E-commerce Advertising in Social Networking Sites and

Implications for Social Commerce

19th Pacific Asia Conference on Information System (2015 PACIS)

Jenny, Xinyan ZhangCity University of Hong Kong

Rachael K.F. IpMacau University of Science and Technology

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Overview

Jenny, Xinyan ZHANG

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Introduction

Online marketers are attracted by SNS because of the large number of SNS users.• Ratio of online adults engaging in social networking sites has increased from 8%,

in 2005, to 74% as of January 2014 (Pew Research Center).

• Facebook, as the most popular networks worldwide, has over 1 billion registered accounts as of March 2015 followed by QQ and Whatsapp in which the number of registered accounts is 829 million and 700 million respectively (statista.com)

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Introduction

Customers trust the e-commerce advertising posted on SNS because they trust the SNS used by them.

Customers’ trust in e-commerce advertising information will lead to their intentions of adopting advertising information.

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Theoretical Background

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Trust transfer (1)

Two types of trust transfer (Stewart 2003): (1) Trust transfers between targets: Known target Unknown target

(Trusted target) (Unfamiliar target)

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Trust Transfer (2)

(2) Trust transfers from a context to another: Context A (Offline Shop) Context B (Online Shop)

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Trust Transfer (3)

In our study: (3) Trust transfers from a context to a target Context (SNS) Target (Advertising Information)

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Medium Credibility to Message Credibility

Flanagin and Metzger suggest that overall medium credibility affects the credibility of information delivered by the specific medium (Flanagin & Metzger, 2000).

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Study

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Research Model

Trust in SNSsTrust in

Advertising Information

Intentions of Adopting Advertising Information

H1 H2

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Constructs

Trust in SNSs : defined as people perceive that the social network sites (SNSs) are benevolent, competent and integrative. (Mayer, Davis, & Schoorman, 1995; Gefen & Straub, 2004; Bhattacherjee, 2002)

Trust in Advertising Information : defined as people’s perception of reliability, usefulness and affection of information in advertising (Soh et al., 2009) posted on SNSs.

Intentions of Adopting Advertising Information : defined as people’s intentions of adopting advertising information to make purchase related decisions (Soh et al., 2009).

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Hypotheses

H1: Customers’ trust in SNSs will positively affect their trust in advertising information posted on them.

H2: Customers’ trust in advertising information will lead to their intentions of adopting advertising information to make purchase related decisions.

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Research MethodologyOnline survey on sojump.com, a reliable and widely used online survey platform

in China. 134 subjects participated this study and 132 questionnaires are valid. We performed the data analysis by using partial least squares (PLS)Reliability and Validity

Covergent Validity Discriminant Validity

Construct CR AVE TrustSNS TrustAD IntentionINFO

TrustSNS 0.892 0.485 0.696

TrustAD 0.964 0.630 0.550 0.794

IntentionINFO 0.918 0.788 0.371 0.605 0.888

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Findings and Discussion

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Findings

• Structural Model

*p<0.05 , **p<0.01, ***p<0.001

Trust in SNSsTrust in Advertising Information

R2=0.31

Intentions of Adopting Advertising Information

R2=0.37

0.55***

(t=7.75) 

0.60***

(t=10.30)

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Discussion

Hypothesis Expectation Finding

H1Trust in SNS Trust in Advertising Information

Yes

H2

Trust in Advertising Information

Intention of Adopting Advertising Information

Yes

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Implications

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Practical Implications: Social CommerceSocial Advertising: No universally agreed definition.It is generally considered as a kind of advertising that relies on social networks and social relations in generating, targeting and delivering marketing communications (Bakshy et al. 2012; Li & Shiu 2012; Tucker 2012).E-commerce Advertising in SNSs Vs Social Advertising.The research model is partially applicable to Social Commerce.

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Theoretical Implication: Trust TransferContext to Target: Social Networking Sites E-commerce Advertising

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Limitations and Future Study

Definition of dependent variable.All the measures are from previous studies. We plan to development

some new measurements which are specific to the new research scenario.

Social relationship, i.e., the relationship, will be included in the future study.

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Q&A

Thank you!