THE SOCIAL NETWORK The growing use of social network sites (such as Facebook) and online communities

Department of Management
MGT3014 Research Methods Take Home Mid-term Test
– Read the case and answer all the questions.
– This paper carries 100 marks.
– Attempt ALL questions.
– Marks allocated to Parts of questions are indicated in brackets.
– Indicate your Name and Student ID Number on your answer paper.
– Word limit: maximum 2000 words (Indicate the number of words in your paper).
– Similarity should be less than 20%.
You are reminded of the necessity for clear and orderly presentation in your answers.
The growing use of social network sites (such as Facebook) and online communities (such as for instance the Apple Computer community, the community of Harley-Davidson riders, and the community of Starbucks customers) provides exciting opportunities for organizations. Online brand communities allow organizations to engage and interact with customers, obtain market information, sell and advertise products, rapidly disseminate information, develop long-term relationships with the community, and eventually to influence consumers’ preferences and behavior (Dholakia and Bagozzi, 2001, Dholakia, Bagozzi, and Pearo, 2004, Franke and Shah, 2003, Muniz and Schau, 2005, Tedjamulia, Olsen, Dean, and Albrecht, 2005). “Brand community” is a term that is used to describe like-minded consumers who identify with a particular brand and share significant traits, such as for instance “a shared consciousness, rituals, traditions, and a sense of moral responsibility” (Muniz and O’Guinn, 2001, p. 412). Online brand communities are based on their core value – the brand- and grow by building relationships with and among members interested in the brand (Jang et al. 2008).
There are several possible categorizations of online brand communities, but they are generally grouped into two categories based on who initiates and manages the community; (1) company-initiated communities, built by the company that owns the brand and (2) user-initiated communities, voluntarily built by their members (that is, the consumer) (e.g., Armstrong and Hagel 1996; Kozinets 1999). These two types of brand communities provide different opportunities for marketers. For instance, a brand community on a company website is one of the key determinants of attracting consumers to and retaining customers on the website (Nysveen and Pedersen, 2004). Consumer-initiated online brand communities may provide consumers with useful information about other consumers’ experiences with the product or service and the strengths and weaknesses of products or services (Jang et al. 2008).
The success of online brand communities is heavily dependent on consumer participation in the online brand community. To determine why consumers participate in online brand communities business student Jesse Eisenberg has developed a model based on extant service marketing literature. The main idea in this literature is that perceived value and satisfaction are antecedents of the intention to use a product or service (Anderson, Fornell, and Lehmann 1994; Bolton and Drew 1991; Grönroos 1990; Hocutt 1998; Kang, Lee, and Choi 2007; Ravald and Grönroos 1996). Jesse wants to apply this idea to consumer participation in online brand
communities. According to Jesse, “members will probably be satisfied with an online brand community and have the intention to participate in the community when they derive value from the community. Therefore it is important to know which values members may derive from participating in an online brand community.” A thorough review of the literature has convinced Jesse that participation in online brand communities depends on the communities’ perceived informational value, self-discovery value, social interactivity value, social enhancement value, entertainment value, and reward value (e.g., Dholakia, Bagazzi, and Pearo 2004; Flanagin and Metzger 2001).
Figure 1 provides a graphical representation of Jesse’s ideas.
A good theoretical framework identifies and defines the important variables in the situation that are relevant to the problem and subsequently describes and explains the interconnections among these variables.
1. There are three basic features that should be present in any theoretical framework. Discuss these features. (5 marks)
Jesse has undertaken a literature review to develop his conceptual model.
2a. Is there or are there any alternative approaches that would allow Jesse to develop a conceptual model? (5 marks)
Self–discovery valuediscovery value
Social interactivity valueinteractivity value
Social enhancement
Social enhancement valuevalue
Entertainment value
Entertainment value
Reward value
Reward value
Member’s satisfaction
Member’s satisfaction
Loyalty toward online
Loyalty toward online brand community brand community intention to participateintention to participate
Informational value
Informational value
2b. Describe the advantages and disadvantages of undertaking a literature review to develop a model. (10 marks)
2c. Describe the advantages and disadvantages of the alternative approach that you have come up with. (5 marks)
3a. Label the variables of Jesse’s conceptual model in terms of independent, dependent, moderating, and/or mediating variables. (5 marks)
3b. Explain the general difference(s) between moderating and mediating variables. (10 marks)
4. Develop the relevant hypotheses based on Jesse’s model (use directional hypotheses). (10 marks)
Jesse explains the relationship between entertainment value, satisfaction, and member’s future intention to participate as follows.
Several people participate in online communities to be entertained, to play, or to relax (Armstrong and Hagel, 1996, Dholakia, Bagozzi, and Pearo, 2004, Ridings and Gefen, 2004). Entertainment value can be derived from fun and relaxation trough playing games or interacting with others (Dholakia, Bagozzi, and Pearo 2004). Many people get fun through encountering and solving online challenges or contests (McKenna and Bargh 1999). In addition, specific and challenging goals may provide an online community entertainment value (Beenen et al. 2004). Providing entertainment within a company-initiated online brand
community is therefore expected to affect the perceived value of the online brand community. Providing sufficient entertainment value with an online brand community of a food brand of Foodprints, including photos, videos, contests or games, might attract members.
5a. Provide a thorough evaluation of Jesse’s arguments. (10 marks)
5b. Provide a better explanation of why we would expect this relationship to exist. (10 marks)
6a. Try to come up with a variable that moderates the relationship between one of the independent variables and ‘member’s satisfaction’. (10 marks)
6b. Provide an explanation of why and how you would expect that this variable affects the relationship between the independent variable of your choice and ‘member’s satisfaction’. (10 marks)
6c. Provide the relevant hypothesis. (10 marks)
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