The Impact of Social Media Usage on Marketing Performance via Innovation: An Empirical Study on Service Firms in Egypt

Abstract

With the growing intensified competition and development of the service sector, innovation has become vital dimension for firms to enjoy competitive advantages and yield positive outcomes on the economy. The use of social media (SM) as one of the service firm communication tools fosters innovation and has always been of critical importance to both academia and practice. Thus, this study focuses on the impact of SM usage based on both knowledge exploration and exploitation on the marketing performance via the most widely accepted four innovation types in past literature, which consist of product, process, marketing and organizational innovation in the Egyptian private service sector. Questionnaires were distributed electronically to gather data. Data gathered from 385 private service firms from the top management level. Data has been analyzed via Structural Equation Modelling (SEM), AMOS 22. Results indicated that SM usage has a significant positive direct impact on all types of innovation with varying relative effects. Additionally, it has been found that marketing innovation played the greatest direct and positive impact on the marketing performance, followed by the product innovation, however, the process innovation has been found to have negative impact on the marketing performance. While the organizational innovation does not directly impact the marketing performance. This study contributes to the literature by highlighting on the SM usage and the vital types of innovation that lead to higher marketing performance in the service sector which needs more attention from service marketing managers. Also, this study helps the service providers in the private service firms to focus on the significance role of SM in exploring and exploiting knowledge especially from customers to innovate in a better way to consequently enhance the marketing performance.

Keywords: social media, innovation, marketing performance, service sector, Egypt

DOI: 10.7176/JAAS/75-03

Publication date:August 31^st 2021