Social CRM: Strategies for Business Development and Customer Relations

This report delves into the evolving landscape of Social Customer Relationship Management (CRM) and its pivotal role in modern business strategies. It explores how companies are leveraging social media platforms and Management Information Systems (MIS) to foster stronger customer relationships, attract potential clients, and regain the trust of former customers. The report highlights the importance of MIS in developing effective Social CRM strategies, enabling businesses to analyze customer interactions and make informed decisions. It examines the impact of social media on customer purchase decisions, emphasizing the shift from traditional advertising to a more value-driven approach. The report also reviews various research and literature on Social CRM, including the evolution of organizational approaches and performance measures. Furthermore, it discusses the future of Social CRM, focusing on customer intelligence and its influence on business performance, emphasizing the need for effective communication and marketing strategies in the age of social media. The report concludes by underscoring the significance of customer engagement and the development of customer-centric strategies to achieve sustainable business growth and success in the competitive market.

Running Head: SOCIAL CRM
Social Customer Relationship Management (CRM)
Name
Institution

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Abstract
With the growth of modern corporate world which has led to increased competition in the
market, many businesses have turned their focus on developing strategies which will help these
companies manage their customer relationships with the business such as adopting or developing
a customer relationship management strategy. With the growth of technology and the internet as
the current social networking platform, many businesses have therefore developed online
platforms in which they can interact with their existing customers, the prospective customers as
well as winning back the customers who might have left the companies for their rival companies.
This research report, therefore, aims at providing an understanding of how social customer
relationship management is helping businesses or organizations achieve its strategic goals and
objectives in relation to the development and adoption of business technologies such as the
management information systems and their effect on the growth and development of the
businesses.
Introduction
The modern corporate world has experienced gradual changes over time resulting from different
business environments. These environmental changes both internally and externally have in one
way or the other affected the growth of business organizations as well as the organizational
performance. One of the best ways or improving organizational or business performance is
through improving the organizational customer relationships. Business customers act as the
greatest assets of the business and therefore their relationship with the business determines the
overall performance of the business (Paliouras & Siakas, 2017). A satisfied customer will always
end up being a loyal customer of the business and also becomes an ambassador of the company

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to other prospective customers. Many businesses or organizations have embraced the use of
information technology in perceiving different organizational changes and developing effective
strategies to counter these environmental changes. On the other hand some other companies have
not yet shifted to the use of information technologies techniques due to lack of enough resource
capacity whereas others have been due to the continued use of the traditional CRM techniques
such as advertising. Through the use of management information systems technology, companies
have developed social customer relationship management strategies to manage and analyze their
customer relationships and interactions with the business.
Figure 1: The Use of Social Network has increased over Years in India
Social customer relationship management is therefore in this case described as the use of
social media services and platforms, techniques as well as technology to enable organizations to
engage with their customers with the aim of strengthening business customer relationships
through social media. It also aims at improving the relationships within the organization with the
existing business or organization customers, creating a platform to attract potential and

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prospective customers as well as winning back the confidence of former customers who might
have lost confidence and trust with the company due to lack of an established social platform
where the company can interact with its customers (Chen & Wu, 2016). Business management
has taken another shift due to the advancement of computer-based information technology which
has led to the development of different management information systems that help the managers
of different businesses to make and implement decisions concerning various operations of a
business. Such information systems are developed for specific purposes and have been found to
differ significantly from the standard data processing systems especially those used in financial
management. Therefore managers have realized that the difference between their success and
failure of their business and especially in customer relationship management is due to the extent
to which the managers are able to use the systems to increase their effectiveness of their
organizational performance.
Using MIS to improve the quality of social CRM and the relevant changes involved
The modern corporate world as described earlier is characterized by increased social
media use for business purposes. The rise in the use of social media has been adopted by
business companies as one of the MIS tools to expand in the various sections of the business
such as marketing. Through social media, businesses get good platforms for directly relating
with customers. They can have their products reviewed hence giving the clients the opportunity
of giving their positive or negative feeling towards the particular company products. As a result,
the company will be able to make decisions to improve their customer services depending on the
review of the clients. In other words, how MIS is adopted has a massive impact on how
customers make decisions based on their consumer behavior and their purchase decisions to a

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certain company product or brand. These decisions are mainly influenced by how the brand
interacts with the customers through the purchase cycle centrally to the prior opinion where
customers purchase decisions were influenced solely based on an advert and brand promotion
like it was the case 5 years ago (Choudhury & Harrigan, 2014). Through MIS, businesses and
customers have embraced the use of internet which provides them with more opportunities to
make a variety of choices and have an access to more information related to the product or brand.
Therefore most customers have been found to make their purchase decision based on their value
set on the product rather than on the need for the product alone.
The development of social customer relationship management strategies is important as it
helps in understanding the customer and company interactions and relationships based on the
data obtained from social media platforms used by the company with the aim of improving
business relationships with the customers as well as assisting the business in customer retention
and driving the company product sales growth. The effectiveness of social customer relationship
management has however been attributed to the growth of business information technology
through management information systems. These systems have been developed for specific
purposes in an organization or business and therefore in this case organizations or businesses
have developed a management information system in form of a social customer relationship
management with the aim of improving customer and business relationships and facilitate
effective decision making (Lemon & Verhoef, 2016). Through the use of management
information systems businesses have developed decision support systems which have played a
vital role in customer relationship management. The decision support systems are therefore a
computerized information system used to support decision making in a business and allows users

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to analyze massive reams of data and other product or brand-related information that can be used
to solve customer problems and make better decisions. Therefore management information
systems act as bedrock in which social customer relationship management is built.
Adoption of MIS in improving Social CRM by different companies
Many researchers and authors have conducted different researchers which have led to the
development and adoption of the current social customer relationship management. This is
because social customer relationship management is seen as an emerging concept in the modern
corporate world that integrates the traditional customer relationship management and social
media in order to provide benefits for organizations and customers. Some of the early or constant
reviews which have been done to develop the concept of social CRM include the works of
Awasthi and Sangle, (2012) who in their research was on understanding customer relationship
management technology in multichannel environments. The research covered the literature
content gathered between 2006 and 2010 and was focused on the adoption of technology and
especially in CRM in the context of multichannel environment and therefore provided categories
on some of the multichannel as the; CRM, Multichannel CRM, eCRM, and mCRM. The review
was presented at the Malaysian conference on the information system. In their comparison, the
authors were able to agree that both kinds of literature and approaches view social CRM as an
extension of traditional CRM which is aimed at customer engagement and interactions.
However, they were able to identify a difference in both kinds of literature whereby the scholarly
literature was found to focus on specific issues related to the theoretical concept of CRM while
the practitioner literature was found to focus on how organizations will respond to new
challenges and opportunities resulting from the emergence of social CRM. A more detailed

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review was also done in 2013 by Lehmkuhl and Jung which focused on the development of
organizational approaches to design social CRM systems. This review provided an overview of
current social customer relationship management and also provides further directions for
research as these were found to be limited to the scope of the CRM concept. And lastly, a review
was done by Kupper et al. 2014 which focused on social CRM performance measures. These
performance measures were categorized to be measured in terms of infrastructure, the process,
customer service and organizational performance and therefore provided a greater scope of the
concept of Social CRM, however, these reviews failed to factor in the key factors and outcomes
of CRM adoption in businesses.
Social CRM channels and MIS systems adopted in businesses
Social customer relationship management is the developing concept in the modern
corporate world and has increasingly gained great importance in the effectiveness and growth of
most businesses or organizations. The concept integrates the traditional customer relationship
management strategies such as advertising and product promotions and social media platforms in
order to provide benefits for both organizations and customers. The concepts have employed the
use of management information systems due to the rising growth and advancements in internet
information technology to help the businesses and organizations implement within their
organizations the decision support system (Farid et al., 2016). The development of social
channels is essential for an organization or business to both acquisition and retention of
customers since many businesses are increasingly adopting social paradigms to improve on
productivity as well as the breakdown of organizational social sites. The growth of social
platforms is seen as the future of customer relationship management and that customer

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intelligence will make the difference in the current competitive market between success and
failure of a business in the current rapidly evolving sales environment.
Figure 2: Social media channels used in developing a company brand
The future of Social Customer Relationship Management
Customer intelligence and social CRM are seen as the future of business performance
because customer intelligence provides analysis and discussion support engines facilitated by the
management information systems for managing the current vast social media sphere as
customers no longer make their purchase and consumption decisions based on adverts and brand
promotions. The rise of social media has, therefore, had a great impact on how different
customers make their decisions which are now shaped by the customer’s interactions with the
company brand or product during the purchase lifecycle (Hajli & Lin, 2016). The rapid growth in
information technology and advancements in internet services customers now have more choice
and access to a variety of information concerning a company brand or even concerning various

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company products. And in most cases, customers have been found to make their purchase
decisions based on the value attached to a certain product rather than their needs. This calls many
organizations to therefore to develop effective communication strategies as well as marketing
and sales strategies to meet the current customer needs which have shifted towards the use of
social media platforms. The social media has been found to have certain factors which influence
or trigger customer perception on the worth of a brand. These factors include personal
recommendations found on social media about a brand, the customer service experience as well
as how well the brand value match customer expectations. And therefore the customer's purchase
decision is in form of a process and this is the strategy that builds the social customer
relationship management systems by many organizations (Jun et al., 2014). The customer
purchase process starts with the creation of product awareness, gaining interest in the product,
then desire, purchase and retention. Such a process could not be achieved through the traditional
CRM which involved adverts and promotions and provided little information guided by the
seller’s interest since an advert could, for instance, create an awareness then the potential
customers who may then develop an interest but may not help the customers have a desire for the
product as the desire would come from more knowledge about the product which calls for an
effective customer relationship management strategy and hence the importance of social
customer relationship management.
How companies use MIS to improve on the use of Social CRM
The understanding of the effectiveness and the role played by social customer
relationship management in modern business we have to examine the role played by
management information systems in transforming businesses. Information systems in this case

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refer to a set of interrelated components which help in collection, processing, storing and
distribution of information. They help in support of decision making, coordination, and control
of business operations. One of the great roles played by management information systems in an
organization or business is improving customer relationship and supplier intimacy (Diffley &
McCole, 2015). This is based on the fact that a satisfied customer will always come again which
leads to increased revenue returns for the business and profit and may even refer other customers
while creating an intimacy with suppliers allows them to provide vital inputs to the business at a
lower cost and therefore contributes to increased productivity and reduced operational costs.
Information technology has led to improved decision making as we will see through decision
support systems as decision are made after data is collected and analyzed based on various issues
affecting the business. Management Information technology and systems have enabled most
businesses to increase their competitive advantage through responding to customers and
suppliers in good time, charging less for superior products and offering quality and unique
services (Pick et al., 2016). They also play a vital role in enhancing business survival since
information system has become a necessity of every business in the modern competitive business
world. It helps the business keep at level with the industry growth levels and also meets with the
government regulation requiring record keeping for businesses.
The figure below shows how different social media traffic referrals in business have increased
since 2011 to 2014 indicating the growth in social customer relationship management and the
growing importance of social media in attracting new customers and retaining the existing ones.

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The CRM channels used previously and why we move to social CRM
Businesses operations have shifted to the use of the internet due to the development and
the need for global electronic business and collaboration. The growth of the electronic businesses
has grown due to the fact that business processes are a set or a collection of activities required to
produce a product or a purpose (Krishnan et al., 2014). In most cases, therefore, the performance
of business firms depends on how well the business processes are designed and coordinated.
Most companies have therefore changed their social channels designs and configuration of their
information systems and even their coordination to bring about more data available to the
websites or to the different social media channels. They have also customized most of their
websites in accordance to the demands of their customers both the existing as well as the
prospective ones. The development of new information technology has therefore changed the

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flow of information and therefore making it possible for many people to access and share
information concerning a company product or brand. This has therefore helped in replacing
sequential steps and hence reduces or eliminates delays in decision making.
The figure above shows how social CRM has improved the scope of the traditional CRM by
being more customers centered as compared to the traditional CRM which was centered on
organizational goals and objectives.
The growth of social customer relationship management strategies has therefore been
initiated by the technological advances in information technology and management information
systems. Therefore the growth of social media usage and continued increase in the number of
social platforms has changed the business operations and especially through marketing strategies
(Jain et al., 2017). Many managers in the current corporate world have now believed the fact that
when consumer relationship management is harnessed with social media it can deliver financing
benefits to the company. Organizations performance and success will, therefore, be achieved
through the embracing of the social customer relationship management strategies. SRM is a