Despite substantial research attention on the business use of social media in innovation literature, the action-based mechanisms through which social media affect firms' product innovation remain unclear. We address this gap by drawing on the affordance theory and examining the effects of social media applications on product innovations.
The study was based on analyzing data collected through a questionnaire survey of Chinese firms. Partial least squares structural equation modeling was applied to test the hypotheses.
The results show that social media applications have a positive effect on marketing affordances (including customer behavior pattern discovery, real-time market response and marketing ambidexterity), in turn positively influencing product innovation performance. Organizational structures shape the actualization of the marketing affordance of social media; while organizational formalization positively moderates the relationships between social media application and marketing affordances, organizational centrality weakens these relationships.
Managers will benefit from understanding how social media can be applied to help their firms achieve product innovation. When manufacturing firms engage in social media for product innovation, they may find it worthwhile to focus on marketing actions such as customer behavior pattern discovery, real-time market response and marketing ambidexterity.
This study elucidates the action-based mechanism of marketing affordance by which social media usage improves product innovation performance. This study also highlights the design of organizational structure as an important approach to realizing the potential benefits of social media in product innovation.
