Social Media as Relationship Marketing

What is the chain of cause and effect that makes social media work (or not work) in terms of "brand building"? It's quite obvious how it works in terms of promotion / sales support (making the right offers to people who are interested and getting in touch with their friends); but how exactly does it work for brands?

I have come to the conclusion that as soon as we say it works upon the brand's image (like eg advertising often does) - we are probably wrong. Or to be more precise - we use the wrong intermediate construct - image (some inner representation of the brand's qualities and traits).
If I were to measure social media effects I would rather not go for image profiles in terms of attributes connected to a brand. Why?

1. Because image is mostly about what a brand stands for and is good at and social media is about how a brand behaves on a daily basis and who it can relate to. What we normally want to express when we use the word "image" is not about brand behavior as a "persona" or its real-life relations to others. We could alter our concept of "image" but that's simply tweaking a concept to make it work somehow. I'm convinced social media doesn't need this tweaking.

2. I personally think social media doesn't change much about the perceived strengths or weaknesses of a brand's offerings as long as they don't get better in reality. Simply because it can't just go and make claims about them. People won't listen and will even make the brand look worse than before making those "image" claims.

3. It doesn't have enough reach to alter perceptions in the mass market. And that's what we normally mean when we think "image". We mean something we can measure in the whole target group, not in minor fractions of the target group.

I would frame social media in the field of relationship marketing where reach has never been the big question, where noone has even tried to create a juxtaposition between advertising and e.g. loyalty marketing. Once we do that new metrics come into play: brand loyalty measures, recommendation measures, share of wallet measures, even satisfaction measures and so on. It's also possible to classify it In the field of public relations or customer service or even market research. All of these disciplines/functions would never be staged as candidates to "replace" advertising or to try to claim that they alone can market products.

For me this very simple and un-fancy categorization was very helpful and resolved a lot of cognitive dissonances.

Maybe it will help some readers as well.