Navigating the social media landscape – Strategic use of social media in Finnish SMEs

Social media has become an integral part of marketing strategy for many companies. Although social media is widely used, small and medium sized enterprises (SMEs) are lagging behind their larger counterparts. The smaller the company, the lower is the percentage of social media users. The existing literature has argued that SMEs fail to exploit social media strategically and in long-term. Long-term orientation has a strong link to positive performance; hence lack of strategic use is related to poor performance with social media. Literature recognizes a gap in empirical research on SMEs strategic use of social media. This study aimed to explore this gap, by looking at an industry, where social media is commonly used, clothing. Research question guiding the thesis was: How and why do Finnish SMEs utilize social media and what type of strategies they have for social media? This thesis was conducted as a qualitative, multimethod, multiple case study. The philosophical perspective used in this study was interpretivism. Sample of this study consisted of 31 Finnish SMEs operating in clothing industry. Data was collected first as an exploratory case research by analyzing case companies’ Instagram accounts, in total 1806 posts were gathered. Second data source for this study were interviews, that were conducted for eight companies selected based on the Instagram data. Data from Instagram was analyzed using qualitative content analysis, for Interviews phenomenology was chosen as the analysis method. The analysis of data showed some important findings in relation to the existing research. Unlike previously suggested, the use of social media was seen widely in this study instead of being only sales focused. Especially brand management rose as an important purpose of using social media. In addition, social media was found to be used strategically and in long-term and being an important tool unlike previously examined. Finally, this research found different successful strategies were employed by SMEs. Both broadcasting and engaging in two-way communication were found out to be viable strategies. As a theoretical contribution, this study presented a framework on the strategy formation and possible strategies in SMEs. This study adds to adoption theories by widening the understanding on reasons for SMEs to use social media. Regarding implementation theories, this study suggests that engaging users isn’t necessary for employing social media strategically. This study also adds to existing theory on social media strategy by emphasizing the goals and conditions affecting strategy formation process in SMEs and by presenting two strategic orientations SMEs social media strategy can be positioned according to, time and engagement