The Impact of Social Media Advertising on Consumer Purchase Intentions

The impact of social media advertising on consumer purchase intentions

1. Background

Advertising is the product of commodity economy, since the human society developed to the stage of commodity exchange, people have started to conduct business activities, that is adopting various measures to attract people conducting commodity exchange or commercial transaction (Brown et al. 1951). Inferring by that, the advertisement has already had a quite long history. In the long developing process of advertisement, the advertisers keep exploring and changing the advertising skills to effectively solicit customers, for example, hawkers ring the bells and beat instruments to change “hawking” into “selling by singing”, as well as using the mass media to make advertising promotions later and so on. These advertising skills as well as the innovation and evolution of tools all substantially mean that hawkers (advertisers) have new understanding of the conclusion of experience and the situation of consumers’ acceptance towards information, which reflects the advertisers’ explorations on advertising psychological phenomena and laws. Nonetheless, really connecting the advertisements and psychology is after the birth of psychology at the end of 19th century.

1. Research Aim and Questions

The aims of the project are to assess the impact of social media on consumers’ purchase intention.

In order to do this the research questions are as follows:

• What is the level of awareness of advertising on social media?
• What is the level of recall of advertising on social media?
• What motivates people to respond to these adverts?
• Are particular groups of people more likely to respond to advertising on social media platforms?

1. Literature review

1. Background to Advertising Psychology

In 1879, German physicist Wundt built the first psychological laboratory on the human history in Leipzig, Germany, which marked the birth of scientific psychology. After that, many psychological laboratories were built up, more and more psychologists abandoned the original introspective method (the early psychological research method) and started to adopt experimental method and investigation method to study the psychological issues. In 1895, Gale who came from the psychological laboratory of University of Minnesota first adopted questionnaire survey method to explore consumers’ attitudes and views towards advertisements and advertising goods. After several years’ research, Gale published a book named Advertising Psychology in 1900 (Gill 2015). These researches of Gale were generally regarded as the earliest study in the advertising psychology, but his research did not exert enough influences. In 1901, at the annual meeting held in Chicago, Scott, a psychologist at Northwestern University proposed that it would have bright future to develop the practical work of advertisements into a science and psychology. His view was ardently supported by the people who attended the meeting at that time. The researches on the advertising psychology at the early stage are all conducted under the economic conditions that centered with the producers, thus their purposes are also serving for the seller's market (Ramamurthy 2003). After the Second World War, with the fast development of commodity economy and the intensifying market competition as well as the marketing concept changed from centering with producers to centering with consumers, more and more advertisements researchers and psychologist pay their attention to the researches relevant with the consumers’ behaviors. Many business institutes in America conduct researches on the consumers’ behaviors, especially consumers’ buying incentives which involve the themes of advertisements or issues of advertising appeals. The typical issue among them is the research on deep motives of the marketing barriers for instant coffee. These practical studies have largely enriched the psychological knowledge (Gill 2015).

Since the 1960s, the science and technology of western countries have evolved by leaps and bounds and their economies have developed fast and the advertising industry has achieved unprecedentedly progress (Gill 2015). In this background, the requirements on making the advertising activities scientific are enhanced day by day. As the basic theoretical study of advertising activity, advertising psychology is concerned and focused by more and more people.

Pushed by the practical requirements on the advertising activities as well as influenced by the developments of cognitive psychology and other scientific technology, advertising psychology has achieved large developments since the 1960s and specifically presented in these following aspects:  

1. Empirical research has been increasing and the research results are mostly published on several main magazines.

2. The research fields become extensive increasingly, which include the cognitive process of advertisements, the relationship between advertising performance and national psychology, psychological effects analysis on various advertising performance or persuasive appeals, the psychological system of advertisements spreading, the persuasive skills of advertisements, potential consciousness and advertisements, the emotional function of advertisements, the influences on children of advertisements and consumers’ reactions towards advertisements and so on.

3. Research methods and measures are increasing and advancing. The traditional studies take the investigation method and experimental method as the major measures. Modern advertising psychology study is not only inheriting the traditional research methods, but it also adopts some new research ways of psychology and communication, such as content analysis method, semantic analysis, projective method and so on.

1. Advertisement’s application on website  

One of the application areas of advertising psychology is the use of advertising media.

It is the key point for the media planning that through what kind of combination of information channel, at what time and according to what kind of frequency can the information be most effectively conveyed. Advertising media is the information dissemination means that is able to effectively convey the information to the public (Yang et al. 2015). The popularity of the network contributes to the increasing appearance of a variety of new advertising techniques, but most of them just convert the existing media ideas to the network. A representative communicative advertising medium on the web is the E-mail, but it is more like the online version of the paper letter advertisement. In addition, the company's home page plays the role of the previous showroom and commodity catalog. The Question and Answer section on the home page and the purchase page play the role of sales staff. The various types of advertising on the search engine is similar to the phone book advertisements in which the classification is made by industries (Auschaitrakul and Mukherjee 2017).  As a new form, the role of the magazine's "life notebook" and "residential information weekly" is also reflected on the network, such as websites that can make comparison among multiple brands and there is also a consumer community that is for consumers to mutually exchange evaluation information and views of the goods (Flores et al. 2014). Such media is a substantial expansion of the traditional concept of advertising. The biggest feature of online advertising is the network linkage by the use of various information dissemination means (Flores et al. 2014). The ‘media combination’ before the appearance of the network is that the independent multiple media channels complement opportunities for consumers to have contact with brand information, the most typical of which is the occasional contact with the TV advertisings, where the information is exchanged, and the inquiry of the store's catalog and communication with the staff are conducted through interpersonal communication (Tucker 2014). The linkage is performed by the single media in accordance with the consumers’ behavior process. However, if consumers get in contact with the banner advertisements by chance on the network, they will be able to connect to the search engine, websites that can make comparison among multiple brands and that are for consumers to publish information, and they can purchase the goods by clicking on the catalog information of the goods on the home page of the website of the enterprise (Flores et al. 2014). From the consumer point of view, the online advertising is a media combination where all the traditional types of advertising media conduct the linkage on the information source of the network. However, such a traditional advertising on the network sometimes can not avoid self-glorification, just as the saying goes, ‘every potter praises his pot’.  

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