Journal of Internet Commerce

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Use of Social Networking Sites by SMEs to Engage

With Their Customers: A Developing Country
Perspective

Shavneet Sharma, Gurmeet Singh & Asheefa Shaheen Aiyub

To cite this article: Shavneet Sharma, Gurmeet Singh & Asheefa Shaheen Aiyub (2020) Use
of Social Networking Sites by SMEs to Engage With Their Customers: A Developing Country
Perspective, Journal of Internet Commerce, 19:1, 62-81, DOI: 10.1080/15332861.2019.1695180

To link to this article: https://doi.org/10.1080/15332861.2019.1695180

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JOURNAL OF INTERNET COMMERCE
2020, VOL. 19, NO. 1, 62–81
https://doi.org/10.1080/15332861.2019.1695180

Use of Social Networking Sites by SMEs to Engage With

Their Customers: A Developing Country Perspective
Shavneet Sharmaa , Gurmeet Singhb, and Asheefa Shaheen Aiyubc
a
School of Management & Public Administration, The University of the South Pacific, Suva, Fiji;
b
Graduate School of Business, The University of the South Pacific, Suva, Fiji; cFaculty of Business
and Economics, The University of the South Pacific, Suva, Fiji

ABSTRACT KEYWORDS
The purpose of this research is to investigate use of Social Customer engagement;
Networking Sites by SMEs to engage with their customers. A customer loyalty; customer
conceptual framework is developed that tests the relationship satisfaction; Fiji; SME;
structural equa-
between customer satisfaction, customer engagement and tion modeling
customer loyalty. This research adopts a quantitative approach
where data is collected from 336 respondents. Analysis is per-
formed using structural equation modeling. The empirical
results show that customer satisfaction has a positive influ-
ence on customer loyalty. When customer engagement was
modeled directly to customer loyalty, a positive relationship
was found. The multi-dimensional nature of customer engage-
ment is also confirmed by this study. This study highlights the
value of social networks for SMEs and contributes to literature
by testing the research model to better understand the
research topic.

Introduction
There is consensus amongst researchers regarding the communication
changes social media has brought about, leading to businesses creating
websites to directly interact and connect with customers (Martins and
Patr
ıcio 2013; Hajli 2014; Zhang et al. 2017). This has given businesses the
opportunity to improve their performance and achieve its commercial goals
(Rapp et al. 2013). Businesses are now using social media for brand man-
agement (Dijkmans, Kerkhof, and Beukeboom 2015; Hudson et al. 2016;
Moro, Rita, and Vala 2016; Parsons and Lepkowska-White 2018), to build
consumer trust (Calefato, Lanubile, and Novielli 2015; Zhang et al. 2017;
Cooley and Parks-Yancy 2019), electronic commerce (e-commerce) and
social commerce (Tajvidi et al. 2018), new product development and innov-
ation (Leonardi 2014; Dong and Wu 2015; Du, Yalcinkaya, and Bstieler
2016; Roberts and Piller 2016), knowledge sharing (Leonardi 2014; Munar

CONTACT Gurmeet Singh [email protected], [email protected] Graduate School of Business, The

University of the South Pacific, Suva, Fiji.
Color versions of one or more of the figures in the article can be found online at www.tandfonline.com/wico.
ß 2019 Taylor & Francis Group, LLC
 JOURNAL OF INTERNET COMMERCE 63

and Jacobsen 2014; Bharati, Zhang, and Chaudhury 2015; Leonardi and
others 2017), electronic word of mouth (eWOM) (Leung, Bai, and Stahura
2015; Islam and Rahman 2016; Wakefield and Wakefield 2018), customer
relationship management (CRM) (Trainor et al. 2014; Agnihotri et al. 2017;
Cheng and Shiu 2018; Pan, Torres, and Z
un~iga 2019) and sales growth
(Kumar et al. 2013; Agnihotri et al. 2016; Agnihotri et al. 2017; Kumar,
Choi, and Greene 2017).
Despite the growing number of studies focusing on how social media
can enhance the capabilities and performance of businesses (Trainor et al.
2014), there are limited studies carried out in the context of SMEs (Putzke
et al. 2014; Mumi, Obal, and Yang 2019). Much of the research has been
focused on larger businesses that have more extensive resources.
Additionally, there is little research that has been conducted in developing
country context. The majority of the theories and models in this area have
been tested in developed and western countries. Therefore, this research
contributes significantly in this regard.
This study focuses on SMEs in Fiji. There is no unique definition of an
SME which is accepted worldwide. The term ‘SME’ has myriad definitions
as different countries and organizations have set up different guidelines
when it comes to defining SMEs which are based on the value of sales,
assets and number of employees. For the purpose of this research, the def-
inition provided by the Reserve Bank of Fiji (RBF) will be used. RBF
defines a small enterprise as an enterprise that has total assets or turnover
between F$30,000 and $100,000 and employs between 6 and 20 employees
(The Reserve Bank of Fiji 2013). Medium enterprise is an enterprise that
has total assets or turnover between F$100,000 and F$500,000 and employs
between 21 and 50 employees (The Reserve Bank of Fiji 2013). This defin-
ition is based on the annual turnover of the business, asset and the number
of employees it has. According to the Fiji Commerce and Employers
Federation (FCEF), as of 2004 there approximately 12,000 SMEs that are
registered of which 5,000 are active. The National Center for SME
Development (NCSMED) estimated that SMEs account for 10–12% of Fiji’s
GPD. This highlights the importance of SMEs to the growth and develop-
ment of the Fijian economy and its people.
The objective of this research is to examine customer engagement and
how this leads to customer satisfaction which in turn influences customer
loyalty for SMEs in Fiji. Contribution to literature is done in two ways.
First, the psychometrically sound and concise scale proposed by So, King,
and Sparks (2014) is tested in the context of social media for SMEs in Fiji.
The scale has been tested mostly in a highly developed countries which is
significantly different from a non-western and developing country like Fiji.
So, King, and Sparks (2014) suggested that the scale be tested in a different
64 S. SHARMA ET AL.

setting and culture to enhance the robustness and applicability of the

model. Second, this research empirically tests the proposed conceptual
model that incorporates customer engagement as an antecedent of cus-
tomer satisfaction and customer loyalty as an outcome of customer satisfac-
tion. The following sections of this paper outline the dimensions of
customer engagement and look at its possible antecedents and consequen-
ces of customer engagement. The method employed in this study of Fijian
consumers is also outlined in the following section together with the results
of the research model. This paper concludes by discussing the theoretical
and practical implications of this research and proposes directions for
future research.

Literature and hypotheses

Social media
There are various definitions of social media. Social media has been
described by Kietzmann et al. (2011) in terms of its functionality, including
identity (the extent to which users reveal themselves), presence (the extent
to which users know if others are available), sharing (the extent to which
users exchange, distribute and receive content), relationships (the extent to
which users relate to each other), groups (the extent to which users are
ordered or form communities), conversations (the extent to which users
communicate with each other), and reputation (the extent to which users
know the social standing of others). Therefore, social media can also be
defined in terms of the purposes it serves. In practice, social media refers
to specific platforms through which people communicate, such as discus-
sion forums, blogs, wikis, social networks, and multi-media sites, being
some of the most popular Facebook, MySpace, LinkedIn, Googleþ, Flickr,
Twitter, and YouTube (Bradley & Barlett 2011; Gupta, Armstrong, and
Clayton 2011). These specific platforms may change over time or be
replaced by some others, but it seems valuable to address social media by
looking at the specific platforms people use for ‘the advent of social media
has substantially changed the manner in which many people, communities,
and/or organizations communicate and interact’ (Ngai et al. 2015: 33).

Customer engagement
“Since its initial study in the working environment by Kahn (1990), the
concept of engagement has attracted widespread attention from the aca-
demic world” (Zhang et al. 2017: 230). The perusal of literature is indica-
tive of the fact that marketing scholars do not concur with the definition of
customer engagement (Zhang et al. 2017). For the purpose of this study,
 JOURNAL OF INTERNET COMMERCE 65

we use the following definition. Customer engagement is defined as the

repeated interactions that takes place between a consumer and a business
that strengths the physical, psychological and emotional investment that the
consumer has in the brand or the business (Phang, Zhang, and Sutanto
2013; Hollebeek, Glynn, and Brodie 2014). The notion of investment is
underpinned by the social exchange theory which states that an individual
evaluates the intangible and tangible costs and benefits of engaging in a rela-
tionship (Kelley and Thibaut 1978). At the very least, there should be a bal-
ance between the costs and benefits for customer brand engagement to
persist (Brodie et al. 2011). For instance, attention and enthusiasm may be
invested by consumers in engaging with a business or brand to receive bene-
fits such as offers, product news or a sense of belongingness (Foa and Foa
1980; Blau 2017). Social media is profoundly different from other previously
used marketer-customer technology platforms. It has become a dominant
enabler of customer engagement as they are transparent despite being owned
by customers and facilitate two-way interactions between the business and
the customer (Dwyer 2007; Deighton and Kornfeld 2009; Hennig-Thurau
et al. 2010; Vivek, Beatty, and Morgan 2012; Swani et al. 2017; Simon and
Tossan 2018). According to Goh, Heng, and Lin (2013), messages from
engaged customers were 22 times more valuable than those of marketers.
Customers who are highly engaged play a crucial role when they generate
content, co-create customer experience and value, and make referrals
(Jaakkola and Alexander 2014; Hajli 2014; Zhang et al. 2017). This under-
lines the importance of understanding customer engagement for SMEs.

Dimensions of customer engagement

‘As far as the dimensions of customer engagement, little attention has been
paid to it in the current academic world’ (Zhang et al. 2017: 231). Waqar
et al. (2015) informed that few studies have investigated consumers’
engagement on websites as well as social media. Nonetheless, many schol-
ars do agree that there can be three dimensions such as cognition, emotion
and behavior (Zhang et al. 2017). However, we adopt the five dimensions
of customer engagement that originally conceptualized by So, King, and
Sparks (2014) and includes attention, absorption, enthusiasm, identification
and interaction since this appears to be more wholesome. Two of these
dimensions (enthusiasm and interaction) are similar to what was used by
Vivek (2009)—enthusiasm, conscious participation and social interaction.

Attention
The customer’s level of focus towards the business both consciously or sub-
consciously is referred to as attention. A persistence of this attention
66 S. SHARMA ET AL.

towards the business or its products and services can lead to increased level
of customer engagement (Lin, Gregor, and Ewing 2008; Scholer and
Higgins 2009). This research believes that customers will pay attention if
they are attracted to certain sites. Various studies, in the likes of Dwivedi
et al. (2017), Hsu and Lin (2008), Jung et al. (2016), Lee and Hong (2016),
Wamba et al. (2017), do mention that customers are more attracted to
social media ads if these are creative and attractive.

Absorption
Absorption goes further than attention. Here, the customer is engrossed or
concentrates highly on the business or its related products or services
(Schaufeli et al. 2002). This leads the customer to not being aware of the
amount of time he is dedicating towards the business (Patterson, Yu, and
De Ruyter 2006; Scholer and Higgins 2009).

Enthusiasm
The strong level of zeal or excitement and the interest a person has towards
the business or its related products/service is referred to as enthusiasm
(Vivek 2009: 60). As per Glassman and McAfee (1990), enthusiastic people
tend to take risks and the initiative to elude uncertainty and for better
understanding. Not only this, the enthusiasts, in so doing are able to
enhance customer trust with others in the social networks and this in turn
can ‘directly improve customer perception of the value created’ (Zhang
et al. 2017: 237).

Identification
Customers tend to identify themselves more towards certain brands over
others, especially when these are closely related to their self-image (Bagozzi
and Dholakia 2006). This idea is drawn from the social identity theory that
suggests that a person has a social as well as a personal identity. The busi-
ness a person associates with are a manifestation of the social identity func-
tion of the brand (Tajfel and Turner 1985).

Interaction
Interaction is a crucial aspect of customer engagement. It involves the
exchange and sharing of thoughts, ideas and feelings relating to a custom-
er’s experience with a business or its related products or service (Vivek
2009). This interaction is part of the behavioral element of customer
engagement. Highly engaged customers tend to start ‘interesting inter-
action’ which can include teasing and funny contents (Zhang et al. 2017).
Many researchers agree that consumers develop relationships with
 JOURNAL OF INTERNET COMMERCE 67

marketing companies more so than interpersonal relationships with

employees of those companies (Yim, Tse, and Chan 2008). According to
Waqar et al. (2015: 433), the psychological state influenced by co-creation
and interaction are the key ‘concerns of companies dealing with interactive
websites and social media’. Yet, not much research has been done on
‘interactive forms of online communication such as social media and peer
recommendations … ’ (Waqar et al. 2015: 432).

Customer satisfaction
Customer satisfaction is defined as a judgement that a product or service
characteristic or the product or service itself, is providing (or provided) a
pleasurable level of consumption-related fulfillment, including levels of over
fulfillment and under fulfillment (Oliver, Rust, and Varki 1997). According
to Gustafsson et al. (2005), satisfaction is based on an overall evaluation of
products and services, affecting customers emotional attitude. As such, if a
customer is satisfied with his or her purchase, then he may engage in
repeat purchase. However, a customer that engages with the business would
go beyond the purchase and provide feedback, referrals and have conversa-
tions about the brand on social networking sites (Pansari and Kumar
2017). Satisfaction differs from engagement in that engagement is more of
a motivational state during participation in interactive activities (Hollebeek,
Glynn, and Brodie 2014); it is more about intrinsic motivation than evalu-
ation (Welfald and Downey 2009). Therefore, the following hypothesis
is proposed:
H1: Customer engagement has a significant impact on customer satisfaction for SMEs
in Fiji

Consequences of customer engagement

The consequences of customer engagement include brand experience, trust,
satisfaction, commitment, customer equity, customer value, financial out-
comes and brand loyalty (Van Doorn et al. 2010; Hollebeek 2011).
Through their study, Porter and Donthu (2008) confirm that trust leads to
relational behavior of customers towards the firm, which in turn leads to
willingness to share their personal information, participate in new product
development and being loyal. Situational factions such as age, degree of
socialization and computer experience influence psychological connections
(Funk and James 2001). This study will test customer loyalty as one of the
consequences of customer engagement. Loyalty is an outcome variable that
has been used in previous studies (Mattila 2001; So et al. 2016; Harrigan
et al. 2017; Sparks and Fredline 2007). However, there is still limited
68 S. SHARMA ET AL.

empirical evidence to clearly establish an understanding of the connection

between customer engagement and customer loyalty (So et al. 2016).
Therefore, this was considered appropriate for this study.
Despite the limited empirical evidence supporting the association
between customer engagement and customer loyalty, studies suggest that
when a product or service is evaluated by a customer, attitudes develop
about the purchase that justify a loyal business relationship (Zeithaml,
Berry, and Parasuraman 1996; Yuksel, Yuksel, and Bilim 2010; Nam,
Ekinci, and Whyatt 2011). A customer’s commitment to consistently
repurchases a preferred brand represents loyalty (Oliver 1999). On the
other hand, customer engagement summarizes the connection between
the business and the customer that goes beyond the purchase (So, King,
and Sparks 2014; Vivek, Beatty, and Morgan 2012). Interactive brand
experiences that go beyond the purchase accompanied by an enduring
psychological connection enhances purchase decisions and loyalty
(Patterson, Yu, and De Ruyter 2006; Hollebeek 2009). Also, an engaged
customer is more likely to develop a favorable attitude towards a brand,
company or product leading to loyalty towards the entity (Vivek, Beatty,
and Morgan 2012; So, King, and Sparks 2014). As per the research of
Akar and Topçu (2011), there is a positive relationship between the use
of social media and customers’ attitude. Therefore, the following hypoth-
esis is proposed:
H2: Customer satisfaction has a significant impact on customer loyalty for SMEs
in Fiji

Theoretical underpinning
When a latent construct like customer engagement is being measured, con-
sideration needs to be made to the nature of the construct (i.e., reflective
vs. formative; (Netemeyer, Bearden, and Sharma 2003)). It was stated that
measurement theory is affected by causality (Hair et al. 2006). In a forma-
tive model, it is assumed that the construct is a result of the indicator,
whereas in a reflective theory, the indicator is caused by the latent factor.
As such, the concept of customer engagement is quite similar to other
social science constructs such as behavioral intention, attitude and person-
ality (Hair et al. 2006). Therefore, a reflective model of customer engage-
ment is proposed with specific dimensions of identification, attention,
absorption and interaction and enthusiasm. It is expected that the five
dimensions will covary with easy other. That is, changes in one dimension
will be associated with promotional changes in other dimensions (Hair
et al. 2006) (Figure 1).
 JOURNAL OF INTERNET COMMERCE 69

Figure 1. Conceptual model of customer engagement. Note. The latent factor labels represent
the following: CE: customer engagement; CS: customer satisfaction; CL: customer loyalty.

Method
This study has three constructs of interest. Firstly, customer satisfaction
was measured using the 3-item self-developed scale. Secondly, customer
engagement was measured using the five dimensions of customer engage-
ment 25-item scale by So, King, and Sparks (2014). The scale included five
subscales, namely (1) absorption, (2) identification and (3) interaction (4)
attention (5) enthusiasm (items in Table 1). Third, customer loyalty was
measured using the 6-item scale adopted from Saleh (2016). Finally, basic
demographic was collected about age, gender and educational background.
An online survey was conducted in Fiji with links to the questionnaire
being circulated through the use of social media (e.g., Facebook, LinkedIn).
As it is not possible to get a list of all elements in the population, the
research will utilize a non-probability sampling technique to identify
respondents. This method is very useful in getting general ideas about the
phenomenon of interest (Sekaran and Bougie 2010). Besides, it collects
information from a population conveniently available to provide this infor-
mation. This was deemed most appropriate for the study due to the diffi-
culty in accessing information about all social media users in Fiji.
A total of 336 responses was received from which 324 valid question-
naires were used. Descriptive statistics were carried out using SPSS (25.0)
and the structural equation modeling in AMOS (24.0).

Results
The analysis supported the reliability and validity of the scales. The reliabil-
ity of all factor scales was examined by internal consistency analyses; the
Cronbach’s alpha for customer satisfaction (0.79), identification (0.853),
absorption (0.913), interaction (0.915), overall customer engagement
(0.944) and customer loyalty (0.901) all indicated high internal consistency.
Maximum shared variance (MSV) and average shared squared variance
(ASV) were both lower than the average variance extracted (AVE) for all
factors. Therefore, the discriminant validity of the scale was accepted (see
Table 1).
A descriptive analysis of the respondents indicates that a total 12.3% of
the respondents were under the age of 20, 45.1% of the respondents were
between 20 and 30 years of age, 26.5% of the respondents were between 31
70 S. SHARMA ET AL.

Table 1. Demographic profile.

Demographics # %
Age
Under 20 40 12.3
20–30 146 45.1
31–40 86 26.5
41–50 38 11.7
51 and above 14 4.3
Gender
Male 150 46.3
Female 174 53.7
Qualification
High School 38 11.7
Undergraduate 120 37
University Graduate 140 43.2
Masters 20 6.2
PhD 6 1.9

and 40 years of age, 11.7% of the respondents were between 41 and 50 years
of age while 4.3% of the respondents were above 51 years of age. Of the
324 total respondents, 46.3% were male, while 53.7% were female.

Construct validity (Tables 2 and 3)

Reliability
The recommended level of construct reliability of 0.70 was achieved by all
factors (Hair et al. 2006), with the values of composite reliability, ranging
from 0.795 to 0.917 as depicted in Table 1. Also, strong indicator reliability
was demonstrated as the AVEs for all constructs tested in this study were
above the recommended cutoff by Fornell and Larcker (1981) of 0.50. The
statistical tests suggested that reliable and valid scales were used to measure
the latent variables.

Test of the conceptual model

We tested the predictive validity of the 26-item scale with a structural
model, placing a path from customer engagement to customer loyalty
(Figure 2). The fit indices suggested that the model fit the data fairly well;
(v2 (293) ¼ 614.440, p < .001), v2/df ¼ 2.097, goodness of Fit Index (GFI)
¼ 0.784; adjusted Goodness of Fit Index (AGFI) ¼ 0.742; comparative fit
index (CFI) ¼ 0.898; normed fit index (NFI) ¼ 0.823; root mean square
error of approximation (RMSEA) ¼ 0.083; PCLOSE ¼ 0.000. The results
suggest that original 26 item scale is a significant predictor of customer
satisfaction (b ¼ 0.752, CR ¼ 7.547, p < .001) and explained 59% of the
variance in customer loyalty.
 JOURNAL OF INTERNET COMMERCE 71

Table 2. Confirmatory factor analysis results for refined measurement items.

Model and item indices
Factor and item description SL CR SMC AVE MSV
Customer engagement
Attention 0.903 0.701 0.649
I am passionate about SMEs’ social 0.886 0.786
media page
I am enthusiastic about SMEs’ social 0.934 0.873
media page
I feel excited about SMEs’ social media page 0.834 0.696
Anything related to SMEs’ social media page 0.673 0.453
grabs my attention.
Identification 0.853 0.658 0.649
When I talk about an SMEs on social media, 0.812 0.659
I usually say ‘we’ rather than ‘they’.
This SMEs’ social media page success is 0.821 0.674
my success.
When someone praises the SME on their 0.803 0.645
social media page, it feels like a
personal compliment.
Absorption 0.915 0.684 0.442
When I am interacting with the SMEs’ social 0.768 0.59
media page, I forget everything else
around me
Time flies when I am interacting with the 0.805 0.648
SMEs’ social media page.
When I am interacting with the SMEs’ social 0.875 0.765
media page, I get carried away.
When interacting with the SMEs’ social 0.865 0.749
media page, it is difficult to
detach myself.
In my interaction with the SMEs’ social 0.816 0.666
media page, I am immersed.
Interaction 0.917 0.689 0.451
In general, I like to get involved in the SMEs’ 0.788 0.621
social media community discussions
I am someone who enjoys interacting with 0.85 0.722
like-minded others using the SMEs’ social
media community.
I am someone who likes to actively 0.909 0.827
participate in the SMEs’ social media
community discussions.
In general, I thoroughly enjoy exchanging 0.816 0.666
ideas with other people through the SMEs’
social media community.
I often participate in activities of the SMEs’ 0.779 0.607
social media community.
Customer satisfaction 0.795 0.563 0.452
I believe the service is better when SMEs use 0.754 0.568
social networks for communication
with customers
I am satisfied with the use of social networks 0.762 0.581
by SMEs.
SMEs are able to meet my expectations 0.735 0.541
through their social media page.
Customer loyalty 0.903 0.608 0.452
I feel a sense of loyalty with SMEs when 0.793 0.628
communicating on social networks.
I trust the information shared with me by 0.823 0.678
SMEs through their social media page.
I feel SMEs credibility increases when they 0.767 0.589
communicate through social networks
(continued)
72 S. SHARMA ET AL.

Table 2. Continued.
Model and item indices
Factor and item description SL CR SMC AVE MSV
I trust SMEs as a whole when they keep in 0.793 0.629
touch with customers through
social networks.
I always purchase products/services from 0.736 0.542
SMEs that I interact with through
social media.
SMEs are able to increase my loyalty towards 0.763 0.582
them through the use of social media
Note. SL: standardized loading; CR: composite reliability; SMC: squared multiple correlation; AVE: average variance
extracted; MSV: maximum shared variance.

Table 3. Discriminant validity analysis from confirmatory factor analysis.

CR AVE MSV AT AB IN CL CS ID
AT 0.903 0.701 0.649 0.838
AB 0.915 0.684 0.442 0.665 0.827
IN 0.917 0.689 0.451 0.672 0.597 0.830
CL 0.903 0.608 0.452 0.630 0.556 0.622 0.780
CS 0.795 0.563 0.452 0.557 0.508 0.473 0.672 0.750
ID 0.853 0.658 0.649 0.805 0.644 0.665 0.599 0.534 0.811
Note. The boldfaced diagonal elements are the square root of the variance shared between the constructs and
their measures. Off-diagonal elements are the correlations between constructs. p < .001. AT: attention; AB:
absorption; IN: interaction; ID: identification; CL: customer loyalty; CS: customer satisfaction; CR: composite
reliability; AVE: average variance extracted; MSV: maximum shared squared variance.

Figure 2. The four-factor model of CE structural model with customer satisfaction and loyalty.
Note. The latent factor labels represent the following: CE: customer engagement; CS: customer
satisfaction; CL: customer loyalty; the four factor CE 17-item scale was used to measure CE.
 JOURNAL OF INTERNET COMMERCE 73

Figure 3. The relationship between customer engagement, satisfaction and loyalty. Note. The
latent factor labels represent the following: CE: customer engagement; CS: customer satisfaction;
CL: customer loyalty; the four factor CE 17-item scale was used to measure CE.

Discussion
Recently, researchers have been investigating customer engagement in a
marketing context. Customer engagement has gained more interest in
recent literature worldwide and is considered a useful retention and acqui-
sition strategy (Brodie et al. 2013). Engaged customers may immensely con-
tribute to company’s innovation processes, value creation, creating brand
referrals, co-creating experiences (Hoyer et al. 2010). However, this study
examined the nature of customer engagement within the nomological
framework proposed by So, King, and Sparks (2014). Specifically, with cus-
tomer engagement as an antecedent and customer loyalty as a consequence
of customer satisfaction. The current research provides empirical support
for the nomological framework and finds that customer engagement is a
predictor of customer loyalty on social media for SMEs in Fiji. This means
that if a customer is engaged with the business, they would go beyond the
purchase and communicate, provide referrals, give feedback about the busi-
ness on social media sites (Hollebeek, Glynn, and Brodie 2014). These are
all components of customer engagement. This research also finds that cus-
tomer engagement is a predictor of customer loyalty. This is a relationship
that has been proposed by research (for example, Bowden 2009; Hollebeek
2009; Patterson, Yu, and De Ruyter 2006). This study emphasizes the inter-
dependence between the constructs by placing and testing customer
engagement as part of the nomological framework (Figure 3).

Theoretical implications
This research contributes to SME research through the validation of the
customer engagement scale that was developed by So, King, and Sparks
(2014). The original scale has five dimensions of customer engagement but
when modeled, one dimension (enthusiasm) was found to be not signifi-
cant. This study does not deny the importance of enthusiasm, but provides
justification for considering the four dimensions of customer engagement.
The four dimensions were tested with customer in Fiji. Customer satisfac-
tion was then examined as an antecedent to customer engagement
(Hollebeek 2011; So, King, and Sparks 2014). This study demonstrates that
customer satisfaction has a positive influence of customer engagement.
74 S. SHARMA ET AL.

When customer engagement was modeled directly to customer loyalty, the

positive relationship was found with customer loyalty.
In the competitive SME market in Fiji, the key question that emerges is
how social media can be used to increase engagement. The theoretical con-
tribution of this study is by empirically testing customer engagement by
placing it within a nomological framework for practitioners and researchers
where customer satisfaction leads to customer engagement which in turn
leads to customer loyalty. The multi-dimensional nature of customer
engagement is also confirmed by this study. This study builds on the work
by So, King, and Sparks (2014) by conceptualizing customer engagement
and operationalizing it with SMEs in a developing country. The focus on
social media for SMEs is an important contribution to the social network
marketing literature. Despite SMEs having different characteristics than
other types of businesses, the findings can be applied to other businesses as
well. Social exchange theory is an appropriate theoretical underpinning for
this study regardless of the type of business as there is evidence that the
exchange between the business and the customer is crucial for customers to
identify with and interact with the businesses.

Practical implications
The findings of this research have several practical implications as well.
This study provides valuable insights for SMEs, particularly in Fiji about
the potential of social networks in engaging with their customer base.
Through the use of the scale, SMEs in Fiji can evaluate their business per-
formance against that of their competitors through the comparison of cus-
tomer engagement. This will help the owner-managers to determine if
there needs to be changes in their marketing program to achieve the
expected objectives. It also provides SMEs in Fiji with an important tool to
effectively measure their marketing strategies. The measurement can allow
SMEs to assess their customer engagement prior to and post launch of a
marketing program. This will allow SMEs in Fiji to be able to provide a
measurable justification for the investment in social networks.
Such knowledge is crucial to academics and owner-managers of SMEs in
Fiji to increase the adoption of customer engagement strategies and also
due to an increasing amount of academic attention being given to customer
engagement as a superior predictor of customer loyalty. As the five dimen-
sions of customer engagement are important, owner-managers should focus
on using social media to enhance all these dimensions with more emphasis
given identification and attraction which have a higher factor loading.
SMEs in Fiji must also understand the various functions of social network-
ing sites which can be generated by customers of the business themselves,
 JOURNAL OF INTERNET COMMERCE 75

such as blogs, comments, reviews, polls, videos and pictures. This can foster
customer engagement. For example, SMEs in Fiji can provide informative
or entertaining content through the use of blogs to absorb customers.
These types of activities can help SMEs in Fiji develop a distinctive image
of the business on social networking sites that enables customers to identify
with them. SMEs in Fiji providing transparent and honest feedback to cus-
tomer reviews can also allow for positive interactions with customers. This
will encourage customers to immerse themselves in the interactive experi-
ence with the business, thus allowing the development of customer engage-
ment with the business. Also, owner-managers of SMEs in Fiji can increase
attention needed to provide customers with information that is interesting
and relevant as these types of information can induce attention (Celsi and
Olson 1988). Using social media, SMEs in Fiji can increase dialog with cus-
tomers, enhance business to customer and customer to business communi-
cation. This is a crucial change in the speed, volume, ease of contact and
nature of interaction. Rather than using the classic suggestion box, SMEs in
Fiji can use social media to gain these feedbacks. The owner-managers
need to provide customers with opportunities and incentives for inter-
action, such as reward and recognition scheme that encourage participation
(Sawhney, Verona, and Prandelli 2005). As customer loyalty is illustrated as
the outcome for customer satisfaction, this emphasizes to owner-managers
of SMEs in Fiji the importance of being present on social networking sites
and developing strategies to effectively engage customer.

Research limitations and future directions

Despite this study contributing to SME literature in gaining important
insights into customer behavior and psychology, there are a number of lim-
itations that needs to be highlighted which will pave the way for future
research. Despite this study contributing to literature on customer engage-
ment with SMEs in developed countries, more empirical research is needed
to support the findings.
In evaluating the findings, the sample size of this research was small and
respondents had experience of social networks. This together with a non-
random sampling technique limits the generalization of results in countries
with varying cultures. Future research should validate the customer engage-
ment scale with SMEs in other developing countries. Also, this study uses a
cross-sectional design which can only imply an association between cus-
tomer engagement, customer satisfaction and customer loyalty rather than
demonstrating a causal relationship. This study has only looked at the posi-
tive perspective of customer engagement, future studies can look at nega-
tive experiences with customer engagement and how this affects customer
76 S. SHARMA ET AL.

engagement outcomes. As, this study only looked at customer satisfaction

as one of the antecedences, other factors such as brand commitment and
interactivity can be looked at in future studies. Future research can also
look at other outcomes of customer engagement such as financial out-
comes, customer equity and brand recognition (Van Doorn et al. 2010).
These recommendations will be useful is advancing knowledge about SME
brand management through the use of social media.

Conclusion
This study was carried out with the aim of investigating the business value
of social networks for SMEs. It tested the relationship between customer
satisfaction, customer engagement and customer loyalty. Through the col-
lections of data from 336 respondents, this study was able to explain a 59%
of the variance in customer loyalty. Results indicated there is a positive
relationship between customer engagement and customer satisfaction.
Customer satisfaction then positively impacts customer loyalty for SMEs in
Fiji. This study contributes theoretically and practically to social media
research for SMEs in a developing country.

ORCID
Shavneet Sharma http://orcid.org/0000-0003-2931-0670

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