Business practice of social media - Platform and customer service adoption

This paper examines the key drivers in business adoptions of the platform and customer service within the context of social media. We carry out the empirical analyses using the decision trajectories of the international airline industry on Twitter. We find that a firm's decision-making is subject to both peer influence and consumer pressure. Regarding peer influence, we find that the odds of both adoptions increase when the extent of peers' adoption increases. We also identify the distinctive role of consumers. Specifically, before the platform adoption, firms learn about potential consequences from consumer reactions to peers' adoptions. Upon the platform adoption, consumer voices directed at a firm itself is more crucial to customer service adoption. Furthermore, while both positive and neutral voices facilitate platform adoption, only positive voices significantly contribute to customer service adoption. The findings confirm the distinct trade-offs faced by firms at different adoption stages: while firms are motivated to adopt the platform to reach potential customers, firms care more about the online reputation when deciding customer service adoption.