You are here

How to increase value by co-creating with customers?

Comment gagner en valeur en co-créant avec ses clients ?
Published on
15 April 2019

Co-creation with customers, as exemplified by Lego, is an approach that is increasingly relevant thanks to digitalization. What are the most efficient models to implement co-creation in a digital environment? How to co-create? With whom? Why?

Pierre Dal Zotto is an assistant professor of information systems management and an expert on information and innovation management at Grenoble Ecole de Management. His research focuses on creating value through goods and services with the support of new technology. He’s also a member of the Lego Ideas community and a facilitator for Lego Serious Play at the GEM Playground.

“Co-creating value means producing a product or service with the cooperation of customers thanks to collaborative resources. This process is hardly new, but it has taken on a new dimension in the years after 2000 thanks to the advent of new information technology, which facilitates the process of uniting individuals into thematic communities. Co-creating value through digital resources has caused a disruptive change in classic innovation and marketing approaches. As a result, customers can more easily act as both users and contributors. The digitalized process has broken down barriers and facilitated interaction,” explains Pierre.

Two customer categories  

There are two type of customer categories: contributors who co-create the design, applications, etc., and consumers who benefit from products and services offered by a company. “These categories offer different perspectives. The contributing customer will offer for example an evaluation. A consumer customer is one who doesn’t contribute. Both categories play different roles in the co-creation process,” adds Pierre. These categories offer companies various approaches to co-creation which can be explained through the four strategic initiatives for digital value co-creation:

  • Customization initiatives: e.g., personalizing your Nike sneakers
  • Reputation initiatives: relies on community evaluation and discussion tools. For example, Décathlon has committed to re-designing a product if it receives an overall negative evaluation from customers.
  • Sensing initiatives: based on data analysis tools to propose recommendations for products and services. “We can cite initiatives by Netflix and Amazon whose offers are based on profiling. In 2003, Amazon estimated that 25-35% of its turnover was generated simply through its recommendation tool which relied on consumption analysis. That’s an enormous statistic.”
  • Community initiatives: using open source or co-development tools that integrate customer contributors to the development process for goods and services.

Why co-create?

“Customers are more motivated to pay for a product or service that they helped create. These products are a better match for customer needs.” Companies like ebay, Airbnb or Blablacar are examples of success built on a savvy combination of community, reputation and sensing initiatives. Depending on how you mix and match them, these initiatives are not mutually exclusive and can work quite well together.

The Lego example

Lego is a leader in terms of co-creation with customers thanks to tools such as its website LEGO Ideas. Dinosaurs Fossils Skeletons, Food Stand Diners, Queen Victoria Cruise Ship, and Playable Lego Piano are some of the latest Lego models evaluated by brand enthusiasts during 2018. Their success will be determined by the summer of 2019. The LEGO Ideas tool is based on a shared digital tool that enables customers to freely download Lego Models. The tool enables users to construct and deconstruct models without affecting the initial model.

“Instead of categorizing customers and having them test ideas in focus groups, LEGO Ideas uses a digital tool and community to unite Lego enthusiasts and receive their evaluation of new Lego projects. Once a project receives 10,000 positive votes, Lego launches the model for sale through its online stores,” explains Pierre Dal Zotto. 

Customers becoming creators: how firms leverage technology and consumers for new value

On the same subject

  • Federico Pigni a propos de Digital Twins dans une interview accordée au canal Xerfi.
    Published on 14 February 2019

    Why are Digital Twins becoming a business imperative?

    What are these custom and very specific types of virtual simulations and how can they open up a multitude of new opportunities for us?

  • Marcos Barros, professeur associé à Grenoble Ecole de Management, au sein du département Homme, Organisations et Société
    Published on 23 November 2018

    The death care industry in Quebec marked by the triumph of David versus Goliath

    Following competition from major international players, the local death care industry in Quebec successfully implemented actions in terms of marketing, politics and pricing in order to outmaneuver international competition and secure their share of...

  • les fondamentaux pour bien gérer son marketing personnel.
    Published on 12 July 2018

    The fundamentals of personal marketing

    Successful personal marketing is an art. How can you go beyond compulsive tweeting or an excessive use of social networks in order to create a solid strategy to build and maintain your e-reputation?

  • Valérie Sabatier, directrice de l’école doctorale de GEM
    Published on 04 June 2018

    Vidéo : Experiment to find your business model

    Start-ups developing their business model have every interest in experimenting with business models! This is the conviction of Valérie Sabatier, director of the doctoral school at Grenoble Ecole de Management, who explains that creators of start-ups...

  • Chirag Patel et Christophe Haon
    Published on 18 May 2018

    Research: Retail Website Performance, to Outsource or not to Outsource?

    To improve sales, retail websites focus on personalizing their web pages and increasing their influence on social networks. To achieve these goals, should they rely on internal resources or call on external service providers? A study of 105 U.S....

  • comment tester votre business model
    Published on 26 April 2018

    Startups: How to Test Your Business Model?

    Defining the right business model for an innovative product or service is essential to its success. Experimentation proves to be a useful tool for innovative startups to find the right model.

  • sabatier-genet-bojovic
    Published on 23 April 2018

    Research: Defining Your Business Model Through Experimentation

    Innovative companies rely on experimentation to develop their business models. However, this approach can be quite costly and the risks are underappreciated. Two GEM researchers recently analyzed the experiences of startups in the connected health...

  • paiement mobile
    Published on 26 March 2018

    How to Encourage User Adoption of Mobile Payment Options?

    Despite the convenience of mobile payment technology, customer adoption of this new technology is not a given. How can companies build on previous internet experience to facilitate this transition?

  • Published on 17 June 2017

    Nanovalor: a Platform to Evaluate the Value of New Tech

    Emerging technology can impact society and the economy in a variety of ways. Nanovalor creates a platform to analyze and learn about the value of new tech.

  • Health Industry, Technological Innovation Tied to Business Model Innovation
    Published on 31 March 2017

    Research: Health Industry, Technological Innovation Tied to Business Model Innovation

    With the growth of digital tools and applications, many industries are faced with the arrival of new players. This latest study explores the use of applications in the healthcare industry in order to better compare the innovation capacity between...

  • research on Contextual Television Advertising
    Published on 28 February 2017

    Research: Questioning the Effectiveness of Contextual Television Advertising

    As businesses and marketing go digital, companies have to track the effectiveness of their advertising across many channels. The growth of online transactions has made website conversions an essential factor for many businesses. Thanks to detailed...

  • Published on 19 August 2016

    NeOse™: Creating an Electronic Description of WHAT YOU SMELL?

    Nearly 10% of the world population is believed to suffer from olfactory disorders. Whether it is the inability to detect odors or an altered sense of smell, olfactory disorders can lead to depression and desocialization. In response, Aryballe...

  • Federico Pigni, Professor at Grenoble Ecole de Management
    Published on 01 July 2016

    Research: Creating Value from Digital Data Streams

    The big data era is upon us. Startups, major companies, organizations and governments are all rushing to extract essential insights from big data. Yet in doing so, many have overlooked the potential value of the digital data streams (DDS) that make...

  • Published on 30 June 2016

    Joining the UN’s International Telecommunication Union (ITU)

    Grenoble Ecole de Management becomes the first Business School in the world, and the first higher education institution in France to join the prestigious International Telecommunication Union (ITU), the United Nations specialized agency based in...

  • websites such as TripAdvisor have given consumers the power to impact a company's image.
    Published on 22 March 2016

    TripAdvisor: How Companies React to Negative Ratings

    The world wide web has revolutionized the hotel, restaurant and other travel-related industries. From online bookings to customer ratings, companies have to learn how to operate in this new environment. While an organization's market identity used...

  • Research: Creating Visitor Engagement Through Music
    Published on 29 February 2016

    Research: Creating Visitor Engagement Through Music

    Digital communications have created an information overload for customers. To stand out on the world wide web, companies have to offer clients a high-impact experience. When used properly, music provides a simple yet effective means of creating a...

  • Published on 16 December 2015

    The implementation of complex business models

    Ryan Rumble,PhD student, and Vincent Mangematin, scientific director of research, are members of the Business Models and Strategy research team. In this article they reveal how business models are adopted in practice, and explored the relationship...

  • Federico Pigni, Professor at Grenoble Ecole de Management
    Published on 28 October 2015

    Congratulations Federico Pigni

    Duetto: Industry Transformation with Big Data, a case study in Harvard Business Review by Federico Pigni, Associate Professor in Information Systems in the Management of Technology and Strategy department at the Grenoble Ecole de Management (France...

  • Published on 13 October 2015

    Put Music on your Website

    Your web communication needs to offer a rich consumer experience to distinguish it from others. Nowadays, websites must evoke enjoyable and memorable feelings in their visitors in order to encourage them to revisit and recommend the website.

  • websites such as TripAdvisor have given consumers the power to impact a company's image.
    Published on 29 September 2015

    Customer reaction and Market identity

    This article, written by Tao Wang, Filippo Carlo Wezel and Bernard Forgues, examines the conditions under which organizations publicly respond to unfavorable consumer evaluations that challenge their market identity. This study relies on an analyse...

  • Published on 16 July 2015

    Research: Unraveling the Link Between Managerial Risk-Taking and Innovation - the Mediating Role of a Risk-Taking Climate

    Innovation has become a crucial factor for companies looking to maintain their competitive advantage. Yet creating innovative ideas requires a certain level of risk-taking. While research on this subject has focused primarily on risk-taking at one...

  • Vincent Mangematin, Associate Dean for Corporate Relations and Research at Grenoble Ecole de Management
    Published on 17 March 2015

    Orchestrating Innovation with User Communities in the Creative Industries

    In search of continuous innovation, the digital creative industries have expanded their interactions with user communities to develop their products. This study highlights the evolution of these company-user relationships that allow for fluid...