Analysis Usage of Social Media Marketing Towards Customer Trust, Customer Intimacy and Purchase Intention Based on High Street Fashion Brand
(Case Study of Forever 21 in Jakarta)
By
Varren Regina Rundengan 21954008
MASTER’S DEGREE in
MASTER OF ARTS
BUSINESS AND COMMUNICATION
SWISS GERMAN UNIVERSITY The Prominence Tower
Jalan Jalur Sutera Barat No. 15, Alam Sutera Tangerang, Banten 15143 - Indonesia
February 2021
Revision after Thesis Defense on February 22, 2021
I hereby declare that this submission is my own work and to the best of my knowledge, it contains no material previously published or written by another person, nor material which to a substantial extent has been accepted for the award of any other degree or diploma at any educational institution, except where due acknowledgement is made in the thesis.
Varren Regina Rundengan
_____________________________________________
Student Date
Approved by:
Dr. -phil. Deborah Simorangkir
_____________________________________________
Thesis Advisor Date
Dr. Nila K. Hidayat, SE., MM. -
_____________________________________________
Dean Date
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ABSTRACT
ANALYSIS USAGE OF SOCIAL MEDIA MARKETING TOWARDS CUSTOMER TRUST, CUSTOMER INTIMACY AND PURCHASE INTENTION BASED ON
HIGH STREET FASHION BRAND
By
Varren Regina Rundengan Dr. -phil. Deborah Simorangkir, Advisor
SWISS GERMAN UNIVERSITY
In this era of globalization, the business competition is very competitive especially on how each company makes their strategy to market their products. That’s why the author decide to make the purpose of this study is to analyze usage of social media marketing towards customer trust, customer intimacy and purchase intention.
Quantitavie method was applied to this research and was conducted of customers of brand Forever21 in Jakarta area , by using questionnaire as the data. The number of samples that has been obtained in this research is 30 respondents for the pre-test and 140 respondents for the actual data. The tools used in data processing is PLS-SEM SmartPLS 3.3.2 and the result of the research conclude that usage of social media marketing does influence customer trust, usage of social media marketing influence customer intimacy, customer trust does influence purchase intention, customer intimacy does influence purchase intention, usage of social media marketing does not influence purchase intention, usage of social media marketing does influence on purchase intention through customer trust, usage of social media marketing does influence on purchase intention through customer intimacy
Keywords: social media marketing activities, customer trust, customer intimacy, purchase intention
© Copyright 2021 by Varren Regina Rundengan
All rights reserved
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DEDICATION
I dedicate this works for my family and friends Also, for the future research
ACKNOWLEDGEMENTS
May all glory be to Jesus Christ, by His blessings, infinite grace and love that made it possible for this thesis to be completed well and in accordance with His guidance. The author deeply realized that without the guidance, help, love, and prayer of many people during the process, this study would not be completed on time.
Therefore, the author would like to express profuse gratitude to everyone who has assisted in completing this final study, namely to:
1. Dr. -phil. Deborah Simorangkir as the supervisor of this thesis who always gives guidance, critics, suggestions, and allocated time in the middle of busy activities, and also for sharing his remarkable knowledge to help completing this thesis.
2. All lecturers in Swiss German University that names have not been mentioned, for their guidance and valuable knowledge for one and half year of author’s graduate studies in Swiss German University.
3. Also all of my family who have provided motivation, love and prayer for completing this thesis and always support me for every decision that I take 4. And of course my MA classmates for their support, many jokes in class,
guidance, and motivation to finish this thesis.
As final note, the author realized that there are many imperfections in this thesis and by that the author would gladly receive any critics, suggestions, and comments
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which would be greatly appreciated. Author hopes that this thesis may be beneficial to everyone who reads it.
Tangerang, 11 January 2021
Varren Regina Rundengan
TABLE OF CONTENTS
Page
STATEMENT BY THE AUTHOR ... 2
ABSTRACT ... 3
DEDICATION ... 5
ACKNOWLEDGEMENTS ... 6
TABLE OF CONTENTS ... 8
LIST OF FIGURES ... 12
LIST OF TABLES ... 14
CHAPTER 1 - INTRODUCTION ... 14
1.1 Research Background ... 14
1.2 Research Problem ... 17
1.3 Research Questions ... 22
1.4 Research Objectives ... 22
1.5 Significance of The Study ... 23
1.6 Research Limitation ... 23
CHAPTER 2 - LITERATURE REVIEW ... 25
2.1 Impact of the Internet on Society ... 25
2.2 Social Media Marketing ... 26
2.3 Social Media Content ... 27
2.4 Social Media Metrics ... 30
2.4.1 Organic Reach ... 30
2.4.2 Paid Reach ... 31
2.5 Word of Mouth ... 31
2.6 Intimacy and Trust ... 32
2.7 Consumer Engagement ... 33
2.8 Purchase Intention ... 34
2.9 Social Media Marketing in Fast Fashion Industry ... 35
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2.10 Previous Studies ... 37
2.11 State of the Arts ... 42
2.12 Hypotheses Development ... 43
2.12.1 Relationship between Usage of Social Media Marketing and Customer Trust ... 43
2.12.2 Relationship between Usage of Social Media Marketing and Customer Intimacy ... 43
2.12.3 Relationship between Customer Trust and Purchase Intention ... 44
2.12.4 Relationship between Customer Intimacy and Purchase Intention 45 2.12.5 Relationship between Usage of Social Media Marketing and Purchase Intention ... 45
2.12.6 Relationship between Usage of Social Media Marketing and Purchase Intention through Customer Trust ... 46
2.12.7 Relationship between Usage of Social Media Marketing and Purchase Intention through Customer Intimacy ... 46
CHAPTER 3 - RESEARCH METHOD ... 48
3.1 Type of Research ... 48
3.2 Research Approach ... 49
3.3 Quantitative Research Method ... 49
3.3.1 Obseravtion and Surveys ... 50
3.3.2 Unit of Analysis and Unit of Observation ... 51
3.4 Population ... 51
3.5 Sample Design ... 52
3.5.1 Sampling Size ... 52
3.5.2 Sampling Method ... 53
3.6 Research Method ... 53
3.7 Data Analysis ... 54
a. Validity Test ... 54
b. Realibility Test ... 54
c. Descriptive Statistics ... 55
d. Inferential Statistics ... 55
3.8 Data Sources and Collection ... 55
3.8.1 Type of Data ... 56
3.8.2 Data Collection ... 56
3.12 Model Evaluation ... 64
3.13 SEM ... 65
CHAPTER 4 - FINDINGS AND ANALYSIS ... 66
4.1 Respondents Profile ... 66
4.2 Demographic Profile ... 67
4.3 Descriptive Statistical Analysis ... 71
4.3.1 Descriptive Statistical Analysis Social Media Marketing (Entertainment) ... 72
4.3.2 Descriptive Statistical Analysis Social Media Marketing (Customer Engagament) ... 73
4.3.3 Descriptive Statistical Analysis Social Media Marketing (Self constuct based on Netnography) ... 74
4.3.4 Descriptive Statistical Analysis Social Media Marketing (Word of Mouth) ... 75
4.3.5 Descriptive Statistical Analysis Social Media Marketing (Customer Trust) ... 76
4.3.6 Descriptive Statistical Analysis Social Media Marketing (Customer Intimacy) ... 77
4.3.7 Descriptive Statistical Analysis Social Media Marketing (Purchase Intention) ... 78
4.4 Inferential Statistics ... 78
4.4.1 Outer Model ... 79
4.4.1.1 Result of Convergent Validity and Composite Reliablity ... 80
4.4.1.1.1 Convergent for Actual Study ... 80
4.4.1.1.2 Discriminant for Actual Study ... 80
4.4.1.1.3 Composite Reliability for Actual Study ... 80
4.4.1.2 Result of Discriminant Validity ... 82
4.5 Inner Model ... 83
4.6 Discussion ... 86
CHAPTER 5 - CONCLUSION AND RECOMMENDATION ... 91
5.1 Conclusion ... 91
5.2 Meeting the Research Questions ... 91
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5.3 Study Contribution and Implication ... 92
5.3.1 Theoritical Contribution ... 92
5.3.2 Managerial Implication ... 93
5.3.3 Limitations and Recommendation ... 94
REFERENCES ... 95
APPENDICES ... 108
CURRICULUM VITAE ... 115
LIST OF FIGURES
Figures Page
Figure 1.1 Social Media Stats in Indonesia ... 19
Figure 1.2 Social Media Engagement of Forever21 ... 19
Figure 1.3 Public Sentiment on Social Media of Forever21 ... 20
Figure 1.4 Social Media Engagement of H&M ... 20
Figure 1.5 Public Sentiment on Social Media H&M ... 20
Figure 1.6 Social Media Engagement of Zara ... 20
Figure 1.7 Public Sentiment on Social Media Zara ... 22
Figure 2.1 Revenue from E-Commerce in Indonesia ... 36
Figure 3.1 Research Model ... 57
Figure 3.2 Data Processing Results from Smart PLS 3.2.8 ... 63
Figure 4.1 Respondents by Gender ... 66
Figure 4.2 Respondents by Age ... 67
Figure 4.3 Most used Social Media by respondents ... 67
Figure 4.4 Awareness of Brand Forever21 ... 68
Figure 4.5 Social Media of Forever21 ... 68
Figure 4.6 Average Time Spend on Forever21 Social Media... 69
Figure 4.7 Average Time on Facebook ... 69
Figure 4.8 Average Time Spend on Twitter ... 70
Figure 4.9 Average Time Spend on Instagram ... 70
Figure 4.10 Results of Data Processing 140 Respondents using Smart PLS 3.3.2 ... 79
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LIST OF TABLES
Table Page
Table 2.1 Previous Study on Social Media Marketing ... 37
Table 2.2 Previous Study on Customer Trust ... 38
Table 2.3 Previous Study on Intimacy ... 39
Table 2.4 Previous Study on Purchase Intention ... 40
Table 3.1 Conceptual Definition and Operational Definition ... 58
Table 3.2 Pre-Test Result ... 63
Table 4.1 Descriptive Statistics ... 71
Table 4.2 Limitation of Mean ... 72
Table 4.3 Variable Mean Social Media Marketing (Entertainment) ... 73
Table 4.4 Variable Mean Social Media Marketing (Customer Engagement)... 74
Table 4.5 Variable Mean Social Media Marketing (Self construct based on netnography) ... 75
Table 4.6 Variable Mean Social Media Marketing (Word of Mouth) ... 76
Table 4.7 Variable Mean Customer Trust ... 76
Table 4.8 Varible Mean Customer Intimacy ... 77
Table 4.9 Variable Mean Purchase Intention ... 78
Table 4.10 Result of Convergent Vaidity and Composite Realibility ... 81
Table 4.11 Results of Discriminant Validity of Actual Test... 82
Table 4.12 R-Square Value ... 83
Table 4.13 Hypotheses Results ... 84
