Page 243 - Introduction to Electronic Commerce and Social Commerce

Summary 227

SECTION 7.6 REVIEW QUESTIONS 4. How to deal with false reviews and fake followers?
Unfortunately, there are many fake followers. Some are
1. Define the social customer and describe their characteris- paid by companies to boost their image; others are paid
tics. (Consult Chapter 1.) by competitors. It is possible to use software to detect
2. Why and how are customers empowered by social net- some fake accounts. These fictitious data can mislead
works? companies when deciding, for example, where to adver-
3. Define social CRM. tise. This issue is discussed in Chapter 8.
4. What are the needs of social customers? 5. Should we embark on selling via social networking?
5. List 5–8 benefits of social CRM. For most cases the answer would be yes. Just view it as an
6. How does social CRM differ from traditional CRM? additional channel to increase sales. Which model to use
7. Describe a reputation management system. will depend on the product, the competition, and the
potential risks. See Chapter 12 for strategy and imple-
mentation. For justification, see cases by Petersen (2014).

MANAGERIAL ISSUES

Some managerial issues related to this chapter are as follows. SUMMARY

1. How will social commerce influence businesses? The In this chapter, you learned about the following EC issues as
impacts of social marketing can change the manner in which they relate to the chapter’s learning objectives.
many shoppers make purchasing decisions. Social com-
merce will change both B2B and B2C by increasing inter- 1. Social commerce definition and evolution. Social com-
actions, engagement, and collaboration. The impact will merce (SC) refers to conducting EC in the social media
change business processes, the manner in which companies environment. It can be viewed as a subset of EC where
treat customers and employees, and may even restructure activities are done in social networks and by using social
some organizations. A strong impact will be felt in advertis- media tools. It operates at the intersection of social media,
ing, viral marketing, collaboration, and brand recognition. EC, e-marketing, and supporting theories from several
The impact will also be strong on delivering customer ser- disciplines including social psychology, marketing, soci-
vice, conducting market research, and organizing collabora- ology, and information technology.
tion. For more information, see Jamieson (2014). 2. The scope, content, and drivers of social commerce.
2. Do companies need to sponsor a social network? Social commerce is a comprehensive field comprised mostly
Although sponsoring a social network might sound like a of social media marketing (advertising, market research, and
good idea, it may not be simple to execute. Community customer service) and social enterprise (problem-solving,
members need services, which cost money to provide. recruiting, and collaboration). It also includes social enter-
The most difficult task is to find an existing community tainment, social games, and crowdsourcing. Social com-
that matches your business. In many cases, the cost of a merce is driven by the existence of giant social networks,
social network may be justified by its contribution to Web 2.0 tools, and the emergence of social customers.
advertising. However, social network service providers 3. Benefits and limitations of social commerce. A large
need to create various revenue models to maintain sus- number of benefits are available for customers, retailers,
tainable services. Creating revenue is the most challeng- and other businesses. Customers can get better prices,
ing issue to social network service providers. improve customer service, and also receive social support
3. Is it wise for a small business to be on Facebook? The (e.g., product recommendations) from friends. They can
answer depends on the business and on what you are try- find new friends as well, and establish new contacts.
ing to achieve. It could be helpful for those that need to Retailers can reach more customers, get quick feedback,
constantly reach customers and/or suppliers. Facebook, at improve relationships with customers, go global, and use
present, may not be very helpful for direct sales. However, free word-of-mouth marketing communication. There are
just having a presence costs little and therefore should be also benefits to businesses. Businesses can conduct fast
considered. A major issue for SMBs is the loose security and inexpensive market research, recruit employees from
in social networks. See entrepreneur.com/article/239539 all over the globe, innovate, collaborate, and locate
for comprehensive coverage of this topic. experts when needed.