Keywords

1 Introduction

A constantly growing number of activities of private and public organizations are engineered and managed as services, often times creating innovations for economic prosperity and social welfare. This development is mirrored in the Information Systems (IS) discipline. Examples include the use of services as the organizing logic for providing information systems, the use of services as an architectural paradigm (Service Oriented Architecture, SOA), and the development of Cloud/Internet-based services for information, processes, applications, and IT-infrastructures [1].

Along with a service-oriented economy in a highly competitive environment, there is an ever growing pressure to deliver customers a unique service experience to ensure customer satisfaction, retention and referrals. This necessity to deliver outstanding service can be supported through a mixture of technology and personal interaction, that is, by ‘high tech and high touch’ [2, 3]. Likewise, only few people can imagine their life without the daily involvement in social media services like Facebook, Twitter, or YouTube. Social media and Web 2.0 have advanced to an important part of economic, social, and technology concept of the Internet, which enables users to create content and build a network with other users [4]. The results from user participation, such as posts, friend lists, and profiles, are accessible by other parties of the community [5]. This development attracts attention of companies that aim to take advantage of the opportunities that come with them, such as improving reputation, influencing the purchase decision process of potential buyers, increasing marketing efficiency, supporting cost reductions, receiving post-purchase feedback, and innovating their products through cocreation [6–9].

Combining the developments of a predominantly service-based economy with the pervasiveness of social media customer interactions, the relatively new term social customer relationship management (SCRM) was born [10]. Social customer relationship management is a philosophy and business strategy that professionalizes the affiliation to customers using social media and aims at realizing mutual benefits. The relevance of the opportunities and challenges are underpinned by the reports of the renowned Marketing Science Institute (MSI), which biennially issues its ‘Research Priorities’. The Research Priorities papers capture “the areas of most interest and importance to MSI member companies” [11]. The number one ranked priority, Understanding Customers and the Customer Experience, explicitly emphasize the importance of more research of the customer service experience.

In this paper, we apply a qualitative interview approach to answer the following research question:

RQ: Which opportunities, pitfalls and success factors do companies on several vertical levels of the automotive industry report when applying technology-based Social Customer Relationship Management to enhance Customer Service Experience?

The intention is to build a better understanding of the interaction between Social CRM and the intended delivery of ‘memorable events’ [12] of commercial firms when operating in a business-to-consumer (B2C) or business-to-business (B2B) context.

In the remainder of this research paper, we first draw a picture of the interactions between a service economy, a necessary high level of customer service experience and social media/Social CRM. We then explain the research methodology, before we present and discuss the results. A conclusion, also explaining limitations and avenues of further research, close the paper.

2 The Interplay of Service, Customer Service Experience and Social Technology

For decades, marketing was primarily constructed around physical products. Traditional understandings following the historic goods-dominant logic identify value as something that could be manufactured or created within a business and then distributed to customers, thus, making value at the point of exchange the prime issue. With the advent of the ‘service-economy’ [13, 14], however, the services that go along with products and services as stand-alone offerings moved into the focus of most researchers. The service-dominant logic thinking diffused into ICT development. The Information Systems discipline contributes to the interdisciplinary research stream of Service Science since its first inception about 10 years ago.

However, even in the service-dominant logic, research in marketing focused on defining value from a company’s perspective [15]. More recent approaches have been to explain the notion of value from the customers’ point of view [16, 17]. As most services can only be delivered in conjunction with the customer, the ensuring and managing of the customer service experience became the center of thought.

Customer experience is the subjective, internal response customers have to any direct or indirect contact with a firm [18]. Customer service experience entails any aspect of a firm’s offering, such as the quality of customer care, product and service features, usability, advertising, and packaging. As CEOs oftentimes focus on costs rather than on the customer value, literature is full of bad customer service experiences, such as mystifying phone carrier minutes to discourage comparison shopping and thus price war, hard-to-obtain rebates to stimulate a purchase, or offering electronic surrogates on company hotlines to slash staffing costs. These customer experiences provoke regrets and then the determination to do business elsewhere [19]. At the same time, the advent and success of the service paradigm challenges previously established separations between B2B and B2C relationships, corporate IS and consumer IS, or internal IS and external services.

The Paradigm Shift from Web 1.0 to Web 2.0.

In parallel, profound changes in society, business and technology took place, revolutionizing (online) communication [20]. Central keywords in this context are Web 2.0 and Social Media [4]. Web 2.0 describes second generation web technologies [21] focused on the active, simultaneous and bi-directional involvement of professional and non-professional users [22]. Social Media are corresponding internet-based applications that enable participation in creating, communicating, and sharing content such as text messages, posts, images, or short clips [23]. The availability of easy-to-use forums, blogs, special interest groups, and other social media channels has opened up opportunities for ordinary people to engage easily with large governmental or corporate bodies by creating user-generated content (UGC). UGC was the main factor responsible for the massive growth of Web 2.0 and the unprecedented availability of information-rich content. Commercial companies have actively gathered and analyzed these customer reviews, ideas, and opinions since the early years of this century [24, 25]. This ‘wisdom-of-the-crowd’ [26], however, was not only received, but also actively triggered, shaped, and influenced [27]. Through value cocreation, companies have harnessed their own customers in reducing product flaws or developing completely new products and services [28]. More and more, manufacturers and users of products are entering a symbiosis, with the Web 2.0 being a “key piece of organizational infrastructure that links and engages employees, customers, and suppliers as never before” [29].

Customer relationship management (CRM, [30]) is another promising field of application of Web 2.0, based on this more intimate relationship. Web 2.0 can provide “the means to facilitate dialogue and bonding not simply with individual consumers, but with multiple participants. This in turn may allow these various participants to benefit from an internet dialogue which is based upon community” [31]. In other words, Web 2.0 enables consumer-centric management and offers novel opportunities for direct interaction and collaboration and thus an increased exchange. This ‘Web 2.0 supported CRM’ is termed Social CRM (SCRM), addresses the potential for advanced customer integration, and deals with the deployment of Web 2.0 principles and practices in CRM [32]. According to Greenberg [33], SCRM is “[…] a philosophy and a business strategy, supported by a technology platform, business rules, 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.”

The term social customer service consequently generally refers to customer service offered via social media platforms such as Facebook, Twitter, or YouTube [34]. Examples of user activities are joining groups, placing like- or dislike flags, adding others to the friend list, reading specific texts, watching videos, and changing profile information. With these activities, consumers receive a better customer service experience and benefit from participating companies through relationship advantages, first hand reviews, product updates, brand interaction and exchange, and influence on business processes [35]. Examples are discounts, special promotions, and the acceleration of the fulfilment of support requests. Business opportunities arise in the form of leads (i.e., potential customers), enriched customer profile information, and a better understanding of interests and markets [36]. Fliess et al. [8] state that “activities of customers can be considered as an economic resource”. User activities in social media create value and stimulate companies’ revenues [37].

Social customer service is more than establishing a channel for customers’ requests and complaints, but rather a complete realignment of the online communication philosophy and strategy [38]. The objective is to provide companies and their customer service organizations with the tools needed to move customers from a satisfied and loyal experience to avid brand advocates [39]. It combines personal interaction between company staff and the customer with state-of-the-art technology, also referred to as ‘high tech, high touch’ [2, 3]. This technology-employee pair is especially suitable to create a high customer service experience [40].

3 Research Methodology

The review of literature in the abovementioned areas revealed that applications of Social CRM actually used in practice for the purpose of enhancing customer service experience are not well researched. We therefore chose an explorative, inductive, interview-based method, as this is deemed most suitable for discovering new ideas and arguments [41, 42]. Three constituting considerations led us to the choice of the automotive industry as our research subject: first, automobiles are very complex products [43]. They therefore – in theory – yield abundant motives and possibilities for customers to engage with the manufacturers or suppliers. Second, the high relative value people assign to automobiles being status symbols leads – in practice – to a massive amount of automobile-related online user-generated content [44] as a basis for future increases customer service experience. And third, the automobile industry still plays a decisive role in many countries’ economies, making the findings highly relevant for practical purposes.

Table 1. Question blocks of interview guideline
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After the target industry had been fixed, we developed an interview guideline comprising seven question blocks that adhered to common qualitative research standards [45]. The guideline was first pre-tested with six final year Master’s students enrolled in management-related degrees (Table 1) [46].

Eighteen semi-structured practitioner interviews were then carried out on the practitioners’ own premises (field research, [47]). The selection of the interview partners and the eleven companies which they work for, respectively, was based on a diligent, purposive, theory-driven sampling strategy, that is, relevance was more decisive than representativeness [48]. This ensured the inclusion of most aspects of the underlying theories in the evidence gathered from the informants [45, 49]. It also enabled comparisons as well as theoretical and literal replication [50]. The inclusion criteria were ‘automotive company’ or ‘professional service firm working for the automotive industry’, the interviews were continued until a theoretic saturation had been reached [51]. The literature confirms that multiple cases enhance validity [49, 52], and the convergence of statements and observations increases confidence in the findings [49]. The interviews lasted between 51 and 96 min. More than one interviewee was questioned at most companies to avoid a respondent bias and so that a first triangulation of findings could be done (see the descriptions of companies and interview partners in Appendix A). The inclusion of managers from different hierarchical ranks, working for firms at several vertical levels of the industry (original equipment manufacturers (OEMs), suppliers and service providers), should ensure the formation of a holistic picture and mitigate the possibility of missing important insights [53, 54]. The interviews were transcribed [45] and coded following an open coding process [55]. Relevant passages were identified and categories were subsequently refined in an axial coding phase. The analysis was diligently carried out to fulfill the common requirements for qualitative research (e.g., [48, 56, 57]). The interpretation process was rule-driven and documented (“procedural validity”). Finally, consensus was derived through discussions with several of the interviewees [58].

4 Results and Recommendations

The analysis of the coded interview transcripts gives a solid picture of current practices of using Social CRM to enhance customer service experience. The research categories and codes used for analysis were not based on a certain framework or theory, but emerged completely out of the interview data. We then iteratively rearranged them until we got seven rather homogenous concepts. Besides pros and pitfalls, we derived processes, plans, proactivity, personnel, and personality.

In the following section, we summarize and discuss the findings (see Table 2 for sample evidence). As the topic is especially relevant for practitioners trying to leverage the technology for the benefit of their clients and their own bottom line results, we decided to deviate from standard procedures and present the findings in the form of practical recommendations.

Table 2. Sample qualitative evidence from interviews
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First of all, personnel need to understand the overall meaning and significance of customer service experience for their clients and of Social CRM for their company. Both managers and employees should attend workshops and training sessions to obtain the necessary social media and customer centricity awareness. Only under these circumstances the use of Facebook, Twitter and other services will increase the service experience and add value to the company. Otherwise, the services will be ends in themselves and can even be a threat. All interviewees confirmed that Social CRM offered through social media has taken a center stage. Resources in form of capital and man power need to be allocated.

If the company has decided to offer Social CRM, it has to make sure to align it with the overall business model, corporate vision, mission, and strategy. This is the task of the top tier of managers, who then have to convey the new thinking to the whole organization.

Another responsibility of the top management is to ensure that all divisions are involved in equal measure. One key challenge is to reply to customers’ request virtually in real-time and thus, every division needs a designated person being responsible for the process [59]. Regular office hours will not necessarily meet the actual user behavior in the social media environment and additional resources have to be allocated to guarantee quick response rates at all time.

As part of the Social CRM strategy, risk planning has to be considered in possible cases of extraordinary situations. Again, this is important for all divisions because the company has to appear as one coherent entity. Every member should document interactions with customers to simplify the review process afterwards.

All previous recommendations make great demands on employees and, therefore, every company should have appropriate recruiting and training procedures. Within the recruiting process, demands regarding social competence and service-oriented qualities as well as communication skills should be assured. Another option would be to outsource Social CRM to an external partner [60]. However, for the most part, the managers interviewed do not recommend this as customer relationship management, be it with traditional or with ne means and technologies, has been and will remain a crucial success factor for the entire company.

In terms of continuous process improvement, the company needs to offer constant, advanced training to be enable staff staying ahead of the fast moving evolution of social media services [61]. Software product updates and new internal policies have to be effectively communicated to every employee involved in the social customer service process.

Finally, the decision which social media service to adopt first to establish Social CRM is important. It is nearly impossible for companies to enter multiple services at the same time [39]. Thus, they should focus on the most dominant service in the desired national market. Facebook has a leadership role and was deemed to be a reasonable starting point for most of the companies. Customers’ expectations, which are of high importance, should be weighed up with the firm’s own resources and capabilities.

5 Conclusion

In this research paper, the authors analyzed how Social CRM can interact with and be beneficial to customer service experience. Our study took an inductive, explorative stance with qualitative interviews as the method of data collection and coding as the means of data analysis. We advanced the body of research in the Service Science field from an IS academic viewpoint by answering the following research question:

Which opportunities, pitfalls and success factors do companies on several vertical levels of the automotive industry report when applying technology-based Social Customer Relationship Management to enhance Customer Service Experience?

As customers have a greater number of choices than ever before, more complex choices, and more channels through which to pursue them, companies need to focus on delivering an excellent customer service experience [62]. Spreading important clues that address all five senses of the customer, that is, seeing, smelling, tasting, hearing or touching, can at least partially be supported through Social CRM methods [63, 64]. However, many companies just seem to follow a trending social media path everyone is using without adding significant elements to their overall business model [65]. They have not realized until now how to integrate social media service into their strategic concept in order to differentiate themselves and create unique selling propositions [66], as well as igniting value cocreation [28].

The rapidly developing and changing social media environment and the hitherto changing relationship between companies and its customers can be regarded as the rationale for conducting this study (cf. also [67]). As more and more power shifts from the companies to the customers, new concepts, technologies and recommendations have to be created and provided [68]. This explorative approach with first empirical elements helps to set the research agenda for upcoming studies.

In conclusion, we could identify opportunities, pitfalls and success factors of Social CRM when it comes to enhancing customer service experience. In the end we agree with March [36, 69] who states that “by choosing social media over other communications channels, millions of customers have given voice to their concerns in what has become an increasingly public arena.”

However, some limitations occur in this study which we would like to address. As is common with qualitative research, the number of data points gathered is limited. Eighteen interviews from eleven firms are a good start, but it remains unclear whether talking to eighteen other managers would yield the same or similar results. Cultural differences were also not taken into consideration. In addition, the interviewees were all related to the automotive industry, which can be counted as very mature. Questions of external validity, that is, whether the results can be transferred to other, potentially more dynamic industries, remain unacknowledged.

Further research can address more companies of various sizes, industries and cultural backgrounds. Switching from a commercial context to the public or non-profit sector may be worthwhile. Looking at the issue from the other side, the customer’s point of view, could also bring up new perspectives and triangulate the findings. The increasing ubiquity of a service society calls for more relevant and rigorous research that reaches across traditional geographical and disciplinary boundaries.