The Influence of Social Media on MSME Performance with Product Innovation as a Mediating Variable
DOI:
https://doi.org/10.61159/mv0rb705Keywords:
Social Media, Product Innovation, MSME PerformanceAbstract
The increasing use of social media as a digital marketing tool, however, its effectiveness in improving business performance still shows mixed results. The purpose of this study is to analyze the influence of social media and product innovation on company performance in the MSME sector in Pesanggrahan District. This research methodology used a quantitative approach, with a total population of 308 and a sample of 175 selected through purposive sampling. The survey method used was questionnaires distributed to MSMEs in Pesanggrahan District, and SEM-PLS was used for analysis. The results showed that social media use has a direct effect on MSME performance. However, social media has a positive and significant effect on product innovation. Furthermore, product innovation has a positive and significant effect on MSME performance. The results of the mediation analysis showed that product innovation significantly mediates the relationship between social media and MSME performance. These findings confirm that social media utilization will be more effective in improving MSME performance if it is accompanied by the business owner's ability to innovate products. This research contributes to MSMEs optimizing the use of social media as a means of developing product innovation and serves as an academic reference for developing studies on digital marketing and MSME performance.
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