Modelling Socio-Digital Customer Relationship Management in the Hospitality Sector During the Pandemic Time

Introduction

This chapter focuses on customer relationship management (CRM) in the hospitality sector in the context of a sharp rise in digitization during the COVID-19 pandemic. CRM has become a strategic approach in business that is underlined by relationship marketing theory (RMT). CRM can be defined as the “process of acquiring, retaining, and partnering with selective customers to create superior value for the company and the customer” (Parvatiyar & Sheth, 2001, p. 6). CRM can generate differentiation, address competition, and offer increased customer value (Dewnarain, Ramkissoon, & Mavondo, 2019; Foltean, Trif, & Tuleu, 2019). CRM’s technology-driven transformation is called social customer relationship management or SCRM or CRM 2.0 (Sigala, 2018). Accordingly, CRM has been renamed SCRM or CRM 2.0 (Hidayanti, Herman, & Farida, 2018; Sigala, 2018).

The recently coined term SCRM describes the new way of managing as well as developing relationships with customers (Dewnarain et al., 2019; Greenberg, 2010; Wang & Kim, 2017). Greenberg (2010, p. 50) define SCRM as a “business strategy of engaging customers through social media with the goal of building trust and brand loyalty”. The rise of social media has unfavourable impacts on the management of relationships with customers and has raised specific speculations regarding the application of theoretical concepts or/and traditional CRM models (Foltean et al., 2019; Harrigan, Soutar, Choudhury, & Lowe, 2015).

Turbulent markets and low brand loyalty are essential factors contributing to implementing CRM as the business strategy by the service-based firms (Rahimi, 2017; Saarijärvi, Karjaluoto, & Kuusela, 2013; Sigala, 2018). Customers are willing to get more value in purchases due to which firms are facing challenges of expanding their customers’ base because of the rising acquisition cost of customers, increase in price-sensitive customers, and higher customers’ expectations (Harrigan et al., 2015). The exposure of customers to various social media platforms such as Trip Advisor and Facebook has made them more sophisticated in their decision-making.

While the existing literature retraces well social-CRM’s evolution and its conceptualization, it fails to provide examples and a framework about the usage of social media for implementing the social-CRM’s strategy and meeting new customers’ needs (Dewnarain et al., 2019; Marolt, Pucihar, & Zimmermann, 2015). Owing to the limited understanding of the effective use of tools for social CRM (Marolt et al., 2015; Sigala, 2018), the firms may continue facing problems for successful implementation of social CRM (Dewnarain et al., 2019; Jami Pour & Hosseinzadeh, 2021; Torugsa & Yawised, 2019). This also implies in the context of hospitality as well as in tourism, where the CRM strategies and loyalty programmes of several firms are outdated and are not able to exploit new technologies to attract the Millennials (Bowen & Chen McCain, 2015; Sigala, 2018). In the contexts of hospitality and tourism, scholars have emphasized the essential need to study the dimensions of CRM as Web 2.0 technology has increasingly become an influential force for daily business operations (Dewnarain et al., 2019; Medjani & Barnes, 2021). Web 2.0 applications are specialist software that can help individuals create and disseminate online-based data (Natale & Cooke, 2020). Some popular applications of Web 2.0 can be blogs, podcasts and social networks, voice assistants etc. Due to social media's growing place in the marketplace and their effects on key performance indicators (KPIs) such as customer flow experience and brand loyalty, social CRM has become a global trending topic in hospitality-related businesses (Munjal & Bhushan, 2021). The more significant usage of online review sites, including Trip Advisor and Holiday Check, as well as social networking domains has become a common practice among hotels where they invest large amounts of money in improving social interactions (Foltean et al., 2019; Garrido-Moreno, García-Morales, Lockett, & King, 2018). However, customer engagement (CE) in hospitality contexts has drawn less attention, and future research is essential on CE’s antecedents for practitioners’ guides (So, Li, & Kim, 2019).