SOCIAL MEDIA MARKETING AND PERFORMANCE OF SMALL AND MEDIUM

ENTERPRISES IN METROPOLITAN KANO, NIGERIA

BY

Kazeem Aliyu

JULY, 2023
 ABSTRACT

The focus of this study was on social media marketing and performance of small and medium

enterprises in metropolitan Kano. Questionnaires were used to collect data within the selected

SMEs to ascertain the performance of SMEs within metropolitan Kano. The questionnaires

were also used in establishing the importance of social media to SMEs. Analysis of the

research questionnaires was done using. The key findings from the research were that It was

evident that social media has helped these enterprises to reach out more customers and

satisfy their needs, enhance brand awareness, brand loyalty and sales volume. With such

performance benefits this study finds out that it is strategically imperative to make

effective use of social media among owner-managers and their actual and potential

customers. This study had shown that social media represents a potential vehicle to help

small businesses create better brand awareness, better relationships with customers, and

increase sales via these mechanisms. It had clearly brought out to the small business

owners and managers that that social media plays a vital role when it comes to forming

intangible ties with clients and establishing an effective business performance. The study

hence makes recommendation for further study into the assessment of social media marketing

and growth of Small and Medium Enterprises in Nigerian states and cities. Further study can

also be carried out on the effect of social media marketing on performance of larger firms and

corporations

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 CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

In the highly competitive business environment and unstable economic situation, many micro

businesses fold up due to many challenges they face in their day-to-day business activities. This

has raised many controls, monitoring and forecasting measures as well as the need for businesses

to re-orient their business model and operational strategies into a more adaptive model instead of

a reactive model. Many businesses struggle to sustain projected business goals, gain competitive

advantage and survive today’s market where competition is fierce and market situation is

ambiguous. In the end, the weak get frustrated and go out of business while others survive by

looking beyond their traditional product and service offerings and constantly reviewing their

operations to accommodate the challenges. (Chheda, 2014)

One of the major ways firms pursue the survival or competitive advantage goal is by way of

marketing strategy. The firm uses a unique blend of the marketing mix with aim of attaining its

objectives. For instance, developing a unique product that has customer satisfaction and profit

making potential; placing a price on it that would create value for both the firm and its

customers; setting up a means channel of distribution and communicating with prospecting

customers about the availability of the product, its uses/features, and how it can be got by

customers. This has been done through traditional media of communication and has evolved with

the continuous introduction of innovative new technologies. One of such innovative technologies

is the social media platforms of communication.

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Traditional media of communication is known to be characterized by a one-way street feature,

where you can read a newspaper or listen to a report on television, but you have very limited

ability to give your thoughts on the matter. Social media, on the other hand, has an inherent

feature giving way for two-way communication flow that gives the audience the ability to give

their inputs too and almost instantaneously. (Chheda, 2014). Social network marketing and social

media campaigns provide a window to market a product or service on the Internet through

different social networks. The most common and successful means of social media marketing are

found on sites like Facebook, Twitter, LinkedIn, YouTube and even company blogs.

Social media marketing is the latest "buzz" in marketing. These days, the organizational cause

has replaced the social cause as companies seek to engage with their audience via the online

platforms. Online presence is a must for businesses today. Apart from a basic website;

consumers looks for a blog, a Facebook page, shopping cart, e-brochures, etc. 92% of micro and

micro businesses agree that social media is an effective marketing technology tool. They are

evenly split on the effectiveness of social media for attracting new customers and engaging

existing customers. (Chheda, 2014). Almost every business or marketing activity is cost

intensive, either physical financial costs, opportunity costs, or other unquantifiable costs. So also,

is social media marketing cost intensive to deploy in any business including micro businesses.

Many businesses have invested in Social media facilities that are used for marketing activities.

According to Adegbuyi, (2015) Social media plays a vital role in marketing and creating

relationships with customers. With limited barrier to entry, micro businesses are beginning to use

social media as a means of marketing. Unfortunately, the researcher has observed that some

micro businesses remain micro and do not grow significantly despite marketing efforts that they

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make. It is therefore imperative to ascertain social media marketing and it effect on the

performance of small and medium enterprises in metropolitan, Kano.

1.2 Problem Statement

Small and Medium Enterprises (SMEs) are globally acknowledged as veritable tools for wealth

creation, employment generation, and sustainability. Studies have revealed that SMEs have

retained their position as the backbone of developed and developing countries as they account for

about 70 and 95% of all business entities in most countries around the world and also create

between 50 and 80% of employment. In Nigeria, SMEs play a significant role in generating

employment and income generation opportunities for low-income earners in the economy.

According to the National Bureau of Statistics (NBS, 2021), the total number of people

employed by the SME sector in Nigeria as at December, 2020 stood at 84.02% of the total labor

force. In an era characterized by global cut-throat competition, a knowledge-based economy,

technological advances and innovation, social media has played a pivotal role in increasing the

competitiveness of SMEs. According to Oso (2011), one of the requirements of social media is

that it can be viewed as a strategic tool for economic advancement, that is, it can contribute to a

nation's cultural, human, social, political, and economic development. Many SMEs have

leveraged the internet, especially social media, for business activities such as marketing and

customer service. However recent happenings surrounding the use of social media has posed

some certain challenges such as the ban of twitter from 5th June to 13th January 2022, high data

tariffs amongst others has affected the use of social media by SMEs, which in turn has a downing

effect on the Nigerian economy. It is against this backdrop that this study examined social media

and market performance of SMEs in Kano metropolis, Kano state, Nigeria.

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1.3 Objectives of the Study

The main objectives of this study is to ascertain the influence of social media on the performance

of small and medium scale enterprises, The specific objectives include:

1. To determine the relationship between social media and sales of SMEs in Kano

Metropolis

1.4 Research Questions

1. What is the effect of social media marketing and SME’s performance in Kano

Metropolis?

1.5 Significance of the Study

It is with the belief of the researcher that, it will help stakeholders in providing solutions to the

problems associated with social media as a means of promoting the business small and medium

enterprises and address the lack of adequate support by the government in improving the Micro

Small and Medium Scale Enterprises.

It is also hoped that the study will help in educating prospective entrepreneurs on how best they

can effectively and efficiently utilize the use of social media in impacting their business growth

and contribute better to the economic development of our dear nation (Nigeria).

Finally, it is hoped that this research will add to knowledge techniques and strategy in combating

treats of Micro Small and Medium Scale Entrepreneurs MSMEs especially at the technology

level.

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1.6 Scope of the Study

The study is focused on exploring the impact of social media on the performance of SME’s in

Kano Metropolis. The study broadens the nature of SME’s business in Nigeria and how social

media contributes to its growth.

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 CHAPTER TWO

LITERATURE REVIEW

2.0 Introduction

Marketing is a crucial activity for that aid survival and success of a going business concern.

Businesses in the 21st century today, have more marketing opportunities than compared to those

days (Bresciani & Eppler, 2010). In marketing, micro businesses relies more on word of mouth

validations to win customers (Stokes & Lomax, 2002). In today’s economy system, distinguished

by relationships, technology, and networks, tend to give support to the characteristics of SMEs

(Walsh & Lipinski, 2009). Social media aid companies to connect with customers with the

motive to build relationships and help to take advantage and understand better the needs of

customer. Therefore, businesses strife to ensure that their messages reach as many audience and

customers as possible. To do this effectively, a business must ensure that they have presence via

social media network (Halligan, Shah, & Scott, 2009). Social media bring about numerous

opportunities for micro businesses to market to consumers and aid to build rapport and provide

more profitable interrelationships. Nonetheless, micro businesses still strife to access their

customers.

2.1 Concept of Small and Medium Enterprises (SMEs) Performance

The universal definition of small and medium enterprises (SMEs) is difficult to describe due

to the fact that their definition can be described differently depending on the contexts,

dimensions, levels and the nature of economic development (Vongkhamheng, 2017). This

means that there is no precise description for the notion of SMEs (Berisha & Pula, 2015).

Arowomole (2000) also indicates that it is not easy to define SMEs precisely since each

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country uses different criteria to describe the meaning of SMEs. Even though the meaning of

SMEs is diverse, the basic definition of SMEs is based on two dimensions, namely the number of

employees and sales volumes. These aspects are recognized as the fundamental factors to define

SMEs (Ardic, Mylenko, & Saltane, 2011). The Small and Medium Enterprises Credit

Guarantee Scheme (SMECGS, 2013) defined SMEs as enterprises with a total capital

employed not less than N1.5 million, but not exceeding N200 million, including working

capital, but excluding cost of land and/or with a staff strength of not less than 10 and not more

than 300. Small and Medium Enterprises (SMEs) as defined by the National Council of

Industries (2010) refer to business enterprises whose total costs excluding land is not more

than two hundred million naira (N200, 000,000.00) only. The Central Bank of Nigeria

defines a Small and Medium Scale Enterprise operating in Nigeria as an enterprise with fixed

capital or asset between N5million and N500 million ($26,932 and $2,693,240), turnover

of less than 100 million ($538,648) per annum and labor force between 11 and 300

(CBN, 2003). Small and medium enterprises are assumed to be steps for entrepreneurship,

development and innovation (Olufemi, Sekinat & Omolola, 2019). Most emerging economies

have embraced the initiatives of promoting SMEs as a strategy for industrialization

through entrepreneurship support organizations. This has been demonstrated by several

administrations over the years, that employed monetary, fiscal and industrial measures at

the macro and micro levels to assist the development of SMEs but policy inconsistencies

have always barred the SMEs in the economy from consistent progress (Oyelaran-Oyeyinka

et al. 2007).

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2.1.1 Types of SMEs Performance

There is no generally accepted definition of a small business because the classification of

businesses into large-scale or small-scale is a subjective and qualitative judgment. In countries

such as the USA, Britain, and Canada, small-scale business is defined in terms of annual

turnover and the number of paid employees. In Britain, small-scale business is defined as that

industry with an annual turnover of 2 million pounds or less with fewer than 200 paid

employees. In Japan, small-scale industry is defined according to the type of industry, paid-up

capital and number of paid employees. Consequently, small and medium-scale enterprises are

defined as: those in manufacturing with 100 million yen paid-up capital and 300 employees,

those in wholesale trade with 30 million yen paid-up capital and 100 employees, and those in the

retail and service trades with 10 million yen paid-up capital and 50 employees. In Nigeria, there

is no clear-cut definition that distinguishes a purely small-scale enterprise from a medium-scale

enterprise. The Central Bank of Nigeria, in its Monetary Policy Circular No. 22 of 1988, defined

small-scale enterprises as having an annual turnover not exceeding 500,000 naira. In the 1990

budget, the federal government of Nigeria defined small-scale enterprises for purposes of

commercial bank loans as those with an annual turnover not exceeding 500,000 naira, and for

Merchant Bank Loans, those enterprises with capital investments not exceeding 2 million naira

(excluding cost of land) or a maximum of 5 million naira. The National Economic

Reconstruction Fund (NERFUND) put the ceiling for small-scale industries at 10 million naira.

Section 37b (2) of the Companies and Allied Matters Decree of 1990 defines a small company as

one with:

(a) An annual turnover of not more than 2 million naira;

(b) Net asset value of not more than 1 million naira.

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For the purposes of this study, small and medium-scale enterprises are defined as those with

investments in machinery and equipment not exceeding 500,000 naira and 2 million naira,

respectively, with not more than 50 and 100 paid employees, respectively. This definition does

not reflect the characteristics of typical Nigerian small-scale enterprises in terms of their capital

base and number of employees. The definition may at best relate to medium-scale enterprises.

Small-scale enterprises in Nigeria require a separate definition

2.1.2 Nature and Features of SMEs

One of the commonest characteristics of SMEs is that they are either sole proprietorship's or

partnerships. Even when they register as Limited Liability Companies, this is merely on paper, as

their true ownership structure is one-man or partnership. Most SMEs have labor intensive

production processes, centralized management and have limited access to long-term capital; even

their access to short-term financing is limited and sometime attained at a penal rate of interest

and other conditionality (Oyedijo, 2014).Since partnership spirit in Nigeria is at its infancy,

partners in many SMEs pursue individualistic goals at the expense of the overall interest of the

SMEs. Consequently, mortality rate among SMEs is high as a result of mistrust that often

develops among the owners. Beside poor partnership spirit, regulatory environment – policy

instability and reversals, inadequate infrastructure, etc, - often contribute to their mortality rate

(Oladele, 2013).Another major feature of many SMEs is their over-dependence on imported raw

materials and spare parts. In fact, no industrial subunit under SMEs category is immune to this

structural weakness, Added to this, SMEs in Nigeria suffer from very poor inter and Sectoral

linkages, and as a result lose benefits synonymous with economies of large-scale production

(Oyedijo, 2012).

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Earlier studies have shown that several factors affect performance in SMEs. The major factor has

been shown as lack of capital and financial resources. However, Dia (1996) found that additional

capital and finance can be overcome through innovation and creativity. Kamunge, Njeru and

Tirimba (2014) also found out that access to commercial credit did not contribute to

entrepreneurial success in any significant way. Some researchers argue that small businesses are

undercapitalized. Business owners in Africa tend to depend upon their own family savings and

access to capital remains a challenge. Most of them cannot meet the requirements for

commercial loans, and those who do find such loans expensive. Administrative problems have

been cited as a major cause of business failure.

Kamunge, et al. (2014) found that poor recordkeeping and lack of basic business management

experience and skills were major contributors. Other factors identified are inexperience in the

field of business particularly lack of technical knowledge, lack of managerial skills, inadequate

planning and failure to do market research (Pietro & Sekioua; 2012). Mugo (2012), exploring

performance of SMEs concludes that access to business information services affected the

performance of business to a great extent and that access to finance affected performance of

SMEs because it limited the entrepreneurs' ability to take advantage of opportunity as and when

they arose. The study concluded that technology affected businesses to a very great extent by

facilitating communication with both the supplier and customers, by easing the transportation of

goods and by easing the marketing of the products.

2.2 Concept of Social Media Marketing

Social media is a collection of online platforms and tools that people use to share content,

profiles, opinions, insights, experiences, perspectives and media itself, facilitating conversations

and interactions online between groups of people. Social Media is the platform/tools. Social

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Networking is the act of connecting on social media platforms. Social Media Marketing is how

businesses join the conversation in an authentic and transparent way to build relationships.

Doreen Moran – Digital and Social Marketing Strategist Social media has caused a significant

change in the strategies and tools companies use for communicating with customers. Mangold &

Faulds (2009) argue that “social media combines characteristics of traditional IMC tools

(companies talking to customers) with a highly magnified form of word-of-mouth (customers

talking to one another) whereby marketing managers cannot control the content and frequency of

such information.” Companies are limited in the amount of control they have over the content

and distribution of information. Ignoring such user-generated content is not an option.

Companies must be able to monitor and respond to conversation, both positive and negative,

surrounding the brand. There are ways however, that companies can influence discussions in a

way that is consistent with the organization’s mission (Mangold & Faulds, 2009). Social media

marketing enables companies to achieve a better understanding of customer needs in order to

build effective relationships. Safko & Brake (2009) observe that social media “refers to

activities, practices, and behaviors among communities of people who gather online to share

information, knowledge, and opinions using conversational media” Weinberg (2009) notes that

social media “relates to the sharing of information, experiences, and perspectives throughout

community-oriented websites”. Comm (2009) says that social media is “content that has been

created by its audience”. Safko & Brake (2009) refers to social media as “online applications,

platforms and media which aim to facilitate interaction, collaboration, and the sharing of

content”. With a definition of social media in place, accurately defining social media marketing

is possible. A basic definition is “using social media channels to promote your company and its

products” (Barefoot & Szabo, 2010). An expanded definition is “a process that empowers

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individuals to promote their websites, products, or services through online social channels and to

communicate with and tap into a much larger community that may not have been available via

traditional advertising channels” (Weinberg, 2009; Adegbuyi, 2013). Nowadays, Social Media

Marketing and more particularly Social Networks are becoming increasingly important in

consumers’ purchasing decisions, mainly because they amplify word-of-mouth. They may even

become more important than advertising as a trusted source of information. However, it is

important to stress the fact that, in Social Media Marketing, marketers have less control over

messaging and positioning.

Using social media can be a useful tool in the marketing field; it can reach the targeted

audience with the least cost possible, reaching interested individuals regardless of their

geographical areas, and at the same time help in building potential customers (Pradiptarini,

2011). Research explains many methods on how customers can interact with firms and their

brands such as consumer engagement with brand Facebook pages, creating brand content on

YouTube or Twitter using some social media platforms (Gironda & Korgaonkar, 2014; Kim et

al., 2014; Muk & Chung, 2014; Smith et al., 2012). In a report about the use of social

media in marketing, Stelzner (2016) found out that nearly 60% of marketers use the video

tools that are supported through social media for marketing purposes, and more marketers

are now using the new hot tool of the live video streaming. Also, activities like engaging

customers by sharing relevant contents in social media, collecting feedbacks and responding

them wisely, and eventually adjusting marketing strategy from feedback increases the web

traffic which leads to appear on top in search engine optimization (Dane, 2016). In

addition, using social media to track the activities of competitors and analyzing the result

to use in business helps to upgrade business followed by upgrading plans, such as

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offering discounts and other offers to attract more customers (Caruso, 2016). From the

foregoing, Kaplan and Haenlein (2010) observed that in a marketing context, social media

are considered platforms on which people build networks and share information and/or

sentiments. With their distinctive nature of being “dynamic, interconnected, egalitarian, and

interactive organisms” (Peters et al. 2013), social media have generated three fundamental shifts

in the marketplace. First, social media enable firms and customers to connect in ways that were

not possible in the past. Such connectedness is empowered by various platforms, such as

social networking sites (e.g., Facebook), micro blogging sites (e.g., Twitter), and content

communities (e.g., YouTube), that allow social networks to build from shared interests and

values (Kaplan & Haenlein, 2010). In this regard, “social connectedness” has also been

termed as “social ties” (e.g., Muller & Peres 2019; Quinton & Wilson, 2016), and the

strength and span of these ties determine whether they are strong or weak (Granovetter,

1973). Prior studies have shown that tie strength is an important determinant of customer

referral behaviors (e.g., Verlegh et al., 2013). Second, social media have transformed the way

firms and customers interact and influence each other. Social interaction involves “actions,”

whether through communications or passive observations, that influence others’ choices and

consumption behaviors (Chen et al., 2011). Nair et al. (2010) labeled such social interactions as

“word-of-mouth (WOM) effect” or “contagion effects.” Muller and Peres (2019) argue that

social interactions rely strongly on the social network structure and provide firms with

measurable value (also referred to as “social equity”). In social media studies, researchers

have long recognized the importance of social influence in affecting consumer decisions,

and recent studies have shown that people’s connection patterns and the strength of social

ties can signify the intensity of social interactions (e.g., Aral & Walker 2014; Katona et al.,

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2011). Third, the proliferation of social media data has made it increasingly possible for

companies to better manage customer relationships and enhance decision making in

business (Libai et al., 2010). Social media data, together with other digital data, are widely

characterized by the 3Vs (i.e., volume, variety, and velocity), which refer to the vast quantity

of data, various sources of data, and expansive real-time data (Alharthi et al., 2017). A huge

amount of social media data derived from different venues (e.g., social networks, blogs,

forums) and in various formats (e.g., text, video, image) can now be easily extracted and

usefully exploited with the aid of modern information technologies (Moe & Schweidel, 2017).

Thus, social media data can serve as an important source of customer analysis, market

research, and crowd-sourcing of new ideas, while capturing and creating value through social

media data represents the development of a new strategic resource that can improve

marketing outcomes (Gnizy, 2019).

2.2.1 Types of Social Media Marketing

1. Content Marketing/ Content Creating:

Content Marketing is a strategic marketing approach. It’s a process of developing and

distributing content in order to attract and retain customers. Creating blog posts, videos,

podcasts, Emails or info graphics you want, and sharing them. It’s not only about creating good

content when it comes to content marketing. The information should be well-written and logical.

Knowing what your audience exactly wants. And it’s even better when your content helps your

company to achieve its objectives.

2. Advertising/ Sponsorship:

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Advertising is a type of audio and visual marketing communication that uses public funding,

non-personal messages to promote or sell a product, service, or concept.

Advertising is generally considered to be a paid message you control. Common methods include

messages placed in magazines and newspapers, and on TV, radio, websites, and different social

media platforms. Unlike public relations efforts, you decide, create and place the exact message

you want. Advertising expenses include the cost of creating your ads and placing them on

different social media platforms. A person or organization that pays for or contributes to the

costs of organizing a sporting or artistic event in exchange for advertising is known as a sponsor.

Social Media Sponsor is a type of collaboration where a brand is giving products or money to a

user account for promotion or selling purposes. The sponsor can be a person or an organization

that offers money to another social media account (influencer, personal brand, or authoritative

accounts) in exchange for other benefits

3. Influencer Marketing:

Influencer marketing is one of the best social media marketing types. But what exactly does the

term “influencer” mean? A social media influencer is a person who has built a loyal audience

through social media. This influencer can be a You Tuber, a blog writer, or someone from other

communities. However, the creation of content, they have the potential to convince the audience

to buy the product. Hence, Influencer marketing is a type of marketing in which a company

connects with an influencer who has a loyal audience for the same product or speaks for the

same goods. Therefore as a result of this, influencers share their material with their audience,

raising brand visibility and assisting in the conversion of followers into buyers.

The following are examples of influencer marketing:

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  Sharing a coupon code so that the influencer’s audience can get a great deal.

 Social media product reviews.

 The brand’s promotions and new product launches are shared.

 Creating a co-branded product or campaign in collaboration with the influencer.

 Using influencers to create content for your brands, such as videos, blog posts, and social

media adverts.

4. Social Media Management

Social media Management is an organic approach. You must interact with the people in your

social media community. So, if you keep working on it and putting up effort, you can gain more

followers. But this happens over a long period of time. The advantages are enormous, but this is

a long-term strategy.

So when you start with social media management it may not give you more followers at the

initial stage but after a year or so, you can have a large number of loyal followers. This can bring

a significant amount of revenue to your business. This social media marketing helps in

achieving higher ROL.

5. Paid Media Marketing

Paid media refers to inorganic marketing efforts that are handled by the paid placement agency.

It means you have to pay for your advertisement. Paid media has become an important

component of online businesses. To advertise a product to a larger audience, therefore, it is

necessary to purchase online ad space. Paid media is a part of a brand’s overall strategy to boost

traffic, sales, and conversions by clicks, resulting in increased revenue.

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Types of Paid Media

1. Paid Social Media

2. Search Engine Ads

3. Banner Ads

4. Native Ads

Types of Paid Pricing Models

1. Cost per Click (CPC)

2. Cost per Thousand/Mille (CPM)

2.3 PROBLEMS OF SMES DEVELOPMENT IN NIGERIA

The success of SMEs is usually in jeopardy as most entrepreneurs lack the required

entrepreneurial skills and management expertise to survive. They lack good exposure to

management theories/training/practices. Worst still, they do not keep abreast with modern day

techniques.

1. Poor Policy Implementation

The federal government has formulated good policies in the past but implementation and control

has always been the problem. As such SMEs hardly thrive in Nigeria.

2. Insecurity

The high level of insecurity in the Nigeria ranging from kidnapping to the „Boko Haram‟

insurgency, robbery, ethnic clashes, political violence and religious crisis remains a major

problem confronting the establishment and growth of SMEs in the country. Most SMEs owner

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shave shut up their businesses while would-be entrepreneurs are apprehensive to invest. Most

persons have acquired the necessary entrepreneurial skills/technical knowhow and have the

required funds, but the insecurity in the country has made them indecisive because no one will be

willing „to fish in troubled waters‟. Inadequate, inefficient, and at times, non-functional

infrastructural facilities, which tend to escalate costs of operation as SMEs are forced to resort to

private provisioning of utilities such as road, water, electric, transportation, communication, etc.

3. Bureaucratic bottlenecks and inefficiency in the administration of incentives and support

facilities provided by the government.

4. Lack of easy access to funding / credits, which can be traceable to the reluctance of

banks to extend credit to them owing, among others, to poor and inadequate collateral,

high cost of administration and management of small loans as well as high interest rates.

5. Discrimination from banks, which are averse to the risk of lending to SMEs especially

start-ups.

6. Lack of access to appropriate technology as well as near absence of research and

development.

7. High dependence on imported raw materials with the attendant high foreign exchange

cost and scarcity at times.

8. Weak demand for products, arising from low and dwindling consumer purchasing power

aggravated by lack of patronage of locally produced goods by the general public as well

as those in authority.

9. Unfair trade practices characterized by the dumping and importation of substandard

goods by unscrupulous businessmen. This situation is currently being aggravated by the

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 effect of globalization and trade liberalization, which make it difficult for SMEs to

compete even in local / home markets.

10. Weakness in organization, marketing, information usage, processing and retrieval,

personnel management, accounting records and processing, etc arising from the dearth of

such skills in most SMEs due to inadequate educational and technical background on the

part of the SME promoters and their staff.

11. High incidence of multiplicity of regulatory agencies, taxes and levies that result in high

cost of doing business and discourage entrepreneurs. This is due to the absence of a

harmonized and gazette tax regime, which would enable manufacturers to build in

recognized and approved levies and taxes payable.

12. Absence of long-term finance to fund capital assets and equipment under project finance

for SMEs.

13. The lack of scientific and technological knowledge and know-how, i.e. the prevalence of

poor intellectual capital resources, which manifest as:

14. Lack of initiative and administrative framework or linkage to support and sustain SMEs‟

development, which to a large extent, is also a reflection of poor technological capability

or intellectual resource.

15. Lack of appropriate and adequate managerial and entrepreneurial skills with the attendant

lack of strategic plan, business plan, succession plan, adequate organizational set-up

transparent operational system, etc on the part of many founders and managers of SMEs

in Nigeria. As fallout of this, many of the SME promoters purchase obsolete and

inefficient equipment thereby setting the stage of initiation for lower level productivity as

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 well as substandard product quality with dire repercussions on product output and market

penetration and acceptance.

2.4 Social Media and SMEs Performance

In general, social media is utilized for technology-based social engagement. YouTube,

Facebook, MySpace, Flickr, and Orkut are the most popular social networking sites in

recent years (Salam & Hoque, 2019). Twitter, WhatsApp, LinkedIn, and Google + are among

the others. Individuals will be able to express their thoughts more freely, and people will

be able to communicate more frequently as a result of this (Kaplan & Haenlein, 2016).

According to Kaplan and Haenlein (2010), social media (SM) provides a number of

advantages, including the ease with which users can exchange or share information. SM is

increasingly being used in the workplace for reasons other than pleasure seeking (Bughin,

Chui & Miller, 2017; Bughin & Manyika, 2016).

According to Leidner and Kayworth (2016), businesses have recognized the value of

social media in assisting collaborative learning at work, and many businesses are using it to

share ideas and discuss problems. In general, SMEs use social media to share their knowledge

with others (Salam & Hoque, 2019). The use of social media (e.g., Facebook, WhatsApp,

Twitter) by businesses has an impact on customer interactions, information accessibility,

and marketing (Ainin, Parveen, Moghavvemi, Jaafar & Shuib, 2015). SME’s use SM as an

interconnected collection of strategic resources to achieve superior performance. According to

Cooley and Smith (2010), SMEs with a large Facebook following have a better chance of

increasing their business productivity because the Facebook fan page is now a crucial

relationship builder with customers and clients. New marketing methods have emerged as a

result of social media, which have replaced earlier sorts of promotional activity (Salam &

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Hoque, 2019). Customers on social media can be drawn to SMEs by providing a brief

synopsis of their services and products, and if they like what they see, they can click on

links to the company's website for further information. As a social technology, SM differs from

conventional communication technology systems in that it allows for more clarity, open

conversation, and candidness in the workplace, which may conflict with the organization's

ideals (Leidner & Kayworth, 2016). Kwok and Yu (2013) found that SMEs’ sales

performance improved when they adopted Facebook. According to Hassan et al. (2015), social

media can have a big impact on company by influencing purchase decisions. Using social

media allows SMEs to reach markets outside of their immediate geographic area without

having to establish a physical presence (Bilbao-Osorio et al., 2014). It appeals to SME owners

since it has the ability to transcend geographical boundaries, distances, and time (Alarcon et al.,

2015). Because of the impact of social media on SMEs, it has become a hot issue in business

and entrepreneurship research (Edosomwan et al., 2011). According to Durkin et al. (2013),

SMEs can profit particularly from embracing alternative company management tools such

as social media because they often lack the resources required for traditional management.

The increased usage of social media by SMEs has been recognized as a compelling topic in

the expanding entrepreneurial process (Bughin et al., 2017). The most commonly mentioned

entrepreneurial network kinds, according to a thorough assessment of the literature on the

subject, are business networks, social networks, user networks, buddy networks, and recreation

networks (Arslan & Zaman, 2014). Entrepreneurs who start businesses are more likely to

know and collaborate with other entrepreneurs than those who do not, according to the

Global Entrepreneurship Monitor (GEM). Concentrating on SM analysis focuses on the

23
relationships between entrepreneurs and people who can provide the resources needed to start a

firm, as well as their relationship (Larson &Walker, 2016).

24
 CHAPTER THREE

RESEARCH METHODOLOGY

3.1 Introduction

This chapter is intended to discuss the methodology that is used to conduct the study. The

chapter therefore focuses on the target population, sample design, data collection procedures and

instruments and data analysis

3.2 RESEARCH DESIGN

Research design refers to a plan that describes how, when, and where data are to be collected and

analyzed so as to get an overall for answering the research question or testing the hypothesis

(Polit, 2014). This paper adopted a quantitative research method using descriptive survey design

for an exploratory study such as this. Cooper and Schindler, (2016) defined a descriptive study as

one that is concerned with determining the frequency with which something occurs or the

relationship between variables. Questionnaires and secondary data were used for the study which

comprised of research publications, journals, text books and online resource materials.

3.3 POPULATION OF THE STUDY

Paul and Hungler (1999:37) refer to the population as an aggregate or totality of all the objects,

subjects or members that confirm a set of specifications. The target population of the study

covered SME’s registered with SMEDAN in Kano Metropolis, According to SMEDAN, the total

number of registered SME’s in Kano Metropolis are 885.

25
3.4 SAMPLE SIZE AND SAMPLING TECHNIQUES

Random sampling technique was used in selecting 99 SMEs from the entire population. This was

chosen due to the financial of the researcher coupled with time constraints.

3.5 METHOD OF DATA COLLECTION

These are the tools or methods used in getting data from respondents. In this study,

questionnaires are the research instruments used. Questionnaire is one of the research instrument

used for the study to gather necessary data from the sample respondents. The questionnaire is a

structured type which provides answers to the research questions and hypothesis. Secondary data

were also used for the study which comprised of research publications, journals, text books and

online resource materials.

The tool for data collection was self-administered closed ended questionnaire for the purpose of

validity and full response rate.

3.6 METHOD OF DATA ANALYSIS AND PRESENTATION

Having gathered the data through the administration of questionnaire, the collected data will be

analysed using Statistical Package for Social Sciences (SPSS) software. Correlation analysis

would be used to analyse data.

26
 CHAPTER FOUR

PRESENTATION, ANALYSIS AND INTERPRETATION OF DATA

4.1 Introduction

This chapter analyses, interprets and presents the findings gathered from the data collected

above. It provides for the result based on the analysis of social media marketing and performance

of small and medium enterprises in metropolitan Kano. This chapter contains the analyzed data.

The findings were presenting in tables.

Table 4.1: Micro Businesses using Social Media for Business in Kano metropolis

SMEs using Social Frequency Percentage Valid Cumulative

media for business percentage percent

Yes 64 64.6 64.6 100

No 35 35.4 35.4 35.4

TOTAL 99 100 100

Source: Field survey, 2023.

The above table indicates that out of 99 respondents 35 were found not to be using social media

for business and 64 were using social media.

27
Table 4.2: Type of SME business in Kano Metropolis

Type of business Frequency Percentage Valid Cumulative

(%) percentage percentage

Customer service 31 48.5 48.5 48.5

Distribution 7 11.1 11.1 59.6

Manufacturing 5 8.1 8.1 67.7

Retailing 21 32.3 32.3 100

Total 64 100 100

Source: Field survey, 2023

The above table indicates that out of the 64 respondents that use social media in their business,

almost 31 respondents which is 48.5% are pertained to customer service, while the rest pertained

to retailing, manufacturing and distribution put together which indicates the use of social media

is maximum in service industry and minimum in distribution.

Table 4.3: Frequent Social Media Usage by SME’s

Frequent use of Frequency Percentage Valid Cumulative

Social media Percentage frequency

Yes 41 64.1 64.1 64.1

Sometimes 22 34.4 34.4 98.5

No 1 1.6 1.6 100

Total 64 100 100

Source: Field survey, 2023

28
The above table shows that 41 respondents are using social media frequently, 22 respondents

uses the social media sometimes, 1 respondent does not frequently make use of social media

which clearly indicates that the frequency to engage with social media tools is more and thus it

can be used to spread brand visibility.

Table 4.4: Most used social medium platforms by the SMEs

Social Media Frequency Percentage Valid Cumulative

Platforms Percentage frequency

Facebook 20 31.3 31.3 31.3

Whatsapp 15 23.4 23.4 54.7

Instagram 19 29.7 29.7 84.4

Twitter 8 12.5 12.5 96.9

Youtube 2 3.1 3.1 100

Total 64 100 100

Source: Field survey, 2023

The table above shows that most of the respondent uses Facebook for marketing their business at

31.3 percent, Instagram was the next most used platform at 29.7 percent, 23.4 percent of the

respondents uses whatsapp, 12.5 percent uses twitter while 3.1 percent uses Youtube.

29
Table 4.5: Other Media used along with Social Media

Other media used Frequency Percentage Valid percentage Cumulative

frequency

No 31 48.4 48.4 48.4

Yes 33 51.6 51.6 100

Total 64 100 100

Source: Field survey, 2023

The above table shows that 31 out of 64 respondents that use social media marketing do not use

other media and 33 out of the 64 use other media supplementing social media which shows that

almost 50% respondents use traditional media along with social media.

4.2 Test of Correlation

The significant level of 0.05 was set to either accept or reject Ho

The test of correlation is between the variables in the study

Table 4.6

Test correlation showing negative relationship between social media and SME’s in Kano

Metropolis

Performance of SMEs

High Low

High social media usage 56 (87.5% ) 2 (3%)

Low social media usage 6 (9.5% )

Source: Field survey, 2023

30
The Social Media Usage was cross-tabulated with high and low performance of the SME’s. The

findings revealed that among the 64 respondents who use social media, 56 participants

representing87.5% who reported high Social Media Usage also reported high performance, 2

participants representing 3% who reported high Social Media Usage also reported low

performance and 6 participants representing 9.5% who reported low Social Media Usage also

reported low performance. This implies that Social Media Usage has a positive relationship with

the performance of SMEs in Kano Metropolis.

Table 4.7:

Test correlation showing the positive relationship between social media and SME’s in Kano

Metropolis.

Performance of SMEs

High Low

High social media usage 56 (87.5% ) 2 (3%)

Low social media usage 6 (9.5% )

Source: Field survey, 2023

The Social Media Usage was also cross-tabulated with high and low performance of the SME’s.

The findings revealed that among the 64 respondents who use social media, 56 participants

representing87.5% who reported high Social Media Usage also reported high performance, 2

participants representing 3% who reported high Social Media Usage also reported low

performance and 6 participants representing 9.5% who reported low Social Media Usage also

reported low performance. Just like the Ho1 tested this also shows that Social Media Usage has a

positive relationship with the performance of SMEs in Kano Metropolis.

31
Table 4.8: Model Summary

Model R R Square Adjusted R. Std. Error of the

Square estimate

1 .333(a) .111 .104 1.65514

The model summary (Table 4.7) provides helpful information about the regression analysis.

First, the ‘R’ column is the correlation between the actually observed independent variable sand

the predicted dependent variable (i.e., predicted by the regression equation). ‘R square’ is the

square of R and is also known as the ‘coefficient of determination’. It states the proportion (or

percentage) of the (sample) variation in the dependent variable that can be attributed to the

independent variable(s). Further explanation is given under the Table 4.9 below.

Table 4.9: ANOVA (b)

Model Sum of Squares DF Mean Square F Sig.

Regression 45.354 1 45.354 16.556 000(a)

Residual 1 364.350 133 2.739

Total 409.704 134

In this study 11.1% variation in brand awareness. The first hypothesis which stated that “social

media usage has no positive relationship with the performance of SMEs was rejected at R=0.33,

R 2=0.11, F (1, 134) =16.556; p<.05. The first hypothesis is therefore rejected. This implies that

Social Media Usage has a positive relationship with the performance of SME’s in Kano

Metropolis.

32
 CHAPTER FIVE

SUMMARY, CONCLUSION AND RECOMMENDATION

5.1 Introduction

This chapter helps to draw summary, conclusions as well as recommendations and other areas

for future research.

5.2 SUMMARY

The purpose for conducting the research was to examine the positive relationship of social media

to the performance of small and medium enterprises in Kano metropolis. The research questions

that guided the study included: What is the effect of social media on SME’s performance in

Kano Metropolis? What is the relationship between social media and sales of SME’s in Kano

Metropolis? What is the relationship between social media and profitability of SME’s in Kano

metropolis?

SMEs in Kano metropolis were used as case study for this research. A survey research design

was applied. According to SMEDAN, the total number of registered SME’s in Kano Metropolis

are 885. However, in collecting data a set of 99 questionnaires were administered, Secondary

data were also used for the study which comprised of research publications, journals, text books

and online resource materials. The results were analysed using Statistical Package for Social

Sciences (SPSS) software. The statistical tools used were model summary, analysis of variance

(ANOVA) and co-efficient table in testing the research hypotheses. The findings from the study

showed that social media marketing is as important as every other traditional marketing tool as it

has been empirically proven that a significant relationship exists between social media usage in

33
small and medium businesses to engage customers and increase business performance as well as

profitability.

5.3 Conclusion

The study concluded that there was a positive and significant relationship between social

media dimensions and performance of SMEs in Kano metropolis, Kano state of Nigeria.

Based on the study findings, it was depicted that SMEs in Kano Metropolis have been

using social media to a large extent and this has contributed to better market performance. It

was evident that social media has helped these enterprises to reach out more customers and

satisfy their needs, enhance brand awareness, brand loyalty and sales volume. With such

performance benefits this study concludes that it is strategically imperative to make effective

use of social media among owner-managers and their actual and potential customers. This

study had shown that social media represents a potential vehicle to help small businesses

create better brand awareness, better relationships with customers, and increase sales via

these mechanisms. It had clearly brought out to the small business owners and managers that

that social media plays a vital role when it comes to forming intangible ties with clients

and establishing an effective business performance.

5.4 Recommendation

Recommendations are therefore made by the study to small and medium businesses to engage

more in using social media to engage with customers and other prospects. This would enhance

brand awareness as well as increased sales. Also, the study recommends that the small and

medium businesses in Kano metropolis and others invest more financially and technically

(enhanced know-how) in deploying social media marketing tools to engage with customers and

34
prospects. The study hence makes recommendation for further study into the assessment of

social media marketing and growth of Small and Medium Enterprises in Nigerian states and

cities. Further study can also be carried out on the effect of social media marketing on

performance of larger firms and corporations.

35
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