Evaluating the impact of social media activities on human brand sales

Abstract

Brands spend significant resources on social media to connect with their customers, yet there is limited understanding on how consumers engage with brands on social media and how it influences their purchase process. Drawing on social identity theory which suggests that consumers work hard towards increasing the attractiveness of the groups they belong, we propose that consumers identifying with brands manifest both in-role behaviors that are related to product consumption and extra-role behaviors such as word-of-mouth that benefit the whole group. Accordingly, in the music industry (our empirical context), we propose that consumers engage in three social media activities to enhance the attractiveness of their brands: sampling music (SPLAYS), following music artists (SFANS), and commenting on the artists' social media websites (SWOM). Further, in line with brand attachment theory, we argue that these actions influence consumer purchase behavior (and thus music sales). Results using data for 36 music artists over 73weeks and robust time-series econometrics provide support for our framework and highlight how the consumer buying process is influenced by social media activities. Specifically, we find some surprising results – the influence of SPLAYS decreases at a decreasing rate, SFANS increases at a decreasing rate, and SWOM increases at an increasing rate. We discuss the implications of our study findings for brand managers and provide recommendations.