Understanding social media effects across seller, retailer, and consumer interactions

Abstract

In this research, the authors propose a contagion effect of social media use across business suppliers, retailers, and consumers. After developing and validating social media usage measures at three levels—supplier, retailer, and customer—the authors test social media contagion effects and their ultimate impact on multiple performance measures. The conceptual framework and empirical results offer new insights into the contagion effects of social media usage across the channel of distribution as well as important social influence mechanisms that enhance these effects. Consistent with the predictions, social media use positively contributes to brand performance, retailer performance, and consumer–retailer loyalty. Also, the effect of supplier social media usage on retailer social media usage and in turn on customer social media usage is moderated by brand reputation and service ambidexterity. With the ever-increasing growth and adoption of social media applications and similar technologies, this research provides a framework to promote usage by supply channel partners which ultimately influences performance-related outcomes.