Social Customer Relationship Management and Company Intervention: A Strategy to Build Trust: An Abstract

Abstract

Firms are increasingly extending their customer relationship management (CRM) strategies to social networking sites (SNS), moving from just communicating with their customers to learning more about them (Forbes 2016). Customer relationship management performed on SNS is called social CRM, which is defined as “a philosophy and a business strategy, supported by a technology platform, business rules, workflow, processes and social characteristics, designed to engage the customer in a collaborative conversation in order to provide mutually beneficial value in a trusted and transparent business environment” (Greenberg 2010). The use of social CRM helps organizations to engage more with customers (Malthouse et. al. 2013). Engagement helps in building trust with the company (Vivek et. al. 2012).

Also, social CRM, being a social setup, homes other factors that can impact trust, one of which being other consumers generated content (OCGC), which involves “opinions, experiences, advice, and commentary about the company that exist in consumer-created postings” (P2P Foundation 2012). Online trust among customers arises from reputation of the organization or its website (Riegelsberger et al. 2005). Since OCGC is not in control of the company, it can affect the reputation of a company positively or negatively. The current study attempts to provide a solution to this uncontrollable impact of OCGC by examining the role of company intervention on SNS. With company intervention (addressing customer complaints) (Ma et al. 2015), customers might judge the organization more positively, which can improve customer relationships. The findings of this study would support Morgan and Hunt’s (1994) commitment trust theory, which acknowledges that communication, coordination, and discussion, which can be achieved through customer engagement, can help in building trust toward an organization. Second, the proposed findings show the moderating effect of positive and negative OCGC on the relationship between customer engagement and trust toward a company. Finally, the key proposed finding demonstrates that company intervention can lead to reduction in the impact of negative OCGC on the relationship between customer engagement and trust.

Regarding managerial implications, the current study emphasizes that company intervention, within a company’s page/community, on SNS should be one of the company’s strategies to reduce the effect of negative comments/queries/information provided by other consumers.