Co-Creation Theory and How Companies Are Using It to Their Advantage

Tags: Co-Creation

co-creation theory

Most things begin with a theory that evolves into a concept. That concept is then transformed into reality as a prototype or pilot project. Depending on the customer response, the theory may eventually evolve through a series of defined principles into a full-fledged commercial effort.

Here, with respect to co-creation theory, there is a bit of a twist. Before you can understand how companies are using co-creation, it’s important to first understand what co-creation actually is.

“Co-creation is a business strategy focusing on customer experience and interactive relationships. Co-creation allows and encourages a more active involvement from the customer to create a value-rich experience.”

The twist is that co-creation theory is more like a mindset or corporate philosophy then it is like a theory per se. If you adopt it wholeheartedly and work at it, the theory can become reality. In this case, with respect to new product development, messaging, positioning and marketing efforts, co-creation theory – applied – can make all the difference between a roaring success and yet another ho-hum, snoozy launch. Nobody wants a mediocre product launch, especially your management team. Read on to gain some insight into what co-creation theory is and how it is successfully practiced by a few familiar brands.

Leaders in Co-Creation Theory

There are always winners and losers. With respect to co-creation theory, there are some strong contenders for the “winners” category. Two leaders just happen to be snack brands owned by the same global behemoth and another represents the home electronics industry.

First, Frito-Lay’s® (which merged with Pepsi-Co® nearly five decades ago) potato chips has set the bar to a new height with its Do Us a Flavor® campaign and contest that is now in its fourth year. The stakes are high: prizes are $10,000; $50,000 and $1,000,000 and that’s hardly pocket change. Not to mention the bragging rights! What the company does successfully is embrace regional diversity, honors it and boomerangs it back to the communities where the idea for that “regional flavor” first originated. Last year, they literally “saluted” America by launching eight new flavors, co-created with customers, where each new product highlights the unique flavor preferences of different areas around the country.

Another giant snack brand, Doritos®, also by Frito-Lay, tapped into co-creation theory early (2006) and simultaneously pioneered the strategy of user-generated content for marketing. At the time, many were skeptical, including the executives within the company. Sam Hinchliffe, the brand manager at the time, summed it up best when he said, “To open our advertising to the public could have been a massive risk, but it has really helped us engage with our core audience. We’ll be doing this again because the buzz around the brand is exactly what we aspire to.” The brand’s commitment to crowdsourcing new product ideas and marketing content catapulted it onto the world stage with its Crash the Superbowl® King of Ads contest. The idea of showcasing ads developed by fans (aka “amateurs”) launched in 2006 and enjoyed wild success for a decade until the campaign was retired. Over the years, each ad placed within the Top 5 consumer favorites, including four Number One rankings.

Switching gears from snacks to technology, Dell®, recognized the value of co-creation theory leap years ahead of its contemporaries on the Fortune 100. Back in 2007, they launched IdeaStorm, essentially an online suggestion box. Revolutionary for its time because companies didn’t air their dirty laundry, let alone did global enterprises expose all their warts to the world along with suggestions for new products and features. It quickly evolved into a social media platform that literally exploded when one customer, Cy Jervis, suggested that Dell join the conversation and make the platform bilateral: a key concept in co-creation theory which was just evolving.

In the first few years of IdeaStorm, more than 15,000 suggestions were submitted which resulted in over 500 product improvements and enhancements co-created with its (1,000,000 plus registered users) customer base. However, the platform got a bit stale three or four years or so after launch, largely because Dell employees themselves had disengaged from it and stopped responding to the ideas due to a convoluted set of internal processes. In effect, it stopped “listening” to its customers, and, not surprisingly, revenues became flat and declined around that time. Dell refreshed the platform in 2012 and continues to embrace crowdsourced ideas for new product development, and hence, co-creation theory, as one of the key pillars of its corporate strategy.

Quick Tips: Get the Most out of Co-Creation Theory

It’s all about bringing the customer into the process as early as possible and being proactive, not reactive. Put the power in the hands of consumers and watch them become loyal customers. Some customers take that loyalty to a whole new level and become self-appointed brand ambassadors. That’s the kind of loyalty and word-of-mouth marketing that you simply cannot pay to obtain.

So, we have presented a few examples of brands who enjoyed stratospheric success with their early adoption and unique applications of co-creation theory. But, how can you and your company (which may not have the deep pockets of a global enterprise) get the most out of co-creation theory? Here are a few quick tips for some quick wins:

  • Make sure you have some wood behind your arrow – if you’re taking aim at co-creation theory as a strategy for new product development, everyone in your company needs to be onboard with it. A proper budget needs to be allocated and protected. Plus, the team needs to understand that results will take some time to show.
  • Pay it back – in this world, you really do need to give to get. You’re asking customers (and prospective ones) to give something to you. Sure, many customers are quite free with their opinions and want to be heard. Many are simply thrilled to be asked. But, if you reward them for their effort, you’ll not only get deeper insights with better-defined ideas, you will also get a built-in cadre of loyal customers – some of whom may elect to become your brand ambassadors.
  • Toe dip – you don’t have to bet the farm on your first go-around or take the enormous risky leap of faith that Frito-Lay did when they agreed to let amateurs produce a multi-million dollar Superbowl ad. Consider piloting an initiative on a small scale. Test it out. Work out the kinks. Identify your gaps and conduct an honest evaluation about what worked and what didn’t so that you can make a data-informed decision if you plan to roll out co-creation theory at scale.

Co-creation theory, in concept, is simple: ask for feedback and apply what you heard. In the real world, co-creation theory needs a little work to establish the infrastructure (platforms, processes, policies, people and programs) required to successfully reduce it to practice. But, with the right tools, the right mindset and help from an agency, your brand can also enjoy the immeasurable benefits of co-creation theory.


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