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Value Creation and Relationships in Transformation: A Study of Social Media in the Travel Industry

In recent years the Internet has greatly changed the travel industry and the emergence of social media has driven this change further. In the past travel companies have been natural links between customers and suppliers but today customers can buy travel directly from the supplier, making it difficult for travel companies to attract new customers and retain existing customers.

As social media is revolutionizing the way people communicate, the trend suggests that it is becoming increasingly important for firms to take part in this technological development to interact with customers.

Although Internet and social media has a major impact on firm-to-customer and customer-to-customer conversations, there is little guidance in academic literature and organizational contexts on how to use social media in an effective way.

Therefore, the aim of this study is to describe and explain how social media has transformed the relationships between selected Swedish travel companies and their customers, and how these firms create and sustain value and relationships through social media. Furthermore, we will give implications for management on how to utilize social media to create and sustain value and relationships.

The results of our research confirm that social media is transforming the relationships between firms and customers. From our findings we conclude that the customer has become more empowered, that interaction now occurs through a two-way communication and that social media has made industries and relationships more transparent.

The results also indicate that firms do not realize the value that can be created through social media for the customer as well as for the firm. The use of social media among the interviewed firms varies with some firms using social media through many tools and some firms not using social media at all.

Our findings implicate that being aware of what value is created and why the firm is involved in a certain social media tool increases the likelihood of success. The firm should further not be afraid to experiment with social media.

However, social media also presents challenges. As social media is characterized by rapidly changing trends, it is difficult to predict what will happen not only in a distant future, but even so just a few years ahead.
Source: Linköping University
Author: Bergström, Joakim | Svensson, Mariel

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