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The Impact of Social Media on Retail Business Model

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In retail businesses, such issue can also appear but under the following term: that the organization involved supports the use of social media in regard to employee communication or in regard to various business sectors, such as customer services, supply chain management and so on.
In any case, the potential value of social media for the retail sector cannot be ignored. In fact, social networking seems to be a continuously expanding trend, a fact that should be taken into consideration by marketers in the retail industry worldwide. According to a research published by the Tuck School of Business at Dartmouth (2011), the number of people across the USA subscribed to social networks has been significantly increased between 2008 and 2010 (see Figure 1 below). It is assumed that the social media would be a valuable tool for managers and marketers in retail businesses worldwide. However, in order for the specific tool to be effective, it should be combined with other business practices (Kreitner and Cassidy 2012), meaning especially the training of employees so that they are able to handle social media as a key means of communication and cooperation.
On the other hand, Howley (2010) noted that the performance of social media in businesses internationally is not standardized. in fact, it has been proved that the impact of social media on business activities is higher in certain industries compared to others (Howley 2010). For example, firms operating in the construction industry may not be benefited by social media at the same level such as the firms operating in the retail industry (Howley 2010).
At the same time, Constantinides, Romero and Gomez Boria (2008) have highlighted the following issue: the relation of social media with the retail industry has an important implication.