1. Use of social media in marketing:
Key determinants of consumers’ engagement on Facebook in Hong Kong
Mark Ng
Hong Kong Shue Yan University
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2. Background of Study Social media is popular!
By Feb 2012, Facebook reports more than 850 million users globally
Average user spends about 700 minutes per month on the Facebook.
Opportunities created by Social Media:
About 20% users would make purchase through social media sites.
Sales would reach $30 billion by 2017.

3. Hong Kong:
Jan 2013: 3.9 million Facebook users in Hong Kong (53% of its population and 78% of its online population).
Most users aged from 25 to 34 (33%) and from 18 to 24 (26%).

4. Many major brands have established their ‘Facebook pages’ to connect with target markets, build brand image, and implement sales promotions in Hong Kong.
Feb 2013: Starbucks HK, Estee Lauder, H&M with >100,000 fans

5. Research Objectives
Examining the key motivating factors that determine consumers’ participation in commercial activities on social media
Provide some insights on how marketers can make use of the Facebook to engage with customers effectively

6. Research Framework Positive factors Negative factors
Convenience to maintain relationship
Enjoyment
Knowledge function
Social presence
Threat to privacy
Satisfaction, self disclosure and Participation of activities on Facebook

7. Convenience of maintaining relationships
Use of social network to connect with friends and relatives (Dwyer, Hiltz & Passerini, 2007; Hann, Hui, Lee & Pang, 2007; Young, 2009)
To communicate and interact with their friends  Satisfaction, self-disclosure and use of Facebook

8. Enjoyment
Internet: hedonic platform for entertainment (Igbaria, Parasuraman & Baroudi, 1996; Igbaria, Schiffma, & Wicckowshi, 1994).
Pleasure and fun --> Actively involved in the mass communication process (Wearden & Harper, 2000).
Enjoyment – Satisfaction, more disclosure and use of Facebook

9. Knowledge Function (Information)
Facebook: To gain knowledge and information from their friends and different virtual communities (Armstrong & Hagel, 1997; Chang et al. 1999).
Gain useful information and knowledge  Satisfaction and participation of Facebook activities.

10. Perceived risks of privacy
Large amount of personal information disclosed on Facebook  Higher risks on privacy invasion (Acquisti & Gross, 2006; Hogben, 2007).
Concerned about privacy issues tend to avoid using OSN, disclose less information and refuse to allow businesses to access their personal information (Gao, Sultan, & Rohm 2010; Hugl 2011; Krasnova et al. 2010).

11. Social presence
Users of Facebook would become more active if they find their friends are presence and interact with each other (Sachdev, 2011).
Social presence  Satisfaction, self-disclosure and participation of various activities on Facebook.

12. Gender differences
Women: more relationship-oriented (Minton & Schneider, 1980) – more emphasis on convenience of maintaining relationship (Hargittai, 2007)
Enjoyment of using Facebook is more important motives for male (Lin & Yu, 20008).
Women: Higher concern about privacy

13. Perceived Convenience
Proposed Model
Perceived Convenience
H1a
Satisfaction
H1b
H6a
Enjoyment
H2a
Participation H3
H6b
H2b
Knowledge function
H4a H7
H4b
Perceived Risk
Self-disclosure
H4c
H5a
H5b
Social presence

14. Hypotheses of the Study
H1a
Perceived convenience  Satisfaction
H1b
Perceived convenience  Self-disclosure
H2a
Enjoyment  Satisfaction
H2b
Enjoyment  Commercial activities H3
Knowledge function  Commercial activities
H4a
Perceived privacy risk  Satisfaction (-ve)
H4b
Perceived privacy risk  Self-disclosure (-ve)
H4c
Perceived privacy risk  Commercial activities (-ve)
H5a
Social Presence  Self-disclosure
H5b
Social Presence  Commercial activities

15. H6a
Satisfaction  Self-disclosure
H6b
Satisfaction  Participation of commercial activities H7
Self-disclosure  Participation of commercial activities H8
Convenience of maintaining relationship more important determinant for female users H9
Enjoyment more important determinant for male users
H10
Risk of Privacy stronger concern for female users

16. Research Method Participants
620 students and graduates from different universities in Hong Kong recruited online
Valid Sample: 566
44.5% Male, 55.5% Female
Most of them are below 35 years old
More than 80% of them log-in their Facebook account everyday

17. Questionnaire Design Three sections:
Section 1: Scale measuring different constructs
Section 2: Measure participant’s behavioral pattern of using Facebook
Section 3: Demographical background of Participant

18. Major constructs & measurement
Latent variables
Operational definition
No. of items
Convenience in relationship maintenance
(Krasnova et al. 2010)
being able to efficiently maintain relationship with friends 3
Enjoyment
(Krasnova, et al., 2010; Nambisan & Baron, 2007)
having pleasant and enjoyable experiences on Facebook
Perceived privacy risk
(Malhotra, et al., 2004)
potential uncertain negative consequences related to self-disclosure on Facebook
Knowledge function
(Armstrong & Hagel, 1997 and Ducoffe, 1996)
Facebook allows the user to receive useful and new information. 4

19. Operational definition No. of items
Latent variables
Operational definition
No. of items
Perceived social presence
(self-developed)
Perceived use of Facebook by his/her friends and relatives 4
Satisfaction of using Facebook
(Bhattacherjee, 2001) 2
Self-disclosure
(Krasnova et al. 2010)
The breadth and depth of the revelations a user makes on Facebook 3
Participation of commercial activities on Facebook
(Self-developed)
User’s participation into commercial activities on Facebook

20. Method of Analysis Partial Least Square Structural Equation Modeling
Measurement Model (Outer model)
Structural Model (Inner model)

21. Findings Measurement Model (Outer Model) Reliability Validity
Cronbach’s Alpha
Composite Reliabilities
Validity
Convergent validity
Discriminant validity

22. Reliability of Each Constructs
Latent Variable
Composite reliability
Cronbach’s alpha
Convenience in relationship maintenance
0.860
0.757
Enjoyment
0.876
0.790
Knowledge function
0.851
0.753
Perceived privacy risk
0857
0.778
Social presence
0.910
0.869
Satisfaction
0.902
0.787
Disclosure
0.923
0.875
Participation
0.864
0.766

23. Discriminant validity
Convergent validity
AVE of all constructs are greater than 0.50, meeting the recommended criteria (Fornell & Larcker, 1981)
Discriminant validity
The correlation of each constructs should not be higher than the square root of respective AVE (Fornell & Larcker, 1981)

24. Variables
Con
Know
Enjoy
Risk
Social
Sat SD PC
Usage
Convenience
0.820
Knowledge
0.540
0.775
Enjoyment
0.460
0.493
0.838
-0.145
-0.161
-0.254
0.812
0.342
0.422
0.327
-0.003
0.847
Satisfaction
0.515
0.532
0.580
-0.324
0.336
0.906
Self-disclosure
0.462
0.491
0.500
-0.311
0.282
0.547
0.895
0.228
0.245
0.351
-0.331
0.222
0.404
0.427
0.824
Update
0.250
0.161
0.300
-0.199
0.034
0.367
0.568
0.329
1.0

25. Structural Model (Inner model)
Predictive power (R2)
Satisfaction (47.7%)
Self-disclosure (41.0%)
Participation of Commercial activities (28.5%)
Average explained variance R2 is 35.9% (moderate)
Goodness of fit (GoF):
GoF index is 0.526, which is at satisfactory level.

26. Blindfolding procedure is used to evaluate quality of model (Wold, 1982).
The CV-communality and CV-redundancy figures of the model are positive, which show that the quality in both measurement model and structural model is satisfactory.

27. Results of Model

28. Discussions Relationship with participation into commercial activities
Factors
Direct and Indirect relationship
Perceived privacy risk (-ve)
Direct relationship
Satisfaction
Self-disclosure
Indirect relationship
Convenience
Enjoyment
Knowledge functions

29. Gender differences
Convenience of maintaining relationship have stronger impact to satisfaction for female users (p<.05)
Enjoyment of using Facebook has direct effect on the self-disclosure of male users on Facebook but not that of female users (p<.05).
Perceived risk of privacy invasion has direct effect on the self-disclosure of female users but not that of male users (p<.05)

30. Managerial Implications
Primary motives: Connect with friends and entertainment
Avoid always using social media to push messages to consumers
Connect with consumers as ‘friends’ and gain their trust (Heinonen 2011)

31. Most powerful predictor of satisfaction and disclosure of personal information: Enjoyment
Innovative, interesting, and attractive activities to strengthen the link with consumers

32. Provide them interesting, useful and relevant information

33. Reduce the perceived risks of joining these activities such as by reduce amount of information collected, more transparent and user friendly privacy policy

34. Limitations and future directions
Sampling procedure
Expand to a more representative sample of a population
Testing in other countries or markets
Some other factors may also influence the dependent variables in this study
Examine the use of other OSN vehicles such as Weibo in China

35. Thank you!