The role of social media is without question the single most disruptive innovation re-ordering the balance of power of customer relationships in all industries and nations. Social media has given consumers a clear, loud and very visible voice to share what delights and disgusts them about the performance of brands and companies. Social media is the most powerful communication, collaboration and potentially the most revolutionary channel for making customer relationships more effective than they ever have been before. These platforms were in place and functioning within the social fabric of nearly all industries with service industries including airlines, getting the brunt of complaints on Twitter, Facebook and through the many other social media sites. During July, 2009 a flashpoint event happened that showed just how potent the real-time communication and information velocity on social networks is. Dave Carroll watched as his expensive, professional-grade guitar was tossed and dropped on the tarmac buy United Airlines (UAL) baggage handlers. After nearly a year of fighting with UAL and getting nowhere, Dave Carroll did what anyone with his innate skills and talent did; he wrote a song, recorded it and created a very entertaining video which within seven days crossed well over 50 million views globally (Shambora, 2010). United was still unphased, and to this day will not mention it in their financial statements, even after a Harvard Business Review case study has been written on how not to manage a public relations crisis in social media. This event set in motion a powerful catalyst of customers going on the offensive with videos, creating blogs, writing tweets and doing Facebook posts on the walls of companies who delivered exceptionally good or bad service. Now three years since the initial event, there is a Social Customer Relationship Management (SCRM) revolution underway. The intent of this analysis is to show how the availability and use of social media on the Internet is changing how businesses operate. Social media delivers the most precious information a company needs to survive, and that includes the brutally honest opinion of how they are performing relative to their customers' expectations (Greenberg, 2010).
Management Information Systems
How Social Media Is Re-Writing
The Rules of Customer Experience, Relationship's and Trust
The role of social media is without question the single most disruptive innovation re-ordering the balance of power of customer relationships in all industries and nations. Social media has given consumers a clear, loud and very visible voice to share what delights and disgusts them about the performance of brands and companies. Social media is the most powerful communication, collaboration and potentially the most revolutionary channel for making customer relationships more effective than they ever have been before. These platforms were in place and functioning within the social fabric of nearly all industries with service industries including airlines, getting the brunt of complaints on Twitter, Facebook and through the many other social media sites. During July, 2009 a flashpoint event happened that showed just how potent the real-time communication and information velocity on social networks is. Dave Carroll watched as his expensive, professional-grade guitar was tossed and dropped on the tarmac buy United Airlines (UAL) baggage handlers. After nearly a year of fighting with UAL and getting nowhere, Dave Carroll did what anyone with his innate skills and talent did; he wrote a song, recorded it and created a very entertaining video which within seven days crossed well over 50 million views globally (Shambora, 2010). United was still unphased, and to this day will not mention it in their financial statements, even after a Harvard Business Review case study has been written on how not to manage a public relations crisis in social media. This event set in motion a powerful catalyst of customers going on the offensive with videos, creating blogs, writing tweets and doing Facebook posts on the walls of companies who delivered exceptionally good or bad service. Now three years since the initial event, there is a Social Customer Relationship Management (SCRM) revolution underway. The intent of this analysis is to show how the availability and use of social media on the Internet is changing how businesses operate. Social media delivers the most precious information a company needs to survive, and that includes the brutally honest opinion of how they are performing relative to their customers' expectations (Greenberg, 2010).
How Social Media Is Changing Customer Relationships for the Better
The truest form of marketing revolves around setting accurate, achievable and realistic expectations that can lead to delighting and exceeding the expectations of customers. Yet prior to social media and even today with its massive influence, many companies choose to turn the other way, a deaf ear so to speak, to social media. In doing that they virtually assure they will lose customers and eventually become less profitable. Today's consumers, across business-to-business (B2B) and business-to-consumer (B2C) industries, expect to be heard. It is the wise and insightful companies today that are concentrating on this aspect of their relationships with customers and using social media to systematically and thoroughly better understand their unmet needs, expectations, aspirations and critical success factors for getting to their goals. In seeking to use social media to better understand their customers, enlightened companies are modifying their CRM systems to deliver a much greater level of insight and intelligence than had ever been possible in the past (Carolyn, Parasnis, 2011).
For those fortunate companies who view social media channels not as a threat but opportunity to gain greater insights into their customer bases, the integration with CRM system and the development of finely-tuned SCRM platforms is propelling their businesses to new levels of performance (Ang, 2011). This is also in the context of bringing more relevant information to customers across all of these social media channels, and always living by the axiom of getting what you give (Bernoff, Schadler, 2010).
Social media channels need to be orchestrated as any other multichannel strategy, with the leading companies globally today realizing that each of their customer bases relies on different social media channels for different needs (Bernoff, Schadler, 2010). Taking this approach to seeking out information and insight on customers will not only speed the sales and buying cycles, it will also set the foundation for strong trust to be created with prospects and customers both (Woodcock, Green, Starkey, 2011). Imagine in Untied Airlines had taken this enlighten view and gone into a full service recovery strategy with the CEO not only replacing the guitar but sponsoring the band's tour and giving each a lifetime pass on United globally? That would have been revolutionary and shaken off the stodgy, button-downed, boring and just snobby reputation United has today. They are despised by many of their best customers, just watch the Twitter feeds of Ray Wang or Paul Greenberg, two road warriors in the enterprise software space. Yet what is so powerful is the lesson United taught every company. Imagine what would have happened if United had gone into a very aggressive service recovery strategy and delivered far above what anyone believed? To call it a social media win would be an understatement.
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