The Importance of Co-Creating Value With Customers

Tags: Co-Creation, Online Communities

[vc_row][vc_column][vc_column_text css=”.vc_custom_1528487839572{padding-bottom: 50px !important;}”]Paying attention to your customers is important. Most companies would agree with that sentiment, as it’s a core principle of both research and development and marketing. Incorporating your customers into the process is even better, which is why co-creating value with customers is critical for success in today’s market.

What Is Co-Creation?

In general terms, co-creation is a business strategy that takes customer-facing ideas farther than methods such as Six Sigma or similar participatory quality programs. While such programs integrate cooperation from those throughout a business organization and use customer-based metrics as a foundation for measuring success, co-creation helps boost the chances of success by pulling the customer further into the fold. Co-creating value with customers means involving the consumer fully in the process.

Why Should My Company Be Co-Creating Value With Customers?

Traditionally, organizations might poll the customer via surveys, focus groups or feedback processes. While such feedback does provide for a two-way communication road, it’s stagnant and less flexible than co-creation. In the traditional model, customers voice opinions, and those opinions are used in the creation of a product. Customers might then be asked for other opinions, which are used to modify or perfect the product. With this approach, there’s always a chance the development team is misinterpreting customer feedback.

In a co-creation model, customers are involved throughout the process, as are all stakeholders. Real-time feedback during development reduces misunderstandings and ensures a richer value proposition for every development. Co-creating value with customers benefits the product, the consumer, the organization and, ultimately, the bottom line.

Fully Engage All Stakeholders in Creating Value

In a co-creation model, you don’t just get consumers involved in creating value. Co-creation methods encourage organizations to involve stakeholders from all levels in developing policies, services or products. Venkat Ramaswamy, one of the authors who coined the phrase co-creation, and co-author Francis Gouillart define stakeholders as including customers, suppliers and vendors, distributors and distribution channels, regulators and employees. Ramaswamy and Gouillart say people in any position or relation to the company have something of value to add. People, write the authors, are “inherently creative and want to shape their own experiences.” Co-creation is a way organizations can tap into that creativity while providing all stakeholders with a feeling of control over something within the process.

Encourage Customer Loyalty

Co-creating value with customers encourages loyalty to your brand because it creates ownership. Any strong business leader knows ownership is a powerful thing. When you empower good employees to own a process and its results, you usually increase team morale and see increases in production. The same tenet applies to consumers; if they feel integral to the creation process, then they are more likely to feel tied to the brand, product or service. They want it to succeed more, which means they will do more to make that happen. Co-creation leads to greater word-of-mouth marketing and the development of brand ambassadors, both of which are necessary in today’s world of online reputation management.

Create Meaningful Products and Services for the Consumer

Products and services are often more integral to customer lives when organizations get involved in co-creating value with customers. Set aside the misunderstanding of customer needs already mentioned and you’re still left with any number of reasons a launched product doesn’t provide a rich value experience for a consumer. One of those reasons is that things change from the time research is conducted to the time a product is released, and today’s market moves fast. Co-creation lets you keep tabs on a moving target so you can adjust accordingly, and it ensures that the end result of any endeavor isn’t just valuable to consumers; it ensures the product or service is meaningful to the customer at an emotional, cultural or mental level.

Reduce Costs and Risks Associated With Development

Finally, co-creation lets you reduce some of the costs and risks inherent in the development process. Co-creating streamlines research and feedback, often providing necessary feedback at critical times instead of waiting until work is done to seek customer approval. Since co-creation involves everyone, you mitigate risks that a product or service simply won’t work at all with your market or that it flies in the face of important safety or niche regulations. Ultimately, co-creating provides an organization with more ideas and knowledge upfront so teams are less likely to make major mistakes along the way.

How Can You Benefit From Co-Creation?

While crowdsourcing feedback on social media or a company website can provide valuable input, co-creation involves more of a commitment. Successful co-creation involves community, which means you need to build one around your brand or product. A variety of platforms exist for community building, and if you have a strong social media presence, you can start there and encourage users to sign up for a forum, portal or other tool where you plan to handle online co-creation tasks.

Once you start building a tribe, it’s time to listen. Many entrepreneurs and business teams are almost drowning in their own ideas, so it’s hard to step back and listen to others. To co-create value, though, you have to let others do some of the work.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][templatera id=”3348″][/vc_column][/vc_row]

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