Factors influencing adoption of Social Media Marketing in the Venetian agritourism sector (Italy)

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MASTER’S THESIS

“Factors influencing adoption of Social Media Marketing in the Venetian agritourism sector (Italy)”

Stefano Zacconi

Master’s Degree in Economics of Tourism: Monitoring and Evaluation

Centre for Postgraduate Studies

Academic Year 2019-20

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(Italy)”

Stefano Zacconi

Master’s Thesis

Centre for Postgraduate Studies University of the Balearic Islands

Academic Year 2019-20

Key words:

Social Media Marketing, agritourism sector, Veneto (Italy), TOE framework, multiple linear regression analysis, ANOVA

Thesis Supervisor - Dr Catalina Natividad Juaneda Sampol

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ABSTRACT

Veneto is one of the leading regions in Northern Italy (the most developed and productive area of the country) in terms of total number and growth rate of agritourism activities. In recent years, the development of the agritourism sector was affected by numerous changes, one of which is the emergence of social media platforms as marketing tools (“Social Media Marketing”). In fact, social media has become an essential instrument for marketers to promote their products or services and to communicate with their customers. The aim of this research was to investigate the determinants of Social Media Marketing adoption in the agritourism sector of Veneto, by applying the “Technological - Organizational - Environmental (TOE) Model” as a theoretical framework. The data were obtained through an online questionnaire with 5-point Likert scale questions, based on five TOE factors (Compatibility, Relative Advantage, Top Manaagement Support, Competitive Pressure and Customer Pressure), identified through prior IT adoption literature. The survey was administered to a population of 728 Venetian agritourisms and the collected data (from 182 respondents) were analyzed by SPSS Statistics 23 (Statistical Package for the Social Sciences): descriptive statistics, reliability analysis, correlation test, multicollinearity test and multiple linear regression analysis in conjunction with one-way analysis of variance (ANOVA). The results showed that all of the considered variables have positive impacts on the adoption of SMM, but only two of them (Relative Advantage and Top Management Support) are significant factors. In the end, this study will be helpful for agritourism entreprenuers in defining and implementing more adequate marketing strategies via social media.

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INDEX OF CONTENTS - INTRODUCTION (Page 4)

- LITERATURE REVIEW (Page 5)

o Social Media Marketing and the Italian agritourism sector

o The TOE Framework

 Technological Context

 Organizational Context

 Environmental Context - METHODOLOGY (Page 8)

- RESULTS (Page 11)

o Sample characteristics o Descriptive statistics o Reliability

o Correlations

o Multiple linear regression analysis o Discussion on the research findings

- CONCLUSION (Page 18)

o Limitations of the research - BIBLIOGRAPHY (Page 19) - APPENDIX (Page 21)

o Survey

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INDEX OF TABLES AND FIGURES - Figure 1 – Research Framework (Page 6)

- Figure 2 - Measurement items of the independent variables (Page 9)

- Figure 3 - Measurement items of the dependent variable (Page 11)

- Figure 4 - Sample characteristics (Page 11)

- Figure 5 - Descriptive statistics of survey variables (Page 12)

- Figure 6 - Reliability of all variables (Page 13)

- Figure 7 - Reliability of individual variables (Page 13) - Figure 8 – Correlations (Page 14)

- Figure 9 – Model Summary (Page 15) - Figure 10 – ANOVA (Page 15)

- Figure 11 – Coefficients (Page 16)

- Appendix – Survey (Page 22)

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1. INTRODUCTION

In recent years, the agritourism industry has been at the center of important changes that have modified the socio-economic structure of rural areas in the italian territory (ISTAT, 2019). This sector, which is the combination of two different industries (tourism and agriculture), involves the application of a new entrepreneurial perspective on established dispositions of economic management, attentive to the demand for services and sensitive to environmental preservation (Palmi & Lezzi, 2020). The agritourism industry offers substantial advantages on various levels (economic, social, ecological, legal and organizational) and represents a solid business alternative for a growing number of farmers (Schilling & Sullivan, 2012). In Italy, between 2007 and 2018, the growth of agritourism farms was over 33%, with an active balance of 5.895 agritourism farms (there are 23.615 farms in total, all over the country). At a territorial level, this trend mainly affects the areas of the North-West (+ 56.3%) and the islands of Sicily and Sardinia (+ 34.9%), while in the North-East the growth rate is more contained (+25.7%).

Moreover, between 2007 and 2018, the current value of agritourism production rose from 1.08 to 1.39 billion euros (+ 29%). In Northern Italy, the highest growth in the sector is recorded in the region of Veneto (+ 2.2%), which is the fourth region in the country by number of agritourisms with 1.456 facilities (ISTAT, 2019). Due to these characteristics, Veneto can be considered the most promising region of Northern Italy (the most productive and advanced part of the country) for the development of the agritourism industry and the opportunities that it can offer. There are many changes that are affecting the development of this sector, especially the recent practices of Social Media Marketing (the branch of marketing that deals with generating visibility on social media), which combine the characteristics and purposes of traditional marketing with new communication technologies, in order to establish a continuous, profound and productive dialogue with consumers/users (Thach, Lease, & Barton, 2016). In fact, nowadays, the growing popularity of social media has changed deeply the concept of marketing and allowed firms to acquire and maintain customers, create solid relationships, engage, share information on their products/services, efficiently and at a low cost (Kibos, 2015). Social media platforms are essential tools for marketing and communication policies with customers, since it is through tools such as Facebook, Twitter and Youtube that a company can effectively advertise and promote itself and its services (Sago, 2013). The purpose of this research is to investigate the factors that influence the adoption of Social Media Marketing in the agritourism sector of Veneto. In this study, five main factors were considered, based on the “Technological – Organizational – Environmental Framework (TOE)” (Tornatzky & Fleischer, 1990).

Therefore, this research should assess the impacts of “Compatibility (CMPA)”, “Relative Advantage (RA)”, “Top Management Support (TMS)”, “Competitive Pressure (CMPE)” and

“Customer Pressure (CST)”. Until now, there have been very few papers that examined the determinants of Social Media Marketing adoption in the italian agritourism industry. The results of this study should help agritourism owners and managers to define more effective and cost- efficient strategies for the promotion of their activities, in order to develop the agritourism sector in the region of Veneto and the rest of Italy.

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2. LITERATURE REVIEW

Social Media Marketing and the Italian agritourism sector

Social media are a set of online technologies and practices, based on the assumptions of Web 2.0 and employed by users to create, share and exchange different types of content with each other (such as videos, images, audio and texts) (Obar & Wildman, 2015). The use of these platforms has grown exponentially in recent years, to the point that they are not used only by the younger generations, who, however, still represent the section with the highest percentage of users. In fact, even the adult population have approached social media and have begun to integrate them into their daily lives (Brenner & Smith, 2013). Moreover, this technological development caused repercussions on companies and world markets, more specifically on the practices and methodologies of business management (Packer, 2011). In fact, the effective use of social media helps firms to improve communication, efficiency, productivity, performance and profits (Nagy, Oláh, Erdei, Máté, & Popp, 2018). A confirmation of this claim is represented by the rise of Social Media Marketing, which allows to promote market activities through social media channels (Karahan & Kirtis, 2011). Social Media Marketing maintains the main elements of traditional marketing and allows to generate a direct dialogue between service providers and consumers, thanks to two-way interactions between the parties (Packer, 2011). The tourism industry represents one of the most competitive and complex fields of the service sector and necessitates an effective management of the marketing tools. Therefore, nowadays, the implementation and support of Social Media Marketing strategies are essential for satisfying the global tourist demand (Jashi, 2013). There are very few papers that investigated adoption behaviour toward Social Media Marketing in the italian agritourism sector. In fact, the existing body of knowledge is more focused on the tourism industry in general, rather than its subcategories, such as the agritourism sector. Agritourism can be defned as the set of “tourism hospitality activities carried out by farmers […] by using their rural facilities and combining tourism with farming, forestry and livestock activities” (Calignano, 2016). In the past, rural tourism was considered a small branch of the tourism industry with scarce impact on the market; however, recently, it has been characterized by a significant development and a surprising increase in popularity with the tourists (Hall, Roberts, & Mitchell, 2017). In fact, in Italy, the first agritourism activities began to appear in the mid-1960s, but only in the last two decades their growth has been significant (specifically, from the period 2008- 2012); nowadays there are more than 23.000 agritourism facilities all over Italy, of which 1.456 in Veneto (Calignano, 2016). Therefore, it is important to comprehend what changes are happening and which determinants will stimulate further development and new value in the italian agritourism industry (Palmi & Lezzi, 2020). The results of this research are expected to improve the existing literature on social media adoption in the agritourism field, which is an underrated subject in Italy, by providing theoretical and practical contributions. Moreover, this paper will offer a better understanding of the factors that influence the adoption of Social Media Marketing in agritourism activities, in order to define more adequate strategies for the promotion of this sector.

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The TOE Framework

The “Technological – Organizational – Environmental (TOE) Framework”, developed by Tornatzky and Fleischer (1990), has been extensively implemented by various researchers in order to explore the factors that determine the adoption of Information Technology (IT) innovations among enterprises and others contexts (Schaupp & Bèlanger, 2014); some examples include: e-business (Zhu, Kraemer, & Xu, 2006), open systems (Chau & Tam, 1997), enterprise resource planning (Pan & Jang, 2008) and knowledge management systems (Lee, Wang, Lim, & Peng, 2009). The TOE Framework presents three main aspects of the organization’s characteristics that influence the adoption of IT innovations, which are:

- The Technological Context (TC), related to the characteristics and the usefulness of the technological innovations (such as complexity, compatibility, relative advantage, etc.);

- The Organizational Context (OC), related to the the internal issues within the company (such as top management support, firm size, firm structure, etc.);

- The Environmental Context (EC), related to the the issues that exist in the business sector of the organization (such as competitive pressure, customer pressure, etc.).

Figure 1. Research framework

Source: Own elaboration modified from (Tornatzky & Fleischer, 1990)

In Figure 1, it is represented the research framework of this study with the five independent variables (“Compatibility”, “Relative Advantage”, “Top Management Support”, “Competitive Pressure” and “Customer Pressure”), divided according to the type of TOE context, and the dependent variable (“Adoption of Social Media Marketing”).

Adoption of Social Media Marketing Technological Context:

- H1: Compatibility (+) - H2: Relative Advantage (+)

Organizational Context:

- H3: Top Management Support (+)

Environmental Context:

- H4: Competitive Pressure (+) - H5: Customer Pressure (+)

-

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Technological Context

- Compatibility (CMPA): It refers to the degree of fit between new technologies and the business processes of the firm. The perceived compatibility is an essential factor for the adoption of technological innovations; in fact, enterprises are more likely to implement them, if they are considered compatible with their existing technologies, processes and values (Jabeen, 2017). This variable was found significant by the papers of Grandon &

Pearson (Grandon & Pearson, 2004), Alshamaila, Papagiannidis, & Li (Alshamaila, Papagiannidis, & Li, 2013) and Doom, Milis, Poelmans, & Bloemen (Doom, Milis, Poelmans, & Bloemen, 2010).

H1: Compatibility (CMPA) has a positive influence on the adoption of Social Media Marketing practices in Venetian agritourisms.

- Relative Advantage (RA): It refers to the degree to which a technological component is perceived to provide a greater benefit for the enterprise. Many researches have reported that when organizations perceive the relative advantage of a technological innovation, then the probability of adoption will increase. Social Media Marketing offers many advantages to those adopting it, including increased brand awareness, better customer satisfaction, cost-effective marketing strategies and improved brand loyalty (Jabeen, 2017). This variable was found significant by the papers of Grandon & Pearson (Grandon & Pearson, 2004), Alshamaila, Papagiannidis, & Li (Alshamaila, Papagiannidis, & Li, 2013) and MacGregor & Vrazalic (MacGregor & Vrazalic, 2005).

H2: Relative Advantage (RA) has a positive influence on the adoption of Social Media Marketing practices in Venetian agritourisms.

Organizational Context

- Top Management Support (TMS): It refers to the commitment, motivation and enthusiasm provided by the management towards the adoption and implementation of new technologies. Top Management Support is essential for enterprises interested in creating a competitive environment and providing the necessary resources (human, financial, technical, etc.) for the adoption of IT innovations. This kind of support is crucial in dealing with internal barriers and resistance to change among employees of the firm (Jabeen, 2017). This variable was found significant by the papers of Alshamaila, Papagiannidis, & Li (Alshamaila, Papagiannidis, & Li, 2013), Parker &

Castleman (Parker & Castleman, 2007) and Shiau, Hsu, & Wang (Shiau, Hsu, & Wang, 2009).

H3: The Top Management Support (TMS) has a positive influence on the adoption of Social Media Marketing practices in Venetian agritourisms.

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Environmental Context

- Competitive Pressure (CMPE): It refers to the degree to which an organization is affected by competition in the market. Rivalry within the same business sector increases the likelihood of adopting technological innovations, in order to gain competitive advantage. In fact, an enterprise might feel pressure to adopt Social Media Marketing practices, if competitors, that have implemented it, are perceived favourably by their customers and others in the sector (Jabeen, 2017). This variable was found significant by the papers of Parker & Castleman (Parker & Castleman, 2007), Doom, Milis, Poelmans, & Bloemen (Doom, Milis, Poelmans, & Bloemen, 2010) and Stockdale &

Standing (Stockdale & Standing, 2004).

H4: The Competitive Pressure (CMPE) has a positive influence on the adoption of Social Media Marketing practices in Venetian agritourisms.

- Customer Pressure (CST): It refers to the degree to which a firm is influenced by customers’ requests. Many studies indicates that pressure from customers is an important determinant in the adoption of technological innovations; in fact, enterprises should communicate with customers on social media platforms and respond to their questions and comments, in order to improve the brand reputation (Jabeen, 2017). This variable was found significant by the papers of Kim & Ko (Kim & Ko, 2012), Laroche, Habibi, & Richard (Laroche, Habibi, & Richard, 2013) and Trainor, Andzulis, Rapp, &

Agnihotri (Trainor, Andzulis, Rapp, & Agnihotri, 2014).

H5: The Customer Pressure (CST) has a positive influence on the adoption of Social Media Marketing practices in Venetian agritourisms.

3. METHODOLOGY

The aim of this research is to determine the factors influencing the adoption of Social Media Marketing in Venetian agritourisms, through the use of the TOE framework, in order to help owners and managers to better plan their future marketing strategies. For this purpose, an online survey, created on Google Forms, was used to collect the necessary data. The questions of the survey were developed in English language and then translated in Italian, in order to be understandable for the potential respondents. The questionnaire is composed by a total of 19 questions, which are mainly 5-point Likert scale questions with statements to which respondents gave their degree of agreement/disagreement with five possible options: “Strongly Agree” (5), “Agree” (4), “Indifferent” (3), “Disagree” (2) or “Strongly Disagree” (1). The measurement items of the construct variables were designed using prior IT adoption literature as reference (Figure 2 for independent variables and Figure 3 for the dependent variable). The questionnaire was divided into seven main parts, based on the considered research variable:

- Section A: 4 questions related to demographic characteristics of Venetian agritourisms (from questions 1 to 4);

- Section B: 2 questions related to “Adoption of Social Media Marketing (AD)” in Venetian agritourisms (from questions 5 to 6);

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- Section C: 2 questions related to “Compatibility (CMPA)” of Social Media Marketing with existing technologies and managerial needs in the agritourism (from questions 7 to 8);

- Section D: 4 questions related to “Relative Advantage (RA)” derived from the use of Social Media Marketing (from questions 9 to 12);

- Section E: 3 questions related to “Top Management Support (TMS)” regarding the adoption of Social Media Marketing (from questions 13 to 15);

- Section F: 2 questions related to “Competitive Pressure (CMPE)” regarding the adoption of Social Media Marketing (from questions 16 to 17);

- Section G: 2 questions related to “Customer Pressure (CST)” regarding the adoption of Social Media Marketing (from questions 18 to 19).

The survey was distributed to 728 agritourisms, which represents 50% of the target population (1.456 agritourism farms in Veneto). The sample of this research was obtained by considering the first half of Venetian agritourisms registered in the ISTAT (National Institute of Statistics in Italy) Database, which defines the minimum requirements and characteristics for being considered an agritourism farm in Italy. The survey was kept open for a period of ten weeks (from May 2020 to July 2020) and the collected responses, excluding the missing and incomplete ones, were 182 (response rate of 25%). The obtained data were analyzed with SPSS Statistics 23 (Statistical Package for Social Sciences) by using descriptive statistics (Mean, Standard Deviation, Minimum and Maximum), reliability analysis (Cronbach’s α scores), correlation test (Pearson correlation), multicollinearity test (Tolerance and Variance Inflation Factor) and multiple linear regression analysis in conjunction with one-way analysis of variance (ANOVA). Moreover, Principal Component Analysis (PCA) with varimax rotation was discarded, since it did not fit well with the construct variables; in fact, the results did not show a clear and precise definition of each component.

Figure 2. Measurement items of the independent variables

Type of Variables Indipendent Variables Measurement Items Sources

Compatibility (CMPA)

Social Media Marketing activities are compatible with existing technologies in the agritourism

(CMPA_1)

(Jabeen, 2017);

(Grandon &

Pearson, 2004);

(Alshamaila, Papagiannidis, &

Li, 2013);

(Doom, Milis, Poelmans, &

Bloemen, 2010) Social Media Marketing activities

are compatible with managerial and operational needs (CMPA_2)

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Source: Own elaboration Technological Context

Relative Advantage (RA)

Social Media Marketing improves

employee relationships (RA_1) (Jabeen, 2017);

(Grandon &

Pearson, 2004);

Li, 2013);

(MacGregor &

Vrazalic, 2005) Social Media Marketing improves

supplier relationships (RA_2) Social Media Marketing improves

brand awareness (RA_3) Social Media Marketing increases

agritourism revenues (RA_4)

Organisational Context

Top Management Support

(TMS)

Top management is interested in the adoption of Social Media

Marketing (TMS_1) (Jabeen, 2017);

Li, 2013);

(Parker &

Castleman, 2007);

(Shiau, Hsu, &

Wang, 2009) Top management accepts possible

risks which may result from adopting Social Media Marketing

(TMS_2)

Top management is willing to invest the necessary resources for

improving Social Media Marketing usage

(TMS_3)

Environmental Context

Competitive Pressure (CMPE)

The agritourism is under pressure from competitors to use Social

Media Marketing (CMPE_1)

(Jabeen, 2017);

(Parker &

Castleman, 2007);

(Doom, Milis, Poelmans, &

Bloemen, 2010);

(Stockdale &

Standing, 2004) Using Social Media Marketing

helps the agritourism to compete better with its rivals (CMPE_2)

Customer Pressure (CST)

The agritourism is under pressure from customers to use Social

Media Marketing (CST_1)

(Jabeen, 2017);

(Kim & Ko, 2012);

(Laroche, Habibi,

& Richard, 2013);

(Trainor, Andzulis, Rapp,

& Agnihotri, 2014) Customers are satisfied with

agritorurism's adoption of Social Media Marketing (CST_2)

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Figure 3. Measurement items of the dependent variable

Dependent Variable Measurement Items

Social Media Marketing Adoption (AD)

Social Media Marketing practices are used extensively in the agritourism (AD_1)

Future usage of Social Media Marketing in the agritourism (AD_2)

Source: Own elaboration

4. RESULTS

The results of this research were analyzed and assessed, in order to understand which of the five examined hypotheses were supported and to define the impact of each TOE variable on Social Media Marketing adoption.

Sample characteristics

The Sample Characteristics Table (Figure. 4) illustrates the frequency of respondents based on four characteristics: age, gender, level of education and role in the agritourism.

Figure 4. Sample characteristics

Characteristics Respondents

(Number)

Respondents (Percentage of total)

Age of respondent

21-30 years 32 17,6

31-40 years 60 33,0

41-50 years 62 34,1

Over 50 years 28 15,4

Total 182 100,0

Gender of respondent

Female 77 42,3

Male 105 57,7

Total 182 100,0

Level of education

Elementary School 2 1,1

Middle School 25 13,7

High School 74 40,7

Bachelor's Degree 43 23,6

Master's Degree 37 20,3

PhD 1 0,5

Total 182 100,0

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Role of the respondent Owner

Manager Staff Member Total

91 52 39 182

50,0 28,6 21,4 100,0

The table shows that: the majority of respondents aged from 41 to 50 years (34,1%), followed by participants aged from 31 to 40 (33%), those aged from 21 to 30 (17,6%) and those with more than 50 years (15,4%); from 182 respondents, more than half of them are men (57,7%) and the remaining 77 participants (42,3 %) are women; most of respondents have only an high school diploma (40,7%), followed by those with a Bachelor’s Degree (23,6%) and those with a Master’s Degree (20,3%); 50% of respondents are owners, while the others were either managers (28,6%) or staff members (21,4%).

Descriptive statistics

The following table shows descriptive statistics for the survey items. It illustrates the minimum, maximum, mean and standard deviation of the obtained responses calculated with SPSS on all survey variables.

Figure 5. Descriptive statistics of survey variables

Variables Mean Items N Minimum Maximum Mean Std. Deviation

AD 3,794 AD_1 182 1 5 3,75 0,935

AD_2 182 1 5 3,84 0,959

RA 3,8214

RA_1 182 1 5 3,87 0,935

RA_2 182 1 5 3,81 1,004

RA_3 182 1 5 3,84 0,955

RA_4 182 1 5 3,77 0,911

CMPA 3,761 CMPA_1 182 1 5 3,72 0,9

CMPA_2 182 1 5 3,8 0,907

TMS 3,8645

TMS_1 182 1 5 3,88 0,884

TMS_2 182 2 5 3,82 0,804

TMS_3 182 1 5 3,9 0,907

CMPE 3,8352 CMPE_1 182 1 5 3,89 0,898

CMPE_2 182 1 5 3,78 0,825

CST 3,9945 CST_1 182 1 5 3,98 0,793

CST_2 182 1 5 4,01 0,821

The mean values of all 15 items are higher than 3 (using 5-point Likert scale), suggesting all the factors are considered important by respondents. CST_2 (which measures the satisfaction of customers with Social Media Marketing adoption in agritourisms) is the only item with a mean value higher than 4 (Mean = 4,01). It can be seen that “Customer Pressure” (Mean = 3,99) is considered the most important independent variable, followed by “Top Management

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Support” (Mean = 3,86), “Competitive Pressure” (Mean = 3,83), “Relative Advantage” (Mean

= 3,82), “Compatibility” (Mean = 3,76).

Reliability

In order to ensure the precision of the measurements, reliability was tested by using Cronbach’s alpha scores. Reliability is concerned with the consistency of a measure and defines the extent to which results can be reproduced when the research is repeated under the same circumstances.

The Cronbach's alpha coefficient of 15 items (Figure. 6) is 0,953 and the values for each variable (Figure. 7) are above 0,5 (ranging from 0,685 to 0,878), confirming that all constructs have high reliabilities (Hair, Babin, Money, & Samuole, 2003).

Figure 6. Reliability of all variables

Cronbach’s α score Number of Items

0,953 15

Figure 7. Reliability of individual variables

Construct variables Items Cronbach’s α score

Compatibility (CMPA) CMPA_1

0,685 CMPA_2

Relative Advantage (RA)

RA_1

0,878 RA_2

RA_3 RA_4

Top Management Support (TMS)

TMS_1

0,831 TMS_2

TMS_3

Competitive Pressure (CMPE) CMPE_1

0,778 CMPE_2

Costumer Pressure (CST) CST_1

0,725 CST_2

Adoption of Social Media Marketing (AD) AD_1

0,836 AD_2

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Correlations

Correlation is a statistical measure that defines the extent to which two or more variables change together; in fact, a positive correlation specifies the extent to which the variables increase/decrease in parallel and a negative correlation specifies the extent to which one variable increases as the other decreases. Pearson’s Correlation Coefficient (r) is a statistical measure that defines the strength of the relationship between two variables. Pearson's r has a value between + 1 (positive correlation) and – 1 (negative correlation).

Figure 8. Correlations

RA CMPA TMS CMPE CST AD

RA Pearson Correlation 1 ,746^** ,785^** ,792^** ,677^** ,832^**