Social Media, Reference Groups, and Their Brands

The purpose of this chapter is to explain the marketing power of social media in branding and brand marketing. The chapter argues that through social media’s power to connect people, consumers enjoy greater contact with not only their reference groups and role models but also the latter’s choice of products and brands. Naturally, this translates into marketing potential especially in the domain of brand marketing, as considerable information on reference groups and their brands is generated and mediated through social media. To illustrate, popular social media sites such as YouTube, WhatsApp, Facebook, and Instagram are used by over 3.6 billion users, globally. Social media facilitates unique networking and communication capabilities, which affords consumers the power to control the flow of information. For instance, consumers can now ‘follow’ their idols, role models, or reference groups more easily through social media. In turn, the social media phenomenon creates numerous marketing opportunities for retailers. Social media allows marketers to understand the decision-making processes of consumers by studying their brand preference as well as the brand communities they belong to and how they interact within those communities. More than ever, social media has enabled people to connect with their role models and reference groups in ways that they have not been able to in the past. Furthermore, the power of artificial intelligence enhances marketers’ power to more directly target consumers’ interactions and preferences on reference groups’ brands. With this information, retailers enhance their ability to more effectively design advertising and marketing communication.