mail isnt going away anytime soon as a vehicle for reaching voters.
But its clear that web-savvy campaign managers would like to benefit from
broadening the way voters support campaigns, especially with the advent of
the social-network generation.
Preirie cited how easy it is to earn votes in the day of elections via reaching
the target audience thru the medium that everybody is accessible.
Local Studies
According to the New Media Philippines study entitled, Making a First Good
Impression with your Business Facebook Official Profile, that a lot of brands
are now rushing to Social Media to take a stab at the massive online market.
However most marketers dont have too much respect for new media. Since
everyone does it, a lot of marketers feel that its easy and that its something
that they can do on the fly. This is where they make a fatal mistake which
can just lead to more harm than good. Lets apply some traditional marketing
principles in strategizing for the official Facebook Profile Page of your
business. If youre a customer and by some chance you find yourself in the

44

official profile page of a brand, youll most likely see a profile picture and a
very busy wall. This is where the connection fails. You cant communicate the
unique selling proposition of your product with a wall filled with random
comment.
From the dawn of new media, organizations and individuals pushed by a
variety of interest have converted their attention into another area of
spreading their advocacies. Dela Cruz (2009) says the Internet has been a
necessity in human life. Being an avenue that draws the attention of the
people, groups have used the Internet for their own purposes such as
election advocacies. The methodology delved into the analysis of advocacy
sites, creators of the sites were also interviewed on the basic fact and figures
of their respective websites along with a survey conducted among the voters
on their perception on the advocacies online. Dela Cruz states:
The key to the success of such website is maximizing all possible functions
of the Internet that will help attract audience. Although Internet has a lot of
potentials, utilizing multi-media platform is still the best way to spread
advocacies.
Seeing the media as the major role player in the emergence of a damaged
culture, another research proposed the reinforcement of advocacy in
advertising on national television by the possibility of a law supporting the
primetime airing of advocacy advertisements. Relying heavily on interviews,
the researchers interviewed two (2) leading media networks, ABS-CBN and
GMA 7, the Congress and advocacy advertising agencies and institutions.
The researchers concluded:
...the researchers found that both government laws and self-regulatory
rulings raise problems on supporting the primetime airing of advocacy
advertisements on television.
The political arena widens during the elections giving way to political actors
such as election candidates and non-government organizations in the
country. Political actors find their space in the Internet as another area of
campaign which made the researcher, Gloria (2004), put up the study on the
election-related websites as a way to maximize the potential of the Internet
for political ends. Gloria analyzed eight (8) election-related websites and
interviewed the Webmasters on their stand on the trend of setting up online
presence. And at the same time, political science and journalism specialists
were interviewed as a contributing analysis together with an online survey to
Filipinos. Gloria concludes:

45

For political communication, the use of election candidates of the Internet

as a campaign tool hardly played any role in the political game. This
manifests that the traditional media today are still the preferred political
tools to pump up support from the electorate.
As social networking sites boom in the country, there raises the question on
the perks and perils of these sites to the youth, both men and women, as
well as the factors why the youth has clung to the idea of suing or creating
accounts on social networking sites. Macaraig and Samaguil (2008) found out
that the students adhere to the usage of social networking sites because of
the benefits that social networking sites can provide them than on the
technical characteristics of the websites. Between males and females, it has
been found that males use the social networking sites because of the speed
showing the friability attitude of the males. It also shows that females use it
for gratification or for the expressiveness allowed by the sites.
Mass organizations have also entered the virtual world of spreading their
political campaigns and propagandas. Borais and San Juan (2005) studied
the shaping and reshaping of the political groups websites and newsletters
on the political socialization of its members. The official website and official
newsletter were textually analyzed together with then technical aspect of the
sites such as the design, political content such as presentation and
expression and language used. The audience also underwent Focus group
discussions and focus interviews to further into their perceptions on the use
of the website and the newsletter on the possibility that it may or may not
contribute to their political socialization. The researchers states that:
...the website and the newsletters of the political groups contribute to the
shaping and reshaping of the political socialization of its members...
Foreign Studies
According to Amy Porterfield, there are 5 Must-Read Social Media Marketing
Studies: #1: By 2010, 26 Million (1 in 7) U.S. Adults Will Use Twitter Monthly A new study by eMarketer surpasses their previous estimates of Twitter
usage. The study, conducted just last month, found the following: In 2009,
there will be 18 million U.S. adults who access Twitter on any platform at
least monthly. That represents a 200% increase over 2008 levels. Usage will
reach 26 million U.S. adults in 2010, a further 44.4% climb.
Earlier this year, eMarketer reported more conservative usage numbers,
stating that there were indications of large numbers of users abandoning the

46

site shortly after signing up and many others only using it sporadically.
However, they recently revised their estimates because recent data shows
healthyand growingpercentages of U.S. Internet users adopting the
popular microblogging platform, according to eMarketer senior analyst, Paul
Verna.
Twitter is not the only social networking site to report record usage numbers.
In September, Facebook officially hit the 300 million-user mark, making the
social networking site nearly as large as the U.S. population.
#2: Americans Spend 17% of Online Time on Social Media Sites - As popular
social media platforms continue to grow their numbers of users, it is logical
to conclude that Americans are spending more time on social networking
sites. According to a recent study by The Nielsen Company, 17% of the time
spent online was at social networking sites (an increase from 6% in August
2008).
Among those paying the most attention to this recent trend are advertisers.
Online ad spending increased by 119% to $108 million in August 2009.
#3: In 2010, Over 50% of Marketers Will Be Using Social Media - Marketers
are becoming even more aware that social media marketing must be a key
component of their media buy strategy. This was recently affirmed in the
findings of the 2010 Media Planning Intelligence Study by the Center for
Media Research, which examined the likelihood of marketers including social
media in their 2010 marketing plan. Over half (56.3%) of marketers stated
that social media would realistically be part of that mix. The top 5 most
popular media for the 2010 marketing spend were Email (56.8%), Social
networks (56.3%), Keyword search (49.7%), Radio (42.2%) and Magazines
(42.1%).
In addition, 57% of media buyers reported they will buy non-traditional
media, including online, display video, search, mobile and event
sponsorships, while 43% reported they will buy the more traditional media,
including TV, print and radio.
#4: Blogs Most Useful Social Media Tool, Say 51% of Businesses - McKinsey
Quarterlys Global Survey examined companies overall assessment of the
value of different social media technologies. As reviewed by eMarketer,
When it came to customer-related benefits, blogs were the most useful tool,
bringing measurable benefits to 51% of responding companies worldwide.

47

That was followed by video-sharing and social networking at 48% each, and
RSS feeds at 45%.
In addition to these findings, the top three reported benefits of Web 2.0
marketing included: Increased marketing effectiveness (52%), Higher
customer satisfaction (43%) and Reduced marketing costs (38%).
#5: 75% of Marketers Plan to Increase Social Media Use in 2010 - According
to a recent survey by virtual events provider Unisfair, marketers are most
focused on attracting and keeping customers in 2010 and they plan to use
social media to make this happen. A few interesting factoids from the
Unisfair findings: The 3 leading marketing priorities in 2010 according to U.S.
marketers: New customer acquisition (60%), Customer retention and
engagement (48%) andThought leadership (45%). And the top 5 marketing
tactics U.S. marketers planned to increase in their 2010 marketing mix:
Social media (75%), Web search/SEO (51%), Email campaigns (49%), Virtual
events (48%) and Online advertising (28%).
The study also asked marketers to rank the value of social media platforms.
LinkedIn came in on top at 26%, Facebook at 23% and Twitter at 17%.
According to the study, Can Your Business Survive Without Social Media? By
Pete Hollier, Its time for businesses to seriously consider the impact of Social
Media on their business. Social Media must be investigated from two
different business perspectives.
What is the impact if the business does not initiate a Social Media Program?
A lot of the benefits of Social Media appear to be more perceived than based
on quality market research. To assist businesses determine if Social Media is
a worthwhile addition to their marketing program I have included results of
recently completed surveys.
Without a doubt the conclusions are clear. Social Media will have a positive
impact on your business, and the risk factor of implementing such a program
is as close to Nil as is possible in a business situation. Risk free improvement
of business performance, seems unlikely but Social Media Programs come
very close to that benchmark.
The Social Media Surveys say it is evident businesses see the value of Social
Media as part of their over all Marketing Mix. Coleman-Parkes Research
discovered 84% of North American companies feel they require new methods
to interact with customers, including Social Media and mobile devices.

48

It is also evident Social Media has become an expected activity from

consumers. Companies who fail to embark on a Social Media Campaign do so
at their own peril. Research undertaken by The 2008 Cone Business in Social
Media Study resulted in some impressive statistics which must be noted by
business owners.
The results from the survey showed 60% of American citizens used Social
Media. Of those 93% indicated business should have a Social Media presence
and 85% indicated businesses should interact via Social Networks with their
customers. With powerful results such as these it is hard to comprehend why
businesses are not implementing Social Media Marketing.
Consumers surveyed indicated businesses should use Social Media to: Solve
Problems 43%, Obtain user feedback on product and services 41%,
Enable consumers to interact with the company brand 37% and Market to
consumers 25% .
A survey complete by Coleman-Parkes Research for Avnade an IT
consultancy firm provides feedback on a number of issues from a businesss
perspective. Some of the Barriers to initiating Social Media Programs: Lack
of understanding by Senior Management 58%, Negative impact on employee
productivity 49% and Fear of unknown technology 58%. Companies currently
using Social Media reported the following: Improved Feedback 78%,
Improved Customer Satisfaction 66%, Improved Customer support 71%,
Increased Sales 40% and Improved public perception of company 75%.
Within the survey completed for Avande were some general statements
which must be considered: 52% of respondents stated Companies that fail
to embrace social media technologies for business purposes will be left
behind, 78% of respondents stated As we enter a possible economic
downturn we need to focus on new ways of communicating with customers
which add real value. And 77% of respondents stated If they did not initiate
a Social Media Program Social Media would enter the company by stealth.
The results of the surveys clearly indicate that Social Media has become an
accepted and expected method of interaction and communication by
consumers. This fact in itself is quite powerful, when considering many forms
of business promotion are considered to be intrusive by consumers. A
method of business promotion which meet the expectations of consumers
and is in fact wanted is a must win situation for business.

49

From the business perspective, as with most new methods there is resistance
and Social Networking is no different. Lack of understanding of how to use
Social Media and the technology required and used are predominant factors
for business not initiating Social Media Programs. It is very clear from the
survey that companies that do undertake a Social Media program gain
benefits from their interaction with customers and prospective customer.
Businesses that do not participate now or initiate in the future will have
difficulties, especially in the economic environment we currently experience.
These difficulties include lack of communication with customers and
prospective customers and a lowering of overall competitiveness within the
market place.
Businesses of today must undertake a Social Media Program to succeed in an
increasingly competitive and connected business environment, not doing so
is a risk to the over all success of the business and its stake holders.
According to Robin Wauters, Study Finds Marketers Embracing Social Media
Marketing In A Big Way, Integrated marketing services provider Alterian
today released the results of their seventh annual survey on social media
marketing adoption.
The survey covered 1068 marketing professionals worldwide (actually, it was
98% North America and Europe and only 2% Asia Pacific and other regions).
Alterian found that 66 percent of respondents will be investing in social
media marketing (SMM) in 2010. Of those, 40 percent said they would be
shifting more than a fifth of their traditional direct marketing budget towards
funding their SMM activities.
The survey also found more than a third (36 percent) of respondents are
investing in social media monitoring and analysis tools.
Nearly half of respondents (42 percent), however, said they dont currently
incorporate clickstream and web analytics data into their customer and email database.
The research also found that over half of respondents (51 percent) are
placing a fair or significant amount of effort on moving from a campaigncentric direct marketing model towards multichannel customer engagement
in fact only 7 percent make no effort at all.
According from the study entitled Social Media Marketing versus Prevalent
Marketing Practices by Abdul Ghaffar and Muhammad Tariq, Schmiemann

50

(2006), in the European Union 90% of the businesses are micro in nature and
same is true within Sweden where micro businesses are considered as the
backbone of the economy. These businesses create employment
opportunities; germinate entrepreneurial spirit in public and innovation in
organizations. In spite of this still there is very scant published material on
micro firms and it is relatively complex to define micro firms as there are
several connotations of their qualitative and quantitative definitions. Micro
firms in qualitative terms are businesses which are owner managed, have a
small market share and the owner manager has discretionary power of
making his or her own strategic decisions (Bolton Committee, 1971).
According to Johnson, (1999) micro business is a business having up to 10
employees. This quantitative definition might cause some confusion as in
this case the term SMEs can be used interchangeably with small businesses
which also cover the definition of micro firms.
In the year (2005), European Commission introduced a new criterion for
defining SMEs. Accordingly, Medium-sized, Small and Micro businesses are
businesses which have fewer than 250 employees or either an annual
turnover not more than 50 million Euro. Whereas, Small-sized firms are
businesses which have fewer than 50 employees and their annual turnover
do not surpass 10 million Euros. Finally, Micro firms are businesses which
have fewer than 10 employees with annual turnover not exceeding more
than 2 million Euros. From this discussion evidently micro business is easy to
describe but difficult to define.
First, we begin by defining marketing in the context of small firms as, Small
business marketing consists of those business activities that direct the
creation,

development, and delivery of a bundle of satisfaction from the creator to the

target user and that satisfy the targeted user (Logenecker et. al, 2010).
According to Timmons (1999) business mortality statistics for small
businesses show that, small firms experience a high rate of termination
during initial years. The rate of discontinuance can be as high as 70% during

51

the first five years of inception. Whereas, Marc (2004) argues that marketing
practices like a careful analysis of target market can lower failure rates of
small businesses up to 60%. At the same time small firms confront several
other problems which in descending sequence of their importance are sales
and marketing 40.2%, followed by human resource management 15.3%,
general management 14.3% and operations 8.6% (Huang & Brown 1991).
This indicates that marketing is the most pressing problem confronting small
businesses and still it has been recognized as most important business
function for small businesses (McKenna, 1991), and of-course marketing in
small firms differ from marketing in large firms (Bjerk & Hultman, 2002). The
same course of reasoning is applicable in the context of micro firms which
are influenced by owner-manager and resource scarcity (Karolina et al,
2007).
These challenges call for a marketing orientation in small firms to improve
performance with respect to competitors. According to Never and Slater
(1991) a marketing orientation is defined the, organizational culture that
most effectively creates the necessary behaviours for the creation of
superior value for buyers and thus continuous superior performance for the
business. However, Mike (2002) state that there are other possible
orientations which small businesses can follow such as production
orientation, product orientation, financial orientation. Most recently Kotler
and Keller (2009), advocated the concept of holistic marketing orientation
meaning that everything matters in marketing and that a wide, integrated
orientation is needed to compete effectively in marketplace and mind space.
It has been agreed on that the principles of marketing theory are equally
important for both small and large firms (Sui & Kirby, 1998). There are
several models of marketing that provide guidelines for businesses to survive
and grow in their respective industries. However, Welsh and White, (1981)
proclaims that, a small business is not a little big business. There are
several points on which small businesses differ from big organizations like;
owner-management has a distinct strict discipline in small businesses, lack of
trained personnel, short-ranged management perspective, limited financial
resources, adoption to steady state conditions and analytical models used in
big organizations have limited usage in small businesses (Welsh & White,
1981). This shows that small businesses are not like big businesses
therefore, the needs of these two types of organizations differ from each
other including its marketing needs.

52

Towards a New Model of Marketing, one set of marketing theory cannot be

generalized for two types of organizations with different characteristics and
requirements. The marketing theories which are written in the context of big
organizations have little or no relevance to small businesses (Chasten &
Mangles, 2002).
Little research has been carried out on small businesses and those
researchers tried to draw models and theories specifically for small
businesses but these efforts alone cannot help the needs of the small firms
in totality. For instance, Miller and Antilla (1987) researched 36 Finnish and
Swedish firms but they described their research as being too qualitative for
examining state-of-the-art marketing in small manufacturing firms.
Similarly, most of the research that is done on small businesses focuses on
the
problems
or
barriers
present
in the
small
firms
(Simpson
et. al, 2006). Some research is practical in nature but lacks real time
application. For instance, the Growth/Stage Model by Siu & Kirby, (1998)
advocates the consideration of the stage of growth of small businesses while
formulating marketing models for small firms, but the model is unable to
mention the impact of radical technological advances like the internet.
In the light of the above short comings in theories for the small firms, it can
be argued that the theories need to be either modified to suit the small
businesses or a completely new set of theories and models be drawn for the
small businesses. Simpson and Taylor (2002) came up with a new model of
marketing, the role and relevance model of marketing. The role and
relevance model of marketing in SMEs explains the role and relevance of
marketing in a small business environment. The model places organizations
in four quadrants depending on the relevance and role of marketing. These
quadrants comprise as; Marketing led organizations (MLO), Marketing
dominated organization (MDO), Marketing weak organization (MWO) and
Marketing independent organization (MIO).

53

In Marketing-led organization (MLO), there is strong marketing orientation for

maintaining or increasing market share in a competitive business
environment. Marketing-led organization is perceived to be organizations
pursuing best business practices to cope with changes in business
environment. In a Marketing-dominated organization (MDO) there is minor
relevance and major role of marketing in strategy making processes.
Normally, such organizations have guaranteed business from a major
account or client. Therefore, marketing may be seen as unnecessary and the
organization might be called a marketing-nominated organization but in the
long term marketing can help the organization move to (MLO) quadrant in
the model. In the Marketing-weak organization (MWO) a sales orientation is
prevalent with major relevance and minor role of marketing. This type of
organization does not have a proper marketing department and these
businesses are normally not interested in growth either. A Marketing
independent organization (MIO) resembles a marketing dominant
organization (MDO) but in such type of organization there is no unconditional
orientation and commitment towards marketing. However, a drawback of
(MIO) approach is that the organization future is at the mercy of the major
client (Simpson & Taylor, 2002).
From the above discussion we come to know that Marketing-led organization
(MLO) is the best strategy for a small business for maintaining or increasing
market share in the domain of competition. There are three possible

alternative paths identified for small firms to reach the desired (MLO)
quadrant.
Strategy A which follows the route (MIO-MDO-MLO) is an innovative
approach which is resource intensive in the beginning but should help the

54

small business later in exploiting actionable opportunities, Strategy B

which follows the track (MIO-MWO-MLO) is more a reaction to market
demands, and finally Strategy C which follows (MIO-MLO) path is seldom
used by Small brick and mortar businesses (Simpson & Taylor, 2002). Later in
the year, (2006) Simpson and Taylor carried out another research along with
Padmore and Hughes to test their new model. They found that there still lie
some deficiencies in their model but the model has been successful in taking
the understanding of marketing in small firms one step further by
categorizing small businesses on the basis of marketing activities they carry
out inside (Simpson et. al, 2006).
To sum up the above discussion in few simple words the authors have tried
to form a launching pad for the RQ1 of this thesis. In the first place an effort
has been made to define accurately micro firms and therefore we have
adopted for this thesis the standard definition of micro firms given by the
European Commission (2005). Second, the authors have tried to describe
how marketing is seen and carried out in small firms as by design or default
a small business is not a little big business. Therefore the authors try to
explain that marketing practices in small firms should be seen as distinct
from big business and a new model of marketing is discussed which classifies
small firms in four quadrants depending on the role and importance of
marketing for a small business.
Conventional Marketing Mix and Social Media, Traditional marketing practices
are centred on the marketing mix model. The marketing mix model was
introduced by Borden in the 1950s (cited from Neil, 1984). Soon after in the
1960s according to McCarthy (1960), the marketing mix model was termed
the 4Ps of marketing as it contains Product, Price, Place and Promotion
variables. Ever since then it became the indisputable marketing model and
replaced the then existing functionalist approach and parameter approach of
Copenhagen Business School of Scandinavia (Alderson, 1957).
Further with the passage of time researchers like Booms and Bitner proposed
more supplementary Ps of marketing to existing list of 4Ps such as
people, process and physical evidences constituting a 7Ps approach which
is more inclined to services marketing (Fifield & Gilligan, 1996), and
personnel, physical assets, procedures and personalization (Goldsmith,
1999). Most recently Otalcan (2005) has introduced the concept of
(2P+2C+3S) by including Personalization, Privacy, Consumer, Community,
Sales promotions, Site and Security in the marketing mix list of variables
which are more inclined to E-Marketing practices. It is important to know that

55

although the original marketing mix model has been oversimplified by

restricting it merely to 4Ps of marketing (Gronross, 1999) still it is interesting
to know that embedded in the Promotion P are sub variables such as
advertising which can be both below-the-line (BTL) and above-the-line (ABL)
or a hybrid combination of both known as through-the-line advertising
(ABL+BTL =TTL), Sales promotions such as (Samples, Premiums, Point of
Purchase (POP), Trade shows, scientific shows, sweepstakes), Personal
selling, Public relations and Direct marketing (Wilmshurst, 2007). Most
recently according to Glyn and David (2009), with the arrival of social media
a new dimension has been added to promotion mix as social media in a
conventional sense can help companies to interact with consumers, while in
unconventional manner it makes possible for customers to interact directly
with other customers.
The table 2-2 (a) below reveals the fundamental changes that social media
has induced by making media instantly updatebale, control, archives
accessibility, freedom and in terms of measuring the effectiveness of a
marketing campaign. On the other hand traditional media is unchangeable
with archives not accessible and reaches a finite number of people (Stokes,
2008).
Table 2-2(a) Traditional Media versus Social Media
Traditional Media

Social Media

Fixed, unchangeable

Instantly updateable

Commentary limited and not

real time

Unlimited real-time commentary

Limited, time delayed best

seller lists

Instant popularity gauge

Archives poorly accessible

Archives accessible

Limited media mix

All media can be mixed

Committee publishers

Individual publishers

Finite

Infinite

Sharing not encourage

Sharing and participation

56

encourage
Freedom

Control

Source: Rob Stokes, (2008)

The above discussion is further elaborated by Charlene Li and Josh Bernoff
(2008) who, based on their observation of hundred of businesses, have come
up with five common objectives such as listening, talking, energizing,
supporting and embracing as to why companies use social media. These five
objectives correspond to the traditional business functions as shown in the
table 2-2 (b) which also reveals that how things have become different in the
domain of groundswell.
Table 2-2(b) Objectives of Social Media versus Conventional Business
Functions
Traditional Business
Functions

Social media functions

or objectives of
groundswell

Differences in the new

landscape

Research

Listening

Ongoing monitoring of
your customers
conversations with each
other, instead of
occasional surveys and
focus groups

Marketing

Talking

Participating and
stimulating two way
conversations your
customers have with
each other, not just
outbound
communications

Sales

Energizing

Making it possible for

your enthusiastic
customers to help sell
each other

57

Support

Supporting

Enabling your customers

to support each other

Development

Embracing

Helping your customers

to work with each other
to come up with ideas to
improve your products
and services

Kotler and Armstrong (2004) define a product as, Anything that can be
offered to a market for attention, acquisition, use or consumption that might
satisfy a need or want. It can be a tangible physical good (s), service (s) and
idea(s) which are intangible in nature. Based on consumer welfare and
satisfaction Shapiro et al, (2002) have categorized products into four
categories as shown in figure (2-3).
As the figure reveals that desirable products have both high immediate
appeal and long term satisfaction. Salutary products have low immediate
appeal but may benefit the customer in long run e.g. Air bags. Pleasing
products
have high

immediate appeal but might hurt the consumer in the long run such as
cigarettes and deficient products have neither immediate appeal nor long
run benefits. Marketers plan their products on the basis of customer value
hierarchy consisting of five distinct levels as shown in Figure (2-4). According
to Logenecker et al, (2006), the basic level is the core benefit which signifies
the fundamental benefit for which the consumer buys the product. The
second level consists of generic or basic product and the third expected
product. The fourth level is augmented product which means any additional
features, benefits or value laden services on the basis of which organizations

58

compete and finally, potential product which include the total augmentations
and transformations a product might produce in future time (Kotler, 2000).

Price is the reflection of market forces and is defined as, The sum of the
values that customer exchange for the benefits of having or using the
product or service (Wong et al, 2005), and The amount of money charged
for a product or service (Kotler & Armstrong, 2008). Boone and Kutz (2001)
argue that price refers to the exchange value of a product or service. Pricing
tactics normally changes as the product or service goes through the product
life cycle (Kotler et. al, 2005). For imitative products firms normally follow
four types of strategies such as Premium pricing, good value, overcharging
and economy pricing strategy, as shown in the figure (2-5). For innovative
products firm can chose from market skimming to penetration strategies
(Kotler et. al, 2005). It is important to discuss that many small businesses
consider under- cutting pricing as the most appropriate strategy in the initial
stages for attracting customers and booming sales. However, the small
business owner should bear in mind that established competitors normally
have more resources than new one and in a cut throat price competition they
can be wiped out the small business (Logenecker et. al, 2010).
As the Figure (2-5) reveals below Premium pricing strategy means having
high-quality product and higher prices and on the other hand, Economy
pricing strategy has a low quality product or services and charges lower
prices.Whereas, good value pricing offers high quality at an affordable price
and overcharging strategy means that the organization over prices its
product or service relative to the quality of the product/service (Kotler et. al,
2005). Companies which launch new innovative products, with the fear of
easy entry for competitors, often use skimming pricing startegy also known
as market-plus pricing as in these strategy higher prices are set initially on

59

purpose to skim the profits from the market. The term takes its origin from
the expression skimming the cream (Boone & Kurtz, 2001).
On the other extreme, market penetration sets lower prices in beginning to
penetrate the market initially and then gradually raise the prices as demand
pull is created (Kotler & Armstrong, 2008).
According to Longenecker et al, (2006) small business should not recognize
off target pricing as an irreversible error as pricing is not an exact science
and there are no established hard and fast rules. If the pricing strategy
misses the target then small firms should make necessary adjustments to
their strategy.
According to Boone and Kurtz, (2001) a marketing channel is defined as, A
system of marketing institutions that promotes the physical flow of goods
and services, along with ownership title, from producer to consumer or

business user; also called a distribution channel.

60

Companies seldom work in isolation for creating value for customers as

majority of firms are only part of larger distribution network (Kotler et. al,
2005). Therefore it is crucial for firms to determine the type of channel which

is most appropriate for attainment of their objectives. Some channels have

many marketing intermediaries such as a wholesalar, agent/broker, and a
retailer (Boone & Kurtz, 2001) while in a direct-marketing channel there are
no intermediaries involved, as shown in the Figure (2-6) below (Kotler et al,
2005).

Intermediaries are used in distribution channels as they create efficiencies in

providing products to end-users as these intermediaries are more specialized
expertise in these operations (Kotler & Armstrong, 2008).
The above Figure 2-7(left) reveals that intermediaries enable economies as
there are three manufacturers who are reaching three end users. In this

arrangement nine different contacts are required. On the other hand in the
Figure 2-7 (right) there are also three manufacturers who are using one
distributor that uses six contacts. The result is distribution decreases the
number of contacts or amount of work which needs to be done by both
manufacturers and end users (Kotler & Armstrong, 2008). This reduces the
cost of operation and, hence, more benefit for the end user.

61

Wibur Schramm (1995) defines communication as, the process of

establishing a commonsense or oneness of thought between a sender and a
receiver. According to Boone and Kurtz (2007), integrated marketing
communications try to organize and direct the elements of marketing mix
(advertising, personal selling, sales promotions, public relations and direct
marketing) to create a customized message for target audience to attain
organizational objectives. Longenecker et al, (2010) proclaims that small
firms use promotions in different extents; a small business rarely would use
the entire promotional strategies available. In conventional promotional mix,
the five elements are designed by businesses in coordination with paid
advertising agencies and marketing research firms (Glynn & David, 2009).
This method has been used ever since, World War II for creating integrated
marketing communications strategies with organizations operating from a
position of control (Muniz & Schau, 2007). However, Blackshaw and Nazzaro
(2004), proclaim that recently the strategies for interacting with target
audience have changed with the advent of consumer generated media, as
control of managers on timing, content, and frequency is diminishing to a
great extent (Glynn & David, 2009). This is mainly been made possible
through the social media trend where consumer interact with one another
independently and get the information which they normally would get from
institutions (Charlene & Li, 2009).
In this regard for comparion purposes Emily Riley and Rebecca Jennings,
(2009) in collaboration with Forrester research have devised a template for
aligning social marketing tactics with traditional marketing channels as
shown in table 2-3 below.
In order to carry out this type of comparison the businesses must first
determine their goal which can be brand building, engaging customers,

information gathering, inducing purchase and customer service. Then the

62

marketer should analyze which tactics might take the place or be compared
to a traditional marketing approach (Emiley Riley et al, 2009). After
discussing the evolutionary developments which marketing mix has
undergone, now we shall elaborate the specific variables of the marketing
mix model one by one.
We are witnessing a transition from traditional media to social media. In an
effort to cover both sides of the continuum we would start with conventional
promotional strategies and then towards relationship marketing and finally to
social media adoption practices.
According to PricewaterhouseCoopers, 2009 worldwide marketers spend in
excess of 400 billion dollars on advertising of which major amount of money
is spent on television advertisements. According to Boone & Kurtz (2001,
advertising is non-personal (one-to-many), paid form of communications
(unlike publicity) which uses several types of media for informing or inducing
trial in target audience. Whereas, Kotler et al, (2005) define advertising as,
Any paid form of non-personal presentation and promotion of ideas, goods
or services by an identified sponsor. According to Baker (2006), for creating
effective advertisements Strong's widely accepted model of AIDA- (Attention,
Interest, Desire & Action) is used. Businesses use advertising for informing,
persuading, and comparing their products or services to competitors (Boone
& Kurtz, 2001; Kotler et al, 2005; Baker, 2006; Stanton et. al, 2003; & Kotler
& Armstrong, 2008). Majority of small businesses use other people
competencies for their advertising purposes such as advertising agencies
and research firms (Longnecker, 2006).However, today broadcasters are
faced with numerous problems which are mostly technology oriented. For
instance, Baker (2006), stresses that with the arrival of Personal video
recorders (PVRs) like TiVo, consumers can record many hours of
programming and can easily skip advertisements.
Regarding two types of advertising (informative and persuasive) there are
two schools of thought. The Harvard School of Thought see advertising
mostly as anti-competitive and persuasive in nature, whereas, the Chicago
School of Thought view advertising as informing consumers by having a
favourable impact on competition (Beuscart & Mellet, 2008). Furthermore,
there are two main categories when it comes to the types of media for
advertisements such as Above-the-line (ATL) which contains all commission
based media such as Television, Newspapers, Magazines, Radio and Belowthe-line (BTL) which are non commissioned such as publicity (Wilmshurst,
1994).

63

Table 2-4: Profiles of Major Types of Media

Medium

Advantages

Limitations

Television

Mass-marketing
coverage; Low cost per
exposure; combines
sight, sound and motion

High absolute costs;

High clutter; fleeting
exposure; less audience
selectivity

Newspapers

Flexibility; Timeliness;
good local coverage;
highly believable

Short Life; poor

reproduction quality;
small pass along
audiences

Direct Mail

High audience
selectivity; flexibility; no
ad competition allows
personalization

Relatively high cost per

exposure; Junk Mail
image

Magazines

High geographic and

Long ad purchase lead
demographic selectivity; time; high cost; no
credibility & prestige;
guarantee of position
long life; good passalong readership

Radio

Flexibility; high repeat

exposure; low cost; low
message competition;
good positional strategy

Little audience
selectivity; Creative
limitations

Internet

High selectivity; low

cost; immediacy;
interactive capabilities

Demographically
skewed audience;
relatively low impact;
audience control
exposure

Source: Kotler & Armstrong, (2008)

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According to Kotler et al, (2005) advertisers need to make media related

decisions in the light of reach, frequency, timing and media impact; and
Baker (2006), stresses that advertising medium requires attention in terms of
character of medium; atmosphere; coverage; cost; size and position of the
medium. In terms or frequency of advertisements it is important for small
firms to decide how often to advertise as it involves a number of objective
and subjective elements. Therefore prudent entrepreneurs seek professional
advice and recommendation in this regard (Longenecker et. al, 2010).
According to Robert Kiyosaki and Sharon Lechter (2000), advertising works
on a six-week cycle. Small businesses should not lookout for results from
promotional campaigns until the completion of six- weeks cycle. Kiyosaki
(2000) stresses that small firms should not abandon promotional campaigns
prematurely particularly during economic recessions as in these economic
circumstances consumer turn to those businesses which stay more visible by
being persistent in their promotion (cited in Longenecker et. al, 2010).
According to Cant and Heerdan (2005), personal selling can be defined as,
the process of person-to-person communication between a salesperson and
a prospective customer in which the former learns about the latters needs,
and seeks to satisfy those needs by offering the prospective customer the
opportunity to buy something of value, such as a good or service.
Salesperson play a vital role in the process of personal selling that is why
sometimes they are referred as the eyes and ears of organization as they
cross and up sell to customers (Greend,