Diminishing Returns to Social Capitalist Firms and Their Employee Advocates: Evidence from WeChat

Abstract

When employees act as advocates on their firms’ behalf, their personal social media networks provide a potentially powerful platform for social capitalistic companies to access a broad audience. Existing theories exploring employee advocacy and companies’ social capitalistic efforts essentially assume, however, that employees willingly act as a tertius iungens, linking firms with potential job-, information-, or product seekers from their social networks, and that employees’ contacts are interested or—at worst—neutral message recipients who respond to the information they want, and ignore the rest. However, a motivated information processing view, proffering information overload and audience preference for uniqueness, would predict audience disconnect from company efforts and possibly adverse relational effects for overly zealous employees. Reconciling these perspectives, we theorize that firms that push their employees to act as their advocates on social media will be rewarded, but will see diminishing returns in information diffusion and audience attention. We test and find support for our hypotheses on a unique data set of 3,050 company messages sent on two Chinese interior design companies’ combined 2,162 employees’ WeChat Moments with 200,240 readers. Both company and employee “push” efforts and message recipients’ “pull” (due, e.g., to the fear of missing out) do increase message diffusion, but there are diminishing returns for employees posting messages in terms of reader count and attention. These findings contribute to our understanding of the limits of utility for social capitalist firms leveraging their employees’ networks and the relational costs employee advocates experience in promoting their firms, and help to better define the boundaries between potential and activated social capital.