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The Impact of New Media on

Customer Relationships

Author: V. Kumar, Lerzan Aksoy, Bas Donkers, Rajkumar Venkatesan, Thorsten Wiesel and Sebastian Tillmanns

Resource -Journal of Service Research, 2010Professor – 苑守慈

Presenter – Allan Wu

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Agenda• Introduction & Background• New Media Definition• Playing Pinball: A Conceptual Framework of New

Media’s Impact• Key New Media Phenomenon

(1) New Media Information and Services(2) New Media Technologies

• Summary and Conclusions• Q&A

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Introduction&Background

• ‘The digital innovations of the last decade made it effortless, indeed second nature, for audiences to talk back and talk to each other’’ (Deighton and Kornfeld 2009, p. 4)

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Introduction&Background

• Summarizes the major challenges that new media bring for managing customer relationships

• Making use of the opportunities provided by new media requires a thorough understanding of why consumers are attracted to these new media and how they influence consumers’ affect and behavior

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Introduction&Background

• (a) consumer behavior

• (b) the successful management of customer interactions

• (c) measuring customers’ activities and relationship outcomes, highlighting areas for future research.

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New Media Definition

• New media o information channels in which active

consumers engage in behaviors that can be consumed by others both in real time and long afterwards regardless of their spatial location.

Ex: websites and other digital communication

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New Media Definition• Digitalthere are virtually no marginal costs for producing extra copies of digital products

• Pro-activecontribute to all parts of the value chain, ranging from superficial articulation to extensive products

• Visibleactivities can be seen by others

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New Media Definition• Real-time and memoryMemory is also crucial for personalizing future interactions.

• Ubiquitousanywhere at any time

• NetworksConsumers use new media to participate in social networks

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Playing Pinball:

A Conceptual Framework of New Media’s Impact

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Pinball

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Pinball

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Key New Media Phenomena

• New Media Information and Services

• New Media Technologies

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Key New Media Phenomena

(a) consumer behavior=>Understanding consumers (b) the successful management of customer interactions=>Customer interactions(c) measuring customers’ activities and relationship outcomes, highlighting areas for future research.=>Customer measurement and relationship outcomes.

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New Media Information and Services

1.New multimedia services

2.Digital consumer articulation

3.Consumers as retailers

4.Online social communities

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New multimedia services

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New multimedia services

• Understanding consumerso Effect on traditional o Impact on brand perceptiono Who engage ? what drive?

• EX TV & Youtube

• Customer interactiono Consumer willingness to pay in new media environmentso What kind of advertising is most persuasive on new multimedia

sites?

• Customer measurement and relationship outcomes.o How can behavioral data generated on multimedia sites be

employed?o Long-term advertising effectiveness and clickstream datao Prediction accuracy of virtual world data for real-world predictions

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Digital consumer articulation

EWOM

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Digital consumer articulation

• Understanding consumerso Impact of real-time EWOM on diffusion patterns

• Customer interactiono Appropriate strategies for managing negative EWOMo Appropriate ways to interact with consumers who articulate

negative EWOM

• Customer measurement and relationship outcomes.o Measurement approaches to EWOMo Modeling EWOM’s impact on behaviorso How much to invest in EWOM management?

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Consumers as retailers

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Consumers as retailers

• Understanding consumerso Under which conditions do consumer prefer used products?o Does the purchase of used products affect brand perceptions?

• Customer interactiono How do online second-hand markets affect the value of new

products?o Balancing of customer/retailer orientation

• Customer measurement and relationship outcomes.o Use of data for other purposeso Can data be embedded in segmentation models?

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Online social Communities

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Online social Communities

• Understanding consumerso Impact of a active participation on other consumer behaviorso Overlap between consumers’ activities in online and offline

communitieso Conditions under which communities can influence brand perceptions

• Ex: Fan page

• Customer interactiono How can communities be used for brand management?o Conditions to successfully run service-support communities

• Customer measurement and relationship outcomes.o Consumers’ willingness to provide datao Integration of community data with company databaseo Effects of marketing in communities on customer relationshipso Incremental value of engaging activities

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New Media Technologies

1.Search bots2.Shopping bots3.Mobile technologies4.Recommendation systems5.Peer-to-peer networks and piracy6.Online auctions

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Search bots

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Search bots• Understanding consumers

o Influence of search on consumer decision making consumers’ choice of search terms

o Influence of visibility in searches on brand perceptions

• Customer interactiono Understanding the interactions between organic listing and

targeted ad placementso Balancing new and existing customers with search advertising

• Customer measurement and relationship outcomes.o Effectiveness of search advertising for different customer

segments and productso Relative effectiveness of banner advertising vs. keyword

search advertising

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Shopping bots

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Shopping bots• Understanding consumers

o Is information shared with others?o Perception of partitioned prices

• Customer interactiono How to adapt to price comparisons?o What are’ ’ideal’’ partitioned prices?o Effectiveness of price concealment strategies

• Customer measurement and relationship outcomes.o How can price comparison data be used to improve pricing?o Effects of bots on customer outcomes and moderating role of

relationship quality

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Mobile technologies

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Mobile technologies• Understanding consumers

o Conditions under which consumers are willing to accept permission-based services

• Customer interactiono Economic potential of location-based serviceso Which services have commercial potential?o Tradeoff between push and pull marketing with respect to

location-based serviceso Economic potential of bar codes

• Customer measurement and relationship outcomes.o Quality of data collected from mobile deviceso Types and measures amenable for measurement via mobile

devices

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Recommendation systems

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Recommendation systems

• Understanding consumerso Integration of consumer preferences in recommenders

consumer acceptance of recommenders

• Customer interactiono Usability and design of recommenderso Optimal amount of information obtained from consumer

• Customer measurement and relationship outcomes.o How can recommender data be used for other marketing

issues?o How to treat new userso Performance of recommendations compared to other

information

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Peer-to-peer networks and piracy

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Peer-to-peer networks and piracy

• Understanding consumerso How do consumers justify illegal behavior?o How do consumers decide what is worth paying for?

• Customer interactiono Effectiveness of anti-piracy strategieso Use of peer-to-peer networks for commercial distributiono Transformation of ‘‘pirates’’ into paying customers

• Customer measurement and relationship outcomes.o Usage of peer-to-peer networks to explore cultural trends and

identify niche productso Effects of anti-piracy actions on ‘‘healthy’’ relationships

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Online auctions

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Online auctions• Understanding consumers

o Conditions under which consumer prefer auctionso Choice when ‘‘Buy it Now’’ option existso Perception of active participation

• Customer interactiono Design of interactive pricing mechanismso Through which auction type should products be sold?

• Customer measurement and relationship outcomes.o Do bids allow determining price-response functions or

willingness-to-pay?o How can bidding behavior be integrated with customers’

purchase history?

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Summary and Conclusions

• The framework illustrates that new media require a shift in marketing thinking

• Researchers are encouraged to use this pinball framework as a road map that can help to shed light on exciting new research questions

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What other technology could influence customer

relationship?

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Q&A