Millennial Consumer’s on Instagram: Implications for Luxury Brands vs. Celebrity Influencers: An Abstract

Abstract

Brands and retailers have solidified their presence online and their interaction efforts with consumers on social media. Studies have looked at the interaction of brands with consumers and their ability to advertise (Ashley and Tuten 2015; Hudson et al. 2016). However, utilizing social media platforms in marketing brings a challenge to brands due to its openness as well as fast changing nature (Colliander and Marder 2018). The luxury market will be worth nearly 375 billion by 2020, and millennials (Generation Y and Z Cohort) are expected to account for 45% of the global personal luxury goods market (Luxury Goods Market 2014; Solomon 2017). The millennial generation is extremely technology savvy and more likely to use the internet wirelessly, thus expecting to be engaged and communicated via online seamlessly (Chu and Kamal 2011). Parasocial Interaction Theory (PSI) is defined as “an illusionary experience, such that consumers interact with personas (i.e. mediated representations of presenters, celebrities, or characters) as if they are present and engage in a reciprocal relationship” (Labrecque 2014, p. 135). This study adopts Instagram, a visual-oriented social media platform, as the study context. As one of the popular social media platforms, Instagram is recognized as the most effective platform for luxury fashion brands (WWD Staff 2017). college students from a large Midwestern university were recruited (n = 385). The survey was consisted of 35 series of questions that assess brand relationship to a celebrity influencer and the brand on Instagram. The survey questionnaire included consumers’ perceived interactivity (McMillan and Hwang 2002; Labrecque 2014), similarity/likeability (Reysen 2005), parasocial interaction (Rubin et al. 1985; Labrecque 2014); willingness to share information (Schoenbachler and Gordon 2002; Labrecque 2014). A total of 121 usable responses were retained, and the data was analyzed using SPSS 22.0. Since this study is an exploratory nature, simple statistical analyses such as descriptive statistics, reliability tests, Principal Component Analysis (PCA), independent t-test, and regression analysis were conducted. This study concludes that people who follow both (brand and celebrity influencer) feel more interacted with the brand. Overall the millennial consumer prefers interactions with both brand and celebrity influencer, which would create a feeling of PSI. The results present that if a brand is using a celebrity influencer, influencer needs to be interacting with the followers on Instagram more often whereas a brand needs to be transparent on Instagram in order to gain trust of millennials through open conversations (e.g. what they offer, sustainability, communication, etc.).