Factors influencing generation Y's adoption of social media word-of-mouth communication

400 Pages·2016·4.29 MB·English

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How to cite this thesis
Surname, Initial(s). (2012) Title of the thesis or dissertation. PhD. (Chemistry)/ M.Sc. (Physics)/
M.A. (Philosophy)/M.Com. (Finance) etc. [Unpublished]: University of Johannesburg. Retrieved
from: https://ujdigispace.uj.ac.za (Accessed: Date).
FACTORS INFLUENCING GENERATION Y’S ADOPTION OF SOCIAL MEDIA
WORD-OF-MOUTH COMMUNICATION

ROY MALON SHAMHUYENHANZVA
STUDENT NUMBER: 201241191

FULL DISSERTATION

Submitted in fulfilment of the requirements
for the degree
MCom
in Marketing Management
in the Faculty of Management
at the
University of Johannesburg

Johannesburg Supervisor: Prof M Roberts-Lombard
August 2014 Co-Supervisor: Prof E van Tonder
DECLARATION

I, Roy Malon Shamhuyenhanzva, declare that this dissertation is my own, unaided work and
any assistance that I have received has been duly acknowledged in this dissertation. It is
submitted in partial fulfilment of the requirements for the degree of Master of Commerce at the
University of Johannesburg. It has not been submitted before for any degree or examination at
this or any other University.

……………………. ….……. ……………………
Roy Malon Shamhuyenhanzva (Day, month, year
)

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ACKNOWLEDGEMENTS
While my name appears on the cover, I want to express my heartfelt appreciation to the
individuals who made this project and journey possible and worthwhile. If you have never
researched, it is hard to explain how many people help you create something that ends up with
your name on the front cover. I got a lot of help and invaluable advice, knowledge and support
during the process of writing my thesis, in the process learning a lot about research. It is with
my gratitude that I appreciate:

Firstly, I am especially grateful and would like to give my utmost thanks to wonderful and
brilliant supervisors, Prof M Roberts-Lombard and Prof E van Tonder, for putting up with me
and for the encouragement, inspiration and motivation throughout my studies. There were
times when the going got tough, but thanks to you, for the confidence you instilled in me, you
made everything look elementary, especially during the proposal stage. Thank you for your
invaluable expertise, such knowledge, appreciation and understanding of research and for
moulding me to be the person I am today. My MCom journey was not easy – I couldn’t have
done this without you. I thoroughly enjoyed my visits to UJ, our times together and all our
conversations. Thank you.

The biggest thank you, as always goes to my family. Thank you guys (my beautiful loving wife
Hazvinei, my son Takudzwa Blessing and my daughter Makanaka Gabriella) for being
understanding about how often Daddy took time to purse studies and making this project a
reality. To my wife Hazvinei, for providing me room to read and write my research, and above
all for being supportive and understanding as I took every waking moment available from you
my wife and our lovely, most precious and amazing kids.

Mom and dad, thank you so much for all your love, guidance and support over the years and
for the opportunities you gave me to make all of this possible. I would not be the proud man I
am today if it were not for your sacrifice. I love you both with all my heart and feel so blessed
to have you as my parents.

My siblings, for the encouragement, prayers, love and support, you helped me sail through!
Thank you.

All my friends, colleagues (particularly Dr Maxwell Sandada and Mr Leonard Ndlovu), thank
you so much, I am really grateful for the encouragement, support and help.
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Dr Richard Devey from the Statistical Consulting Services of the University of Johannesburg,
I greatly appreciate all your effort, time, invaluable expertise and guidance in my research
study. Thank you so much for assistance with the processing and analysis of the data and for
making me passionate about statistics.

Elsabeth Marnitz, thank you for time and effort in conducting the language editing.

Above all, I would like to thank the Almighty God, Jesus Christ, for giving me such wonderful
and brilliant supervisors (Prof M Roberts-Lombard and Prof E van Tonder), a conducive and
supportive environment, strength, drive and understanding to accomplish my study. I thank
you Lord for all the blessings in my life.

“TO GOD BE ALL THE GLORY”

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DEDICATION
This study is dedicated to my Mom and Dad, my wife Hazvinei and my two lovely kids,
Blessing and Gabriella.

To my Mom, only God knows the pain you went through, giving birth to me just moments after
losing another son, I can imagine what you were going through. Guess I am the only one born
crying with everyone around me also in tears, not of joy, but sorrow, hurt, pain and mourning.
I will always love you Mom.

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EXECUTIVE SUMMARY
The rapid proliferation and adoption of social media have transformed the media and
communications landscape; upending the way consumers search for product/service
information, how they learn and engage with brands. Moreover, social media provides
consumers with a platform where they can form communities around their favourite brands and
interests, having abilities to critic and evaluate products and services collectively.
Consequently, consumers are no longer passive receivers of marketing information; they no
longer rely only on marketer-generated information, but rather leverage more on user-
generated reviews and consumption-related experiences abundantly available on social media.
This had led to consumers becoming more informed and empowered, resulting in a shift in
marketing control from marketers to consumers. Marketers, in an attempt to circumvent
consumer scepticism and defence mechanisms, have established online presences, with some
marketers disguising their marketing efforts by adopting marketing strategies such as seeding
viral campaigns and stealth marketing. Discerning credible and authentic reviews and
recommendations from manipulated social media-driven word-of-mouth (WOM) is now
therefore a challenge to consumers.

This study seeks to advance understanding into the evaluation criteria used by Generation Y in
determining authenticity of information, by investigating the influence of different factors
namely: source credibility, social-tie strength, homophily, authority and interestingness in their
credibility judgements of social media-driven WOM. With limited research studies having
been conducted in South Africa on social media, and with the primary focus of these studies
being in the areas regarding its impact on consumer decision-making processes and marketing
communications, this study seeks to advance understanding on credibility judgments of social
media WOM. Moreover, no formal study could be found that has focused exclusively on
Generation Y and the fast-food industry in the country.

A quantitative research approach was adopted, with the research design being descriptive. Data
was collected through a survey study, using a structured questionnaire. Stratified sampling was
applied in drawing the sample units, with the two major cities of Gauteng namely, Pretoria and
Johannesburg each constituting a stratum. Furthermore, the fast food outlets were also stratified
according to the different types of fast-food they represent, with random proportional samples
drawn from each respective fast-food brand in each city. Data was analysed through performing
ANOVAs, significance testing, factor analysis, correlation testing and regression analysis with
the help from the Statistical Consultation Service of the University of Johannesburg.
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The empirical research findings indicate that understanding Generation Y’s credibility
judgment criteria is beneficial in the design and development of effective marketing strategies
that will appeal to Generation Y, as they are a vital spending force in the fast-food industry.
The outcome of the standard multiple regression analyses showed that Generation Y’s trust in
social media WOM (measured by trust in online sources and trust in virtual communities and
bloggers) is influenced by source credibility, tie strength, homophily, authority and
interestingness. In addition to this, the regression analysis results also showed that only trust in
online sources influences the adoption of social media WOM and Generation Y’s intention to
purchase or select from the review outlet. Based on these findings, recommendations were
made to fast-food retailers for the implementation of social media marketing strategies that can
help enhance Generation Y’s trust in a firm’s sponsored social media sites. Moreover,
recommendations were made on how fast-food retailers can capitalize on social influence and
collaborate with Generation Y. The research study also proposes a further investigation into
other factors that might influence Generation Y’s choice considerations with respect to which
outlets at which to dine or eat out.

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TABLE OF CONTENTS

DECLARATION i
ACKNOWLEDGEMENTS ii
DEDICATION iv
EXECUTIVE SUMMARY v

CHAPTER 1 1
PROBLEM STATEMENT, OBJECTIVES AND METHOD OF STUDY 1
1.1 INTRODUCTION 2
1.2 BACKGROUND TO THE STUDY 6
1.3 STATEMENT OF THE PROBLEM 13
1.4 RESEARCH OBJECTIVES 15
1.4.1 Primary objective 15
1.4.2 Secondary objectives 15
1.5 SIGNIFICANCE OF THE STUDY 16
1.6 LITERATURE REVIEW 17
1.6.1 Consumer behaviour 17
1.6.2 Word-of-mouth as a referral tool 18
1.6.3 Social media, technology and the selection of fast-food outlets 19
1.6.3.1 Source credibility 21
1.6.3.2 Tie strength 22
1.6.3.3 Homophily 23
1.6.3.4 Authority 23
1.6.3.5 Interestingness 24
1.7 RESEARCH HYPOTHESES 25
1.7.1 Relationships between the independent variables and trust of social media
WOM (the intervening variable) 25
1.7.2 Relationship between trust of social media WOM (the intervening variable)
and adoption of social media WOM by Generation Y in their selection of
fast-food outlets (the dependent variable) 26
1.8 RESEARCH METHODOLOGY 26
1.8.1 Types of research methods 26
1.8.2 Data collection 27
1.8.3 Data analysis 28
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1.9 ETHICAL CONSIDERATIONS 29
1.10 LIMITATIONS OF THE STUDY 29
1.11 CLASIFICATION AND DEFINITIONS OF TERMS 29
1.11.1 Independent variable 29
1.11.2 Dependent variable 30
1.11.3 Intervening variable 30
1.11.4 Social media 30
1.11.5 Generation Y 30
1.11.6 Sampling unit 30
1.12 DIVISION OF THE STUDY 31

CHAPTER 2 32
THE FAST-FOOD INDUSTRY IN SOUTH AFRICA 32
2.1 INTRODUCTION 33
2.2 THE GLOBAL FAST-FOOD INDUSTRY 33
2.2.1 The current status of the global fast-food industry 34
2.2.2 New trends within the global fast-food industry – A future perspective 35
2.2.3 The global fast-food industry and its influence on the local South African
fast-food industry 39
2.3 THE SOUTH AFRICAN FAST-FOOD INDUSTRY 41
2.3.1 Contribution of the South African fast-food industry to economic growth 43
2.3.2 Growth within the South African fast-food industry 44
2.3.3 Distribution and competitive nature of South African fast-food outlets 45
2.4 TARGET MARKET ANALYSIS OF THE SOUTH AFRICAN
FAST-FOOD INDUSTRY 51
2.4.1 Importance of Generation Y to the fast-food industry 53
2.5 MARKETING STRATEGIES TO APPROACH GENERATION Y IN
THE SOUTH AFRICAN FAST-FOOD INDUSTRY 55
2.6 CONCLUSION 67

CHAPTER 3 69
SOCIAL MEDIA WOM IN PERSPECTIVE 69
3.1 INTRODUCTION 70
3.2 THE NATURE OF WOM 70
3.2.1 Definitions of WOM 71
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