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Does Facebook Commerce Enhance SMEs Performance? A Structural Equation Analysis of Omani SMEs

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  • Mansour Naser Alraja
  • Sarfraz Fayaz Khan
  • Basel Khashab
  • Raghad Aldaas

Abstract

This research aims to identify the factors affecting the adoption of Facebook commerce, in specific the adopted Facebook advertisements for both small and medium enterprises (SMEs) and how this contributes to enhancing such SMEs’ organizational performances. Specifically, ease of use, demographic targeting, interaction, and brand awareness are regarded as the key factors that can influence Facebook’s advertisements adoption. However, three organizational performance dimensions (efficiency, flexibility, and responsiveness) are considered to be the most significant areas of focus in this research. In this study, both the quantitative research approach and the descriptive research design were employed. Data were collected from different SMEs in Muscat and Dhofar in Oman, and the total valid questionnaires suitable for analysis reached 342. The participants were primarily from those who publicize their services through Facebook. Many statistical techniques including exploratory, confirmatory, and structural equation modeling have been adopted in this study; meanwhile, the quantitative data were analyzed using SPSS 25 and AMOS 25 softwares. The findings of this study suggested that the ease of use, demographic targeting, interaction, and brand awareness interpreted 20% of the variance in the Facebook advertisements as the dependent variable. However, Facebook advertisements as an independent variable were found to have a statistically significant effect on the SMEs’ performance dimensions (efficiency, flexibility, and responsiveness) with standard regressions of 0.66, 0.51, and 0.74, respectively, thereby explaining 44% of the variance in the efficiency, 26% of the variance in the flexibility, and 55% of the variance in the responsiveness. Regarding the researchers’ knowledge, this research stands out as the first research to highlight SMEs that measure statistically the relationship between the organizational performance dimensions and Facebook advertising as key social media tools within a unique context—such as Oman as an example of developing countries.

Suggested Citation

  • Mansour Naser Alraja & Sarfraz Fayaz Khan & Basel Khashab & Raghad Aldaas, 2020. "Does Facebook Commerce Enhance SMEs Performance? A Structural Equation Analysis of Omani SMEs," SAGE Open, , vol. 10(1), pages 21582440199, January.
    • Handle: RePEc:sae:sagope:v:10:y:2020:i:1:p:2158244019900186
    DOI: 10.1177/2158244019900186
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    References listed on IDEAS

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    1. Persson, Fredrik & Olhager, Jan, 2002. "Performance simulation of supply chain designs," International Journal of Production Economics, Elsevier, vol. 77(3), pages 231-245, June.
    2. Madhuri V. Tikam, 2013. "Impact of ICT on Education," International Journal of Information Communication Technologies and Human Development (IJICTHD), IGI Global, vol. 5(4), pages 1-9, October.
    3. Michail Batikas & Rene Van Bavel, 2013. "Assessing the Benefits of Social Networks for Organizations," JRC Research Reports JRC85669, Joint Research Centre.
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    Cited by:

    1. Mansour Naser Alraja & Rabia Imran & Basel M. Khashab & Mahmood Shah, 2022. "Technological Innovation, Sustainable Green Practices and SMEs Sustainable Performance in Times of Crisis (COVID-19 pandemic)," Information Systems Frontiers, Springer, vol. 24(4), pages 1081-1105, August.
    2. Fazal ur Rehman & Basheer M. Al-Ghazali, 2022. "Evaluating the Influence of Social Advertising, Individual Factors, and Brand Image on the Buying Behavior toward Fashion Clothing Brands," SAGE Open, , vol. 12(1), pages 21582440221, March.
    3. Ashraf, Mohammad Ali & Alam, Mirza Mohammad Didarul & Alexa, Lidia, 2021. "Making decision with an alternative mind-set: Predicting entrepreneurial intention toward f-commerce in a cross-country context," Journal of Retailing and Consumer Services, Elsevier, vol. 60(C).
    4. Raza Ur Rahman & Syed Mohsin Ali Shah & Hatem El-Gohary & Muzaffar Abbas & Syed Haider Khalil & Saad Al Altheeb & Fahad Sultan, 2020. "Social Media Adoption and Financial Sustainability: Learned Lessons from Developing Countries," Sustainability, MDPI, vol. 12(24), pages 1-26, December.
    5. Sikandar Ali Qalati & Dragana Ostic & Mohammad Ali Bait Ali Sulaiman & Aamir Ali Gopang & Asadullah Khan, 2022. "Social Media and SMEs’ Performance in Developing Countries: Effects of Technological-Organizational-Environmental Factors on the Adoption of Social Media," SAGE Open, , vol. 12(2), pages 21582440221, May.

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