IDEAS home Printed from https://ideas.repec.org/a/eee/joinma/v39y2017icp15-26.html
   My bibliography  Save this article

Can Social Media Marketing Improve Customer Relationship Capabilities and Firm Performance? Dynamic Capability Perspective

Author

Listed:
  • Wang, Zhan
  • Kim, Hyun Gon

Abstract

Social media usage has become ubiquitous, and organizations need to manage this tool to meet their strategic goals. Companies are finding it necessary to modify their approach to customer relationship management (CRM) and develop new marketing capabilities that facilitate customer satisfaction. The purpose of this study is to examine how social media usage can help firms build new CRM capabilities and thus improve marketing adoption strategies and business performance. We suggest that social CRM capability is critical when companies merge social media into their marketing strategies to improve customer engagement and firm performance. We empirically analyze data from 232 companies using Facebook, COMPUSTAT North America, and Global Fundamentals annual databases for the period 2004–2014. This study contributes to extant literature by confirming a new form of CRM capabilities – social CRM – using the resource-based view and dynamic capabilities theory frameworks, and by demonstrating that social media usage plays a moderating role by amplifying the positive impact of social CRM capabilities on firm performance.

Suggested Citation

  • Wang, Zhan & Kim, Hyun Gon, 2017. "Can Social Media Marketing Improve Customer Relationship Capabilities and Firm Performance? Dynamic Capability Perspective," Journal of Interactive Marketing, Elsevier, vol. 39(C), pages 15-26.
    • Handle: RePEc:eee:joinma:v:39:y:2017:i:c:p:15-26
    DOI: 10.1016/j.intmar.2017.02.004
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S109499681730018X
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.intmar.2017.02.004?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Berthon, Pierre R. & Pitt, Leyland F. & Plangger, Kirk & Shapiro, Daniel, 2012. "Marketing meets Web 2.0, social media, and creative consumers: Implications for international marketing strategy," Business Horizons, Elsevier, vol. 55(3), pages 261-271.
    2. John Fahy & Graham Hooley & Tony Cox & Jozsef Beracs & Krzysztof Fonfara & Boris Snoj, 2000. "The Development and Impact of Marketing Capabilities in Central Europe," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 31(1), pages 63-81, March.
    3. Arellano, Manuel & Honore, Bo, 2001. "Panel data models: some recent developments," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 53, pages 3229-3296, Elsevier.
    4. Johanna Gummerus & Veronica Liljander & Emil Weman & Minna Pihlström, 2012. "Customer engagement in a Facebook brand community," Management Research Review, Emerald Group Publishing Limited, vol. 35(9), pages 857-877, August.
    5. Shantanu Dutta & Om Narasimhan & Surendra Rajiv, 2005. "Conceptualizing and measuring capabilities: methodology and empirical application," Strategic Management Journal, Wiley Blackwell, vol. 26(3), pages 277-285, March.
    6. Chrysanthos Dellarocas, 2003. "The Digitization of Word of Mouth: Promise and Challenges of Online Feedback Mechanisms," Management Science, INFORMS, vol. 49(10), pages 1407-1424, October.
    7. Kaplan, Andreas M. & Haenlein, Michael, 2010. "Users of the world, unite! The challenges and opportunities of Social Media," Business Horizons, Elsevier, vol. 53(1), pages 59-68, January.
    8. Hanna, Richard & Rohm, Andrew & Crittenden, Victoria L., 2011. "We're all connected: The power of the social media ecosystem," Business Horizons, Elsevier, vol. 54(3), pages 265-273, May.
    9. Verhoef, Peter C. & Venkatesan, Rajkumar & McAlister, Leigh & Malthouse, Edward C. & Krafft, Manfred & Ganesan, Shankar, 2010. "CRM in Data-Rich Multichannel Retailing Environments: A Review and Future Research Directions," Journal of Interactive Marketing, Elsevier, vol. 24(2), pages 121-137.
    10. Richard P. Bagozzi & Utpal M. Dholakia, 2006. "Open Source Software User Communities: A Study of Participation in Linux User Groups," Management Science, INFORMS, vol. 52(7), pages 1099-1115, July.
    11. Neil A. Morgan & Douglas W. Vorhies & Charlotte H. Mason, 2009. "Market orientation, marketing capabilities, and firm performance," Strategic Management Journal, Wiley Blackwell, vol. 30(8), pages 909-920, August.
    12. David J. Teece & Gary Pisano & Amy Shuen, 1997. "Dynamic capabilities and strategic management," Strategic Management Journal, Wiley Blackwell, vol. 18(7), pages 509-533, August.
    13. Rapp, Adam & Trainor, Kevin J. & Agnihotri, Raj, 2010. "Performance implications of customer-linking capabilities: Examining the complementary role of customer orientation and CRM technology," Journal of Business Research, Elsevier, vol. 63(11), pages 1229-1236, November.
    14. Kathleen M. Eisenhardt & Jeffrey A. Martin, 2000. "Dynamic capabilities: what are they?," Strategic Management Journal, Wiley Blackwell, vol. 21(10‐11), pages 1105-1121, October.
    15. Trainor, Kevin J. & Andzulis, James (Mick) & Rapp, Adam & Agnihotri, Raj, 2014. "Social media technology usage and customer relationship performance: A capabilities-based examination of social CRM," Journal of Business Research, Elsevier, vol. 67(6), pages 1201-1208.
    16. Xueming Luo & Jie Zhang & Wenjing Duan, 2013. "Social Media and Firm Equity Value," Information Systems Research, INFORMS, vol. 24(1), pages 146-163, March.
    17. David Godes & Dina Mayzlin, 2004. "Using Online Conversations to Study Word-of-Mouth Communication," Marketing Science, INFORMS, vol. 23(4), pages 545-560, June.
    18. Malthouse, Edward C. & Haenlein, Michael & Skiera, Bernd & Wege, Egbert & Zhang, Michael, 2013. "Managing Customer Relationships in the Social Media Era: Introducing the Social CRM House," Journal of Interactive Marketing, Elsevier, vol. 27(4), pages 270-280.
    19. Odd Jarl Borch & Morten Huse & Knut Senneseth, 1999. "Resource Configuration, Competitive Strategies, and Corporate Entrepreneurship: An Empirical Examination of Small Firms," Entrepreneurship Theory and Practice, , vol. 24(1), pages 49-70, October.
    20. Dellarocas, Chrysanthos, 2003. "The Digitization of Word-of-mouth: Promise and Challenges of Online Feedback Mechanisms," Working papers 4296-03, Massachusetts Institute of Technology (MIT), Sloan School of Management.
    21. Manfred Bruhn & Verena Schoenmueller & Daniela B. Schäfer, 2012. "Are social media replacing traditional media in terms of brand equity creation?," Management Research Review, Emerald Group Publishing Limited, vol. 35(9), pages 770-790, August.
    22. Chang, Woojung & Park, Jeong Eun & Chaiy, Seoil, 2010. "How does CRM technology transform into organizational performance? A mediating role of marketing capability," Journal of Business Research, Elsevier, vol. 63(8), pages 849-855, August.
    23. Om Narasimhan & Surendra Rajiv & Shantanu Dutta, 2006. "Absorptive Capacity in High-Technology Markets: The Competitive Advantage of the Haves," Marketing Science, INFORMS, vol. 25(5), pages 510-524, September.
    24. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(2), pages 277-297.
    25. Shantanu Dutta & Om Narasimhan & Surendra Rajiv, 1999. "Success in High-Technology Markets: Is Marketing Capability Critical?," Marketing Science, INFORMS, vol. 18(4), pages 547-568.
    26. C. Clark & Ulrich Doraszelski & Michaela Draganska, 2009. "The effect of advertising on brand awareness and perceived quality: An empirical investigation using panel data," Quantitative Marketing and Economics (QME), Springer, vol. 7(2), pages 207-236, June.
    27. Brodie, Roderick J. & Ilic, Ana & Juric, Biljana & Hollebeek, Linda, 2013. "Consumer engagement in a virtual brand community: An exploratory analysis," Journal of Business Research, Elsevier, vol. 66(1), pages 105-114.
    28. Hooley, Graham J. & Greenley, Gordon E. & Cadogan, John W. & Fahy, John, 2005. "The performance impact of marketing resources," Journal of Business Research, Elsevier, vol. 58(1), pages 18-27, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hyun Gon Kim & Zhan Wang, 2019. "Defining and measuring social customer-relationship management (CRM) capabilities," Journal of Marketing Analytics, Palgrave Macmillan, vol. 7(1), pages 40-50, March.
    2. Perez-Vega, Rodrigo & Hopkinson, Paul & Singhal, Aishwarya & Mariani, Marcello M., 2022. "From CRM to social CRM: A bibliometric review and research agenda for consumer research," Journal of Business Research, Elsevier, vol. 151(C), pages 1-16.
    3. Trainor, Kevin J. & Andzulis, James (Mick) & Rapp, Adam & Agnihotri, Raj, 2014. "Social media technology usage and customer relationship performance: A capabilities-based examination of social CRM," Journal of Business Research, Elsevier, vol. 67(6), pages 1201-1208.
    4. Venciūtė Dominyka, 2018. "Social Media Marketing – from Tool to Capability," Management of Organizations: Systematic Research, Sciendo, vol. 79(1), pages 131-145, June.
    5. Witek-Hajduk Marzanna K. & Zaborek Piotr, 2022. "Social media use in international marketing: Impact on brand and firm performance," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 58(2), pages 121-142, June.
    6. Sora Lee & Jaewon Yoo, 2021. "Determinants of a Firm’s Sustainable Competitive Advantages: Focused on Korean Small Enterprises," Sustainability, MDPI, vol. 13(1), pages 1-16, January.
    7. Hui Feng & Neil A. Morgan & Lopo L. Rego, 2017. "Firm capabilities and growth: the moderating role of market conditions," Journal of the Academy of Marketing Science, Springer, vol. 45(1), pages 76-92, January.
    8. Ulrike Baumöl & Linda Hollebeek & Reinhard Jung, 2016. "Dynamics of customer interaction on social media platforms," Electronic Markets, Springer;IIM University of St. Gallen, vol. 26(3), pages 199-202, August.
    9. Alexander Wieneke & Christiane Lehrer, 2016. "Generating and exploiting customer insights from social media data," Electronic Markets, Springer;IIM University of St. Gallen, vol. 26(3), pages 245-268, August.
    10. Foltean, Florin Sabin & Trif, Simona Mihaela & Tuleu, Daniela Liliana, 2019. "Customer relationship management capabilities and social media technology use: Consequences on firm performance," Journal of Business Research, Elsevier, vol. 104(C), pages 563-575.
    11. Xi’na Yuan & Sohyoun Shin & Xinming He & Sang Yong Kim, 2016. "Innovation capability, marketing capability and firm performance: A two-nation study of China and Korea," Asian Business & Management, Palgrave Macmillan, vol. 15(1), pages 32-56, February.
    12. Marchand, André & Hennig-Thurau, Thorsten & Flemming, Jan, 2021. "Social media resources and capabilities as strategic determinants of social media performance," International Journal of Research in Marketing, Elsevier, vol. 38(3), pages 549-571.
    13. Sander F. M. Beckers & Jenny Doorn & Peter C. Verhoef, 2018. "Good, better, engaged? The effect of company-initiated customer engagement behavior on shareholder value," Journal of the Academy of Marketing Science, Springer, vol. 46(3), pages 366-383, May.
    14. Kick, Markus, 2015. "Social Media Research: A Narrative Review," EconStor Preprints 182506, ZBW - Leibniz Information Centre for Economics.
    15. Lars Matysiak & Alan M. Rugman & Andreas Bausch, 2018. "Dynamic Capabilities of Multinational Enterprises: The Dominant Logics Behind Sensing, Seizing, and Transforming Matter!," Management International Review, Springer, vol. 58(2), pages 225-250, April.
    16. Kyuho Jin, 2022. "Can Business Groups Survive Institutional Advancements? Examining the Role of Internal Market for Non-Tradable, Intangible Assets," Sustainability, MDPI, vol. 14(17), pages 1-17, September.
    17. Mitrega, Maciej & Siemieniako, Dariusz & Makkonen, Hannu & Kubacki, Krzysztof & Bresciani, Stefano, 2021. "Versatile capabilities for growth in the context of transforming countries: Evidence from Polish manufacturing companies," Journal of Business Research, Elsevier, vol. 134(C), pages 156-170.
    18. Pantea Foroudi, 2023. "Conceptualizing, Measuring, and Managing Marketing Assets: Developing the Marketing Assets, Communication Focus, and Capability Nexus," Corporate Reputation Review, Palgrave Macmillan, vol. 26(3), pages 203-222, August.
    19. Yucheng Zhang & Zhiling Wang & Lin Xiao & Lijun Wang & Pei Huang, 2023. "Discovering the evolution of online reviews: A bibliometric review," Electronic Markets, Springer;IIM University of St. Gallen, vol. 33(1), pages 1-22, December.
    20. Sun, Wenbin & Price, Joseph & Ding, Yuan, 2019. "The longitudinal effects of internationalization on firm performance: The moderating role of marketing capability," Journal of Business Research, Elsevier, vol. 95(C), pages 326-337.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:joinma:v:39:y:2017:i:c:p:15-26. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.journals.elsevier.com/journal-of-interactive-marketing/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.