ABSTRACT
Social media–based strategies are fundamentally different from traditional firm strategies without considering the impact of social media content. Public engagement with customers on social media does not come without risk. Negative word-of-mouth on social media stemming from poor customer engagement or a brand response can disseminate rapidly and reach a large audience, especially when the customer has a strong social influence. This chapter examines how a firm’s online management responses in social media websites affect its performance. Then, we look at how firms generate user engagement in their social media communities and how social media affects their pricing and other operations strategies. This chapter also discusses a new type of social media, location-based social media, which offers users the option to share their locations with their social media friends.
