Applicability of Web 2.0 Tools for Customer Retention

The outcome of this paper shows that Web 2.0 tools offer many possibilities in order to retain customers and especially the two applications Facebook and Twitter can be used therefor. However, by implementing Web 2.0 tools into a company's marketing strategy also problems can occur, especially if not used with sufficient knowledge. Looking at the example of the social network platform Facebook, one can see that the wrong utilization of corporate pages can lead to inconsistency of the published information and the general company image. Furthermore users can feel over-spammed and thus, can prompt negative feelings for a brand or a company. Nevertheless future-looking companies, which want to stay competitive and differentiate from their competitors, are offered great chances by Web 2.0 tools, such as active communication with customers, segmentation and targeting, building of trust and acceptance, establishing enthusiasm and emotions or identifying trends and collecting customer data. Thus, the usage of Web 2.0 tools can create value for companies, by means of increased brand awareness, customer satisfaction, customer loyalty, and as a result higher customer retention. In a first step the term Web 2.0 is discussed and furthermore the respective tools are described and their understanding is supported by popular examples of Web 2.0 applications. As a second part this thesis will treat the topic of customer retention, possible opportunities and threats and how to manage it. As a last step the beforehand defined Web 2.0 tools are analyzed according to their applicability for customer retention. The most elaborate part of this step includes the comparison of the two Web 2.0 applications Facebook and Twitter as for their suitability for various beforehand defined processes of the different phases of customer retention. Those two applications were chosen due to recent events and popularity of both, at the time this thesis were written. Contents

Abstract

1.Introduction

1.1.Description of the problem

1.2.Research Questions

1.3.Limitations

1.4.Methods

1.5.Structure

2.Web 2.0

2.1.Definition and history of Web 2.0

2.2.Web 2.0 tools

2.3.Summary

3.Customer Retention

3.1.Definition

3.2.Opportunities and Threats of customer retention

3.3.Effectiveness of customer retention

3.4.Managing customer retention

3.5.Critique in measuring customer retention

3.6.Summary

4.Web 2.0 tools for Customer Retention

4.1.Web 2.0 tools in the fields of application of e-commerce

4.2.Facebook vs. Twitter

4.3.Summary

5.Conclusion

5.1.Outlook to further research

6.List of References

6.1.Books and Articles in Journals

6.2.Online Journals and Documents Studienarbeit

Autor: Tomas Paulitsch (Pseudonym dokumente-online.com)

Fachhochschule Krems

2015