Opportunities and challenges of social media in supply chain management: A study in the South African FMCG retail industry

Abstract

Orientation: Social media is often described a double-edged sword, yielding opportunities and challenges. It brings organisations closer to their customers, and when executed properly it can help drive business and provide a significant return on investment.

Research purpose: To explore the opportunities and challenges that social media has created in SCM in the South African FMCG retail industry.

Motivation for the study: Limited research has been conducted on the innate link between supply chain management (SCM) and social media, especially within the context of the fast-moving consumer goods (FMCG) retail industry and within a developing country context such as South Africa.

Research design, approach and method: A generic qualitative research approach was adopted. Semi-structured interviews were conducted with 12 top and middle managers from the South African FMCG retail industry. Thematic analysis was used to analyse data. This was done in sequential phases, namely by data familiarisation, generating codes, identifying themes, constructing thematic networks and drawing conclusions from the data.

Main findings: The findings indicate that social media has created faster and more collaborative communication between an organisation’s suppliers and their customers. However, it has also empowered consumers and forced FMCG retailers to respond faster to consumer complaints and queries to maintain customer relationships for sustained competitive advantage. The lack of control over content that is shared by customers on organisations’ social media platforms is a challenge that organisations experienced. The predominant social media platforms found to be used were WhatsApp, Facebook and Twitter.

Practical/managerial implications: Traditional methods of communicating are changing, and organisations need to adapt to social media as an alternative form of technology customer engagement and relationship management. For managers, if social media is embedded in the supply chain, the supply chain can gather information from a broad base of different sources.

Contribution/value-add: This collective intelligence can be used to uncover evolving trends or for better-informed decision-making, planning and overall collaboration between supply chain partners.