Social media -based value creation and business models

Purpose - The purpose of this paper is to create an organized picture of the current understanding of social media-based value creation and business models. Design/methodology/approach - Following the process model presented by Fink (2005), a systematic literature review of academic journal articles published between 2005 and 2014 was conducted. The research was grounded on the theoretical foundations of service-dominant logic. Findings - This study offers detailed descriptions and analyses of the major social media mechanisms affecting how value is created in social media-based value networks and the kinds of impact social media can have on present and future business models. Research limitations/implications - The study is limited to academic research literature on business organizations, excluding all studies related to public and non-profit organizations. Practical implications - Attention is given to developing an in-depth understanding of the functions and concrete value creation mechanisms of social media-based co-creation within the different organizational processes (e.g. in product and service development and customer services) and to updating the related practices and knowledge. Originality/value - This study provides new insight into the challenges related to research models and frameworks commonly used for observing value creation, thus highlighting the need for further studies and updates.