Value co-creation by definition is a process rather an economic strategy that is mainly concerned about uniting two parties together. However, in this context, the two parties or the actors are the marketers and the customers (Spencer and Cova 2012).It is for this reason that the marketers are now trying to improve the customer experience and trying to take it to a whole new level. There is also the very new concept of postmodern consumerism which is mainly directed towards something much more than just the exchange of goods.
As per the opinion of Reichheld and Sasser(1990), the companies must advertise and promote a product in such a way that can enable the customers to have a personal encounter. The product must be such that evokes in the customer a sense of feeling, emotion, and sensation. This same view has also been supported by other authors. As per the opinion Spencer and Cova (2012), the modern-day marketing method is not merely the buying and selling of goods but the buying and selling of services. The customers spend their time, energy and money in order to purchase experience and not only the product. A large-scale research and analysis has been carried on to find out some priorities that the marketers must meet in order to enhance the customer experience and these areas are stimulating service innovation, service infusion, developing proper service networks and systems with the help of the modern scientific and technological methods and devices (Ostrom et al. 2015). A good example can be that of Nike. Nike is one of the most well known and leading brands of sneakers and clothes. They have selected a particular tagline saying JUST DO IT which indeed is a very powerful saying and a powerful means to connect with the customers.
Figure1: Nike’s value co-creation idea
(Source: emeraldinsight 2014)
Nike made a revolutionary approach in order to allow the customers to customize their shoes in their way. It allowed the customers to style their own shoes by choosing their own color, materials, moods, and styles (Hilton and Hughes 2013). It indeed was a very helpful approach for enriching the customer service. Customers really were very much attracted towards this new business approach because it gave them an opportunity to form a personal and emotional connection with the products. This is because the customers did not have to buy the same old typical products just for the sake of buying and using it but they got an opportunity to style the products as per their choice. This new value co-creation strategy has largely contributed to the overall revenue of the company. It had really brought the two parties namely the company (Nike) and its customers. This strategy was responsible for contributing about 22 percent of the total revenue for the year 2015. On the other hand, Woodall et al. (2014) are of the opinion that Nike still needs to work a lot of its value co-creation process. Though it involves its customers in the production process and allows them to develop a personal connection with the products, they have failed to include women customers. There is a lack of enough variety of women footwear. Moreover, Nike delays diversifications and innovation in their production process. This gives a huge opportunity to their competitors to go ahead of them. This might make ruin the customer loyalty.
Figure2: Starbuck’s value co-creation idea
Source 🙁 fresh minds 2013)
As per the opinion of Holbrook and Hulbert (2002), this value co-creation strategy helped in bridging the gap between the company and its fans. Another such example is that of star bucks. One of its value co-creation strategies is My Starbucks Idea which helps to develop personal connections between the customers and coffee chain. Technological advancements and developments have also helped a lot to develop this value co-creation. One of the most important examples is social media platforms. The companies make use of the social media platforms to develop several company WebPages and consumer forums which helps the customers to share their feedback and their opinions about their experiences with the companies. On the other hand, Fuchs (2017) is of the opinion that there are also certain disadvantages of using social media platform as the means of value co-creation. It is quite a time intensive. Companies that select this procedure for value co-creation has to always keep some of their officials active throughout the day to read the posts of the customers, respond to their queries. Without such active services to manage the online social networks, the companies would really face a major problem.
Figure3: Elements of Customer loyalty
Source: (beyond philosophy 2013)
As has been stated by Möhlmann (2015) in this modern competitive world, the marketers have to follow the process of constant improvement. In order to do this, they need to collect the feedback from their customers on a regular basis (Holbrook and Hulbert 2002).
This same view has also been supported by several other authors. As per the opinion of Lemon and Verhoef (2016), that the postmodern markets are constantly improving themselves to satisfy the customers. Based on these feedbacks the marketers usually develop the plans for improving the customer satisfaction. Customer loyalty will develop only when the customers keep on going back to the same firms under any kind of influences. In order to do this, the marketers will have to make the customer experience very enhancing and a long lasting one.
Figure4: Quality, support, satisfaction, and service from the companies lead to Customer loyalty
(Source: beyond philosophy 2013)
As per the opinion of Woodallet al(2014), there is a directly proportional relationship existing between customer satisfaction and customer loyalty. If the customers are satisfied with the services provided but the marketers then they will consider coming back to the same firm over and over again. These services usually include the after sale services. Post-purchase behavior from the end of the marketers matters a lot in creating customer loyalty. A good example is that of Xerox Company whose objective was to attain complete satisfaction from their customers. They made sure to clearly assess the level of satisfaction of the customers based on a five-point scale where 4s meant satisfied and 5s meant very satisfied. When Xerox saw that some of the customers were very satisfied with them (5s) and some were just satisfied(4s) with them, Xerox realized that the customers who have given them 5s were much the ones who will repurchase for them and so there was a high chance that these customers will become the loyal customers. On the other hand, the customers who were just satisfied with Xerox and had given them a rating of 4s were less likely to become loyal customers in comparison to the very satisfied ones. So, Xerox started making necessary efforts to enrich the customer experience even more particularly for the satisfied (4s) customers. This is because a satisfied customer is a loyal customer. However, as per the opinion of Baker and Saren (2016), this method of surveying the customer satisfaction is very hazy and did not fetch clear results to the company. Hence, organizations must make sure that the survey methods that are being used by them are useful and clear.
One of the important methods of measuring the employee satisfaction can be seen in the Taco Bell Company. They mainly measure the employee satisfaction through interviews, surveys, and face to face conversations with the customers. This helps in promoting personal contact between the customers and the Marketers. On the other hand, Karvanen et al. (2014), is of the opinion that customers may also face irritations while using responding to these surveys. Often the customers may face issues with the internet connection, or they may not be available to open their emails, the customers may not be available to take up phone calls. So, this might waste the time of the companies. Hence, the companies must make sure to send proper information to the customers before sending them the survey or the feedback forms
As per the opinion of Chang and Taylor (2016) value is a broader concept and has many different meanings. It has different meanings for different individuals. Different consumers value different kinds of services. In the modern day marketing in general and in the postmodern marketing, in particular, the services are also known as offerings. The marketers are trying to sell their commodities as offerings to the customers. So, the marketers are not only actually marketing goods but services. The consumers purchase the service and enjoy it. The service consumption includes an event with constituent parts.
As per the opinion of Möhlman (2015) Consumption is a process that the customers often want to experience in their own way. It includes several complex and interdependent relations. It is for this reason Holbrook and Hulbert (2002) have stated that many modern-day companies like Nike and Ford are providing their customers with the option of customized purchase. Under this process, the customers are able to design their products in their own way. As per the opinion of Ostrom et al. (2015), this also helps in adding a touch of personalization within that product. So, this value co-creation strategy makes the marketing of the product more like the marketing of an offer g or a value-oriented service.
A very good example of companies creating value for their customers is Ford. The Ford motor vehicle is designed for the purpose of creating a certain value for its customers. Ford does not believe in excluding the customers from their market research. As per the opinion of Ye et al(2014), Ford does not want to include its customers in the entire marketing process only before the launch of the products but right from the beginning and throughout the entire process of production. Ford has provisions like offering their customers with ford finance, allowing the customers their own insurance called ford insurance (Spencer and Cova 2012). Apart from this, Ford also has extended its helpline services to the customers on a 24*7 hour basis where the customers can use a messaging app called Just Answer to send their queries through a text and an assistant is always there every nine seconds to answer the queries. On the other hand, some authors have rejected this idea saying that there can be several disadvantages. The companies will have to stay proactive on the app all day long. There can also be several errors in the internet connections which might affect the delay the response from the ends of the company and this, in turn, affects customer loyalty.
As per the opinion of Lemon and Verhoef (2016), the call centers are often used by many big firms and companies for outsourcing purposes to offshore locations. This is a very popular and reasonable way that helps in balancing the expenses of the company properly (Ye et al. 2014). However, there are also several problems with it. When the customers usually call the helpline services of any companies after purchasing their products they want to talk to the company staffs itself. The company helpline numbers usually direct the customer calls to the third party call centers. This often creates a huge dissatisfaction within the customers. The companies might have to let go of their customers in such cases. It is for this reason that many companies are now trying to ensure that the customer calls are always entertained by the firm themselves. As per the opinion of Brinkkemper and Jansen (2016), outsourcing has several problems like too much dependence on the financial well being of another company. There are also quality problems. If there are any changes in the contract there are extra charges that have to be paid. Even if the firms are outsourcing this service to some third-party call centers they make sure that the customer complaints and queries are given sufficient importance and are resolved immediately within the given time period.
The other kind of value creation strategy that can be used by the modern day marketers is providing the customers with the SST or the self-service technology services. It is mainly used to enrich the customer experience (Wilson et al. 2012).
As per the opinion of Baker and Saren (2016), community participation is also one of the most important strategies that are being adopted by many companies in order to enhance the customer service. In other words, these companies often try to focus over a particular group of customers who, they consider to be the targeted or the potential customers for themselves and try to render some specific services into these customers as part of their marketing procedure. As per the opinion of Hilton (2013), this practice not only helps in enhancing the customer experience but also helps in improving the community as a whole. A very good example can be the cosmetic brand YourGoodSkin which has been co-founded by a group of about thousand women. On the other hand, Dick et al. (2015) are of the opinion that too much focus on community participation can also hamper the production of the company. The company might spend too much time in improving the familiar products rather than developing something new. There is also a risk that the customers might be unhappy with their service and might switch over to other rival companies. Hence, the company has to strike a proper balance between applying their own experience and also the feedback from the customers.
Figure5: YourGoodSkin a value co-creation strategy
(Source: consumer value creation 2014)
One of the important strategies of value co-creation is co-creating service recovery. Under this method, the companies make sure to work upon the failures or the drawbacks in the services offered by the companies. This approach helps to enhance the customer loyalty because the customers realize that they have been given proper assistance by the firms whenever they suffered from a service failure. Particularly those companies that have considerably low brand equity can focus on this service recovery strategy (Hilton and Hughes 2013). Other authors have also given their acceptance in the same. As per the opinion of Chang and Taylor (2016), this will give the consumers an impetus to vest their faith in the companies and repurchase from them.
Conclusion
Thereby it can be concluded that it is really very important for all the modern-day colonies to focus more on their value creation methods. The customer satisfaction is one of the most important reasons behind the success of a company. The companies have to make sure that they are able to offer some service or some kind of offerings to the customers. The companies must make the customers very much a part of the organization and they must be able to share their ideas and feedbacks in order to construct their service in their way. The act of buying a product must be backed by the customer satisfaction. However, co-creation of value is to make the customer one of the important actors of the entire process of marketing. The companies must aim towards the construction of an environment where the customers can design and construct their own service expectations. The modern day business scenario is mainly based upon the after sale services provided by the firms to their customers. If the customers are unhappy with the after sale services they might switch over to other firms in the market. Hence in order to retain customers, the firms will have to focus more on the value co-creation of services that mere marketing of goods.
References
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