Social media usage and firm performance: the mediating role of social capital

The emergence of various new technologies, especially social media, has led to their worldwide acceptance, as these technologies offer dual-benefit to the employees in terms of work as well as socialization and entertainment. However, the knowledge about the influence of these social media technologies on the performance of a company is limited. This study measures the influence of social media usage on firm performance, mediated by social capital. Data were collected using surveys method from a sample of 132 social media users of large IT company community members. It was found that all the three dimensions of social media usage (social use, hedonic use and cognitive use) have a positive influence on firm performance (financial and market performance). Social capital was found as a partial mediator between the relationship of social media usage and firm performance. Theoretical and managerial implications along with future research directions are also discussed. © 2017, Springer-Verlag GmbH Austria.