Social media customer service may trigger chain of complaints

Companies engaging with customers on Twitter, beware! Responding to complaints on social media has the side effect of triggering new complaints, researchers, including one of Indian-origin, have found.
As companies flock to social media outlets to engage with their customers, a question arises as to whether such service interventions on social media work, researchers said.
The study found that on one hand, addressing complaints on social media improves customer relationship with the company.
However, it also increases customers' expectations to receive help, and makes customers more likely to speak up in the future, encouraging even more complaints.
For their study, the researchers examined the history of compliments and complaints by several hundred consumers of a major telecommunications services provider made on Twitter and the company's responses.

They used a dynamic statistical model to investigate both how consumers' relationships with the company evolve and how they decide whether to compliment or complain.

"People complain on Twitter not just to vent their frustration. They do that also in the hope of getting the company's attention," said Liye Ma, professor at the Robert H Smith School of Business at the University of Maryland in US.
"Once they know the company is paying attention, they are more ready to complain the next time around," Ma said.
Despite this side effect, addressing complaints is still worthwhile, the researchers said. The improved customer relationship from such effort outweighs the downside of encouraging more complaints.

However, if companies only look at what customers say on social media without recognising this "squeaky wheel" effect, they will underestimate the effectiveness of their service intervention, the researchers warned.
The study also investigated the influence of friends on social media - hearing more positive words from friends improves a customer's relationship with the company.
However, the customer reaction to voices can go either way - in certain cases the customer feels the need to agree with friends and compliment them, while at other times the customer disagrees with friends and complains.
"The social media environment is in a sense self-stabilising and companies should not overreact to negative comments," said Baohong Sun at the Cheung Kong Graduate School of Business in China.

"Social media is a double edge sword - companies need to watch out and weigh the plus side against the down side for marketing and service interventions," said Sunder Kekre of the David A Tepper School of Business at the Carnegie Mellon University in US.
The study was published in the journal Marketing Science.