Social media : The new killer application in the building of customer relationships

Abstract: Research questions: Wherein social media lies the challenges for companies in order to build customer relationships? Purpose: This bachelor thesis was aimed to describe the challenges companies face in the building of relationships through social media. Theoretical framework: The thesis was based on theories about how companies can build loyal relationships and what factors that must be included, how social media is defined and what it is composed of, and finally how companies can build relationships through social media and what factors that must be included. Methodology: The data collection was based on a qualitative research in which semi- structured interviews were used. Conclusions: The authors have after this study reached the conclusion that the main challenges, when it comes to create relationships through social media, are the allocation of resources, the lack of understanding within the organization and the difficulties related to the understanding of what consumers’ value. The lack of understanding concerns three areas, which are the treatment of criticism from the consumers, the importance for companies to get involved in social media and how much resources that are required from the companies when they decide to participate on social media in relationship building purposes. The last mention lack of understanding could be connected to the challenge of allocation of resources, since companies have to understand that an investment in social media requires resources in the form of employees with a strong engagement. The challenge of what consumers value, involves that companies need to find out what the consumers actually value, which can be done by making use of different monitoring systems. Companies must therefore, also learn how to handle these systems, in order to use them in the best possible way. There are thus, organizational requirements that must be achieved in order to create long-term and loyal relationships through social media.