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428 Part Three Key System Applications for the Digital Age

clicking through, compared with an average of just Still, the results can be unpredictable, and not
one in 1,000 for traditional online ads. always beneficial, as Starbucks learned. Starbucks
Even if the Facebook or Twitter postings in ads runs contests on Twitter regularly and uses the
show brands apologizing about missteps or customer service to spread free product samples. In 2009,
complaints, advertisers may still benefit. Today, Starbucks launched a social media contest that was
the more honest and human companies appear, essentially a scavenger hunt for advertising posters.
the more likely consumers are to like them and Users who found the posters and posted photos of
stick with them. For example, JCD Repair, a six- them on Twitter would win a prize. The campaign
year-old iPhone, iPad, and Android repair business backfired. At the urging of anti-Starbucks protesters,
based in Chicago, found that encouraging custom- users flooded Starbucks’ Twitter feed with pictures
ers to post reviews of its service on Facebook, Yelp, of employees and protesters holding signs criticizing
and Google+ Local helped generate more busi- Starbucks’ labor practices.
ness. Although the vast majority of the reviews are
Sources: Melinda F. Emerson, “Even Bad Reviews on the Web Can
overwhelmingly positive, Matt McCormick, JCD’s
Help Your Business,” The New York Times, July 17, 2012; Doug
owner, believes that even the bad reviews can be Henschen, “How to Get from CRM to Social,” InformationWeek,
useful. A bad review here and there not only helps February 22, 2012; Betsy Sigman, “Social Media Helps Build Strong
Brands,” Baseline, March 9, 2012; Andrew Adam Newman, “Brands
you look more credible, it can also give you very
Now Direct Their Followers to Social Media,” The New York Times,
valuable feedback on what you’re doing wrong, August 3, 2011; Geoffrey A. Fowler, “Are You Talking to Me?” The Wall
McCormick believes. It also gives you a chance to Street Journal, April 25, 2011; “In a Few Words, Growth,” The Wall Street
set the situation right with the customer. If you deal Journal, June 6, 2011; “Starbucks and Twitter: Hash Tag Hell,” Viva
Visibility, vivavisibilityblog.com/hash-tag-hell/; and “Anti-Starbucks
with problems swiftly and set things right, people are Filmmakers Hijack the Coffee Company’s Own Twitter Marketing
impressed. Campaign,” bloggasm.com, May 21, 2009.

CASE STUDY QUESTIONS

1. Assess the management, organization, and 3. Give some examples of management decisions
technology issues for using social media to engage that were facilitated by using social media to
with customers. interact with customers.
2. What are the advantages and disadvantages of 4. Should all companies use Facebook and Twitter
using social media for advertising, brand building, for customer service and advertising? Why or why
market research, and customer service? not? What kinds of companies are best suited to
use these platforms?

B2B) contributing about $4.1 trillion of that amount (U.S. Census Bureau, 2012;
authors’ estimates). By 2016, B2B e-commerce should grow to about $5.6 trillion
in the United States. The process of conducting trade among business firms is
complex and requires significant human intervention, and therefore, it con-
sumes significant resources. Some firms estimate that each corporate purchase
order for support products costs them, on average, at least $100 in adminis-
trative overhead. Administrative overhead includes processing paper, approv-
ing purchase decisions, spending time using the telephone and fax machines
to search for products and arrange for purchases, arranging for shipping, and
receiving the goods. Across the economy, this adds up to trillions of dollars
annually being spent for procurement processes that could potentially be auto-
mated. If even just a portion of inter-firm trade were automated, and parts of
the entire procurement process assisted by the Internet, literally trillions of
dollars might be released for more productive uses, consumer prices poten-
tially would fall, productivity would increase, and the economic wealth of the
nation would expand. This is the promise of B2B e-commerce. The challenge

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