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Innovative companies are leading the challenge to involve customers and public, and have realized that cooperation with them is vital to maintaining a competitive advantage. In this participatory culture customers want a relationship with those brands that matter. This brings us to the concept of co-creation.
Co-created value arises in the form of personalized unique experiences for the customers and ongoing revenues, learning and enhanced market performance drivers for the firm. The traditional view of value creation has been focused on the company, regardless of the perceived value the customer or consumer.
However, the globalization process and information technology are forcing companies to be more sensitive to user experience.
Nowadays, creating customer experiences is less about products and more about relationships, according to this Payne, Storbacka and Frow (2008) state, “Traditionally, suppliers produce goods and services, and customers purchased goods and services. Today customers can engage in dialog with suppliers during each stage of product design and product delivery”(p. 84). In the article the authors “explore the nature of value co-creation in the context of SD logic” (Payne, Storbacka and Frow, 2008, p. 83).
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To complete they research they developed a conceptual framework for co-creation of value consisting of three components: customer value-creating process, supplier value-creating process and encounter processes.
The first component is the customer value-creating process. The relationship is bidirectional. The consumer is an active element involved in the exchange and production of a product or service. “The customer’s value creation process can be defined as a series of activities performed by the customer to achieve a particular goal” (Payne, Storbacka and Frow, 2008, p. 86).
The customer ceases to be passive (target) to be active (co-producer)
The second component is the supplier value-creating processes, “This involves a review of co-creation opportunities; planning, testing and prototyping value co-creation opportunities with customers” (Payne, Storbacka and Frow, 2008, p. 88), in this context, companies tend to adopt an inside-out co-creation, but those who take an outside-in approach, watching and listening to customers, are able to discover ways to create mutual value.
The consumer determines value. Creating value lies in the ability to combine knowledge and skills to generate useful of a product or service. Thus, value emerges from the effective resource’s application. The companies themselves do not create value.
Finally the third component developed by the authors is the encounter process, this element explores the interaction and exchange that take place within customers and suppliers relationship and which need to be managed in order to develop successful co-creation opportunities (Payne, Storbacka and Frow, 2008, p. 85)
Therefore, companies must adopt the co-creation, in which the bases of the value shift from products to experiences, and the influence of this narrow consumer through the value chain (design, manufacturing, logistics, service). Co-creation is becoming a competitive.
Before the co-creation was implemented in management strategies, creating a value during the production and design process of a product seemed to be the sole responsibility of the companies. At this time the co-creation becomes a mutual need of suppliers and consumers. The challenge for companies in the twenty-first century is to work on consumer’s experiences that have become very active players in the value creation system.
Managers must implement co-creation to promote relations involving customers in developing value propositions that meet specific customer needs, as well as find new marketing opportunities for competitive advantage and using the information from the company-customer interactions to improve the co-creation proposal.
This study provides a basis for future research in the field of co-creation of value, as well as evaluating the co-creation of value in different types of businesses. This study allows other researchers to develop new ways to create the co-creation of value between their company and their customers.
Managing Co-Creation of Value. (2017, Jan 04). Retrieved from https://studymoose.com/managing-co-creation-of-value-essay
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