Abstract:
Small and Medium-Sized Enterprises (SMEs) are considered the backbone of
any successful and thriving economy. Increasing globalization and rapid
digitization across industries have led to greater international competition.
Furthermore, innovation has created challenges and opportunities for SMEs,
and they have recently been attracted to social media applications to reach a
larger audience, improve their relationship with potential customers, and
retain existing customers. However, scant focus has been devoted to
comprehensively understanding the adoption of social media in the SMEs
context in developing countries. Many SMEs are adopting social media
platforms to contact potential customers and provide services. After the end of
the civil war 2009 and the COVID-19 pandemic, people from the Northern
Province, especially in Jaffna, started SMEs, which should be run on virtual and
physical markets for business survival. Therefore, this study examines the
effect of social media adoption on SMEs performance in Jaffna district using an
integration of the TOE (Technology, organization, environment) framework.
The study employed a quantitative approach, and a closed-ended questionnaire
was used to gather the data. The normality and reliability of the measurement,
correlation analysis, and regression analysis were established to test the
study's hypotheses. Also, the Sobel test was used to test the mediating effect.
The results revealed that technological, organizational, and environmental
factors positively impact SMEs' performance. The results also revealed that
social media adoption significantly influences the mediating role of SMEs'
performance. In addition, media adoption mediates the relationship between
technological, organizational, and environmental factors and SMEs'
performance.
