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Social Media's Influence on Business-to-Business Sales Performance
Transcript of Social Media's Influence on Business-to-Business Sales Performance
Palmer Williams Social Media's Influence on B2B Sales Performance B2B and Social Media Reaching business-to-business clients is a relatively "new phenomenon".
Social media, sometimes referred to as social CRM (customer relationship management), are still working on B2B sales.
In 2010, Nielsen Company announced that social media users worldwide grew nearly 30 percent, from 244 million to nearly 315 million users (Nielsen).
Research from Gartner’s Consumer Technology and Markets group forecasted that global spending on social media would total $14.9 billion in 2012 (Gupta). Constructs: Creating Opportunity In this step, salespeople first undertake prospecting initiatives such as cold calling and advertising in order to create opportunities for the organization (Moncrief and Marshall 2005).
Social media can be used to qualify leads early in the sales cycle by researching the profile of the ideal target prospect (Shih 2009). Constructs: Relationship Management Defined as “all marketing activities directed towards establishing, developing, and maintaining successful relational exchanges” (Morgan and Hunt, 1994).
To adapt and utilize social media, sales organizations are having to think of different approaches of communication with to form positive relationships with customers and other businesses. Data Analysis Research Design: Exploratory Results From the survey that was completed by 1,699 respondents, the data analysis indicates that social media usage in business-to-business is not only valid but reliable for all of the constructs in the study.
The last construct (Outcome-Based Sales Performance) is implied by an indirect influence of sales processes.
These findings imply nomological validity, which means they show a high degree of related behavior between the constructs. Social Media Business-to-Business (B2B) Transactions of (e-)commerce between businesses.
Manufacturer -> Wholesaler
Wholesaler -> Retailer Hypothesis Development "The current study evaluates the role of social media and its impact on sales processes and sales performance. Sales processes are activities that a sales professional undertakes to secure a lead, turn it into a prospect, and then eventually a customer." 3. Customer 2. Prospect 1. Lead Simple as 1,2,3 Right? Gupta, Neha (2011), “Forecast: Social Media Revenue, World- wide, 2010–2015,” Gartner, Stamford, CT, September 23.
Nielsen Company (2010), “Global Audience Spends Two Hours More a Month on Social Networks Than Last Year,” NielsenWire, March 19 (available at http://blog.nielsen .com/nielsenwire/global/global-audience-spends-two- hours-more-a-month-on-social-networks-than-last-year/). Key Takeaway Constructs: Understanding Customers Manage the prospect opportunity by gaining a deeper understanding of customer’s needs.
Social media assists sales professionals in choosing the right decision makers to do business with. Constructs: Relationship Sales Performance Hypothesis 5: Social media usage has a positive relationship with a selling organizations’ outcome-based sales performance. Hypothesis 1: Social media usage has a positive relationship with a selling organizations’ ability to create opportunities. Hypothesis 2: Social media usage has a positive relationship with a selling organizations’ ability to understand customers. Hypothesis 3: Social media usage has a positive relationship with a selling organizations’ ability to manage relationships. Constructs: Outcome-Based Sales Performance These measures are an important aspect in the overall measuring of salesperson performance.
Social media influence both relationship and outcome-based aspects of sales performance. Hypothesis 4: Social media usage has a positive relationship with a selling organizations’ relationship sales performance. Relational measures of sales performance focus on behaviors that strengthen the relationship between buyers and sellers.
Social media makes it simple to gather these measures by using users interests, 'likes' and overall activity. Social media influences both aspects of sales performance. Data was collected using an emailed link to an online survey supported by two reminder emails. Sample Description The sample shows global diversity with respondents from 40 different countries.
1,699 respondents completed the 134-item survey, yielding an 11.2% response rate. Factor Analysis and Construct Validity Correlations in Factor Analysis Constructs were measured on a seven-point scale (1 = “strongly disagree,” 7 = “strongly agree”).
Chi-square difference tests across nested CFA (Confirmatory factor analysis) models confirm that the measurement model reflects the best construct assessment. This table shows the item loadings across a series of
“purifying” CFAs and provides an understanding of the fit of
each item. Based on this information, we believe that social media serves a vital role in providing business-to-business interactions (leading to high sales performances) and should be used to change leads into prospects, and prospects into customers.