Co-creation of Value - Collaborating with Customers [11]

[Co-creation is the purposeful action of partnering with strategic customers, partners or employees to ideate, problem solve, improve performance, or create a new product, service or business. Christine Crandell]

Customer focus no longer means just researching current and future needs to design expected or desire goods or service. A rising trend in business today is co-creating value with customers. Value is created when product and buyer come together within a particular use situation. Examples include retailers getting the customer involved in the shopping experience to save time (Home Depot’s self-checkout) or costs (IKEA’s assembly and delivery by customers), smart phone personalization through app selection, Dell’s online built-to-order computers, and management consultants collaborating with clients to add value in research projects. As the table below explains, co-creation of value has a dual emphasis on the customer and company as value creators. 

Value Creation and Marketing Opportunities

Marketing Strategy	Market Emphasis	Value-Creation Focus	Corporate Examples
Market driven	Established market	Customer	Coca-Cola, Procter & Gamble, Toyota
Market driving	Emerging or imagined markets	Company	Google, IKEA, Virgin Group
Co-creation of value	Established, emerging or imagined markets	Customer and company (simultaneous)	Amazon, Apple, LinkedIn

Co-creation of value can lower costs and improve the overall service experience. A great example of the new co-creation of value model is illustrated in the case of Crushpad, a Napa-Valley based winery. Crushpad’s value proposition is “Make Your Own Wine” and has transformed their business through technology. Consumers can participate on a limited to a full scale basis depending on their interest in the wine-making process. Some activities that customers engage in include creating a wine-making plan; monitoring the grapes; picking, crushing and fermenting the grapes; and even packaging the bottles. Support services include party planning, advice on wine creation and business guidance on how customers can sell their own wine. Websites, blogs and community events help spread the word about this unique type of co-creation of value.

Here are 6 questions to address as your company ponders the idea of co-creation of value:
1. Do you strive to continually exceed customer expectations?

2. Does your view of value creation go beyond the firm (to include the customer)?

3. Do you actively seek to create an extended community of users?

4. Is personalizing the customer experience a major part of your marketing strategy?

5. Is your marketing team truly obsessed with researching and improving customer experiences?

6. Do you nurture and forge enduring business relationships with customers and collaborators?

This blog post is the 7th in a series extracted from Superior Customer Value – Finding and Keeping Customers in the Now Economy, 4^th Ed. (2019, Routledge Publishing/ Taylor & Francis). For further information contact Art Weinstein at artweinstein9@gmail.com, 954-309-0901, www.artweinstein.com