What company characteristics are associated with the adoption of social media?

ABSTRACT

In just one decade, social media have moved from being marginal phenomena to having three billion active monthly users globally in 2017. We use a large representative sample to study which company characteristics are associated with the early adoption of social media. Our findings suggest that digital orientation (outside social media), innovativeness, external collaboration in marketing and sales, and orientation towards consumer markets all increase a company’s probability of adopting social media. In addition, larger and younger companies are more likely to be early movers. Overall, business use of social media has only reached its early maturity; thus, it still has plenty of room to grow.

KEYWORDS:

• Social media
• online social networks
• technology diffusion
• technology adoption
• business

JEL CLASSIFICATION:

• D22
• M15
• O33

Acknowledgments

This paper is a part of BRIE-ETLA, the research collaboration of BRIE, the Berkeley Roundtable on the International Economy at the University of California at Berkeley, and ETLA, The Research Institute of the Finnish Economy. The authors thank Business Finland and Technology Industries of Finland for support.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

¹ Source: https://www.youtube.com/yt/press/statistics.html. Accessed 23 May 2017.

² Source: https://www.statista.com/statistics/705598/vimeo-subscribers-worldwide/. Accessed 23 May 2017.

³ Source: https://blog.pinterest.com/en/150-million-people-finding-ideas-pinterest. Accessed 23 May 2017.

⁴ Source: https://www.omnicoreagency.com/pinterest-statistics/. Accessed 23 May 2017.

⁵ For instance, R&D collaboration with a firm that launches its new products in LinkedIn or marketing collaboration with a company using social media marketing tools may trigger the firm to adopt similar practices of social media use.

⁶ We performed separate Wald tests to compare the significance of the difference between the two coefficients. Results of these tests are available upon request.

⁷ Similar estimation results for the other dependent variables are available from the authors by request. They confirm the presented observations concerning SOME_ANY.

⁸ Conditional on (a) being present online and (b) being on at least one social media platform, our sample firms are on average on 2.7 of the seven possible platforms we consider.