Unlock Your Business Potential: How Social Media Powers Customer Relationships

Theo Raines in Business & Economy August 2025 • 4 min read.

"Discover how leveraging social media technology (SMT) can strengthen customer relationship management (CRM) and drive firm performance in today's digital landscape."

Customer Relationship Management (CRM) has evolved significantly, becoming a core strategy for businesses aiming to improve shareholder value through stronger customer relationships. CRM is no longer just a technological solution but a comprehensive approach to managing and enhancing customer interactions. Effective CRM implementation can boost firm performance and predict new product success, making it a vital component of business strategy.

Digital technologies are reshaping markets and business models, with social media technologies offering new avenues for companies to connect with customers. Social media's vast content and interactive nature profoundly impact consumer knowledge, attitudes, and behaviors. Empowered customers now actively engage with businesses, co-creating value through two-way interactions.

Social media technology (SMT) has the potential to revolutionize business processes, enhance customer relationships, and improve operational performance. Companies are increasingly recognizing the impact of SMT, using it to maintain competitiveness and drive business results. This research explores how businesses can leverage SMT to boost their CRM capabilities and achieve better firm performance.

Why Social Media Matters: Understanding CRM Capabilities and Firm Performance

Interconnected social media icons forming a CRM structure, illustrating the power of social media in customer relationship management.

Social Media Marketing (SMM) is crucial for both B2B and B2C organizations, but its adoption requires a deep understanding of strategic and operational issues. Many executives lack the necessary knowledge to integrate SMT effectively into their business processes. While the benefits of SMT are clear, understanding how to implement and manage it remains a challenge.

The power of SMT lies in its ability to engage customers in value co-creation and brand building, presenting a significant opportunity for marketing managers. By understanding the factors that drive SMT adoption and its effect on CRM capabilities, businesses can better navigate this challenge. Previous research has explored the organizational determinants of SMT adoption, but the external drivers, particularly institutional factors, require further investigation.

Customer Coercive Pressure: Meeting customer demands by integrating SMT into CRM processes.
Mimetic Competitor Pressure: Keeping pace with competitors by adopting similar technologies.

To fill this knowledge gap, we investigate: a) the influences of customer coercive pressure and mimetic competitor pressure on SMT use; b) the mediating role of CRM capabilities in the relationship between SMT use and firm performance. The institutional theory and RBV perspective provide the theoretical foundations of this research.

Final Thoughts: Leveraging SMT for Sustainable Growth

By embracing SMT and aligning it with CRM strategies, businesses can unlock new opportunities for growth and create lasting customer relationships. Understanding the drivers of SMT adoption and its impact on CRM capabilities is essential for navigating the complexities of today's digital landscape and achieving sustainable competitive advantage.

About this Article -

This article was crafted using a human-AI hybrid and collaborative approach. AI assisted our team with initial drafting, research insights, identifying key questions, and image generation. Our human editors guided topic selection, defined the angle, structured the content, ensured factual accuracy and relevance, refined the tone, and conducted thorough editing to deliver helpful, high-quality information.See our About page for more information.

This article is based on research published under:

DOI-LINK: 10.1016/j.jbusres.2018.10.047, Alternate LINK

Title: Customer Relationship Management Capabilities And Social Media Technology Use: Consequences On Firm Performance

Subject: Marketing

Journal: Journal of Business Research

Publisher: Elsevier BV

Authors: Florin Sabin Foltean, Simona Mihaela Trif, Daniela Liliana Tuleu

Published: 2019-11-01

Everything You Need To Know

What is the primary role of Social Media Technology (SMT) in Customer Relationship Management (CRM)?

SMT serves as a powerful tool to enhance CRM by providing new avenues for companies to connect with customers. It allows businesses to boost their CRM capabilities, improve operational performance, and ultimately drive better firm performance. SMT facilitates two-way interactions, enabling customers to co-create value and actively engage with businesses, which is crucial in today's digital landscape.

How does Customer Coercive Pressure and Mimetic Competitor Pressure influence the adoption of Social Media Technology (SMT) within a business?

Customer Coercive Pressure influences SMT adoption by compelling businesses to meet customer demands by integrating SMT into CRM processes. If customers expect a business to be reachable through social media, the business must adapt. Mimetic Competitor Pressure, on the other hand, drives SMT adoption by pushing businesses to keep pace with their competitors. Businesses often adopt similar technologies and strategies to remain competitive in the market. These pressures highlight the importance of strategic SMT implementation.

What are the key benefits of integrating Social Media Technology (SMT) with Customer Relationship Management (CRM) for business performance?

Integrating SMT with CRM can significantly improve firm performance. This integration allows businesses to strengthen customer relationships, which is a core strategy for improving shareholder value. Specifically, SMT enhances CRM capabilities, enabling businesses to engage customers in value co-creation, build brand loyalty, and predict new product success. It helps in navigating the complexities of the digital landscape and achieving a sustainable competitive advantage.

What is the significance of understanding the factors that drive Social Media Technology (SMT) adoption in the context of CRM?

Understanding the drivers of SMT adoption is crucial because it directly impacts how effectively a business can leverage SMT to improve CRM capabilities and, consequently, firm performance. By recognizing the influences of Customer Coercive Pressure and Mimetic Competitor Pressure, businesses can strategically implement SMT. This understanding helps businesses navigate the digital landscape, implement effective CRM strategies, and achieve sustainable growth by creating lasting customer relationships.

How can a business leverage Social Media Technology (SMT) to foster sustainable growth and competitive advantage in today's market?

A business can leverage SMT for sustainable growth by embracing it and aligning it with CRM strategies. By using SMT, businesses can unlock new growth opportunities by strengthening customer relationships and engaging them in value co-creation. They can maintain competitiveness by adapting to customer demands and keeping pace with industry trends through SMT adoption. Understanding the factors that drive SMT adoption and its impact on CRM capabilities is essential for navigating the complexities of the digital landscape and achieving a sustainable competitive advantage.