Managing Customer Relationships in the Social Media Era: Introducing the Social CRM House

Abstract

CRM has traditionally referred to a company managing relationships with customers. The rise of social media, which has connected and empowered customers, challenges this fundamental raison d'etre. This paper examines how CRM needs to adapt to the rise of social media. The convergence of social media and CRM creates pitfalls and opportunities, which are explored. We organize this discussion around the new “social CRM house,” and discuss how social media engagement affects the house's core areas (i.e., acquisition, retention, and termination) and supporting business areas (i.e., people, IT, performance evaluation, metrics and overall marketing strategy). Pitfalls discussed include the organization's lack of control over message diffusion, big and unstructured data sets, privacy, data security, the shortage of qualified manpower, measuring the ROI of social media marketing initiatives, strategies for managing employees, integrating customer touch points, and content marketing.

Good, better, engaged? The effect of company-initiated customer engagement behavior on shareholder value

“…Third, social media can improve the quality of customer-firm interactions (e.g., the sensory content of interactions can be enhanced compared to, for instance, traditional print media, by including video and sound) (Libai et al 2010), which may yield a more favorable customer experience. Recent studies indicate that social media can indeed create a favorable experience, thereby fostering customer retention (e.g., Malthouse et al 2013), influencing brand evaluations (e.g., De Vries et al 2012), and leading to increased sales (e.g., Kumar et al 2013), amongst other things. We therefore hypothesize:…”

Effect of Instant Messaging Advertising on the Hierarchy‐of‐Effects Model Amid Teenagers in South Africa

“…However, the effectiveness of IM platforms should also be considered from a more holistic perspective, since social media advertising has a significant effect on attitudes that cannot be determined solely by CTR (Williamson, 2012). Several studies have focused on the examination of online consumers' attitudes and usage (Kuisma et al, 2010;Punj, 2011;Mina, 2012;De Haan et al, 2013); and, more recently, social media (Malthouse et al, 2013;Maxwell, 2013;Weinberg et al, 2013;Hardwick et al, 2014;Hollebeek et al, 2014;Liu et al, 2015). A majority of these inquiries agree that the primary objective of online and/or social media advertising is to establish favorable attitudes towards organizations and their brands.…”

The effect of social media interactions on customer relationship management

“…Although there is a large body of research on the various positive implications of brand communities (for an overview, refer to Gruner et al 2014), challenges with respect to the management of customer relationships and its implications on the development and retention of customers, as well as their profitability, remain (Malthouse et al 2013). Without knowing how social media influence customer relationships, companies struggle to assess the return on their investments.…”

“…Recent research has advocated the value of social media interactions for companies that propose conceptual frameworks to manage brands (Gensler et al 2013) and customers (Malthouse et al 2013), develop metrics (Peters et al 2013), and assess the marketing potential in the social media context (Yadav et al 2013). However, there is a need for a deeper understanding of the implications of social media , specifically one based on empirical evidence.…”