Customer engagement on social media, brand equity and financial performance: a comparison of the US and Korea

Abstract

Purpose The purpose of this paper is to analyze the relationship between customer engagement in social media (CESM), brand equity and corporate performance and investigated whether these relationships differed according to cultural factors in the United States and South Korea. Design/methodology/approach We collected customer engagement on social media data on Facebook and brand equity data from Interbrand for listed companies in the United States and Korea. A total of 405 data sets were analyzed by partial least squares structural equation modeling (PLS-SEM). Findings Results revealed that CESM did not affect financial performance through a direct path but was found to have a positive indirect path via the mediation of brand equity. In addition, this relationship was found to differ between the United States and South Korea. Originality/value This study contributed to the literature on social media and international management by verifying the relationship between CESM, brand equity and financial performance, and by presenting exploratory research results to ascertain if these relationships differ according to the cultural dimension of the country.