Testing the Impact of Social CRM on Firm Performance: The Role of Customer Engagement, Innovation Performance and Social Media Use

Testing the Impact of Social CRM on Firm Performance: The Role of Customer Engagement, Innovation Performance and Social Media Use

Wafa Belkahla Hakimi, Amira Mehdi
Copyright: © 2020 |Pages: 15
DOI: 10.4018/IJCRMM.2020040105
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Abstract

The present article proposes and validates a general model that studies the impact of social CRM on firm performance. The social media use is introduced as a moderating variable. Innovation performance and customer engagement are also introduced as mediating variables to make the model more integrative and comprehensive. For model validation purposes, a quantitative research was undertaken. An online survey was conducted. 195 responses were collected and a partial least squares analysis was used to test hypothesis and validate the research model. Results have shown mainly that social CRM has a positive direct impact on innovation performance and customer engagement. However, and surprisingly, customer engagement has shown no effect on the firm performance. In the same line, and contrary to our expectations, Social CRM did not show a causal and direct effect on firm performance; however, this effect was shown to be positively moderated by social media use. More details about the result evaluations are exposed in the core paper.
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Literature Review And Research Framework

Customer Relationship Management (CRM)

It is in the 60s that companies paid attention to the relationship management (RM) as a marketing approach. Since that time the marketing theory has known a big leap and firms have changed the way they behave as a consequence, they have refocused their concerns and strategies in moving from product to a customer-centric strategy in order to build and to strengthen their relationships with customers even for industries characterized by its high competitiveness where they understand that a dissatisfy customer can cause a serious damages to the company (Crosby, 2002, Rahimi and Kozak, 2017).

More as, according to Haenlein (2017), the CRM concept has made its appearance within the literature discussion in the 80s, Furthermore, the notion of services marketing has been more popular and many studies are done to differentiate it from products marketing (Sheth, 2001). Until that time, the marketing world doesn't stop evolving and growing up and as a consequence the field has seen a remarkable transformation in the past 3 decades (Haenlein, 2017).

CRM doesn't have a unique definition so in order to be able to cover this concept from all the aspects we have decided to group the definitions into two axes: CRM as a business strategy and CRM as a technology.

CRM as a Business Strategy

In the 90s CRM was defined by (Morgan and Hunt (1994), p28) as a “strategic approach to marketing underpinned by relationship marketing theory”.

Parvatiyar and Sheth (2001, p. 6) presented the CRM as “a comprehensive strategy and process of acquiring, retaining, and partnering with selective customers to create superior value for the company and the customer”. In the same line of ideas, Tarokh and Ghahremanloo (2007, p. 1) defined the CRM “as the core business strategy that integrates internal processes and functions, and external networks, to create and deliver value to targeted customers at a profit”. They also stated a link between the business intelligence (BI) and the CRM; they explained the importance role of the BI in a successful CRM implementation.

From their side, Nguyen et al. (2007, p. 3) presented the CRM as a business process that enable to “digitizing a staff’s knowledge about his or her customers” in order to not only know the customer behaviours, desires and attitudes but also to obtain a long-term and a sustainable relationship with them.

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