Know Your Firm and Manage Social Media Engagement: Impact on Firm Sales Performance

SKU
16162

Publication History

Received: March 21, 2019
Revised: June 29, 2020; June 29, 2021; February 21, 2022
Accepted: April 17, 2022
Published Online as Accepted Author Version Preprint: Forthcoming
Published Online as Articles in Advance: Forthcoming

https://doi.org/10.25300/MISQ/2022/16162

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Abstract

We examine the impact of firm social media engagement on sales performance, answering the “whether,” “what,” and “how” questions. The study uses a quasi-experimental design in a social e-commerce setting, for which propensity score matching and difference-in-differences methods quantify a mean 20.67% sales increase after firm social media adoption. We also find that firms that sell low-involvement products benefit more from social media adoption than do those that sell high-involvement products. Further, in regard to how to manage social media engagement, we find that informative content in general is sales effective, especially for selling high-involvement products; whereas promotional content, a new type of content discovered in this study, is more beneficial for sales of low-involvement products. Meanwhile, more social media followers generate greater firm sales performance. We use instrumental variables and control function method to address endogeneity issues and conduct robustness checks to support our conclusion. This study sheds light on the value of firm social media, particularly in regard to industry differences and firm know-how.

Additional Details
Author Fei Ren, Yong Tan, and Fei Wan
Year 0
Volume Forthcoming
Issue Forthcoming
Keywords Firm social media, sales performance, product involvement, content analysis, quasi-experiment, propensity score matching, difference-in-differences, instrumental variable, control function
Page Numbers
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