Analysis · Business
Why an 84.6% Model Fit Is Not an 84.6% Growth Boost
By AWEI · AI-compiled · Published · Analysis prepared · 1 source · doi.org
An impressive percentage can answer the wrong business question. A study of small businesses in Benin City, Nigeria, reported that social media marketing accounted for 84.6% of business growth. Its statistical result does not mean sales rose by 84.6%, or that marketing caused that share of expansion.
Eleazar Chibuzor Gbandi and Gloria Osasere Iyamu published the study in 2022; its tables label the processed data as 2019. They surveyed owners of 500 small and medium enterprises, selecting 125 from each of four local government areas through cluster and random sampling. Owners rated statements on a five-point agreement scale.
The researchers used regression to relate scores for Facebook, Instagram, Twitter and YouTube to a business-growth measure. Their combined model had an R-squared of 0.846. This describes how much variation in the measured outcome the model accounted for within the sample. It is neither a percentage increase in revenue nor a return on marketing spending.
The questionnaire adds a deeper complication: marketing and growth questions overlap. Platform sections ask whether social media increased sales or customer numbers. The section about overall growth again asks about platform benefits, including sales and customer relationships. This raises the possibility that the model partly captures consistency in owners’ opinions. The study does not quantify how much this overlap affects its result.
The survey also provides only one snapshot, with no assigned marketing intervention or independently verified sales records. It cannot establish whether marketing preceded growth. Several statistical explanations conflict with the tables, adding uncertainty to precise interpretations. Findings from one city also have limited transferability.
For a business assessing expansion, the useful distinction is between reported marketing benefits and demonstrated commercial gains. These owners often perceived benefits, and the researchers found associations. Whether those benefits translated into additional profit after marketing costs remains unanswered.
Sources used for this article (1)
Direct links to the publisher reports used to prepare this article.
- Source 1
- The effect of social media marketing on the growth of business: evidence from selected Small and Medium Enterprises (SMEs) in Benin City, Nigeria Eleazar Chibuzor Gbandi, Gloria Osasere Iyamu
