Roles and Resource Contributions of Customers in Value Co-Creation Essay

Introduction

In recent years, the use and implementation of value co-creation increased significantly, presenting a new opportunity for enriching customer experience. According to Prahalad and Ramaswamy (2002), this concept refers to the idea of collaboration and interplay between a customer and a service provider. Cossío-Silva et al. (2016) and Chen and Wang (2016) emphasize that value co-creation can positively impact the behavioral loyalty of customers, yet they state that there is insufficient knowledge in the given field regarding the consequences. In this connection, it is important to study the contemporary academic literature and understand the potential of value co-creation.

Exploring Value Co-Creation Literature

The tremendous use of value co-creation is largely associated with the shift of attention from the goods-centered view of marketing to a service-centered one. The emergence of the Internet (Web 2.0) and social media are two more prerequisites and drivers of the cooperation between customers and service providers. The service-dominant (S-D) logic implies that the given term can be regarded as metaphorical and offers a new conceptualization, considering value co-creation as joint actions (Grönroos 2012).

The value proposition is another issue studied by a range of articles that present it as a promise of a firm to deliver products and communicate. In turn, the value proposition also includes the fact that customers are aware of this delivery and ready to collaborate. The latter is discussed by Dong et al. (2016), who state that low readiness leads to negative outcomes. The meaningful guidelines are provided by Eisingerich, Auh, and Merlo (2014): to increase customer participation readiness, they assume the use of the word of mouth to build a stronger link between customers and companies.

However, Grönroos (2012) clarifies that mere feedback is insufficient to stimulate a consumer to repurchase, but preparation for using customer feedback is a promising strategy that can transform transactional customers into loyal fans. The effective internal support system is rationally regarded as necessary to process inputs from purchasers and provide them with actionable information (Plé 2016). In terms of the engagement model, customers and firms are viewed as interconnected networks, in which clients want to be active co-contributors in crafting the products and services (Terblanche 2014). For example, customers can rate through online markets and develop products via feedback.

The role of customer participation and engagement presents the most extensively explored theme. The identified engagement model can be challenged since the transformation of customer emotions is a complicated psychological process. To understand what drives a customer to take part in value co-creation, Bharti, Agrawal, and Sharma (2014) conducted the study among the bottom of the pyramid (BOP) customers and found that relationship with the solution, interaction, and the level of dependence are three factors that largely determine the motivation customers. The value co-creators may also take the roles of co-producers, co-promoters, co-distributors, experience creators, et cetera (Agrawal & Rahman 2015).

However, Cova, Dali, and Zwick (2011) claim that value-creation can occur only if there is a direct interaction between a customer and firm. In other words, the so-called collaborative capitalism is promoted as the key basis for value co-creation.

To facilitate customer participation, it is essential to pay attention to the market environment and the tools available to engage potential co-creators. The combination of offline and online strategies is recommended by Grönroos (2012) to build strong relationships with the customers and ensure their desire to contribute to the product and service improvement.

The technological opportunities are critically discussed by Zhang, et al. (2015) and Yadav, Kamboj, and Rahman (2016), who reflect on the ways the websites shape the customer experience and impact their intention to participate in value co-creation. Namely, it is justifiably stated that hedonic experience, learning, and social integration values serve as impetuses. The assumptions that are given by Chen and Wang (2016) and Ritzer and Jurgenson (2010) deepen the study of co-creation by adding the term of presumption, including both production and consumption at the same time.

While the majority of the reviewed articles focus on the benefits of value co-creation, there is the dark side as well. As for the negative outcomes of failed value co-creation, Heidenreich, et al. (2015) state that the firms with a high level of co-creation are more prone to face disadvantageous disconfirmation compared to those with a low level. Although the initial strategy proved to be ineffective, it is suggested to offer co-created service recovery to restore the trust of customers.

Conclusion

To conclude, the current literature recognizes a lack of studies devoted to the role, impact, and future of value co-creation. The majority of the reviewed articles emphasize the beneficial use of this concept to cooperate with customers and actively engage them in product design, evaluation, and distribution. There is a need to continue explorations in the given field to transform customer experience and reinvent the ways customers and firms interact with each other, thus making these relationships much more effective and mutually advantageous.

Reference List

Agrawal, AK & Rahman, Z 2015, ‘Roles and resource contributions of customers in value co-creation’, International Strategic Management Review, vol. 3, no.1-2, pp. 144-160.

Bharti, K, Agrawal, R & Sharma, V 2014, ‘What drives the customer of world’s largest market to participate in value co-creation?’, Marketing Intelligence & Planning, vol. 32, no. 4, pp. 413-435.

Chen, CF & Wang, JP 2016, ‘Customer participation, value co-creation and customer loyalty – a case of airline online check-in system’, Computers in Human Behavior, vol. 62, pp. 346-352.

Cossío-Silva, FJ, Revilla-Camacho, MÁ, Vega-Vázquez, M & Palacios-Florencio, B 2016, ‘Value co-creation and customer loyalty’, Journal of Business Research, vol. 69, no. 5, pp. 1621-1625.

Cova, B, Dalli D and Zwick, D 2011, ‘Critical perspectives on consumers’ role as ‘producers’: broadening the debate on value co-creation in marketing processes’, Marketing Theory, vol. 11, no. 3, pp. 231-241.

Dong, B, Sivakumar, K, Evans, KR & Zou, S 2015, ‘Effect of customer participation on service outcomes: the moderating role of participation readiness’, Journal of Service Research, vol. 18, no. 2, pp. 160-176.

Eisingerich, AB, Auh, S & Merlo, O 2014, ‘Acta non verba? The role of customer participation and word of mouth in the relationship between service firms’ customer satisfaction and sales performance’, Journal of Service Research, vol. 17, no.1, pp. 40-53.

Grönroos, C 2012, ‘Conceptualising value co-creation: a journey to the 1970s and back to the future’, Journal of Marketing Management, vol. 28, no. 13-14, pp. 1520-1534.

Heidenreich, S, Wittkowski, K, Handrich, M & Falk, T 2015, ‘The dark side of customer co-creation: exploring the consequences of failed co-created services’, Journal of the Academy of Marketing Science, vol. 43, no. 3, pp. 279-296.

Plé, L 2016, ‘Studying customers’ resource integration by service employees in interactional value co-creation.’, Journal of Services Marketing, vol. 30, no. 2, pp. 152-164.

Prahalad, K & Ramaswamy, V 2002, ‘The co-creation connection’, Strategy and Business, vol. 27, no. 2, pp. 51-60.

Ritzer, G & Jurgenson, N 2010, ‘Production, consumption, prosumption: the nature of capitalism in the age of the digital ‘‘prosumer’’, Journal of Consumer Culture, vol. 10, no. 1, pp. 13-36.

Terblanche, NS 2014, ‘Some theoretical perspectives of co-creation and co-production of value by customers’, Professional Accountant, vol. 14, no. 2, pp. 1-8.

Yadav, M, Kamboj, S & Rahman, Z 2016, ‘Customer co-creation through social media: the case of ‘Crash the Pepsi IPL 2015’’, Journal of Direct, Data and Digital Marketing Practice, vol. 17, no. 4, pp. 259-271.

Zhang, H, Lu, Y, Wang, B & Wu, S 2015, ‘The impacts of technological environments and co-creation experiences on customer participation’, Information & Management, vol. 52, no. 4, pp. 468-482.