Chronic customers or increased awareness? The dynamics of social media customer service

• Main Authors: SUN, Shujing, GAO, Yang, RUI, Huaxia
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2021
• Subjects: Strategy; Information; Technology; Economics; and Society (SITES); social media; customer service; complaint management; service awareness; Databases and Information Systems; Social Media
• Online Access: https://ink.library.smu.edu.sg/sis_research/6254; https://ink.library.smu.edu.sg/context/sis_research/article/7257/viewcontent/Chronic_Complainers_or_Increased_Awareness__The_Dynamics_of_Socia.pdf
• Institution: Singapore Management University

Despite that social media has become a promising alternative to traditional call centers, managers hesitate to fully harness its power because they worry that active service intervention may encourage excessive use of the channel by disgruntled customers. This paper sheds light on such a concern by examining the dynamics between brand-level customer complaints and service interventions on social media. Using details of customer-brand interactions of 40 airlines on Twitter, we find that more service interventions indeed cause more customer complaints, accounting for the online customer population and service quality. However, the increased complaints are primarily driven by the awareness enhancement mechanism rather than by chronic complainers. Furthermore, holding everything else fixed, high-quality care leads to fewer future complaints. The managerial implication is clear: firms shall implement a more active, prompt, and effective strategy, which can redirect customers to this cost-effective service channel and ultimately reduce customer churn.