The Impact of New Media on Customer Relationships

The Impact of New Media on Customer Relationships

New media are considered as all digital communication and information systems. Consumers can consume the things said and done within these new media in current time and long afterwards, regardless of their geographical locations.

There are 6 dimensions of these new media mentioned below.

• Digital: digital products can be reproduced unlimitedly with no marginal costs.

• Pro-active: people can all contribute, co-creation will

• Visible

• Real-time and memory: media can be accessed at the time they are produced as well as far after they are produced.

• Omnipresent: media can be accessed anywhere at any time at different locations through mobile devices.

• Networks: New media is used by people to participate in social networks.

The impacts of new media can me compared with playing pinball. Once you shoot a message in to the world it is influence by many other factors, afterwards it will come back and it can be shot back. Using the new media sources, information have become difficult to predict, interconnected and multidirectional.

When focusing on new media it is very important to understand how companies and customers interact with each other. Changes appear in the way customers receive it with the companies and brands, as well as they react on it and the relationships between customers and companies.

The new media can be split up in two categories

1. Information and Services: this refers to the differences in content and the behavior of customers that is a result from it.

2. Technologies: This concerns the new media infrastructures.

These new media phenomena have been divided in to ten categories, for each of which topics for further research are offered, concerning the understanding of consumers, customer’s interactions and customer measurement and relationship outcomes. They will be discussed one by one.

Within the first category, information and services, 4 phenomena are discussed.

New multimedia services

Understanding consumers

It is important for companies to know how these new media affects the traditional types of media such as TV. This might decrease because people are watching more and more on YouTube instead of TV. Besides, they should know what makes a multimedia type of communication a success.

Customer interactions

Additionally it is very important for companies to know what types of business models will fit these new multimedia sites. For example if people are willing to pay for it. At last it is crucial to know where it is most effective to place advertisement.

Measuring Customers/outcomes

It is important to know how behavior on this multimedia can be used, and to assess long-term effectiveness.

Digital consumer articulation

Understanding consumers

It is important to check why people would choose one of the many possible media. Besides, it is important to assess the results of electronic worth-of-mouth communication.

Customer interactions

It is very important to be able to manage the negative worth-of-mouth communications, and to be able to communicate with the people that create it in a good way.

Measuring customers/outcomes

Trying to measure EWOM is extremely difficult, though it must be done. It is of great importance to create a model to measure its impact and to analyze a link between EWOM and possible behavioral outcomes. Besides it is important to know how much should be invested.

Consumers as retailers

The new media tools provide many ways for consumers to sell things, for example the Dutch ‘Marktplaats’. This might have effects on companies and must thus be taken into account. Some implications for this research are:

Understanding customers

For the understanding, it should me research under what conditions people will sell their own products, and under what conditions buyers would prefer used products. Besides it might be important to research if the purchase of these used products will influence the brand’s value.

Customer interactions

It is presumed to also be relevant to research how the buying and selling of the used products may affect the sales of new products and for which industries this is relevant.

Measuring customers/outcomes

Do these different roles a customer plays in being both a sellers and a buyer influence his or her satisfaction and retention.

Online social communities

Research implications may be:

Understanding customers

It is important to conduct research on the fields of the conditions under which these communications may influence the perceptions of the brand, as well as the impact that the active participation of these consumers may have.

Customer interactions

It will also be useful to know how support communications can be run the best and the role of service personnel in these communities. Besides research is necessary to see how a brand can get virtual ‘friends’ of the brand.

Measuring customers/outcomes

How can companies gain useful information from these communities is an important question that has not yet been answered. Besides it may be important to check the effects of marketing in these communities and the integration of community data with the company’s database.

For the second category, technology, six phenomena for further research are discussed. The research implications are divided in sub categories, being:

• Understanding customers

• Customer interactions

• Measurements of outcomes.

Search engines

Understanding customers

It is important to be able to identify the influence of the search on the purchasing decisions of consumers, and what search terms they use the most.

Customer interactions

The interaction between organic results and targeted ads is an important factor, as well as the balancing of new and existing customers.

Measuring customers/outcomes

Measurements that need deeper insights are how well a search will predict a consumer’s trend, the effectiveness of search engine advertising compared to banner advertising and the customer loyalty involved.

Shopping bots

Understanding customers

Why do people consult shopping bots and which people will do so and is this information shared with other, are important research implications.

Customer interactions

Questions that come up are for example how companies should adapt to these price comparisons and what their ideal price would be.

Measuring customers/outcomes

Concerning the measurements it is important to be research further possibilities on how these price comparisons can used to be improving the pricings.

Mobile technologies

Understanding customers

It is important to know the relevance of mobile technologies. Besides it is important to know what consumers are willing to accept to receive on their devices.

Customer interactions

Mobile phones can give insight to locations of people that can be used for economic potentials. Besides there is a huge amount of different services, not all are evenly relevant.

Measuring customers/outcomes

Quality of the data that might be collected is an important factor. There are not a lot of possible measures available yet, that still need to be researched. Additionally it is important to check if people would like to include themselves in possible researches.

Recommendation systems

Understanding customers

The integration of consumers in the recommendations to others is extremely useful to know, since this has become easier with these new media. In addition to this is important to assess how much people value other users recommendations

Customer interactions

Getting the optimal amount of information out of the consumers and the usability and design of recommenders is an important implication of research as well.

Measuring customers/outcomes

Measuring there is important to check if the recommender data can be used for other purposes, to be able to compare different recommendations and thus how to treat new users. At the end the influence of these recommendations on the profit is essential.

Peer-to-peer networks and piracy

The new media create a big possibility for people to illegally transfer the different products or software. It thus became more and more important for companies to take this in to account.

Understanding customers

Finding out how consumers justify their illegal behavior and what is worth paying it for. Besides it is useful to know how they balance the risks and benefits of illegal behavior.

Customer interactions

For company’s it is important to measure the effectiveness of anti-piracy strategies as well as using the peer-to-peer networks for their own marketing advantages, and in thus maybe try to change ‘pirates’ in to paying customers.

Measuring customers/outcomes

Measuring the costs of privacy is important to further research as well as the effects of anti-piracy actions on the healthy relationship with the customer, they might be hinted to other ways of buying the products.

Online auctions

Understanding customers

Why do people participate in online auctions is one of the most important aspects to investigate when looking at online auctions.

Customer interactions

Which auction type should be used to address the best people and the designing of interactive price mechanism is also relevant for further research.

Measuring customers/outcomes

The research on measuring the outcomes indicates that they should know how bids are influencing the willingness to pay and how bidding behavior can be included in a customer’s purchase history.

This all illustrates that new media need a new way of thinking and an extreme amount of extra research to be done for marketers.