The huge popularity and strong
influence of social media have revolutionised the way people impart and receive
information. One of which is that social media empowers individuals by acting
as a medium for publication of personal views to a large audience. While the
ease of publication is great for self-expression, it poses problems for
businesses when negative consumer experiences are shared and spread rapidly on
social media. This put businesses in risk of serious financial losses. While
there are defamation acts to ease the damage from false accusations, its
limitations prompt a need to look into better ways to protect and uphold the
online reputation of businesses by improving the current social customer
relationship management system (SCRM).
In the digital age, the online
reputation of businesses is of fundamental importance even if the operation of a
business is offline. Studies have reported that 86% of customers buying
decisions were influenced by negative online reviews (Gesenhues, 2013) and poor
customer service has resulted in costing U.S businesses a staggering 41 billion
loss a year (Mitchell, 2013). This reflects an underlying importance in
maintaining the online reputation of a business as it can directly affect
customers’ opinions, trust and ultimately sales of a business. To exacerbate
the problem further, a study has shown that bad customer service interactions
are more likely to be shared than good ones (Marketing Charts, 2013). This was
of evidence in a local incident, where a blog post (Ng, 2014) of IKEA’s
successful attempt to fix a situation of an unhappy customer only warranted
half the amount of shares (five thousand shares) when compared to the blog post
that condemned IKEA’s sorry attempt at customer service (ten thousand shares).
This negativity bias further emphasises the importance of protecting, over
repairing, the reputation of a business as efforts to correct a wrong will not
be as widespread as the wrong per se.
As of current context, reputations of
businesses are not well protected by laws. While defamation acts are in placed
to counter against false accusations, the law of “fair comment” under the
defamation act requires that subjective opinions be allowed, as “a defence of
fair comment shall not fail by reason only that the truth of every allegation
of fact is not proved if the expression of opinion is fair comment having
regard to such of the facts alleged or referred to in the words complained of
as are proved” (Singapore Statutes Online, 2014). As explained by R.Brown,
author of Law of Defamation in Canada,
an opinion protected under this law is “not actionable as it is an opinion on a
matter of public interest” (Duhaime, n.d.). The presence of subjective opinions is
problematic because they can intensify a problem through exaggerations and, or
by evoking emotions in other readers. In the IKEA example, the author demonstrated this
by calling for readers to “avoid IKEA at all cost” and by stating that he is “a
very very easy going man and this is my first and possibly only negative review
because you guys screwed up big time” (Ng, 2014). Statements as such uses
comparative measures to aggravate the issue, yet it may not be perceived and
interpreted in the same way by another individual and when compared to other
negative experiences. In such cases, defamation acts cannot be used to demand
for the withdrawal of such statements and businesses are ultimately left to
deal with such issues without much regulation although it could be unfair to
them.
Under such circumstances, many
businesses are looking to protect their reputation by improving and maintaining
positive customer relationships. One of the practices is to adapt to a more
interactive and dynamic practice of SCRM that uses social media and other
technologies to track customers’ opinions on social networking platforms and
interact with customers on a personal level. SCRM is defined on customer advocacy
and experience (Morgan, 2013). This practice allows businesses to find, analyse
and evaluate problems at ground level that might be individualistic or across
board in nature. However, as SCRM is still at an introductory stage, where the
development of this service structure is limited within the few years of
existence of social media, an actual SCRM infrastructure for businesses to
follow is absent and there is a sense of trial and error where businesses are
not effectively using social media to achieve their goals. One of the prevailing
problems is that businesses are not providing real-time help to customers and
requiring them to repeatedly enquire about the same issue, resulting in
disappointment and unhappiness. As in the IKEA example, the author complained
of having his enquiries repeatedly ignored on IKEA’s Facebook page, which led
to his scathing blog post and the attention that IKEA could do without. Efficiency
is vital especially when customers are bounded by time constraints and in need
of an immediate solution. In fact, a study reported that 42% of customers
expect 60 minutes response time (Baer 2012) and another study reported that providing
real time help produced significant benefits to a company such as increased
customer satisfaction and customer retention (Strong, 2014). It is vital that
businesses take the expectations of customers seriously and revamp their model
of SCRM to prevent the outburst of unhappiness among customers.
Ultimately, the most important aspect
in customer relationship management is to be sincere and provide commendable
service whenever possible, and to only worry when customers make something out
of nothing.
(903 words)
References:
Baer, J (2012) 42 percent of customers
complaining in social media expect 60 minute response time. Convince & Convert. Retrieved from: http://www.convinceandconvert.com/social-media-research/42-percent-of-consumers-complaining-in-social-media-expect-60-minute-response-time/
Brandweiner, N (2012, May 31). Customers more likely to share bad service experiences. My Customer. Retrieved from http://www.mycustomer.com/topic/customer-experience/customers-more-likely-share-bad-service-experiences-study/143371
Customers increasingly turn to social media to share bad customer experiences (n.d.). Omega Management Group Corp. Retrieved from http://www.omegascoreboard.com/news/customer-service-horror-stories/consumers-increasingly-turn-to-social-media-to-share-bad-customer-experiences/
Duhaime (n.d.) . Fair Comment Legal
Definition: A comment made which through defamatory, is not actionable as it is
an opinion on a matter of public interest. Retrieved from:
http://www.duhaime.org/LegalDictionary/F/FairComment.asp
Gesenhues, A (2013, April 9). Survey: 90% of customers say buying decisions are influenced by online reviews. Marketing Land. Retrived from http://marketingland.com/survey-customers-more-frustrated-by-how-long-it-takes-to-resolve-a-customer-service-issue-than-the-resolution-38756
Greenslade, R (2014, October 20) 23% increase in defamation actions as social media claims rise. The Guardian, Retrieved from http://www.theguardian.com/media/greenslade/2014/oct/20/medialaw-social-media
Josiah, M (2011, June 17). Hotel online
reputation research statistics and quotes. Review Pro. Retrieved
from http://www.reviewpro.com/reputation-research-statistics-2767
Mitchell, E.S (2013, December 13).
Study: Bad customer service costs US companies $41 billion a year. PRNewser. Retrieved from: http://www.adweek.com/prnewser/study-bad-customer-service-costs-us-companies-41-billion-a-year/82363?red=pr#more-81359
Morgan, J (2010, November 3). What is
Social CRM? Social Media Examiner. Retrieved
from http://www.socialmediaexaminer.com/what-is-social-crm/
Ng, C.B (2014, November 14). IKEA
referred to my kitchen as a shit job and here's why you should avoid getting
your kitchen there at all costs. [web log post]. Retrieved from
http://charlesbenedict.com/2014/11/14/ikea-referred-to-my-kitchen-as-a-shit-job-and-heres-why-you-should-avoid-getting-your-kitchen-there-at-all-costs/
Ng, C.B (2014, Decemeber 8). IKEA says
sorry and gives me a spankingly beautiful new kitchen. [Web log post] Retrieved
from http://charlesbenedict.com/2014/12/08/ikea-says-sorry-and-gave-me-a-spankingly-beautiful-new-kitchen/
Singapore Statutes Online,
Attorney-General’s Chambers (2014, February 28). Defamation Act. Retrieved
from http://statutes.agc.gov.sg/aol/search/display/view.w3p;orderBy=date-rev,loadTime;page=0;query=Id%3Af5d30732-e645-4326-91bb-daf3fa3fa3ad;rec=0
Strong, F (2014, January 2). The complicated problem of social CRM. Sword and the Script. Retrieved from http://www.swordandthescript.com/2014/01/problem-social-crm/
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