An empirical evidence on the impact of social customer relationship management on the small and medium enterprises performance

Abstract

Social media has swiftly established itself as a primary source of products’ information for customers. Nowadays, Small and Medium-size Enterprises (SMEs) can use social media to develop Customer Relationship Management platforms (social CRM). Firms, particularly SMEs in developing countries need to understand the factors affecting their performance by implementing social CRM. However, there is a dearth of awareness on the impact of social CRM on the performance of SMEs. This study proposes an integrated model that aims to investigate the effects of social CRM on SMEs’ performance. The model is constructed by incorporating three dominant theoretical frameworks: the Fit-Viability Model (FVM), Network Externalities, and the Resource-Based View (RBV). A cross-sectional survey was used to gather data from 149 SMEs managerial staff. Findings revealed that almost 50% of the variability in the performance of SMEs is explained by the fitness and viability of social CRM. In addition, network externalities of social media significantly impact the social CRM fitness in the context of SMEs with path coefficient 0.617. Furthermore, the internal financial resources factor makes sCRM viable for SMEs as the results show significant relationship between the internal financial resources and the sCRM viability with 0.536 path coefficient. Manager innovativeness, IT knowledge, top management support, and government assistance, on the other hand, do not contribute significantly to the viability of social CRM for SMEs. The model aids SMEs in making well-informed decisions regarding the adoption of social CRM by evaluating both the suitability of social media for CRM tasks and the enterprise preparedness to implement social CRM, leading to enhanced performance.