Impact of Social Media Management Styles on Willingness to Be a Fan: A Transaction Cost Economics Perspective

Abstract

This study investigates the impacts of different styles of social media management on user’s willingness to be a fan. Six companies’ brand-pages on a social media site are examined. Data are collected using survey and interview with a group of social media users. Qualitative data analyses are conducted based on 30 observation reports and 60 open-ended surveys, with follow-up interviews. Grounded on the theoretical lens of transaction cost economics, we find that companies successful in attracting more fans adopt the bilateral governance structure (with frequent updates and mixed asset specificity) in their social media transactions. They are relatively more dedicated and allocate more amounts of resources in their social media interactions. Practicing the right governance structure is demonstrated to be more preferable to the fans, able to attract more engagement and generate organic media in the long run. This is because it is helpful for creating positive perceptions of a brand-page, and fans find it useful in reducing their efforts in information searching and product procurement and social networking costs; and this in turn shows to positively impact one’s willingness to be a fan of the page, which can possibly create the opportunities to be a potential customer, leading to future purchases from the brand. This study also identifies the key concepts or sub-constructs of (user’s) willingness to be a fan of a brand-page in the context of social media. They are brand-page management style (dedicated, caring, responsive), contents (quality, usefulness, diversity) and product (uniqueness, variety, popularity).