Customers are no longer considered as receivers of values, products, and services. Rather, customers are becoming active partners in the production process. The values that customers want to receive have to be determined by them and, therefore, understanding and applying the process of customers’ co-production is an essential step to adapting with the new era of product innovation.
Co-production is often defined within the context of customer participation. Participation is an important component of the service production process. It can be seen in three different ways; information sharing, responsible behaviour, and personal interaction. First, an information sharing between both customer and firm should take place in order to ensure that needs are met. Second, a responsible behaviour should occur. Both parties have to obey certain duties and responsibilities. There also have to be some level of interaction between the organisation and its customers. Co-production reflects a conscious strategic decision by producers who engage and involve consumers in the design and development of products. It refers to the involvement of consumers in the various value creating activities. These activities include the production and distribution processes which are usually performed in the course of manufacturing a product or creating a service for a given target group of consumers.
The trend towards greater consumer involvement has been activated by the development changes in technology, consumer sophistication, and regulatory environments. In particular, the development of digital technologies which allow consumers to have instant access to stored information and to create and disseminate text, pictures and voice messages at minimal cost, has contributed significantly to this trend.
In order to understand how to engage consumers in co-production activities, organisations must understand the mechanisms which lead them to participate. Similarly, to their motivation for other consumption related decisions, consumers decide to engage in co-production to satisfy their diverse economic, psychological and social needs. Organisations need to carefully study these needs and show how proper coordination could increase consumers’ propensity to engage in co-production. Adopting the co-production concept can be considered as a shift in the companies’ perspective of customers. It is perceived as a new tool for increasing customer satisfaction and products’ success in the market.
To be able to increase the values that customers seek, there is a need to investigate the reasons that encourage these customers to purchase the products that they co-produced. Developing new products that are competitive and have the potential to grow is one of the challenges facing many companies today. Gone are the days when screaming television ads and radio jingles about sales push audiences to purchase products. Your desire to reach your market audience may not be met until you allow buy-ins from outside your office walls.
Few years ago, there was a clear difference between producers and audience. Fast forward to today, market audiences are fast influencing the process of production. Rather than providing finished, mass-produced products or services, companies are realising the need to provide tailor-made contents in which the audience usually contributes to the process.
Co-production is helping organisations build their brands organically as market audiences who gain a feeling of influence and control, automatically own the brand and are loyal to it. Ultimately, co-production provides opportunities to grow brand and increase market share. In the current economic downturn plaguing many organisations, now is the time to bring customers on board and gain competitive advantage that would transform into business profitability outcomes.
Through co-production, loyal customers put the brand first and help to increase brand share by attracting more customers. By producing together, customer’s participation and cooperation can help organisations find solutions to complex issues that their team may not achieve on its own.