Impact of Social Experience on Customer Purchase Decision in the Social Commerce Context of Instagram

Social commerce is a new business model formed from the merger of social networking and e-commerce that promotes product sales and influences user purchasing behavior via a network of social media and social networking sites. As social experience such as recommendations, interactions, and communication between people, is viewed as the fundamental component that drives social commerce, monitoring its influence on an individual's purchase decision becomes critical. The writing of this thesis is to research Instagram as research object to analyze factors of Social Experience which are impacting Customer Purchase Decision. The data was obtained by distributing a questionnaire to 125 respondents who had Instagram apps installed on their smartphone and had at least two transactions in the previous 6 months. The data were analysed with the Structural Equation Model (SEM) using Amos 22.0 software. The study has indicated that Subjective Norms has positive significant effect on Customer Purchase Decision with regression coefficient value of 0.195; Peer Communication has positive significant effect on Customer Purchase Decision with regression coefficient value of 0.247; Emotional Support has positive significant effect on Customer Purchase Decision with regression coefficient value of 0.336, Parasocial Interaction has positive significant effect on Customer Purchase Decision with regression coefficient value of 0.352 and lastly Perceived Herd Behavior has positive significant effect on Customer Purchase Decision with regression coefficient value of 0.325.