Impact of Co-Creation on Consumer Perceptions in Product Development

1. The effects of co-creation* on consumer perceptions *Co-creation between firms and consumers in new product development Joyce van Dijk 841018208030 MSc thesis ECH chairgroup Prof. Dr. G. Antonides

2. Content of this presentation What is co-creation and why is it important? Main question and sub questions for the thesis Relevance Main theory Expected outcomes & conceptual model Research method Treatments

3. What is co-creation? • “Purposive and intentional collaboration between consumers and producers, where they systematically interact, learn, share information and integrate resources with the result of co-creating value” (Van Dijk, 2011) • Why is it important? • Changing consumer: empowered, critical, better informed • Web 2.0 and social media: interconnected world • Consumer in search of authenticity • Firms: search for new innovation & marketing strategy • Customer-centricity (from pushing products to cultivating cust. value)

4. Example • Pickwick Dutch tea blend25 Hyvesmembers co-created with Pickwick experts, both online and offline, to develop the new tea blend, co-design the package and the marketing campaign. Pickwick referred to the co-creators in the tv commercial and on the tea’s packaging

5. Back to the thesis… • Main question: • (To what extent) are perceptions affected when consumers know that a product is developed in co-creation with consumers? (compared to a product that is exclusively ‘producer’ created?) • Does co-creation enhance ‘authenticity’ and ‘sincerity’ of brands? • Does co-creation affect trust and how consumers relate to a brand? • Does co-creation affect how new products are evaluated? • Does co-creation influence behavioral intentions towards the product/brand? • Does it matter how the co-creation is communicated?

6. Relevance • Current research focuses on the co-creation process itself: e.g. required management skills, motivations of co-creation participants • Studies show effects on consumers who participate in co-creation: • Increased loyalty to the company • Stronger relationship with the company • Increased likelihood to spread positive word-of-mouth • Increased trust in the brand • An increased positive brand image • Studies show that co-creation: • Creates more relevant products • Enhances product performance (sales) -> But what about consumers who did NOT participate? -> But can performance be due to perception effects?

7. Relevance • Just one study about effects of co-creation on perceptions of consumers: • More favorable attitude, and consider them more customer-oriented (Fuchs & Schreier, 2011) • -> However, Fuchs and Schreier (2011) don’t test brand effects , use fictitious labels, and no FMCG products. • Interviews with co-creation practitioners show (Van Dijk, 2011): • Great curiosity to know effects on consumer perceptions • Belief that brand and product perceptions are indeed affected by co-creation • Unsure about what effects exactly will occur and how strong the effects will be

8. Theory • Brand associations and personalityConsumers distinguish between brands based on brand associations (Keller, 1993) • Meanings consumers attach to brands (in their memory) • Partly determined by brand image • Distinguish between brand images by attributes such as brand personality • Brand personality perception: result of brand actions

9. Adapted from Keller (1993)

10. Theory • Sincere brandsResearch shows consumers now search for sincere and authentic brands (Holt, 2002; Gilmore & Pine, 2007). These are brands that don’t appear commercialized, but are viewed as sincere friends or part of a community (Beverland, 2005). • Descriptive measures of ‘sincere’ brand personality (Aaker , 1999):(5-point Likert scale: 1 = "not at all descriptive," 5 =extremely descriptive”)

11. Theory • Brand relationship strength Betterpredictor of consumer actions (Aaker et al. 2004) • Indicators of consumer-brand relationship strength (Aaker et al. 2004): • Commitment: willingness to continue the brand relationship • Satisfaction: happiness with brand performance • Intimacy: closeness, willingness to share information • Self-connection: fit between brand personality and consumer’s personality

12. Theory • Product evaluationDoconsumers evaluate co-created products differently? • Measures for new product evaluation (Song & Xie, 2000; Bruner et al., 2005): • Overall appeal: Is the product attractive, what appeals the most? • Innovativeness: Is the product innovative and different from available products? • General product advantage: How superior is the product relative to similar products? • Uniqueness: To what extent are product features unique relative toavailable products?

13. In short: expected effects hypotheses

15. Method • Scope: Fast-moving consumer goods sector (FMCG): familiar products, relatively cheap, low effort and risk, rapid consumption In FMCG sector brands are the main differentiation point (Wood, 2000) • Method: Experimental (post-test-only) control group designManipulated variables: branded product (existing brand X/ fictitious brand Y) and treatment (A/B/C). Between-subjects design: every respondent is randomly exposed to only one product and one treatment • Execution: Online questionnaire, data collection via Insites Consulting consumer panel

16. The experiment treatments • Respondents are part of group X (well-know brand) or group Y (fictitious brand) are exposed to one of the three treatments: • Treatment A: (control group) Concept board with a description of the product, presented as producer-created • Treatment B: Concept board, description of product, presented as co-created • Treatment C: Concept board, description of product presented as co-created + evidence to support this claim

17. What will I find out?! Want to know the results? Keep track of my progress onJoycediscovers.wordpress.com Joyce van Dijk 841018208030 MSc thesis ECH chairgroup Prof. Dr. G. Antonides