The Impacts of Social Media on Online to Offline (O2O) in...

Global Journal of Emerging Trends in e-Business, Marketing and Consumer Psychology (GJETeMCP)

An Online International Research Journal (ISSN: 2311-3170)

2017 Vol: 3 Issue: 1

443 ww.globalbizresearch.org

The Impacts of Social Media on Online to Offline (O2O) in Vietnam

NGUYEN THI KIM LIEN,

Graduate student, School of Business Administration,

Chang Gung University, Taiwan,

E-mail: [email protected]

HENRY KER-CHANG CHANG,

Professor, Dept. Information Management,

Chang Gung University, Taiwan,


HARDY LIN,

Professor, Dept. Information Management,

Chihlee University of Technology, Taiwan,


___________________________________________________________________________________

Abstract

Nowadays, social media is increasing at the numerous rates of 1.8 billion users in the world.

It not only permits people communicate directly with each other, but also allows companies

can advertise and sell their products to customers. Social media provides the huge

opportunity for producers to understand their customers well. Moreover, the

most applications of social media are becoming a suitable space to retrieve the humorous

customer’s experience, opinions and preference regarding each brand, product or some

special goods. According to chabrol in 2015 Vietnam has 28 million social media accounts,

the most popular social platform are Facebook (21%), Google+ (13%), Skype (12%) and

Viber (9%). Taking advantages of popularity and accessibility of social networking, especially

Facebook, in the recent years have a lot of companies, group members or an individual run a

business by creating a Facebook fan page as a marketing tool. As a matter of fact, if this tool

is being efficiently used, it will bring many benefits to the company. The purpose of this

study provides an Online to Offline (O2O) E-Commerce Service Model and takes the social

relationship steadfast, which can help marketers or brands to know their customers via social

network existing Big Databank (especially Facebook in Vietnam) and the methodology of

research data is surveyed by SPSS software to do analysis by which they can adapt the

current social commerce marketing strategy more effectively and responsively.

___________________________________________________________________________

Key Words: Social media, online to offline (O2O), SPSS, Big Databank

mailto:[email protected]

mailto:[email protected]





1. Introduction

Online social networking websites such as: Facebook, Twitter, and Myspace etc. have

made a huge impact not only on individual’s life but also effect on how internet users

communicate, share their data, creating and maintaining their profile, establishing the links

with their friends (Faraz and Zohaib, 2012). Moreover, success of online social networks with

growing trends has allowed individual or organization to break through this new domain for

marketing their product. Many social networks allow companies to market their product

through different tools provided by them.

Facebook is the most successful social media network with more than 1.8 billion users and

the number is increasing day by day (Statista, 2016), it has offered many marketing tools for

the companies to target their customer like creating groups, pages. In Vietnam recently has

created a new wave of stimulating the development of social media. According to statistic in

2015, Vietnam has 28 million active social media accounts: Facebook 21%, Google+ 13%,

Skype 12%, etc. (Chabrol, 2015). Thus, the trend of marketing on social media is being more

popular, by spending a small fee or even no cost for brand promotion on social media,

companies can achieve positive results

Buying process including problem recognition, information search, evaluation of

alternatives, purchasing behaviors, after buying behaviors, and satisfaction is the consequence

of buyer’s experience during many purchasing stages (Kolter, 1997). Therefore,

understanding social users profile and how their satisfaction with the model O2O exist in

Vietnam nowadays is needed which helps entrepreneur can easy to increase brand awareness

and loyalty by customers. Moreover, they also can run targeted ads with the real time result.

Thus, we study the impacts of social network on Online to Offline (O2O) in Vietnam, to

achieve the overall aim of study, the following objectives are fulfilled: (1) identified the

profile of customer who buy product on social media, (2) identified which kind of products is

the most popular being buy via social media, (3) defining the reason why a customer buys a

product online, (4) customer attitude towards the feedback online from others customer, (5)

understanding customer satisfaction towards the O2O model in Vietnam.

2. Literature Review

Social media is the collective of online communication channels dedicated to

community-based input, interaction, content sharing and collaboration, websites and

applications dedicated to forums, micro blogging, social networking, social bookmarking,

and wikis are among the different types of social media (Margaret, 2013). According to the

statistic of the most popular social networking sties in the world, Facebook is the highest with

1,1 billion monthly visitors, Twitter stays in the second place with 310 million monthly

visitors and 120 million belong to Google+, etc. (eBizMBA guide, 2016). Similarly, according

to a research about social media usage in Asia, Vietnam has 77.58 % people in use social

media multiple times per day. Facebook is the most social networking site which they chose

http://whatis.techtarget.com/definition/discussion-board-discussion-group-message-board-online-forum

http://searchmobilecomputing.techtarget.com/definition/microblogging

http://whatis.techtarget.com/definition/social-networking

http://whatis.techtarget.com/definition/social-bookmarking

http://searchsoa.techtarget.com/definition/wiki





to use, following that are Zalo, Google+, Viber, Instagram and Twitter (Infogr.am, 2016).

There are a lot of studies to recognize and predict the relationship between products and

shopping behavior, these studies were indicating a list of products which would be suitable to

be sold via the internet. Miller and Lammas (2010) indicated that intangible products category

which provides information to consumer, such as, online video, music, computer software,

stock market, financial reports and weather information; tangible products category that has

variety classes, such as automobiles, electronic devices, books, clothes, accessories, flowers,

and jewelry.

Constantinides (2004) found that the important things of visiting the website are to help

consumers to communicate with other users in order to achieve their purposes. Using social

media becomes one of necessities that affect consumers via several factors; these factors can

be classified such as: functionality factors, design factors, psychological factors, and

information factors. To be more specific, functionality factors that enhancing the online

experience by presenting the virtual client with a good functioning, easy to explore, fast,

interactive website. Design factors that consumers are affected by the design characteristic of

web page, if the website is good designed and usually updated, they will be more attracted to

buy online. Psychological factors affected to consumers’ attitude towards online buying. For

instance, if consumers build a trust on a website they will have trend to buy online

comfortably and reduce uncertainty towards a product psychological factors, and information

factors. The last is information factors: consumers will be willing to buy online if diversity of

products and information are provided sufficiently. Also, offers warranties and guarantees that

are provided along with products will encourage consumers to shop online (Limayem et al.,

2000).

Kotler (1997) customer buying behavior is the outcome of the needs and the wants of the

consumer and they purchase to satisfy these needs and wants which depending on the

personal factors such as: age, psychology and personality. However, in the term of online

segmentation, there is a slight difference, this is because of there are two main online

segments we can refer to which are “Online Insiders” and “Social Clickers” (Riegner, 2007).

Consumers who actually buy online (Online Insiders): usually consumers’ choices are

influenced strongly by online brands and consumers are impacted to each other. This kind of

event usually affects the repurchase process as a result. Therefore, consumers are gradually

turning to social media in order to get more information on which to base their decisions

(Ramsunder, 2013). For instance, it can be notice that most of online shoppers tend to be

younger, wealthier, better education, more likely to spend time on internet, and shop online

(Levin et al., 2005); Consumers who browse the internet without buying online (Social

Clickers). Lee (2013) indicated that they are daily active people who tend to use the internet

for different purposes, such as getting news, doing different researches for different subject,

sharing information and communicating with other users and from other cultures. Moreover,





they are heavy communicators, but the most participatory ones trend to be younger, and less

wealthy, these Social Clickers may not be influencing purchase decision today, but could

become strong influencers in the future (Vinerean et al., 2013).

Levy and Weitz (2007) noted that the satisfaction is a valuation about how much could be

the retailer meet or exceed customer’s expectation. Individuals who pay for a product or

service but who do not use this product or service should not be expected to have the type of

satisfaction or dissatisfaction that a product or service user will have and satisfaction is a

feeling; it is a short-term attitude that can readily change given a constellation of

circumstances. It resides in the user’s mind and is different from observable behaviors such as

product choice, complaining, and repurchases (Oliver, 1997).

Zhang (2014) indicated that model O2O E-commerce, O2O refers to a combination of

offline business and online commerce. O2O mode is characterized by its information flow and

cash flow on online, logistics and ecommerce flow on the offline which greatly expanded the

scope of business of e-commerce. The model construction of O2O E-commerce is including

these aspects: Merchant services information, recommendation and search related to which

users can search what they want to obtain service categories such as: catering, entertainment,

accommodation, etc. Online payment: when the user selects a decision to buy business

services, namely online payment into links, and then automatically in third-party payment

platform. Offline consumption: users can reply on proof of payment to get the appropriate

geographic location near the business entity to enjoy the service. Consumer feedback:

consumer can choose to comment the dealer service in O2O e-commerce platform after

completion of offline consumption.

Since the e-commerce should consider not only the information system but also marketing

strategy. Regarding the information system field, there are three main factors are e-commerce

system quality, product and delivery quality, and perceived price which impacts to customer

satisfaction (Lin, et al., 2011). E-commerce system quality: regarding the investigation of

consumers’ e-commerce behavior, the e-commerce system quality including: information

quality, system quality, service quality (Lin, 2007). Product quality and delivery quality:

perceived product quality is defined as the customer’s judgment about overall excellency or

superiority. On the other hand, the delivery of a product can affect all fundamental objectives

of the value propulsions. Ahn et al. (2004) indicated that the timely and reliable delivery

increase user satisfaction so they will shop again. Perceived price: from the customer’s

perspective, price is what given up or scarified to obtain a product (Zeithaml, 1988).

Perceived price examined the customer ratings of pre-purchase and post purchase service to

explain price variations in the online book market and found that the higher prices of the three

market leaders were most likely associated with higher satisfaction ratings of both pre- and

post-purchase satisfaction (Cao and Gruca, 2004).





3. Methodology.

3.1 Research Questions

As indicated in the introduction, nowadays, social media creates the big change for

marketers who are introducing their products or services to consumers via the world of

connection. If this tool is used efficiency, it will create a huge profit for enterprise. But to

achieve those things, marketers should understand consumer attitudes toward products or

services which are selling on social media. Therefore, the purpose of this research is to

understanding the impacts of social media to O2O in Vietnam. Thus, the study rise two main

question

1. Which factors impact to deciding buy a product of users via social media?

2. What is customer’s attitude toward the model of O2O in Vietnam?

3. Which factors are the most impacts to customer satisfaction when they use O2O

model?

To answer those questions the research identifies seven objectives following:

- Identified the profile of customer who buy product on social media.

- Identified which kind of products is the most popular being buy via social media.

- Defining the reason why a customer buys a product online.

- Customer attitude towards the feedback online from others customer.

- Understanding customer satisfaction towards the O2O model in Vietnam

3.2 Research Model

Besides understanding profile of the consumers, the product is most being bought on

social media, the reason why they buy on social media, and how their attitude towards the

feedback from another customer. This study is also focused to know about customer

satisfaction towards O2O in Vietnam, the research used the model of Lin, et al. (2011) as in

Figure 1:

Finger 1: Model of customer satisfaction (Lin, et al., 2011)

3.3 Hypotheses and Development

According to the literature review, there are seven important independent variables of

E-commerce information system usage and user satisfaction, five independent variables of

E-commerce

System quality

Product quality and

delivery quality

Perceived price

Customer satisfaction





product quality and delivery quality, Perceived price has a positive influence on online user

satisfaction. These factors have been applied in many contexts as indicated in the Table 1:

Table 1: Hypothesizes of the O2O customer satisfaction model

Factors Hypothesis formulated

E-commerce system

quality

H1: Design of the page has a positive influence on customer

satisfaction

H2: Easy to make order has a positive influence on customer

satisfaction

H3: Easy to find products have a positive influence on customer

satisfaction.

H4: Easy to pay via the system has a positive influence on customer

satisfaction

H5: Easy to give back products has positive influence on customer

satisfaction

H6: Employee’s attitude of O2O business has a positive influence

on customer satisfaction

H7: Feeling safe when customer pays via the payment system

Product quality and

delivery quality

H8: Information about products are mention on web page have

positive influence on customer satisfaction

H9: Diversity kinds of products has a positive influence on customer

satisfaction

H10: Quality of products point out on website and the quality of

customer reception have positive influence on customer satisfaction

H11: Delivery on time has a positive influence on customer

satisfaction

H12: Product quality has a positive influence on customer

satisfaction

Perceived price H13: The price is cheaper than traditional shopping goods; it

has a positive influence on customer satisfaction.

3.4 Research method

This study is focused on consumers who use social media to buy products. Thus, we use

quantitative research methodology by survey on social media and use Microsoft Excel 2010

and an SPSS 19 program to do the analysis.

The questionnaires are designed with Google Driver and send it to users who have social

media account such as: Facebook, Zalo, Viber, et al. as well as online shopping groups in

Vietnam to measure three factors: E-commerce system quality, product quality and delivery

quality and perceived price are effect to customer satisfaction, the scale’s question was

converted to five point Liker type scale (1: Strongly disagree, 5: Strongly agree).





The research is used Regression Analysis in SPSS is the method of determining the

relationship between variables. It used to establish a linear relationship between the dependent

variable and independent variable. Regression analysis is carried out the function of the

independent variable called as the regression function and is used widely for prediction and

forecasting. Moreover, it is also sometimes administered to determine the causal relationships.

The accuracy of the regression analysis carried out is highly dependent on the accuracy of

data used for analysis. The regression model consists of the following variables:

1. Independent variable X

2. Dependent variable Y

3. Unknown factors (Beta)

Regression can mainly be of two types, simple linear regression and noon –linear

regression. This procedure is used because we want to find out how the customers satisfy with

the current O2O in Vietnam as well as which the factors are the most impacts to their

satisfaction.

4. Results and Discussion

The study is focused on customers who have experience about online shopping. There

were totally 710 questionnaires sent to users in Vietnam and got the feed backs from 619

users, from the Microsoft Excel 2010, there were 619 people who have social media, but just

had only 439 users who said that they have been bought products or service via social

networking. The rest number of 619 indicated that social clickers accounted for 29%, male

was outstanding with 107 in total 180 social clickers and the activities when they entered

social media were that: reading the news, connecting with their friends, just only 17 users

were answered that they use social media to looking for products. The result indicated that

online shopping through social media is still new in Vietnam.

In 439 customers who have bought products or service on social media, Facebook is the

most application which users refer to choose for shopping online accounted for 78% and 14%

was belong to Zalo in total 439 answers. Interestingly, there was 94% users’ responding that

they access to social media every day and each time they spend at least 30 minutes to 1 hour

on social activities reached to 56% of the answers and 30% were people who usually stay in

social media from 10 minutes to 30 minutes. The following Table 2 below is description the

relation among gender, age and education.

Table 2: The Description among Gender, Age and Education

Gender Age Education

<16 16-20 21-25 26-30 >30 Student Worker Employee Manager others

Male (42%, 185) 0 11 105 47 22 73 11 64 15 22

Female (254, 58%) 6 32 140 61 15 104 12 98 0 40

Total (439) 6 43 245 108 37 177 23 162 15 62

According to the Table 2, the percentage of female is exceeding than male (58% and 42%





respectively). What is mention is that the age of users, who use social media in Vietnam for

buying a product or service are younger which the age around 21 years old to 25 years old

and almost they are student and employee, these things consideration on both side of gender

are man and women. Moreover, in total 439 customers who had experience of buying the

products, there were 60% of users were answered that they always read comment before buy

a product, 32% of people said that they often read comments from another customer and just

2% of consumers were replied that they had never seen the comment before they made an

order as shown in Figure 2:

Figure 2: The percent of customers who have read another consumer’s comment

before purchasing

In 439 responders, who use to be bought products online in Vietnam, they have monthly

income it was not really high, 30% users have earned around 1 to 3 million VND in one

month, 24% online customers got from 3 to 5 million VND in one month, 20% responders

said that they got 5 to 8 million VND a month, and the percentage of people who earned less

than 1 million VND and greater than 8 million VND a month was achieve the same amount

with 13% in total users who bought item for consumption.

In the question about the reason why they are interesting with purchase product online,

47% customers said that through these stages they can easy to find their feverous product, 29

% complain that on social media consumers can easy to compare about product price, product

function, besides that, 9% people replied that they do not have time for shopping outside and

14% user’s answers were social media provide for them another customer feedback which

will to be their reference.

Regarding to the Figure 3 below is demonstration about products which customers refer

to buy via social network.

Figure 3: The percentage of products which customers refer to bought via social media

39%

47%

8% 6%

Electroni

c

Fashion

60%32%

6%2% Always

Often

Seldom

Never





Figure 4: The percentage kinds of electronic and fashion products which users bought online

According to the survey data, it indicated that through social media, fashion products are

the most popular products which were being bought by consumers with 47%, the second

popular products were electronic account for 39%, cosmetic and other products obtained 8%

and 6% in total respectively, to be more specific, the Figure 4(a) represents for the percentage

of electronic products which customers were buying on social media. In 169 feedbacks (47%)

from users who were purchased electronic products online, mobile phone accounted for 37%,

laptop was 24%, camera was 6%, and 33% people had a concern about buy accessory such as:

headphone, speaker, etc., by mean social media. Regarding to the Figure 4(b) about fashion’s

customers, it shown that clothes consumption on social media which were 83%, the

percentage of users who bought bags and shoes were quite similar amount with 10% and 6%

correspondingly and just only 1% caps were acquired via social network in Vietnam.

To understand about customer satisfaction toward model O2O in Vietnam, from the

survey analysis was entered into SPSS 19 to test the research hypotheses, an aggression

analysis was performed, using customer satisfaction as the dependent variable and three

proposed factors: E-commerce system quality, product quality and delivering quality and

perceived price as the independent variables. According to the Table 3, six hypotheses were:

H1, H3, H9, H11, H12, H13 has significant <0.05 that mean these hypotheses correlated

positively and significantly with customer satisfaction at the confidence intervals 95%. The

standardized coefficients were 0.099, 0.145, 0.116, 0.115, 0.118 and 0.119 so the perceived

price of customer was the most important factor that influence to customer satisfaction, and

product quality also play a significantly factor which impacts to user when they purchase a

merchandise via social media. These six independent variables explained 47.9 percent

variance in user satisfaction, R Square equal to 47.9% (see Table 4).

Table 3: Coefficients hypothesis

0

10

20

30

40

Labtop Mobile phoneCamera Accessory

Electronic products (39%)(a)

Coefficientsa

Model Unstandardized

Coefficients

Standardized

Coefficients t Sig.

0

20

40

60

80

100

clothes Bags Shoes Caps

Fashion (47%)(b)





Table: 4 Model Summary

Model Summaryb

Model R R

Square

Adjusted

R Square

Std. Error

of the

Estimate

Change Statistics

R

Square

Change

F

Change df1 df2

Sig. F

Change

1 .692a .479 .463 .723 .497 30.051 13 425 .000

a. Predictors: (constant). The price is cheaper than traditional shopping, Feeling safe when customer

pays via the payment system, Easy to give back products. Easy to make order. Diversity kinds of

products, Easy to pay via the system, Delivery on time, Quality of products point out on website

and the quality of customer reception, Easy to find products, Employee’s attitude of O2O

business, Design of the page, Information about products are mention on web page, Product

quality

b. Dependent variable: Satisfaction with model O2O in Vietnam

4. Conclusions and Recommendations

Based on the finding of this research, we can conclude the fact that most consumers who

buy online are indeed young, between 21 years old to 25 years old. Almost they are students

B Std.Error Beta

(Constant)

Design of the page

Easy to make order

Easy to find products

Easy to pay via the system

Easy to give back products

Employee’s attitude of O2O business

Feeling safe when customer pays via the

payment system

Information about products are mention on web

page

Diversity kinds of products

Quality of products point out on website and the

quality of customer reception

Delivery on time

Product quality

The price is cheaper than traditional shopping

goods

.010

.104

.021

.142

.020

.048

.043

-.002

.053

.124

-.009

.115

.191

.170

.187

.048

.043

.044

.040

.035

.047

.037

.044

.047

.043

.043

0.49

.037

.099

.022

.145

.022

.056

.041

-.002

.056

.116

-.009

.115

.181

.191

.055

2.171

.485

3.216

.505

1.360

.905

-.052

1.211

2.635

-.211

2.646

3.859

4.615

.956

.030

.628

.001

.614

.175

.366

.958

.227

.009

.833

.008

.000

.000

a. Dependent Variable: Satisfaction with model O2O in Vietnam





and employees, before purchasing a product they usually read the comment from another

customer, Facebook is the most knowing place which they choose to buy the products via

social media. Online social customers are referred with purchasing fashion on social network,

and clothes are the most kind of clothes which they want to consume, via these networks they

can easy to find their feverous product.

Regarding the factors impact to customer’s satisfaction, O2O customer satisfaction

context related to six factors: design of the page, easy to find product on the page, diversity

kind of products which sell in the page, delivery on time, product quality and percept of

customer about product’s price is cheaper than traditional shopping. In these factors, percept

about product’s price and product quality are the most important factors effect to customer

satisfaction.

According to the finding of this study, to ensure customer satisfaction, the O2O manager

should develop good information system and the service quality. Price and product quality

which is the most influence user satisfaction positively so the E-commerce operator should

consider bout how to balance between product quality and fair price in order to boots sale and

company profit. Besides that, the managers website also need to design the company page on

social network in the professional way without complicated to make sure customers can easy

to find their refer products. Moreover, the company should pay more attention to the product

sourcing and cooperate with delivery supplier to provide higher quality of delivery such as:

right address, on time and safety packaging.

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