Referral marketing can be identified as the commercial form used to encourage word-of-mouth (WOM) communication. It has become popular in recent times, supporting organisations to attract new customers towards making strides in how customers are pursued to purchase certain types of products/industries. However, some factors impact the success of referral marketing programmes. This study focuses on analysing the impact of such factors as brand, rewards and celebrity endorsement on user engagement in social media referral marketing programmes.
Further, this study discusses the moderating impact of social ties on this relationship mainly focusing on the cosmetic industry. The data were collected from respondents with exposure to referral marketing programmes through the social media platforms: Facebook, LinkedIn, WhatsApp and Instagram. The structural equation modelling (PLS-SEM) was used to analyse the data collected.
The results of the study revealed that brand, reward and celebrity endorsement significantly impact the participation willingness of customers in social media referral marketing programmemes. Moreover, it showed that the social tie moderates only the brand impact on the participation willingness of customers, whereas it does not moderate the impact of rewards and celebrity endorsement on the participation willingness of customers. In doing so, the study looks extensively into the elements that drive or shape customer behaviour within this specific market niche by investigating the effect of brand, incentives and endorsements by celebrities on customer engagement.
Accordingly, this study sheds light on the complex relationship among brands, rewards and celebrity endorsements, while also considering social ties within the context of social media referral marketing initiatives. It also delivers useful information for academics as well as practitioners. Limited studies have been conducted in this field, and therefore, this study adds some knowledge, also highlighting the moderation effect of social ties.
