Investigating the usage of social customer relationship management (SCRM) and its impact on firm performance in the mobile telecommunication services: Egypt case

Abstract

PurposeThe purpose of this study is to investigate the usage of social customer relationship management (SCRM) and its impact on firm performance in the telecommunication industry particularly the mobile services in Egypt. Design/methodology/approachThis study used qualitative approach, which consists of semistructured interviews. Twelve semistructured interviews were conducted with the top management level from the four existing mobile operators in Egypt namely Vodafone, Orange, Etisalat and We. Data collected were analysed by using themed analysis. FindingsIt has been found that SCRM is a crucial tool for keeping long term relationships with customers which in turn affect the firm performance in terms of Growth and profitability in the Egyptian mobile telecommunication services. Originality/valueThis study contributes to the body of knowledge by providing insights and explanations regarding the extent to which the mobile operators use SCRM and how it affects their firm performance in Egypt, as one of the developing countries. Additionally, this study offers guidelines to the service providers particularly the mobile operators with valuable visions into the development of effective SCRM to be able to achieve a sustainable competitive advantage. Corresponding author: Heba Sadek Email addresses for the corresponding author: hebahassan@aast.edu First submission received: 23rd May 2018 Revised submission received: 22nd August 2018 Accepted: 19th September 2018 Introduction In today’s business environment, firms face remarkable challenges due to several aspects, including severe market competition, fast technological developments, unpredictable changes in customers’ preferences and trends (Elena, 2016). For this reason, keeping satisfied customers is considered the most crucial elements that leads to higher firm performance (Charoensukmongkol and Sasatanun, 2017). To attain this objective, firms must focus on managing customers’ relationships by understanding their needs and wants to be able to adjust the products (goods/services) to meet or surpass customers’ expectations (Trainor, Andzulis, Rapp and Agnihotri, 2014). Specifically, the marketing practice recognized as customer relationship management (CRM) is recommended to support firms to attain this objective (Wang and Kim, 2017). CRM has been defined in several ways reflecting numerous viewpoints (Iriana and Buttle, 2006). The majority of CRM definitions are based on the collection and use of customer data for specific customer-focused activities (Xu and Walton, 2005). Based on Peppers and Rogers (2011) the CRM activities are classified into four processes. First the identification which includes the collection of customer information, second the differentiation that aims to segment customers into groups according to Journal of Business and Retail Management Research (JBRMR), Vol. 13 Issue 3 April 2019 www.jbrmr.com A Journal of the Academy of Business and Retail Management (ABRM) 283 their needs, third the interaction which comprises the communication with customers and finally the customization that includes the adaptation of products (goods/services) according to each customer. This traditional CRM is usually implemented by firms through computerized software and database systems. As social media tools such as Facebook and Instagram have expanded globally in the past decade, firms require to manage these tools to achieve their strategic goals (Trainor et al., 2014). Firms are finding social media as an essential means to adapt their approach to customer relationship management (CRM) to enhance customer satisfaction (Wang and Kim, 2017). Thus, Social CRM (SCRM) is not a substitute for traditional CRM but instead is an extension that includes the social functions and processes to improve customer satisfaction and firm performance (Greenberg, 2010). In this study, the authors assume the conceptualization of CRM activities proposed by Peppers and Rogers (2011) as the base for social media application. Despite the significance of incorporating social media with CRM, limited research in some western countries examined how social media interacts with CRM activities to enhance firm performance (Charoensukmongkol and Sasatanun, 2017; Wang and Kim, 2017). Therefore, this study will fill the gaps by focusing on the application of SCRM in the Egyptian mobile telecommunication services and its impact on firms performance. Egypt as an Arab developing country could be a fruitful area for this kind of study. Particularly, the mobile telecommunication services are considered as one of the most important services in the Egyptian economy, which faced rapid growth since the 1990s (El-Haddad, 2017). In Egypt, the mobile telecommunication services are controlled by four big firms, three firms from the private sector namely; Vodafone, Orange, Etisalat and one newly firm from public sector namely WE. All firms now fiercely compete for increasing the number of subscribers they have to maintain satisfied and loyal customers. Thus, firms are forced to think of new ways to differentiate their products and services’ portfolio to attract new customers and to enhance their firms’ performance (Bishara and Wahba, 2004). Accordingly, the purpose of this study is to investigate the extent to which the mobile operators in Egypt use social media in the implementation of CRM activities and whether or not the use of SCRM can improve their firm performance.