BEYOND SOCIAL MEDIA ADOPTION: EXPLAINING THE ADOPTION–OUTCOME DISCONNECT IN DIGITAL MARKETING VALUE CREATION AMONG INDIAN MICRO AND SMALL ENTERPRISES

Abstract

Social media marketing (SMM) gives micro and small enterprises (MSEs) relatively accessible ways to reach customers, communicate with markets and collect feedback, yet activity on social platforms does not necessarily produce equivalent customer or firm value. This study examines that distinction using survey evidence from 400 Indian MSEs that actively use SMM. The empirical design evaluates social media budget, time spent, posting frequency, platform breadth, content breadth and an adoption index in relation to customer engagement, brand loyalty and business performance. The outcome measures demonstrate exceptionally high internal consistency, with Cronbach’s α=.990 for customer engagement, .986 for brand loyalty and .987 for business performance. The high reliability supports measurement consistency, although it does not by itself establish construct validity or causal relationships. The regression evidence provides limited support for a direct adoption-to-outcome relationship. The customer-engagement model is not statistically significant (R²=.010, F(5,394)=.830, p=.529), and the brand-loyalty model is likewise non-significant (R²=.004, F(5,394)=.301, p=.912). The business-performance model explains 2.2% of the variance and is not statistically significant at the omnibus level (F(5,394)=1.74, p=.124). Two coefficient-level signals nevertheless warrant attention: time spent on social media is positively associated with performance (β=.154, p=.025), whereas the adoption index is negatively associated with performance (β=−.143, p=.043). Because the overall performance model is non-significant and the study is cross-sectional, these coefficients are treated as diagnostic signals rather than robust causal effects. The central finding is therefore not that SMM is ineffective, but that observable adoption intensity is an incomplete explanation of value creation. Platform presence, posting activity and broader adoption can create opportunities for interaction, but those opportunities require complementary capabilities such as content quality, responsiveness, customer insight, analytics and integration with customer-management routines. The paper consequently develops the concept of an adoption–outcome disconnect and positions it within the resource-based view and dynamic capabilities perspectives. The theoretical contribution lies in reframing SMM from a simple adoption problem to an adoption–capability–outcome problem and in treating weak direct effects as theoretically informative rather than as evidence of research failure. For managers, the implication is to evaluate social media through conversion measures response quality, meaningful engagement, customer retention, inquiries and business outcomes rather than platform count alone. Future research should test the proposed conversion logic directly through validated capability measures, mediation and moderation models, multi-source performance indicators and longitudinal designs. Methodologically, the study separates the descriptive evidence of adoption from the inferential evidence of outcomes and avoids treating individual significant coefficients as proof of a significant regression model. This distinction is important because the sampled firms are active adopters, meaning the analysis addresses variation in intensity among users rather than the initial decision to adopt social media. The findings also suggest that the performance consequences of digital activity may be contingent on managerial attention and the quality of organisational routines that surround social-media use. Accordingly, the paper contributes a more cautious interpretation of adoption–performance research and specifies measurable directions for future empirical testing. The resulting framework distinguishes digital presence, digital activity and digital capability as analytically different constructs.