SOCIAL MEDIA USAGE IMPACTS ON SME’S FIRM PERFORMANCE: EVIDENCE FROM WEST JAVA, INDONESIA

: This study aims to answer two questions, namely whether social media usage affects the firm performance of Small Medium Enterprise (SME), and what factors encourage SME to use social media. Using path analysis, this study proves that social media usage has a positive significant influence on firm performance of SME. While using the Technological-Organizational-Environmental (TOE) framework, it was found that organizational factor has the greatest positive influence on social media usage. Environmental factor are the second biggest factor that encourages SME to use social media. While the technological factor is the least factor that influence SME to use social media. This research was conducted in 300 SMEs in West Java, Indonesia, and involved various business sectors ranging from food and beverage to automotive. The findings of this study contribute to the academic discussion of strategic entrepreneurship on the relationship between social media usage and firm performance. The findings of this study can also provide direction to examine how is the mechanism of the relationship between social media usage and firm performance of SME.


INTRODUCTION
According to research by Tajvidi & Karami (2017), in the last two decades social media has played a very important role in business performance.This has happened since web 2.0 applications were created and the ability of the internet to transfer data through social networks which allows individuals to interact online has become increasingly easy.Social media can act as a mediator between the company and its stakeholders.Social media also plays a role in democratizing the communication process between companies and their audiences.
According to research by Akmese et al. (2016), technological improvements lead to rapid information sharing (rapid sharing) which makes business behavior that depends on consumers (customer-based business manner).This pattern of behavior will make the company more informed by the opinions expressed on social media so that their wishes and expectations can be accommodated by the company as input in creating and producing products and services that are expected to meet consumer expectations.Responding to the rapid development of social media, many companies and businesses are using social media to improve company performance and primarily to increase sales.Kaplan & Haenlein (2010) define social media as "a group of Internet-based applications that build on the ideological and technological foundations of Web 2.0, and which enable the creation and exchange of usergenerated content".According to data collected by We Are Social, the number of internet users is 202.6 million (73.7% of the population) with a growth of 15.5% from 2020 to 2021.As for active social media users in Indonesia as many as 170 million or 61.8% of the population, an increase of 6.3% in the same year.Social media has the potential to create financial benefits, because using social media allows the creation of business value related to branding, sales, customer service and product development.According to Akmese et al. (2016) who examined public companies in Turkey also proved that companies that utilize social media have better performance compared to those that do not utilize social media.
Small and Medium Enterprises (SME) play a role as the foundation for Indonesia's economic independence.
Secretary of the Ministry of Cooperatives and SMEs Agus Muharram emphasized the importance of SME taking advantage of the existence of social media to improve the sales performance of their products (UMKM Harus Mampu Manfaatkan Media Sosial, n.d.).In the midst of a pandemic, the Indonesian Ministry of Cooperatives and SMEs noted that there were at least 37,000 SME players who felt the impact of the Covid-19 virus (Pentingnya Media Sosial Untuk Mengembangkan UMKM Di Masa New Normal Halaman All -Kompasiana.Com, n.d.).According to the Indonesian Retail Entrepreneurs Association, changes in consumer behavior patterns have a direct effect on modern retail, resulting in a plunge in transactions of 80-85 percent for non-food products and 30-40 percent for food products since the implementation of the social restriction in April 2020.
Facing this Covid-19 pandemic, SMEs survive by relying on the internet using social media to carry out their business activities.The use of social media is mainly used as a means of marketing SME products because it is faster, practical and easier.Based on a survey conducted by the Indonesian Ministry of Cooperatives and SMEs, there was a significant increase in turnover from SME who were connected to the online marketplace during the pandemic.Unfortunately, only 13 percent of SME are connected to social media (Pikiran Rakyat, 2020).The Indonesian Minister of Cooperatives and SMEs hopes that the Covid-19 pandemic will be a momentum for the transformation of SMEs into a digital ecosystem n.d.).
In the current pandemic era, the use of social media has the potential to improve performance for SME in Indonesia, but there is still little empirical evidence available.Therefore, research on how the use of social media affects SME performance needs to be done.Theoretically, there are two theoretical foundations that can be used to analyze the use of technology in a company, namely: diffusion of innovation (DOI) (Rogers, 2010); and the technology, organization, and environment (TOE) framework (Tornatzky et al. 1990).This study uses the TOE framework to investigate the impact of social media use on SME performance in West Java.dimensions adopted from Ahmad et al. (2019).The use of social media is measured using 9 indicators adopted from Ahmad et al. (2019).Finally, company performance is measured using 7 indicators and 7 dimensions adopted from Selvam et al. (2016).All variables were tested for validity and reliability before distributing the questionnaire.To test the validity, we compare the r score and r table from Pearson Product Moment and the results obtained are all valid variables (r count> 0.113).Reliability testing using the Cronbach Alpha criteria method (>0.6) and it is found that all variables meet these criteria.
We analyze the use of social media as a technology or innovation, so we use the TOE framework.The TOE framework was developed in 1990 by Tornatzky and Fleischer.TOE identifies three aspects of the corporate context that influence the process by which technological innovations are implemented: the technological context, the organizational context, and the environmental context.Compactibility, complexity, and relative advantage are characteristics of technology.Organizational characteristics include top management support and organizational competency, environmental characteristics of competitive pressure and technology support (Tornatzky et al. 1990).The TOE framework can be seen in Figure 1.

METHODS
The population in this study is SME in West Java.The sampling technique used in this study is non-probability sampling by using incidental sampling.The sample used in this study was 300 respondents who are the owners or person who understand the firm performance and the use of social media in their organization.The data was collected by survey using questionnaire and conducted from February to April 2021.The data processing in this study used SPSS software.This research uses quantitative research methods with descriptive research types.The unit of analysis studied in this study is the organization.The organization studied is an organization in the form of SME in West Java, Indonesia.This study uses a cross sectional method where all data will be collected first and then processed and analyzed.All items measured in this study were measured using a Likert scale, ranging from 1 (strongly disagree) to 4 (strongly agree).
Technological factor were measured using 24 indicators and 5 dimensions adopted from Ahmad et al. ( 2019 Keller, 2012).So it can be concluded that social media is an online platform that is used by each other where users can easily participate, interact, share, virtually without being limited by space and time.
The use of social media has been shown to have a positive effect on company performance (Ainin et al. 2015;Akmese et al. 2016;Daowd et al. 2020;Garcia-Morales et al. 2018;Mahboub, 2018;Rienda et al. 2020;Tajvidi & Karami, 2017).However, different findings in the study of (Ahmad et al. 2019) prove that the use of social media is not proven to have an effect on company performance.
According to Kimathi et al. (2015) firm performance was identified as one of the most important indicators of the influence of capital structure in the literature review.Alajmi et al. (2011) states that firm performance is a measurement of what has been achieved by a company that shows good conditions for a certain period of time.According to Rosli & Sidek (2013), performance is a reflection of a company.If the performance is bad, then the company is experiencing a setback while if the performance is good then the company is progressing.So, it can be concluded that firm performance is a term used to express something which includes organizational performance, the function of a company, and the results of a company's operational activities.There are two dimensions to measure firm performance according to Selvam et al. (2016), namely the financial dimension which includes profitability, growth, market value.There are also four strategic dimensions, namely customer satisfaction, employee's satisfaction, environmental performance, and social performance.
There are different findings on the effect of using social media on firm performance.Several findings prove that the use of social media has a positive effect on firm performance (Ainin et al. 2015;Akmese et al. 2016;Daowd et al. 2020;Garcia-Morales et al. 2018;Mahboub, 2018;Rienda et al. 2020;Tajvidi & Karami, 2017), while research by Ahmad, Bakar & Ahmad (2019) does not prove this.Therefore, it is necessary to investigate whether in the context of SME, the use of social media has a positive influence on firm performance.Then the hypothesis can be formulated as follows: H1: Social media usage has positive influence on SME firm performance.
The TOE framework, as shown above, provides an analytical framework that can be used to study the adoption and assimilation of various types of information technology innovations.The TOE framework has a solid theoretical basis, consistent empirical support, and potential applications for information systems innovation.Several technology adoption studies that use the TOE framework include studies from Triono (2019); Utami ( 2014 Based on the research of Triono (2019) stated that the technological and organizational aspects have a positive and significant influence on the adoption of information technology in SME, but there is no significant effect from the environmental aspect.A similar study by Ahmad et al. ( 2019) stated that organizational and environmental aspects have a positive influence on the use of social media, but the technological aspect only slightly affects the use of social media.Simultaneously, this study states that technological, organizational, and environmental aspects have an influence on the use of social media.Blanchard (2015) defines social media as communication tools, such as telephone and email, that support the objectives of important business functions, including public relations, marketing, customer interest generation, customer service, and market research.Some of the best uses for social media activities are to support these business functions, and here's the best part: Each of these business functions already has objectives and targets, which you can incorporate social media activities into.
According to Van Dijk (2013), social media is a media platform that focuses on the existence of users who facilitate them in their activities and collaboration.Therefore, social media can be seen as an online medium (facilitator) that strengthens the relationship between users as well as a social bond.Meikle & Young (2011) define social media as a convergence between personal communication in the sense of sharing between individuals (to be shared one to one) and public media to share with anyone without any individual specificity.Meanwhile, according to Kotler and Keller social media is a means for consumers to share text, image, video and audio information with each other and with companies and vice versa (Kotler &

Correlation
To see the strength of relationship between variables we use correlation analysis.It can be seen that there is no strong relationship between variables.The results of the analysis using correlation are presented in Table 2.

Classic Assumption
Classical assumption testing in this study was carried out by some test namely normality, heteroscedasticity, and multicollinearity.The normality test was carried out using the Kolmogorov-Smirnov test and the results obtained were 0.049 and at significance of 0.084 (>0.05) so that it can be concluded that the data were normally distributed.To test the variance inequality, a heteroscedasticity test was carried out using the scatter plot method.From the test results, it is found that the data is randomly distributed, does not form a certain pattern and is spread above and below the number 0 on the Y axis (Figure 3).
To make sure that there is no strong correlation among independent variables, a multicollinearity test was carried out by looking at the VIF value.There was no multicollinearity if the value was in the range of 0.1 to 10.In this study it was found that the VIF value of the three independent variables, namely technological factor, organizational factor, and environmental factor, respectively as follows: 1.442; 1.237; and 1.425.So, it can be concluded that there is no multicollinearity problem from the three independent variables.
To understand how SME adopt social media in their business activities, it is necessary to examine what factors influence this.Using the TOE framework, the use of social media as a form of innovation is influenced by three factors, namely technological, organizational, and environmental factors.Therefore, the following hypothesis can be formulated: H2: Technological factor have positive influence on the social media usage in SME.H3: Organizational factor have positive influence on the social media usage in SME.H4: Environmental factor have positive influence on the use of social media in SME.
The formulation of the conceptual framework based on the development of the hypothesis is depicted in Figure 2.

Descriptive Analysis
The results of the descriptive analysis revealed the level of each variable involved, namely technological factor, organizational factor, environmental factor, social media usage and firm performance.The details are summarized in Table 1.

Path Analysis
We separate the research model into two models.The first model involves TOE variables to social media usage.While the second model involves only two variables, namely social media usage to firm performance.The analysis results of the first model (Figure 4).From the analysis obtained the equation for the Y variable (social media usage) is as follows: The coefficient of determination of the first model is 0.346 or 34.6% is presented in the Table 3.Meanwhile, to find out the magnitude of the influence of each dependent variable on the use of social media, it is done by multiplying Beta by Zero-order as follows (Table 4).
From the calculation results, it can be seen that the influence of X 1 (technological factor) on social media usage is 6.5%; X 2 (organizational factor) on social media usage is 18.3%; and X 3 (environmental factor) on the use of social media by 9.8%.In testing the second model involving variables Y (social media usage) and Z (firm performance) the following results were obtained (Table 5).From the results of the second model test, it can be seen that the influence of the use of social media on the company's performance is 7.8% (Table 6).Overall, the results obtained from the path analysis can be illustrated in the following Figure 5.

Hypothesis Testing
This study has four hypotheses that were tested using path analysis.The test criteria use a comparison of the t value and its significance.In detail the results obtained are presented in the following Table 7. Apart from testing the hypothesis, further analysis was carried out to see how the indirect effect of this research model was.The results of the indirect effect analysis using the t-value criteria are presented in the following Table 8.
Judging from the t-value, there is a positive and significant indirect effect between each X variable (technological factor, organizational factor, environmental factor) on Z variable (firm performance) mediated by Y variable (social media usage).
Based on the results of data processing, it was found that the use of social media had a low positive effect on company performance by 7.8%.All analyzes conducted to examine the relationship between social media usage and firm performance show that social media usage has a positive significant effect on firm performance of SME.This is in accordance with the results of research by Rienda et al. (2020) which states that SME in the fashion industry in the UK and Ireland can improve their performance through two marketing tools, namely registering trademarks and using social media.The results of research by Ahmad et al. ( 2019) explain that bandwagon pressure has a significant influence on the use of social media.Bandwagon pressure is the tendency to follow something because everyone else is doing it.This finding is similar to Ahmad et al. ( 2019) research in the case of social media, it is likely that SME feel pressured to use social media because they want to meet the expectations of consumers who already use social media frequently.Therefore, it is possible that the trend of SME using social media occurs due to bandwagon pressure, not due to pressure from competitors.This happens because the behavior of consumers who have used the latest technology can build a social community, which triggers relationships between consumers to promote a product.This consumer behavior ultimately affects the firm and forces them to enter the social community, by using social media in order to respond to market needs and trends.In line with the results of this study, Tajvidi & Karami (2017) state that social media usage has a positive significant impact on firm performance in the hotel industry in the UK.Furthermore, research by Akmese et al. (2016) which also states that the use of social media in tourism companies has a positive impact on firm performance in Istanbul.
According to the results of data processing shows that the technological factor has a positive influence on social media usage by 6.5%.These results are in line with the results of research by Ramdani et al. (2013) and Ahmad et al. ( 2019)small and medium-sized enterprises (SMEs, which state that the technological factor has a positive effect on social media usage.In line with Haridakis & Hanson (2009) also proved that the technological factor has a positive influence on social media usage.competitive pressures and environmental pressures.In this study it was found that from environmental factors, the competition dimension was the greatest level.It suggested that SME were encouraged to use social media to be competitive.The third factor that has the least influence on social media usage is the technological factor.Technological factors are related to the relative advantage, compatibility, complexity, trialability, and observability of social media.The dimension of the technological factor with the lowest level is the compatibility dimension.It suggested that social media is not natively compatible to the culture or organizational climate of SME.

Recommendations
This study has several limitations.First, the object studied in this research is the only SME in West Java, so it might be better to widen the scope of the studied object to have a more general conclusion.Second, the research time is very limited.It is necessary to conduct research with more varied time intervals to determine the long-term effects of the variables studied in this study.Third, the variables used in this study provide an unsatisfactory explanation of firm performance of SME.Therefore, in the next research, it is necessary to answer at least two things.The first is: how the mechanism of the relationship between the use of social media with firm performance.It could be that the mechanism of the relationship that occurs is not direct but indirectly through other variables.Second, of course, by involving other variables that are proven to have an effect on firm performance, for example entrepreneurial orientation and market orientation.
The environmental factor has a positive influence on social media usage.The results of data processing show that the organizational factor has a positive influence on social media usage by 9.8%.These results are in line with the study by Ramdani et al (2013), which states that environmental factors have a positive effect on social media usage.The study by Ahmad et al. (2019) small and medium-sized enterprises (SMEs also proves that the technological factor has a positive influence on social media usage.Furthermore, Ahmad et al. (2019) states that bandwagon pressure has a significant influence on social media usage.

Managerial Implications
Another finding from this study is prove that social media usage mediates the influence of technological factor, organizational factor, and environmental factor on firm performance.In this study, it is proven that the three independent factors have a positive significant influence on the firm's performance through social media usage.
The findings in this study contribute to strategic entrepreneurship field because further help to explain firm performance of SME from social media technology that is very common this day used by SMEs, especially due to the pandemic.On the other hand, this research can provide direction for further research, especially to explain how social media usage can improve the firm performance of SME.

Conclusions
The results of the analysis prove that social media usage has a positive significant influence on firm performance of SME.Even so, the magnitude of this influence proved to be low, which was only 7.8%.However, this might happen in case of direct influence, which in fact may have an indirect effect.The three factors in the TOE framework in this study proved to have a positive significant influence on social media usage.
The biggest factor that encourages SME to use social media is the organizational factor.This factor is related to the firm's management support in encouraging and facilitating social media usage.The second biggest factor that influences social media usage for SME is the environmental factor.This factor is related to

Table 2 .
Strength of relationship between variables

Table 4 .
Independent Coefficients a

Table 8 .
Analysis of the indirect effect of variable X on variable Z through variable Y