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Social media is a new phenomenon that has changed how the business environment operates. Businesses are able to gain access to resources that were otherwise not available to them. It has also helped businesses to increase their worthiness, cultivate strategic partnerships and increase their contact with customers and suppliers. It is therefore become important for business owners and marketers to understand how social media work as a communication and marketing tool and how they can significantly grow their businesses. The study investigate the effects of social media on small business in Ogun State. This was done by determining the major activities underlying the entrepreneurial development in Nigeria, the contribution of social media to business progress and effects of adopting social media platform on small business. The study adopted a survey research design. 200 Questionnaires were administered to the business owners in two local government within the states out of which 193 were retrieved. Both descriptive statistics (mean, frequency and percentage) and inferential statistics (regression) were used to analyze the quantitative data that was collected with the aid SPSS. The results of the study have been presented in tables and figures for easy interpretation. Among the result reveals from the study are: there is a positive and significant effects of the adoption of social media platforms on business activities of the selected small business, Social media has open up more business opportunities and reduce the overall coast of business operations. The study recommends that to better increase business results, small business owners must understands their digital needs or take help from expertise to save time and help achieve success online all start within a small budget also Presence on Facebook, and other social media channels such as Facebook, Twitter and WhatsApp etc., is highly recommended to small business to reduce their overall cost of operations. It was concluded that the use of the social media contributes to the growth of small businesses.



1.1         Background to the Study

Entrepreneurial development all over the world and especially in Nigeria is a must to national economic growth and development. Apart from being the best approach to further diversify the nation’s economy from her mono-economy status, it is also crucial to poverty eradication and employment generation. In fact, it has been affirmed to be the bed rock of nation’s industrialization and the beginning of new era (Ogundele, 2007; Akinbola, Ogunnaike and Tijani, 2013). Entrepreneurship itself has a long history and can be dated back as far as 17th and early 18th centuries with the popular work of Richard Cantillon and Adam Smith but was largely ignored theoretically until the late 19th and early 20th centuries and empirically until a profound resurgence in business and economics in the last 40 years (Ebbena and Johnson, 2006; Shane, 2003).

In modern society, businesses have taken different forms in terms of ownership, available resources, management and control and all these have informed the definition of a small scale business. Meanwhile, the experience of many developing economies like Nigeria has shown that small and medium scale enterprises (SMEs) can


meaningfully contribute to the attainment of the national economic objectives (Abu & Ezike, 2012). Small scale businesses in particular have the potentials to achieve development objectives such as output expansion, employment generation, income redistribution, and indigenous entrepreneurship promotion and technological advancement among others (Abu & Ezike, 2012; Ogujiuba, Ohuche, & Adenuga, 2004).

In corollary, the contemporary organizations, small or big, now operate in the external environment characterized by intense global competition, technological innovation and change. This setting has the need for businesses to take initiatives, embrace risk, stimulate innovation and cope with level of uncertainty associated with external business factors such as technological innovation and change (Emangholizadeh, Borghei & Matein, 2011). Hence, this has led to the emergence of new media of marketing communications (Kotler & Keller, 2012) beyond the expectations of average entrepreneurs including the small business owners in recent times. The current trend toward social media as a new form of marketing communications with consumers is part of the change.

It is therefore not an understatement that the idea behind social media is far from groundbreaking (Kaplan & Haenlein, 2010). In fact, it is a new form of marketing communications that have revolutionalised the modern business communications and marketing practices across the globe (Kotler, 2012). The concept of social media has indeed generated confusion among scholars and practitioners (Kaplan & Haenlein, 2010) but one can trace its evolutionary development from the origin till date to be able to appreciate its relevance to the small scale businesses. According to Kaplan & Haenlein


(2010), social media has really passed through different stages of development before the popularity accrued to it today.

In their own account, social media started in 1979 by Tom Truscott and Jim Ellis from Duke University as the ‘Usenet’ representing a worldwide discussion system that allowed Internet users to post public messages. It became popular about 37 year ago, when Bruce and Susan Abelson founded ‘Open Diary,’ an early social networking site responsible for bringing together online diary writers into one community (Kaplan & Haenlein, 2010). This led to the creation of ‘weblog’ which also truncated as ‘blog’’ a year later when one blogger jokingly transformed the noun ‘weblog’ into the sentence ‘we blog’. With the increasing high-speed Internet access, social networking sites such as MySpace (in 2003) and Facebook (in 2004) were created and consequently, the term ‘Social Media’ was coined and became popular as it is used by all today. It has witnessed the most recent addition, with the advent of the so-called ‘virtual worlds,’ a computer-based simulated environments inhabited by three dimensional avatars (Kaplan

&   Haenlein, 2010). The new dimensions have added LinkedIn and several other social platforms like Twitter, Whatsapp and the rest.

Among the observed challenges include finding alternative replacement for physical distribution of goods and contacts with consumers via virtual interactions and even intimacy through social media platforms like Facebook and LinkedIn or Whatsapp (Jones, Borgman & Ulusoy, 2015). Besides, social media has created a lot of

countless   opportunities   for   small    businesses    as   they   spend   less   on    marketing


communications and do not need to bother themselves on the required financial resources to reach out to their numerous customers using other traditional marketing communications tools (Jones, Borgman & Ulusoy, 2015). From the foregoing, it is

clear that social media has brought some challenges and opportunities to small scale businesses today (Kaplan & Haenlein, 2010). Moreover, small scale businesses must learn to use social media to their best advantage simply because of its far-reaching impact. Consequently, the concern of this study was to examine the effects of social media on different aspects of business operations of those businesses categorized as the small scale businesses, using selected small scale businesses in Ogun State, Nigeria as a case study.

1.2         Statement of the Problem

The fact that small and medium scale enterprises operating in Nigeria side by side with large scale industries portend certain advantages from its small size. Nevertheless, the growth of small businesses or SME sub-sectors generally has been adversely affected by several factors as a whole but the case of small scale enterprises is aggravated and far more sharply because of their precarious defense mechanisms. One of the significant problems facing the small scale businesses is lack of marketing abilities and necessary skills to deploy modern technologies to reach out to its wide range of customers.

Besides, the complexity of the modern market conditions and poor locations of their sale outlets further restrict their ability to analyze and cope with the changing trends in the


marketplace. Some small scale firms do not even have the financial muscle to compete favourably. These include what it takes to install new technologies, hiring and offering the same wage rate compared with large scale firms to attract best skilled workers to help them deal with the emerging issues arising from the technological change and adoption of new innovations such as social media platform to reach out and compete better.

Poor adoption rate of technological innovations may have contributed to their lack of access to sources of funding. The situation facing most SMEs in Nigeria gets worse by the inadequacy of infrastructural facilities thereby hampering industrial growth of SMEs in Nigeria. Could new technologies mean some progress for the SME sub-sectors in Nigeria? Do they stand to benefit a lot if they embrace the technological change brought by the social media networking sites? What impact would the adoption of popular social media platforms have on the general business operations of the small scale businesses and their owners? Obvious gap exists in providing answers to these puzzles and many more in the existing literature on the effects of social median on small scale businesses in Nigeia. This further stresses the need for this study as an attempt to examine the effects of social media on small scale businesses in Nigeria, using some selected small scale businesses in Ogun State as a case study.

1.3         Objectives of the Study

The main purpose of the study is to investigate the effects of social media on small scale businesses in Ogun State, Nigeria. Specific objectives of the study therefore include to:


  1. Examine activities underlying the entrepreneurial development in Nigeria with special reference to the business activities of small scale businesses in Ogun State in the last two decades;
  1. Appraise the role of social media, as an environmental variable, in modern business enterprises, especially its contributions to their business progress in times;
  2. Evaluate the effects of the adoption of social media platforms on business activities of the selected small scale firms.

1.4        Research Questions

The following questions were attempted in view of the stated objectives of the study:

  1. What are the major activities underlying the entrepreneurial development in Nigeria in the last two decades?
  1. To what extent has the social media contributed to the business progress in Nigeria and beyond?
  1. Does the adoption of social media platforms have any significant effects on business activities of the selected small scale firms?

1.5         Relevant Research Hypotheses

The study also tested the following hypotheses:

1)      Ho: Social media has no significant role to play in the business progress in Nigeria and beyond.

Hi: Social media has significant role to play in the business progress in Nigeria and beyond.


2)      Ho: There are no significant effects of the adoption of social media platforms on business activities of the selected small scale firms.

Hi: There are no significant effects of the adoption of social media platforms on business activities of small scale firms.

1.6         Operationalization of Research Variables

The variables of the study are operationalized thus:

Y = f(X)

Where Y = social media

X = small scale business

X = (x 1 = innovativeness, x2 = risk taking, x3 = business )

By simple equation we have

Y   = f(x 1)………..1 Y = f(x 2)………..2 Y = f(x 3)………..3


The regression equation is given as:

Y   = α0 + β1x1 + µ………1 Y = α0 + β2x2 + µ………1

Y = α0 + β3x3 + µ………1

1.6        Significance of the Study

This study would be highly valuable to different stakeholders in the campaigns towards speedy entrepreneurship development in Ogun State and across Nigeria. First, it would be an eye opener to the Ogun State stakeholders and SME- sub-sector, especially in the area of business process improvement, office and marketing practices . Second, it would also improve their adoption rate of embracing the social media platforms in moving their businesses forward from the present state.

Third, the results emanating from this study would be a revelation to online- business operators and service providers and business students generally as it would also expose them to the vantage positions brought by the introduction and adoption of social media in the business world. Moreover, the results from this study will also help IT professionals, entrepreneurs and small business owners to facilitate the required learning opportunities in the area of social media toward onward development of their entrepreneurial skills and improvement in their business performance in future.


Lastly, the study will be incomplete without mentioning its invaluable contribution to knowledge base and existing literature as well as the research libraries across the country on the subject matter as it will satisfy the knowledge quest and the need of any interested readers, lecturers and future researchers in the area of provision of some useful insight to them for any future studies in the similar area.

1.7         Scope of the Study

This scope of the study is restricted to two Local government areas in Ogun State, Nigeria owing to certain restrictions such as limited time frame and insufficient funding to carry out this study.

1.8         Definition of Terms

Avatars: Some icons or figures used to represent particular persons in a video game,

Internet forum or social media networks.

Business: refers to any form of interactive economic activities that lead to exchange of value through want satisfying goods or services.

Capital and Finance: Capital is the money used in starting up a business or other materials set aside for production of wealth while finance refers to monetary resources or available funds or sources of funds to a business firm.

This material content is developed to serve as a GUIDE for students to conduct academic research


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