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The way in which brands communicate, and how consumers live their lives, is of significant importance to each entity. However, now, more than ever before, the two have become intertwined. This is resulting in one of the biggest developments that the advertising and marketing industry have witnessed in this generation. In a world that is increasingly lacking relevance and individuality, brands and consumers are constantly seeking to be heard amongst the crowd. Over the years brands have stressed the importance of listening to their customers. However, simply listening to customers is now being called into question, and instead the idea of working alongside them is being considered. The modern consumer relishes having more power than ever before and they are willing to use this new found control. Brands can no longer ignore this development, and indeed, should not try to ignore it. There are significant benefits to brands and consumers working together in order to learn more about each other. One huge benefit of this is the potential for organisations to change and structure the way in which they do business, not just how they market and advertise themselves. This collaboration of brand and consumer is now more commonly referred to as Co-Create, a methodology which embraces the collaboration of both brand and consumer and delivers mutual benefits for both. This study will research the effects that Co-Creation has had on the advertising and marketing industry. Furthermore, it will establish the key contributing factors that have given rise to Co-Creation, and how its methodology is implemented. An investigative case study and interviews are used as the basis for the research in this study. This provides highly informed data which will be used to conduct a thorough analysis and draw an educated conclusion on the topic of Co-Create.
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STUDENT No. 08005446Dissertation submitted in partial fulfillment
of the requirements of the
BA (Hons) ADVERTISING MANAGEMENTof Northumbria University
NAME!! ! Matthew MOORE
DEGREE! ! BA (Hons) Advertising ! ! ! Management
SUPERVISOR! Dr Elmira Djafarova
TITLE!! ! Co-Create in Advertising and ! ! ! Marketing
DATE!! ! 5th April 2012
CAMPUS! ! City Campus East
DeclarationsI declare the following:-
(1) that the material contained in this dissertation is the end result of my own work and that due acknowledgement has been given in the bibliography and references to ALL sources be they printed, electronic or personal.
(2) the Word Count of this Dissertation is: 10,728
(3) that unless this dissertation has been confirmed as confidential, I agree to an entire electronic copy or sections of the dissertation to being placed on Blackboard, if deemed appropriate, to allow future students the opportunity to see examples of past dissertations. I understand that if displayed on Blackboard it would be made available for no longer than five years and that students would be able to print off copies or download. The authorship would remain anonymous.
(4) I agree to my dissertation being submitted to a plagiarism detection service, where it will be stored in a database and compared against work submitted from this or any other School or from other institutions using the service.
In the event of the service detecting a high degree of similarity between content within the service this will be reported back to my supervisor and second marker, who may decide to undertake further investigation which may ultimately lead to disciplinary actions, should instances of plagiarism be detected.
(5) I have read the University Policy Statement on Ethics in Research and Consultancy and the Policy for Informed Consent in Research and Consultancy and I declare that ethical issues have been considered and taken into account in this research.
SIGNED: ............................................................
DATE: 05/04/2012
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STUDENT NAME! ! ! ! Matthew MOORE
DEGREE! ! ! ! ! BA (Hons) Advertising Management
DISSERTATION SUPERVISOR! ! Dr Elmira Djaforova
DISSERTATION TITLE! ! ! Co-Create in Advertising and Marketing
DATE! ! ! ! ! ! April 2012
KEYWORDS!! ! ! ! Co-Create-and-Collaboration! ! ! ! ! ! Modern-Consumer! ! ! ! ! ! Advertising-and-Marketing! ! ! ! ! ! Brand-RelationshipsAbstract
The way in which brands communicate, and how consumers live their lives, is of significant importance to each entity. However, now, more than ever before, the two have become intertwined. This is resulting in one of the biggest developments that the advertising and marketing industry have witnessed in this generation. In a world that is increasingly lacking relevance and individuality, brands and consumers are constantly seeking to be heard amongst the crowd. Over the years brands have stressed the importance of listening to their customers. However, simply listening to customers is now being called into question, and instead the idea of working alongside them is being considered.
The modern consumer relishes having more power than ever before and they are willing to use this new found control. Brands can no longer ignore this development, and indeed, should not try to ignore it. There are significant benefits to brands and consumers working together in order to learn more about each other. One huge benefit of this is the potential for organisations to change and structure the way in which they do business, not just how they market and advertise themselves. This collaboration of brand and consumer is now more commonly referred to as Co-Create, a methodology which embraces the collaboration of both brand and consumer and delivers mutual benefits for both.
This study will research the effects that Co-Creation has had on the advertising and marketing industry. Furthermore, it will establish the key contributing factors that have given rise to Co-Creation, and how its methodology is implemented. An investigative case study and interviews are used as the basis for the research in this study. This provides highly informed data which will be used to conduct a thorough analysis and draw an educated conclusion on the topic of Co-Create.
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Acknowledgments
First and foremost, I would like to thank Elmira for her valuable help and guidance throughout the dissertation.
I would also like to thank my mum, dad, brother, girlfriend and friends who are always there for me when I needed them most.
Finally, a huge thank you to the employees at The Sharp Agency Ltd who took the time to be interviewed, your time and patience was greatly appreciated.
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Contents
1. Chapter One: Introduction!8
1.1 Aims and Objectives!9
1.2 Chapter Structure!10
1.2.1 Introduction!10
1.2.2 Literature Review!10
1.2.3 Methodology !10
1.2.4 Findings and Analysis!11
1.2.5 Conclusion!11
2.0 Chapter Two: Literature Review!11
2.1 Introduction!11
2.2 The Modern Consumer!11
2.2.1 The Role of Technology !12
2.2.2 Increased Choice and the Appetite for Relationships!13
2.2.3 Consumer Communities & Consumer Generated Content!14
2.3 The Evolution of the Brand Consumer Relationship !15
2.4 Generating Value with Customers.!16
2.4.1 The Co-Creation of Value.!16
2.4.2 The Building Blocks of Co-Creation (DART Model)!17
2.4.3 What Role Consumer Experiences Play in the Co-Creation of Value.!19
2.5 The benefits of Co-Create!20
2.5.1 A Deeper Level of Understanding a Brands Customers!20
2.5.2 Co-Create Empowering Consumers to Release Their Potential!21
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2.5.3 Consumers Perceived Ownership of Brands!22
2.6 Implementing Co-Creation in an Organisation (Bhalla Model)!23
2.6.1 Listen!23
2.6.2 Engage!23
2.6.3 Respond Externally!24
2.6.4 Respond Internally!24
2.7 Summary!24
3.0 Chapter Three: Methodology!25
3.1 Introduction!25
3.2 Research Philosophies & Approaches!26
3.3 Data Sources!28
3.3.1 Primary Data!29
3.3.2 Secondary Data!29
3.4 Triangulation!29
3.5 Participation Observation!30
3.6 Data Collection Method!30
3.6.1 Case Study Approach!30
3.6.2 Interviews!31
3.7 Sample Approach!31
3.8 Sample Size!32
3.9 Limitations!33
3.10 Ethical Issues!33
3.11 The Sharp Agency Case Study !34
3.11.1 Aesica Pharmaceuticals!35
3.11.2 National Union of Students!36
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4.0 Chapter Four: Findings & Analysis!37
4.1 Case Study Findings!37
4.2 Interview Findings!38
4.2.1 Using Co-Creation as the Cornerstone to Operating the Brands Strategic Marketing Activities!38
4.2.2 The Co-create Process and it’s Effects!40
4.2.3 The future and Potential of Co-Create!42
5.0 Chapter 5: Conclusion!43
5.1 Introduction!43
5.1 Conclusions on the topic of Co-Creation!44
5.2 Limitations of the Study !46
5.3 Further Investigation into the Study!46
Reference List !48
Bibliography!52
Appendices!54
Appendix A - Reflective Statement!55
Appendix B - Interview responses from SCD1 (The Sharp Agency Ltd)!56
Appendix C - Interview responses from SCS1 (The Sharp Agency Ltd)!61
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1. Chapter One: Introduction
Prior to this study taking place, the author took part in a 48-week industrial placement at an advertising agency commencing the third year of their degree. It was during this placement the author was introduced to an agency that worked with clients, but also helped develop how the client worked with their own customers in a very unique way. The method of working was referred to by the agency as ‘Co-Create by Sharp’. The agencies approach to work meant that it would work closely with consumers in order to gain an insightful contribution that would go towards the work produced for their clients. The main driving force behind the agencies decision to adopt this approach was to produce work more relevant to the intended audience.
For many years, brands have looked for new and innovative ways to sell more products or services, gain more market share, and overall strive for increased competitive advantage using various marketing activities. From the birth of ‘modern advertising’ post the Second World War (Pincas and Loiseau, 2006); the advertising industry has seen a significant rise in expenditure, with reports concluding UK advertising expenditure in the third quarter of 2011 reaching £3.8bn (Advertising Association, 2012). A conclusion that can be drawn here is that the relationship between brands and consumers has evolved significantly over the past 60 years to become one that is more complex than anyone could have previously anticipated.
It is apparent that within the current relationship between brand and consumer they expect more from each other. Brands expect more in depth data from consumers enabling them to build a better picture of their customers, ultimately helping to create a more accurate communication tool. Customers expect a whole lot more, they want to be treated like individuals rather than a mass market, and developments in technology have given them the sort of power that brands can no longer ignore.
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Considering that the evolution of marketing and advertising has resulted in brands and consumers growing closer together, the questions that arise are: how close can they get? And, what are the implications for those involved? Many believe that Co-Creation is the platform to provide this closeness, equating in substantial benefits for both parties (Ramaswamy, 2004). One benefit would be to gain unparalleled insight into consumers and another creating mutual value producing long term loyalty from customers, thus delivering long term success for brands.
The research in this study on the subject of Co-Creation is centered around why the approach can be considered more relevant today than at any other time, what can come out of brands adopting Co-Creation, and what are the practical steps to Co-Creation? A significant amount of literature signals towards the fact that working more closely with customers benefits brands, and how certain elements, in particular technology, have been the major influence behind Co-Creation.
1.1 Aims and ObjectivesThis study will include primary and secondary research in order to further investigate Co-Create in advertising and marketing, as well as contributing factors. The secondary research used for this study will include literature on the subject of Co-Create and areas surrounding the modern consumer, the relationship between brands and their consumers, and the phenomena of the Co-Creation of value through the mutual experiences consumers have with brands. The review of the literature will expose if there is a need to further investigate information around the subject of Co-Create and whether this is a significant development within the industry.
The secondary research in this study will shape the approach of the primary research, which is in the form of an investigative case study using a number of semi-structured interviews with experienced members of the
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marketing industry. The primary data will provide the information needed to decipher an educated conclusion to the hypothesis “How has Co-Creation affected the advertising and marketing industry?”
1.2 Chapter Structure
1.2.1 IntroductionThe introduction will include what the topic of the study involves and the background surrounding Co-Create and to why the topic of Co-Create was chosen. It outlines the series of chapters to follow to complete exploration
of the topic that provides purpose, understanding, and a clear path for the
report to follow.
1.2.2 Literature Review
The literature review in this study is a comprehensive look into previous
research on the specific subject of the study as well as the key
surrounding factors that are integral to gaining a better understanding of
Co-Create.
The review includes literature from textbooks, journal articles, websites
and newspaper articles. It brings to light areas in the study that require
further research. The literature review is structured in a way that
addresses what factors have played a significant role into why Co-Create
is possible, what Co-Create is, and how to implement it, and finally what
are the implications for brands and consumers?
1.2.3 Methodology
The methodology will outline the means in which the primary research has
been conducted. The section highlights why primary and secondary
research was used, and their significant importance with regards to
collecting the required data to conduct the study. Information on the data
collection methods used in the study is included, as well as possible
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limitations, and the ethical issues relevant to the study. Included at the end
of this chapter is an investigative case study based on The Sharp Agency
Ltd, which will provide the platform for the case study findings up to
Chapter 4.
1.2.4 Findings and Analysis
The findings and analysis of the study are presented in the form of case
study results and transcripts from the semi-structured interviews. The
results of the research will be analysed in order to be consistent with the
original hypothesis of the study. The primary and secondary research
conducted in this study will feature in the analysis section.
1.2.5 Conclusion
The data that has been collected and subsequently analysed will form the
basis in which to draw an accurate conclusion on the subject of how Co-
Create has impacted on the advertising and marketing industry.
2.0 Chapter Two: Literature Review
2.1 IntroductionThis chapter will provide an account of previous research and theories based around the subjects of collaborative marketing as well as Co-Create. Current knowledge of how consumers and brands have developed over time, as well as the specific factors that can be attributed to the shift towards brands working with consumers will be discussed in the following chapter. Pongsakornrungsilp & Schroeder (2011, p304) describes Co-Create as “the process by which both consumers and producers collaborate, or otherwise participate, in creating value”.
2.2 The Modern ConsumerToday’s modern consumer has become a more influential stakeholder resulting in brands now having to reassess the way in which they interact with their customers (Prahalad & Ramaswamy, 2004). Cova & Dalli, (2009)
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have also discussed how there are ‘various’ signs which suggest that the role of the consumer is changing within today’s marketplace. Bhalla (2011, p4) discusses how today’s consumer is “one that is better educated, more collaborative, and infinitely more resourceful than at any time in the past”. The emergence of this new type of consumer has helped in giving rise to a new marketing approach referred to as Co-Creation.
2.2.1 The Role of TechnologyWith regards to the changing relationship between a brand and its consumers, advances in technology can be considered to be the biggest contributor to how the relationship has changed (Rust, Moorman & Bhalla, 2010), with significant emphasis being placed on the internet as a major factor in facilitating the relationship change (Prahalad & Ramaswamy, 2000). This point is further endorsed by Mainwaring, (2011) who discusses how the use of technology has allowed consumers to gain the power to shift and influence corporate thinking.
The significant influence that the internet has had can be attributed to the notion with it consumers can now with the internet can be exposed to alternative information, meaning they do not have to solely rely on information from brands to decide whether they wish to establish a relationship (Prahalad & Ramaswamy, 2004). Gabriel & Lang, (2006, p26) highlight the importance that access to information has in the consumer decision making process by stating “choice without information is not real choice”. Consumers are now armed with information such as alternative products, services and up to date prices (Clemons, 2008), which has led to brands having to rethink the way in which they interact with consumers because of this more transparent marketplace (Clemons, 2008).
In addition to providing new opportunities for consumers, technology also provides opportunities for brands by giving them more ways in which to
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approach their customers (Ballantyne, 2004). Addis & Holbrook, (2001, p. 53) discusses the importance of a good relationship between brand and consumer which is further helped by advances in technology. They state that that “Such a relationship must be built upon the sort of continuing dialogue now made possible by new communication technologies”.
2.2.2 Increased Choice and the Appetite for RelationshipsToday consumers are exposed to a previously unprecedented level of choice (Schwartz, 2005), with the market place providing many different options for a wide range of different consumer needs (Clemens, 2008). However despite this abundance of choice it has also been argued that more choice does not necessarily help improve the consumer brand relationship; as in some cases an increase in the level of choice for customers has not always provided a better consumer experience (Prahalad & Ramaswamy, 2003).
In some cases the reliance of brands on mass marketing tools in order to reach large populations has led to the isolation of customers, and their desire for a more personal interaction with their favourite brands. (Rust, Moorman & Bhalla, 2010). The major problem with a mass marketing approach to today’s consumers is that it implies that the vast majority of consumers have similar tastes (Beckett & Nayak, 2008). As a result of this mass marketing, resentment has developed towards marketers from the consumer explaining their new found willingness to build more meaningful relationships with their favorite brands (Cova & Dalli, 2009).
In an age where customization is becoming more common, the need for interaction between a brand and it’s consumers is imperative if it is to succeed in accurately delivering what consumers need (Rust, Moorman & Bhalla, 2010). Beckett & Nayak, (2008, p306) discuss this point stating “consumers demand greater interaction with producers in the solving of
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their needs and to be recognized as individuals”. One of the biggest catalysts in why today’s consumers are craving relationships is the confidence brought out of the fact that they are exposed to this wealth of information, meaning they feel more at ease when talking to brands on a more equal footing (Prahalad & Ramaswamy, 2004).
2.2.3 Consumer Communities & Consumer Generated ContentWhen large groups of consumers come together to form communities it can become a significant tool which can influence a consumer’s relationship with a brand, but also as a tool that can support a brand in the innovation process (Rossi, 2011). Cult brands such as Harley Davidson in the US, and Ducati in Europe, have benefited significantly from fanatical brand communities that have not only helped create strong brand loyalty, but also a highly informed knowledge base that brands can use for innovation (Cova & White, 2010). Part of the reason why a community’s influence can be so powerful lies in the close bond that exists between members as a result of sharing a common interest or passion, making these communities very influential amongst fellow consumers (Bagozzi & Dholkia, 2002).
There is strong evidence to encourage brand managers to work with the concept of consumer communities by providing consumers with the tools needed to grow communities ‘customer competence’ rather than simply exploit customers (Beckett & Nayak, 2008) This has been demonstrated by the Harley Davidson and Ducati examples, and the argument that consumers desire a more in depth relationships (Schau, Muniz & Arnould, 2009).
In addition to consumer communities another development brought on by the changing habits of modern consumers is the emergence of Consumer Generated Content (CGC). Initially CGC was considered to be a casual
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hobby for some consumers, but overtime it has developed into a highly influential source of information which rivals established sources such as news and entertainment (Cova & Dalli, 2009). CGC has previously been used in advertising campaigns where consumers are invited to produce adverts for their best loved brands, as used in the Doritos Superbowl Adverts (Muniz & Schau, 2011). There is scepticism however as to how far brands are willing to go with CGC, and also with more consumer centric approaches in general. This is due to concerns of brand managers over handing so much control to the consumer (Muniz & Schau, 2011).
2.3 The Evolution of the Brand Consumer RelationshipIn previous years the focus of how businesses operate has gradually changed from one which focuses on products produced in factories for customers, to one which leans towards the customer’s needs (Wikstrom, 1996). Whilst this change has happened in stages deriving from existing customer orientated practices such as “customer orientation” and “customer segmentation” all indicators point to the future stage one in which the customer as co-producer (Wikstrom,1996).
There are numerous examples of influential figures in business who have expressed their own opinions on the shift towards a more collaborative way of thinking including Threadless.com, a t-shirt manufacturer which relied heavily on the use of customers of co-producers commenting “the customer is the company” (Schau, Muniz & Arnold 2009, 30-31). Kitchen, (2011) also acknowledges the shift in thinking in industry over time by referring to the following quotes by influential figures in the world of business and marketing:
Henry Ford - “If I had asked people what they wanted they would have said a faster horse”.
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David Ogilvy - “Advertising people who ignore research are as dangerous as generals who ignore decodes of enemy signals”.IBM CEO - “Successful organizations Co-Create products and services with customers”.
Addis & Holbrook, (2001) discuss how consumers have become ‘feelers as well as thinkers and doers”, which highlights a significant shift from previous generations. This development has caused the approach of brands that develop, produce, and market products or services without interaction with consumers to become outdated (Prahalad & Ramaswamy, 2004).
2.4 Generating Value with Customers.The traditional concept of value creation has centered around value being created from within the company through its own marketing activities, as consumers were considered to be “outside the firm” (Prahalad & Ramaswamy, 2004). Other traditional approaches to the creation of value relate to the consumer’s perception of price as well as the “sacrifice” that has been given in order to receive the product or service (Ravald & Gronroos, 1996). Pongsakornrungsilp & Schroeder, (2011) however, discuss how a new approach may deliver better results by concentrating not on how companies can create value for consumers, but rather on how they should create value with consumers; or in other words ‘inside out thinking’ (Prahalad & Ramaswamy 2004).
2.4.1 The Co-Creation of Value.The Co-Creation of value is essentially based on the idea of the company and customer viewing each other as equals and working together, which in term will create deeper relationships and higher value (Prahalad & Ramaswamy, 2004). The success of the Co-Creation of value lies significantly in the emergence of the “modern consumer” and the changed market brands find themselves in, which is heavily influenced by the
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factors previously discussed such as technology (Rust, Moorman & Bhalla, 2010), increased choice (Schwartz, 2005), and the changing brand-consumer relationship (Schau, Muniz & Arnould, 2009).
2.4.2 The Building Blocks of Co-Creation (DART Model)In order to collaboratively create value with customers we have to look at the building blocks of how consumers and brands need to interact. Dialog, access, risk-benefits, and transparency are the established basis for how the interactions between the two parties will collaboratively develop value (Prahalad & Ramaswamy, 2004).
Dialog can be considered to be one of the most important elements of DART as the market place can be considered to be series of exchanges or conversations between customer and an organisation (Levine, Locke, Searls & Weinberger, 2001). The dialogue between the two parties must be deep and meaningful, with a willingness on both sides to work together as equal partners (Prahalad & Ramaswamy, 2004). This element constitutes much more than just listening to consumers, it is the deep understanding of what consumers are experiencing in order to better understand the emotional, social, and cultural context of experiences (Prahalad & Ramaswamy, 2004).
Previously a consumer’s access to an organization had been easier to control, and in some cases had been taken advantage of due to possessing more information than the customer (Prahalad & Ramaswamy,2004). This is often referred to as information asymmetry which is defined as “when a party or parties possess greater informational awareness pertinent to effective participation in a given situation relative to other participating parties” (Clarkson, Jacobsen & Bathceller, 2007, p. 828). This is not the case anymore as consumers are more connected (Bhalla, 2011). Due to this development access and transparency are integral to the Co-
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Creation of value, as there is very little brands and consumers can keep from each other (Prahalad & Ramaswamy, 2004). In turn dialogue access and transparency will lead the consumer to having a better idea of the risk or benefits involved in the interaction (Prahalad & Ramaswamy, 2004). Nike takes an active role in consumer groups to advise on issues important to it’s customers, as in the case of Nike running shoes (Ramaswamy, 2008). The information that is provided by Nike as a result of working closely with it’s customer can help with issues such as training methods, and how to prevent injury. This information allows customers to further improve the experience they have with their running shoes, which in turn will create higher perceived brand value in the eyes of consumers. The insights gained from the close relationship between Nike and its customers embodies Co-Creations ability to create competitive advantage.
Table 2.1 DART Model of the Nike case (Ramaswamy, 2008).
Dialogue Access
New rich dialogue between the runner and Nike between the runner/listener and Apple, among runners and between runners and running experts.
Nike provides access to it’s customers through the iPod Nano/Sport Kit device and
the Nike+ web site.
Transparency Risk-Return
For runners, Nike+ makes transparent a huge range of information about running including routes, training knowledge, and how a
runner’s progress compares. Nike learns a lot about
individual runners that was previously opaque to the
firm.
For runners, Nike+ reduces the likelihood of getting hurt by giving them information
about proper training methods. For the company, the risk of losing customers is lowered because runners are interacting with Nike+
frequently.
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2.4.3 What Role Consumer Experiences Play in the Co-Creation of Value.In an age where marketplaces are saturated with infinite levels of choice (Schwartz, 2005) it is clear the that in order for brands to compete they need to switch from merely pushing products onto consumers, to building long term relationships with them and maximising customer lifetime value (Rust, Moorman & Bhalla, 2010).Rust, Moorman & Bhalla (2010) discuss at length the concept of a customer-cultivating company, which places emphasis on securing relationships as opposed to securing sales. This new outlook is an example on how brands are looking at consumers differently, asking ‘what can you do with us?’ rather than ‘what can we do for you?’ (Bendapudi & Leone, 2003).
As brands look for new ways in which to gain competitive advantage a new emphasis placed on the quality of experience a consumer will have with a brand is gaining significant importance (Ramaswamy, 2003). A higher quality of experience can arguably be achieved with a consumer centric company as it allows “individual customers to co-construct their own consumption experiences through personalized interaction, thereby co-creating unique value for themselves” (Ramaswamy, 2003).
A large part of creating increased value with customers lies in the type of relationship between a brand and it’s consumer has, this is particularly significant in the service industry when what the customer is actually paying for is less tangible (Ballantyne & Varey, 2006).The key to building good relationships with consumers, and in turn creating increased value, lies in ensuring a consumers experience with the brand is an enjoyable one (Prahalad & Ramaswamy, 2004; Payne, Storbacka & Frow, 2008). Holbrook (2006) describes the key aspects of a positive consumption experience as “Fantasies (dreams, imagination,
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unconscious desired); feelings (emotions such as love, hate, anger, fear, joy, sorrow); and fun (hedonic pleasure derived from playful activities or aesthetic enjoyment)”. As a result, many leading organisations are looking into how to capitalise on the use of engagement experiences as a new foundation for value creation (Ramaswamy, 2009).
2.5 The benefits of Co-CreateIn order to understand why a brand should adopt Co-Create as a legitimate way in which to operate, it is important to understand what Co-Create is not. It is not the outsourcing of resources to customers or the staging or influencing of consumers. It is an in depth brand to consumer interaction that satisfies the needs and attitudes of today’s consumer (Prahalad & Ramaswamy, 2004). The possibilities that Co-Creation can give a brand depend on the quality of the ‘transactions’ between consumer and brand, which tend to move more quickly than other insight tools. Essentially as each party interact with each other, they are learning more about each other as well as creating mutual value (Wilkstrom, 1996).
2.5.1 A Deeper Level of Understanding a Brands CustomersA key part of how Co-Creation works is continuous dialogue. It is this dialogue which creates deeper understanding between the participants (Ballantyne, 2004). Although Ballantyne (2004) also may argue that dialogue between a brand and its consumers is nothing new, it is the interactive process of learning together that sets Co-Creation from other insight tools. This interactive process has been made all the more possible with the advances in Customer Information Systems (CIS) by improving a brands ability to understand its customers (Zahay & Peltier, 2007).
The fact that !Co-Creation is a consumer centric approach to operating an organization means that it makes it perfect sense to collaborate with consumers as deeply as possible in order to learn more about consumers;
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as who knows more about a brand’s consumer than the consumers themselves? (Beckett & Nayak, 2008).
2.5.2 Co-Create Empowering Consumers to Release Their PotentialWhen the ideas and opinions of consumers really matter in the shaping of how an organization operates it will give a real sense of empowerment to those consumers who participate in the Co-Creation process and as a result will reshape consumers into ones that are fully engaged in the brand (Beckett & Nayak, 2008).
One less reason to why brands should not be worried about working as equal partners to consumers is the consumer’s potential to be creative and insightful. Consumers are far more engaged in the world around them, and the advancement of technology has meant that the ‘threshold to creativity’ has been lowered (Cova & Dalli, 2009). Cova and Dalli (2009) elaborate on this point by arguing that “While building a car still requires a complex set of competencies that only an organization can possess, consumers can, conversely, easily manipulate other products and services, thanks to technology” (Cova & Dalli, 2009 p316-317). A recent study (see table 2.2) on innovation in business stated that customer generated ideas were considered to be the best ideas (Promise, 2009). In addition to their ability to create good ideas, a consumer’s willingness to experiment also lends itself greatly to the idea of Co-Creation (Prahalad & Ramaswamy, 1999).
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Table 2.2
2.5.3 Consumers Perceived Ownership of BrandsIt is more common today for consumers to assume ownership of the brands they love, especially those with a fanatical following. Cova and Dalli, (2009) explain this phenomenon by describing how consumers are increasingly regarding brands as ‘shared cultural property, and how familiarity with a brand gives consumers a sense of ownership of that brand. This sense of ownership will lend itself to Co-Creation in the sense that brand lovers will wish to assist the brands they admire.
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CustomersHead of business units
General employeesBusiness partners and suppliers
In-house R&D teamCEO
Other C-level employeesSales
Special innovation teamOutsourced R&D team
Other
0 13 25 38 50
2.6 Implementing Co-Creation in an Organisation (Bhalla Model)In order for an organization to develop a core Co-Creation capability, there are four main interrelated components which need to be implemented, as demonstrated in Fig 2.3 (Bhalla, 2011, p17).
Figure 2.3
2.6.1 ListenThe modern consumer has regular interactions in a manner of different ways including media, brands, public forums and with fellow consumers. These interactions are valuable in both content and sentiment, meaning it is imperative to the Co-create process that brands listen to consumers (Bhalla, 2011). Shirky, (2008) has discussed at length how people are in fact becoming their own media outlet working in direct competition to more established media such as newspapers.
2.6.2 EngageBy getting consumers to engage with a brand it will provoke conversations and response which will subsequently deliver fresh insights that may previously have gone unnoticed (Bhalla, 2011). Social media has in recent
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years played a large role in making it easier for brands to engage with customers (Chu & Kim, 2011). Brands such as Timberland have used the social media site Facebook to launch campaigns which call for active participation from consumers over a particular subject, for example the Timberland Earthkeeper Movement (Timberland, 2012).
2.6.3 Respond ExternallyOnce a brand has begun to listen and engage with consumers, it is imperative for this brand to respond to the information it has discovered by ensuring the right Co-Create vehicles are put in place this can be done both decisively and consistently (Bhalla, 2011). This was done by the Company Nike through the development of the Joga.com website which allowed Nike football fans to upload their football skills alongside their favourite Nike sports stars (Ramaswamy, 2008)
2.6.4 Respond InternallyResponding internally is much like externally with regards to ensuring that the right facilities are put in place in order to encourage a collaborative environment but for employees as well as customers (Bhalla, 2011). This is because in order in order for an organization to be truly based on Co-Creation the collaborative journey must start at home (Ramaswamy, 2009).
2.7 SummaryIt is clear that there are many different factors have come together resulting in the emergence of Co-Creation. Technology has been a massive driving force behind how the modern consumer can contribute significantly to the Co-Creation process. The power at the hands of consumers means they are more informed when making decisions and more confident when it comes to wanting more meaningful relationships
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with they brands they love, which as a result has forced brands to stand up and take notice.
Co-Creation can benefit brands in a number of different perspectives. It can provide unrivaled insight into consumer thinking and behavior as well as instilling an approach to working closely with customers that can produce long term loyalty.
In order for an organisation to truly adopt a Co-Creative approach to its marketing activities or marketing strategy it has to adhere to a particular set of criteria. Included in the varied amount of literature the criteria will change slightly, although it is safe to conclude that key key aspects of Co-Creation centered around open and in depth communication, mutual trust between the two parties and lastly the willingness to act pursue Co-Creation as a core element of a brands operations.
3.0 Chapter Three: Methodology
3.1 IntroductionThis chapter will outline the methods of research that will be conducted in order to collect the required data to complete this study. In addition to this, any ethical issues and limitations faced during the study will be addressed. The chapter will also include an in depth case study on The Sharp Agency Ltd (Sharp), a full service advertising agency which had adopted a collaborative working philosophy with its clients called Co-Create by Sharp.
In order to guide the direction of the research the dissertation will question “what effect has Co-Creation had on advertising and marketing?”.
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3.2 Research Philosophies & ApproachesResearch is a process which means many different things to many different people, whether it is for business or academia. As a result a clear definition for research is hard to find (Hussey & Hussey, 1997). However, despite the seemingly difficult task of defining research, there seems to be a collective consensus cited in (Hussey & Hussey, 1997) that:
• Research is a process involving inquiry and investigation.• Research has to be systematic as well as methodical.• Finally, that by conducting research it will increase knowledge.
Baker & Foy (2008) discusses how research has had a pivotal role in the development of civilisation. He uses the example of how the use of a process of trial ad error has improved insight and understanding, which has consequentially provided a foundation for development. Taking the concept of how research can aid development and progress, looking more specifically at business or management research, it is clear that research can help the field of business to, for example, help managers draw on knowledge to aid them in the decision making process (Saunders, Lewis & Thornhill, 2007).
The use of adequate research in this study is integral to gaining the vast amount of information necessary to complete satisfactory analysis which will provide the basis for an educated discussion. This will then allow a conclusion to be drawn on whether there is a need for further research (Quinlan, 2011).
When we consider the ambiguity surrounding the term ‘research’, it is unsurprising that the process itself can also be a complex one (Cavana, Delahaye & Sekaran, 2001). The different ideas on how research should be conducted, contributing to the complexity of the term can be broadly
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catergorised under three related schools of thought also referred to as paradigms (Hussey & Hussy, 1997; Baker & Foy, 2008) these are Positivist, Interpretivist and Critical research (Cavana, Delahaye & Sekaran, 2001).
With regards to this particular study, the main basis of research will be concerned with the Phenomenological school of thought. Within the Phenomenological paradigm are both Qualitative and Quantitative methods of research (Hussey & Hussey, 1997). The key defining characteristics that distinguish the two methods cited in (Baker & Foy, 2008) are based in the results that each method delivers. For example, quantitative results are considered to more robust leading to results and recommendations, whilst qualitative are viewed as lacking in robustness, resulting in indecisive outcomes (Baker & Foy, 2008). Recent years have seen increasing opinion that qualitative and quantitative research are no longer being considered as ‘polar opposites’, but can actually be considered to be very similar in nature (Baker and Foy, 2008). For example, much of the theories and practices of both quantitative as well as qualitative data are closely associated with each other (Baker & Foy, 2008). Hussey & Hussey (1997, p. 72) comment that “a mixture of approaches... allows you to take a broader, and often complimentary, view of the research problem or issue”. This will benefit the study through expanding the opportunity to collect more varied data.
Despite the now established links between quantitative and qualitative methods (Baker & Foy, 2008) they are varying practical data collection methods that will deliver the varying result styles. For example a quantitative method can include questionnaires and surveys, whilst a qualitative method can involve observations or interviews (Hussey & Hussey, 1997). For the purposes of this study it is imperative that the correct data collection methods are assessed in order to establish which
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ones will provide the best quality data to aid the study (more information on data collection methods will be included later in this chapter).
Another important factor to consider in the research process is how to establish the accuracy in what is being recorded. In order to decipher this, the methods of Induction and Deduction are used (Ghauri & Gronhaug, 2005). Deduction can trace it roots from scientific research, as it involves the development of a original theory or hypothesis which is then subjected to rigorous testing to establish its validity (Saunders, Lewis & Thornhill, 2007). Induction is a method which requires the understanding of the information gathered, before taking these results to form a theory or hypothesis (Ghauri & Gronhaug, 2005; Saunders, Lewis & Thornhill, 2007). However despite the significant differences between the two methods it is not impossible to use the two simultaneously (Saunders, Lewis & Thornhill, 2007).
3.3 Data SourcesIn order to gather sufficient information to enable a deep understanding of Co-Create and the many factors surrounding it, this study will utilise both primary and secondary data sources.
Primary data refers to information that has been gathered first hand specifically for the research project in task (Zikmund, 2003). Secondary data as described by Burns & Bush (2006) is data that has previously been collected by someone other than the researcher for a different purpose than the one at hand. Aaker, Kumar & Day (2001) discusses how secondary data sources can be considered to be one of the most cost effective ways of accessing information by looking at the usually overwhelming amount of information that already exists on a chosen topic.
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3.3.1 Primary DataPrimary data can be used in instances where information is gathered for a specific research project. As research into the knowledge surrounding Co-Creation is limited, this particular study used primary data collection in order to produce accurate information which could be used in the assessment of the original hypothesis (Ghauri and Gronhaug, 2005).
3.3.2 Secondary Data
The study began with a literature review outlining previous research on the
subject of Co-Creation, collaborative marketing, and the important factors
that contributed towards this approach to marketing. In order to complete
this review of the literature, books, journal articles, webpages, and online
data sources such as NORA were used. Conducting the literature review
was an important stage in the study, as a literature review provided the
opportunity to explore the particular field, which then delivered greater
awareness and understanding (Ridley, 2008). In addition to helping
discover what knowledge exists about the subject, the review also
highlighted gaps in the knowledge, which helped establish where the
primary research for this study could be directed in order to be used later
on as a foundation to analyse the data (Ghauri and Gronhaug 2005).
3.4 Triangulation
Triangulation is described by Yin (2003, p97) as the “rational of using
multiple sources of evidence”, which according to Adami and Kiger, (2005)
will serve two purposes when applied to research strategies these are for
confirmation and completeness of the study. With regards to the study,
triangulation was used in terms of gathering material from information on
The Sharp Agency Ltd and a selection of it’s campaigns to be used in a
case study and two of the agency partners. The use of multiple sources of
evidence is advocated by the common perception that using triangulation
can add further substance to the study (Patton, 2002).
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3.5 Participation Observation
Prior to this study, the author was employed on a 48 week placement at
Sharp, enabling the authors own observations during this period to assist
significantly in the triangulation process. Jorgensen (1989, p. 12) holds the
opinion that “participation observation is exceptional for studying
processes relationships among people and events”. The justification for
using this method lies in the authors extensive knowledge on the finer
details of the agency, as well as the thoughts and behaviour of persons
involved in the interview process.
3.6 Data Collection Method
In order to collect the necessary qualitative data required for this study, a
combination of semi structured interviews and a case study research
approach based on The Sharp Agency Ltd, along with a number of their
clients were used. These methods were used to the opinions of key
industry figures on the both the reasons why a Co-Creative approach was,
used and how effective the approach is, along with examples of Co-
Creation in action.
3.6.1 Case Study Approach
The first part of data collection was to conduct a case study on The Sharp
Agency Ltd (Sharp). This was conducted in order to gain information on
the way a business implements and endorses a collaborative approach to
brands working with their customers. The fact that Co-Creation can be
considered to be contemporary phenomenon with some real life context,
was the defining factor as to why a case study approach was used (Yin,
2003).
The case study looked at the beginnings of the agency and how it has
grown during its short existence (Estd 2010). Is also aimed to establish
what Co-Creation is, in a practical everyday sense, by examining what
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techniques were used in Co-Create sessions to deliver the insight needed
in order to produce great work for clients.
3.6.2 Interviews
The interviews conducted in this study alongside the Sharp case study
were designed to gain greater insight into the reasons for using Co-
Create, and decide what effect is has had on the advertising and
marketing industry (as the original hypothesis would suggest). The
interviews that were conducted can be described according to (Gubrium &
Holstein, 2001, p83) as “qualitative interviewing”. This is because the
interviewees were informed and highly experienced professionals in their
field. Therefore, they are viewed as “meaning makers, not passive
conduits for retrieving information from an existing vessel of answers”.
In order to gain a more balanced and overall wider perspective when
trying to discover the studies original hypothesis, the questions that were
formulated for members of Sharp are slightly different reflecting the
participants differing roles in the agency.
3.7 Sample Approach
To ensure the research carried out is as fair and accurate as possible, a sample approach to the research will now be discussed in further detail (Kent, 1999). Sampling is an important step in the research process due to constraints such as availability of finances, time, or the availability of the subject population (Cavana et al, 2001).
The use of samples in this study, which is based around qualitative research in the pursuit of gaining a better understanding of the situations involving Co-creation, is entirely justified (Kent, 1999). This justification arises from the use of what is known as Purposive sampling (Kent, 1999), which is also referred to by Quinlan (2011) as Non-Probability sampling. Purposive or Non-probability sampling, allows the researcher to calculate
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the amount of bias, and determine the variation of sampling procedure (Kumar, Aaker & Day, 2002). The use of this particular technique eliminates the certain constraints on research such as costs and the significant work involved in gathering a large sample (Kumar, Aaker & Day, 2002).
The sampling technique included within this group of sampling to be adopted in this study is judgemental sampling, also known as purposive sampling (Quinlan, 2011). This technique was chosen in light of the fact that the organisation based in the case study, and persons chosen to interview, were picked because of their significant knowledge around the subject of Co-Creation. The parties involved in the data collection process have significant capacity to further inform the existing research on the subject.
3.8 Sample Size
The sample size is an important factor in the research process in order to
produce well balanced findings. Taking this into consideration, it is
essential, that the sample is of adequate size to ensure a satisfactory level
of accuracy in the data (Saunders et al., 2007).
The sample type used in this study was chosen on the basis that the organisation (Sharp) at the centre of the case study and the interviewees are specialists in the field of Co-Creation. The author decided that increasing the population of the research sample would not be beneficial as it was not possible. Increasing the sample size was not possible at this time as the author was restricted by the size of the organisation and the resources available.
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3.9 Limitations
In order to put the studies findings into context there must be an
assessment of the limitations that could of occurred in the results collected
for this particular study (Ghauri and Gronhaug 2005).
• The necessary information needed to conduct a thorough case study for the purposes of this study not being easily accessible.
• The interviewees not being forthcoming with the desired amount of information. Gubrium & Holstein (2001) describe these as “reluctant respondents” who can fall into two categories depending on whether they have allowed an interview to take place, or are finding it difficult to open up during an interview. The categories are called access and resistance respectively.
3.10 Ethical IssuesThe research undertaken for this study was conducted in accordance to
what is considered ethical research. During the there were no exclusion
criteria, for example based on race, ethnicity or sex. The reason for this
was for both ethical considerations and as a descriptive of your sample
population. Aaker, Kumar & Day (2001, p13) argue that in conducting
ethical research “Researchers have responsibilities to their profession,
clients, and respondents, and must adhere to high ethical standards to
ensure that both the function and information are not brought into
disrepute”.
During the construction and execution of this study, the Northumbria
University Code of Ethics was adhered to at all times, for example
personal consent forms and organisation consent forms were used.
The author of this study did not interview any persons under the age of 18, and the research that was conducted was explained to participants in full
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possible before they took part in both the interview and their case study. Participants were given the opportunity to ask questions and to withdraw from the study at any time without prejudice as well as being offered confidentiality. The storage of information was taken highly seriously with the collected data being stored in password protected files.
3.11 The Sharp Agency Case StudyDuring late 2009 Richard and Darlene Sharp were working on a new nameless agency that would see them break away from previous high ranking positions at well established advertising agencies. After years of their work taking them to places far from their home in Huddersfield, West Yorkshire, it was time to set up their own agency in Richard’s home town where they had brought up their family. The only difference was that Sharp was going to be a different kind of agency, which would work like very few others within the industry.
Several months later both Mandi Taylor and Tom Wass joined Sharp as partners, bringing a wealth of marketing industry experience from previous high ranking positions. With the four partners in the agency established, they began building an advertising agency, which was not going to operate like the agencies they all had worked with previously. In fact it wasn't going to be an ‘advertising agency’ per say, but a Co-Create Agency.
“We don’t do things at people, we do it collaboratively with them. Whether it be your customers, partners or your stakeholders, we have a pioneering methodology called CoCreate by SHARP that involves the people that matter the most to develop ideas that make things happen” (Sharp 2010).
Sharp has provided work with its clients all through the working methodology of Co-creation. This has taken the agency to working with fanatical sports footwear consumers, highly specialised pharmaceutical scientists, the health enthusiasts of Sheffield, empowered students who are striving for change, and the personality loving customers of a
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worldwide hotel brand. The agency is an environment that embraces ideas, both the ideas of those who work there, as well as the ideas of its clients and client’s customers. This openness to working with others at any level needed is the bedrock of Sharp’s working philosophy, which is Co-Create by Sharp.
3.11.1 Aesica PharmaceuticalsIn 2010 Sharp was challenged with creating a new brand image for global pharmaceutical company Aesica that would reflect the organisations true nature in an industry suffering from a very universal image. Aesica is an international brand that needed a brand image to reflect its diversity, friendly approach to business relationships, and expertise. In order to develop a lasting solution to this problem, a collaborative approach was used by Sharp at every stage of the brand development.
Key stakeholders from across the globe were encouraged through Sharp’s Co-Create session to actively take part in the shaping of the company’s image. Every stakeholder had a voice, an opinion, and an overall different approach to how they wanted to tackle the problem. This gave the Sharp team invaluable insights into the people who matter, as well as a sense of ownership of the brand that was subsequently jointly created by the stakeholders.
The new brand image for Aesica has been rolled out across all of the brands communications. This image is concise and reflective of the range of diverse people who collaboratively created it with the guidance of Sharp.
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3.11.2 National Union of StudentsSharp were challenged with producing a campaign that informed millions of people who study in the UK about what the NUS actually did. The client was eager to know what students thought about what the organisation did, and what they thought about them. In response Co-Create by Sharp was able to provide the platform to solve this problem.
In this instance Co-Create was initially used to gain insight into what students thought the NUS did, and what it stood for. This process was resourceful for all involved, it gave the insight needed for both client and agency as well as informing the client’s core audience on what the NUS can do for them as students.
After this period of gaining insight, students (as key stakeholders) were invited to play an active role in developing ways in which to communicate what they had learnt about the NUS during a regulated Co-Create session.
The result of this collaborative process was a campaign based around a platform on the NUS being created which gave students a voice to help shape what the NUS could do for them. Alongside the website was an animation entitled ‘I Am The Change’ which encouraged the idea that individuals matter, and that the individual has the power to influence change. Co-Create by Sharp not only allowed for a development process which enlightened both brand and consumers, but in addition a campaign which accurately spoke to a core audience of students, and one which was heavily influenced by core stakeholders.
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4.0 Chapter Four: Findings & AnalysisThe following chapter includes analysis from the data collected for the purposes of this study. The first section of this chapter will include the findings from the case study based on Sharp, which will also be reinforced using relevant responses from the interviews.
The second part of this chapter will include an analysis of the responses gathered from the interviews which were conducted as part of this study. The analysis of these responses corresponds to the particular subject areas surrounding Co-Creation as highlighted in the literature review. The respondents in this analysis will be referred to as:
• The Sharp Agency Senior Creative Director - CD1• The Sharp Agency Heads of Strategy and Client Services - SCS1
4.1 Case Study FindingsThe origin of Sharp and its Co-Create philosophy was heavily influenced by the partner’s previous experiences at other agencies. Both CD1 and SCS1 were determined that the agency would be one which is defined by characteristics significantly different to other agencies. All of the work produced by the agency for its clients is developed by some type of collaborative or Co-Creative process, this was what was going to define the agency.
The process of Co-Creation can give the agency a wealth of insight which is put into the campaign development process. This can deliver campaigns that resonate more with key stakeholders. The fact that in both examples in the case study that the clients learnt a lot about themselves and their customers represents Co-Creates capacity to be a useful insight tool.
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When a brand uses Co-Creation it actively creates value with important stakeholders. A sense of ownership and relevance were natural results of Co-Creation in the instances of Aesica and NUS.
4.2 Interview Findings
4.2.1 Using Co-Creation as the Cornerstone to Operating the Brands Strategic Marketing ActivitiesThe partners of Sharp had a clear vision of creating an agency distinct from those they had experienced in the industry before. In previous roles, ‘more traditional’ types of research were used when it came to customer engagement. SCS1 specifically referred to these methods to be ‘shallow’ in terms of trying to gain deeper insight, which could unlock great ideas for clients work. The notion that previous methods of working in previous agencies provided inadequate insight on the consumer is a view supported by Ballantyne (2004), who discusses the use of Co-Create as a more in depth tool for the gaining of information between those participating.
In the experience of both SCD1 and SCS1, customers gain a great deal from collaborating with their favourite brands. They both highlighted traits such as honesty, and a willingness to listen to their needs, rather than being ignored and only treated as one of a large group as things that are important to customers. There are many instances in the literature researched for this study which highlight the importance of what customer expect out of today’s brands. Beckett and Nayak (2008) highlight how a mass marketing approach is no longer as of much a viable option for brands as it used to be.
There is also less of an excuse for brands continuing to ignore the needs or thoughts of consumers. Small brands as well as large are now able to
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harness the power of technology, thereby interacting with consumers on an unprecedented level (Addis & Holbrook, 2001; Ballantyne, 2004). Technological factors such as social media were cited in the interviews as key reasons as to why there is a better opportunity for more in depth engagement.
The role of technology has clearly enabled more engagement with consumers, but there are other important factors which have influenced the development of the brand-consumer relationship. The data collected shows that confidence amongst consumers has been a real driving force behind consumer power. There is a strong consensus amongst the respondents that increased access to information and the ability to share information has given rise to such phenomena as consumer communities, consumer generated content, and consumer ownership of brands. This has handed more power to consumers bringing more equality to the marketplace, as consumers feel more at ease with the concept of being able to ask for what they want from brands, as well as having a platform to use their own ability to create a meaningful influence on brands (Promise, 2009). The issues of increased consumer power and the consumer’s new found confidence to contribute are closely linked to technology, as this has provided a platform for these factors to develop as described in the literature by Mainwaring (2011), as well as Addis and Holbrook (2001).
Both SCD1 and SCS1 agree that increased consumer power is a positive thing for consumers, but a note of caution was also apparent in the responses. The idea that brands need to look carefully at how they deal with this change in power, should they embrace it or try to claim back some of this perceived loss of power? The general consensus is that brands need to embrace it, and importantly, listen to consumers more than they have ever done previously in order to harness the great potential this has. Prahalad and Ramaswamy (2004) have written extensively on the
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benefits of interaction between the two parties. They have reached the conclusion that only in-depth interaction can satisfy the needs of today’s modern consumer.
In order for brands to fully adopt Co-Creation there has to be a substantial willingness to do so. In the experience of the respondents, their encounters with a brand’s willingness in adopting this methodology has shown that they were either skeptical, or that they were unsure of how to get closer to their customers. However, they all agree that once brands have looked deeper into Co-Create and gained a better understanding of how it can improve their business, the brands have become excited about its potential.
4.2.2 The Co-create Process and it’s EffectsThe respondents opinion of Co-Create is varied in terms of what they look to get out of the sessions, but the planning of a Co-Create session clearly dependent on the brand and its particular needs. SCD1 states that their needs to be a clear objective for the session, allowing the brand to measure how successful the session was in order to fulfill a particular campaign brief. SCS1 highlights the ingredients which will allow for a successful Co-Create session are ensuring the ‘right’ people attend, developing a succinct and easy to understand set of tasks for the session, and, importantly, ensuring there is a fun and engaging environment to put participants at ease. Both agree that the sessions must encourage participants to interact fully and become completely engaged with the brand. This will provoke meaningful conversations which are needed to gain insight from consumers. This is highlighted by Bhalla (2011) as an important element to the Co-Create process.
The general consensus from the interviews were that the effects of Co-Creation are significantly different for all involved, these being the brand,
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consumer, and the agency. In this study the agency was Sharp. For the agency and brand in particular, it will provide great insight into what consumers think about a brand as well as what these consumers would change if they had control. This will subsequently provide an agency like Sharp with a wealth of tools at their exposure to produce work that is more relevant, and work which can speak to consumers in ways other forms of communication may not. This again relates to how Co-Create can be used as an insight tool, and how it is then used by agencies like Sharp to aid them in the campaign development process (Ballantyne, 2004). In fact, insight was regarded as the most important thing the respondents wanted out of each session.
The Co-Create sessions are usually attended by a number of employees from the brand, which means the session will give the employee the chance to learn from and interact directly with their consumers. When a brand has attended a session, it has at times resulted in them gaining a lot of information about their brand which they had not considered previously. One case for Co-Creation was suggested from SCS1 is that brands are getting value for money from these sessions as they are essentially getting market research as well as idea from one session.
What consumers can gain from these sessions is a renewed sense of passion or loyalty towards the brand. This results from a brand using their time and resources to actively engage with its customers in more in depth ways than other forms of consumer participation, such as focus groups. The overwhelming feeling in these sessions was that participants were encouraged by the genuine want of a brand to hear customer’s opinions and to work with them as partners in projects or on a more long term basis. The respondent’s also discussed how many participants are already ‘brand enthusiasts’ or are converted to ones after the session. This highlights how Co-Create can create value between a brand and its
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consumers. The literature researched in this study has repeatedly emphasized how engagement and collaboration between the two parties will create value and so produce fruitful long-term relationships (Prahalad and Ramaswamy, 2004).
In regards to the question of whether Co-Creation delivers competitive advantage, the overwhelming opinion is yes. This is because both brands and consumers are craving for ‘relevance’ in their relationship, which is main motivation for both SCD1 and SCS1. This matter is discussed at length by Rust, Moorman & Bhalla (2010), who highlight how consumers crave the information they are given by brands to be relevant to them. They also discuss the issue of mass marketing which was discussed in both the literature review and earlier in this chapter. The opinion on how Co-Creation can deliver value and long term relationships is also an important driving force behind how the methodology can deliver competitive advantage. The respondent’s opinion that brands which use Co-Create are showing customers they value their opinions and are willing to invest in order to gain customer satisfaction in terms of products, services, and communication mirrors the literature of Bendapudi & Leone (2003).
4.2.3 The future and Potential of Co-CreateThe data gathered from the respondents puts the future and potential of this methodology in the hands of two main elements, these are further acceptance by both brands and consumers, as well as further advances in technology.
There are clear indications that companies are beginning to take notice of what Co-Creation can do for them. Both respondents were asked to name a company that came close to being truly ‘consumer centric’ and both responses were Threadless.com a company that has been mentioned
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before in the literature (Schau, Muniz & Arnold, 2009). The existence of companies like Threadless.com are a clear indicator that successful companies can be built purely around customer as co-producer. SCS1 also highlighted the coffee shop brand Starbucks that created the mystarbucksidea.com, which was a platform for customers to put their own ideas of how to improve their own experiences at the Starbucks outlets and then vote on their favorites (Ind, Fuller and Trevail, 2012). Famous industry developments such as loyalty cards can be traced to the mystarbucksidea.com project (mystarbucksidea.com, 2012).
5.0 Chapter 5: Conclusion
5.1 IntroductionThis chapter will form a conclusion of the study in order to demonstrate that the original goal of the study has been achieved. The secondary research included in the study has covered the topic of Co-Create directly as well as the contributing factors that surround Co-Create. As Co-Create is not as well known as other areas of business and marketing, the intention of the study was to introduce the concept of Co-Create, examine the factors which have helped it’s development, and study what effect this methodology can have on the industry. The primary and secondary research included in this study has been used to provide information to allow a discussion of Co-Create. They have also been used to suggest how this subject can be researched further due to Co-Create being an under-researched subject; this study should be used as a starting point for further research.
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5.1 Conclusions on the topic of Co-CreationIt is clear that without the ‘modern consumer’ Co-Create as we now know it would not exist. The literature has discussed at length how consumers are now more connected to each other, more informed, and more confident. This change has led to consumers expecting more from brands (Prahalad and Ramaswamy,2004; Bhalla, 2011). There has been a seismic shift in how companies provide for their customers. They are now not only providing products they think customers will want, but actually interacting with customers, and developing products alongside them in order to maintain the relevance of their brand (Cove and Dalli; Kitchen, 2010).
The modern consumer is a major influence behind the emergence of Co-Create, but the primary and secondary data gathered in this study demonstrates that it is technology which drives the modern consumer. There is an extensive body of literature on how technology has transformed modern advertising and marketing, including Prahalad & Ramaswamy (200), Rust, Moorman & Bhalla (2010), and Mainwaring (2011). These authors have stated how technology, and in particular the internet, have provided a platform for consumers to impose a significant amount of influence on brands, as well as opening doors to developing relationships. There are many examples of brands using the Internet, in particular social media sites such as Facebook and YouTube, in order to provide forums for communication between the two (Chu and Kim, 2011). The literature also focuses on Nike and Timberland, as both these brands use the Internet to engage with a loyal customer base (Ramaswamy, 2008; Timberland, 2012).
In an age where most industries and markets are becoming increasingly saturated with infinite levels of choice, the research conducted for this study demonstrates that consumers are not ‘sheep’ and do not expect to
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be treated as such. Mass marketing communications are wasted on consumers because they have grown accustomed to an intense level of personalisation and are tired of the abundance of choice available to them (Prahalad & Ramaswamy, 2003; Schwartz & Barry, 2005). The insight gaining potential of Co-Create is a definitive solution to this, as it allows agencies or brands to take the opinions and ideas of consumers and produce work which is more relevant, thus making it more personal to the consumers.
As discussed in both the primary and secondary research, Co-Create is not merely a market research tool. It is a working methodology that if fully embraced by an organisation, can shape its whole operation around what is most important to its survival its customers. By having this close collaboration between the two parties it will create value, and most importantly this value has the potential to last significantly longer and be more profitable than a brand which only hold passive relationships with customers, merely concerned with hunting for the next sale. The literature has spoken extensively about the Co-Creation of value (Prahalad & Ramaswamy, 2004), this phenomena is closely linked to the quality of relationship that exists between the consumer and the brand. The quality of these interactions will depend on the philosophy of the company. For example Rust, Moorman & Bhalla, (2009), discuss how a company can be described as one which ‘cultivates customers’ meaning that it looks to acquire relationships with consumers rather simply looking for the next sale at any cost. This approach of putting such a high importance on building relationships will contribute significantly to the Co-Creation of value.
Models such as the Bhalla (2011) model, and the DART analysis (Ramaswamy, 2008), are important to consider when determining whether or not a brand is operating collaboratively. The Dart model highlights the
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criteria to consider in order to ensure a brand is truly working with consumers on a equal footing. However, what is particularly important about the Bhalla model is how it makes particular reference to ensuring that the outcomes and the findings of the Co-Creation process are implemented either internally or externally. This is very important as despite brands and consumers knowing more about one another, the success of this methodology very much depends on both parties willing to take action in order implement the outcomes.
5.2 Limitations of the StudyThe study has several limitations. Firstly, the primary research was conducted using a small sample population. It was limited to this small sample as it used one agency, as in the experience of the author Sharp had all the necessary expertise within the organisation to be able to gather enough data for the study. This means it can be difficult to draw a more general industry wide conclusion for this study, but due to the under-researched nature of the topic this was in the best interests of the study. Also, the semi-structured interviews which were used cannot deliver the same level of in depth data as would come from a more developed interview form. There were also issues of the extended periods of time needed for the interviews, as though participants were willing to take part they did have time constraints.
All of these constraints can be dealt with, but unfortunately are not feasible for the author to do so at this time. The main reason for this is the length and timescale placed on the authors dissertation.
5.3 Further Investigation into the StudyEven though the topic of this study can be considered to be under-researched due to its clear potential to have a significant impact on the future of the industry there is significant ground for further study on this
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topic. Any further research on this topic must not include the limitations that this study has faced.
Future research on the topic can include additional agencies and brands that use Co-Create as a methodology as well as those who do not. Also, the use of consumers in the research would help to give another point of view to the analysis and conclusion stage.
Areas that show significant potential in where the subject areas can be further investigated would be what is the future of Co-Create? And, how far the collaboration between the brand and the consumer can be taken? It is clear from the study that pioneers in the subject area, such as Sharp, Threadless.com, and Starbucks have set the benchmark for what can be achieved in the area of Co-Create, but the impact on the industry and the extent to which it can reach is yet to be identified.
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Appendices
Appendix A - Reflective Statement
Appendix B - Interview responses from SCD1 (The Sharp Agency Ltd)
Appendix C - Interview responses from SCS1 (The Sharp Agency Ltd)
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Appendix A - Reflective Statement
As an advertising student and being on an industrial where Co-Creation was my first taste of working in advertising it was only natural I was going to choose this particular topic for my dissertation. It was a topic that initially interested me and which although had been introduced to was something I knew a small amount of background knowledge on. Although I was aware of Co-Creation and collaborative marketing, I knew very little about the background knowledge and theory which make up the topic. This meant that I needed to go right back to the beginnings of Co-Creation in marketing and advertising however this came as no chore as it was a topic I enjoyed it came as particular interest to me.
Conducting my primary research was very successful. Obtaining the select number of interviews not only provided me with viable and reliable results but helped me immensely when it came to analysing my findings. My findings not only allowed me to draw conclusions on my hypothesis indicated before the research but also brought to light evaluations of other areas which were not previously foreseen. My conclusions and evaluations supported by my research provided an in depth understanding of the effect Co-Create has on the industry.
on reflection the study was a very fulfilling and enjoyable experience. I now have a greater understanding of Co-Create and the important factors surrounding it.
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Appendix B - Interview responses from SCD1 (The Sharp Agency Ltd)
Introduction
• When forming Sharp was it your original goal to build an agency based around a ‘Co-Create’ methodology or has it developed since the agency was founded?
• Looking back to your previous experiences in the industry and the way you approached delivering client work, what were the key stumbling blocks you felt that pushed you towards a more collaborative style of working?
Consumers and Brands
• Drawing on your experiences of working with consumers and yourself as a consumer, what has change for you in how you can interact with brands?
Response:
Not specifically. We did have a focus on close collaboration with clients, so the way of working had started and then grew to wider stakeholders and although we were co-creating we didn’t decide to call it co-create until about a year later, and it soon became clear to us that this was a methodology that we should build the business around.
Response:
In the other agencies I worked for they did have their methodologies of working, but the only customer involvement tended to be traditional research. It always surprised me that this was the case and conversations at SHARP about this aspect of other agency methodologies was part of the thinking that led us towards co-create as our USP.
Response:
The consumer has changed. They used to be passive and now they have a voice like never before. And they love to share their ideas and are developing a new type of relationship with brands that are open to their involvement.
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• What do you think consumers expect from the favorite brands with regards to their relationship?
• Do you agree with the statement that consumers have more power than ever before and if you do you think this is a good thing?
• In your opinion why do you think such things as Consumer Communities, Consumer Generated Content and consumers who have a sense of ownership of brands have developed over recent years?
• What are your opinions on how influential these three factors are?
Response:
They expect to be listened to, and reject brands that don’t care what they think.
Response:
Yes I agree and it’s a good thing for sure.
Response:
The ease of how consumers can now become involved through social media has created in many consumers and addiction of involving themselves in communities of like minded people.
Response:
It simply can’t be ignored.
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• How do you think brands should deal with the apparent loss of control of what information consumers are subjected to?
• Do you feel or have you experienced first hand apprehension from brands about working more closely with their customers?
Co-Create
• Could you take me through how you would design a Co-Create session for a client and what things you take into consideration?
• As Creative Director how does Co-Create impact the work you produce for your clients?
Response:
The brands need to listen carefully, and then take part in the conversation to ensure that they act in the best interests of their customers.
Response:
At first they are unsure, but once they realise how they can become part of the conversation they seem quite keen to get involved.
Response:
Their needs to be a clear Objective and a focus on what the output needs to be. Every session is individually planned around the objective and outcomes, so each session is different.
Response:
It provides insights that wouldn’t normally be available so in that respect it helps fuel more relevant work.
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• When starting a Co-Create session what is the one thing you are looking for to come out of the session?
• From your experience of the Co-Create sessions,what do you think the participants get out of the experience and do you think it that their attitudes towards the brand change as a result of being part of the sessions?
• And similarly what do you think your clients get out of the sessions?
• By looking on your website is it safe to say that Co-Create by Sharp is primarily a methodology that can help the work you produce for your clients resonate with its target audience more accurately?
Response:
Fresh insights.
Response:
We find that they have a really rich experience. Contribute in a way they never imagined, and seem to be fans of the brand when they leave!
Response:
Clients are always refreshed and encouraged by what they hear.
Response:
Yes.
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• So it is safe to suggest that in your opinion by using Co-Create by can cut down in what some may consider to be the risk involved in communicating with consumers?
• How do you feel Co-Creation can deliver competitive advantage to those brands who operate this way?
The Future of Co-Creation
• Where do you see the potential or direction you wish to take Co-Creation developing over the next few years?
• What is your idea of a truly ‘consumer centric’ organisation and can you think of any brands that are or come close the the concept of a business totally centered around its customers?
Response:
Yes.
Response:
It provides them with relevance.
Response:
I think it will mature as an idea, and become more acceptable. More examples of success will start to find their way into the market and more brands will start to consider it.
Response:
A truly consumer centric brand is one that listens, understands and delivers for its customers.
Threadless.com
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Appendix C - Interview responses from SCS1 (The Sharp Agency Ltd)
Introduction
• When forming Sharp was it your original goal to build an agency based around a ‘Co-Create’ methodology or has it developed since the agency was founded?
• Looking back to your previous experiences in the industry and the way you approached delivering client work, what were the key stumbling blocks you felt that pushed you towards a more collaborative style of working?
Response:
No. the agency’s philosophy has been, since the start : Ideas that make things happen. And this idea ‘happened’ to us when we were working on a particular project for the NHS Sheffield. It was a tough project …. And we decided that the best way to tackle an ‘image campaign’ to promote NHS Sheffield, was to develop the very earliest ideas together with people of the city itself. And though we didn’t know it then – Co-Create, now the centre of our universe, was born!
Response:
Agencies usually get away with a rather shallow understanding of a brand’s audiences, their triggers and motivations to buy/download/donate…. And even when there are research reports and data analytics to work with, these are not nearly as powerful as a Co-Creative process actually involving the audience/s in idea generation from the start.
This is what is fresh and exciting about it.
The investment of time and insight is upfront. It removes guess work. Its more rigorous.It gives greater confidence that you will engage the audience more effectively.
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Consumers and Brands
• Drawing on your experiences of working with consumers and yourself as a consumer, what has change for you in how you can interact with brands?
• What do you think consumers expect from the favorite brands with regards to their relationship?
• Do you agree with the statement that consumers have more power than ever before and if you do you think this is a good thing?
• In your opinion why do you think such things as Consumer Communities, Consumer Generated Content and consumers who have a sense of ownership of brands have developed over recent years?
Response:
The world has changed. I think 2 things have driven this : Technology and confidence. Technology (Web 2 and 3!) enables social engagement, influence and creations of things meant to be shared. And an increasingly confident base of consumers who know that their opinion matters ( to brands and to other users) and that they exert immense power (good and bad) especially when they act in communities.
Response:
Honesty. Endorsement by other consumers (validate that its thought to be good). Entertainment.
Response:
Yes. And yes. But brands need to understand how to work with this.
Response:
Technology and confidence.
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• What are your opinions on how influential these three factors are?
• How do you think brands should deal with the apparent loss of control of what information consumers are subjected to?
• Do you feel or have you experienced first hand apprehension from brands about working more closely with their customers?
Co-Create• Could you take me through how you would design a Co-Create
session for a client and what things you take into consideration?
Response:
Immensely powerful. Especially where consumers CARE about the subject/brand.
Response:
Its not loss of control. Its about interested, ‘hungry’ consumers creating content and sharing what appeals to them, essentially ignoring stuff that is not real or interesting.
Response:
Clients all want to get closer to their audiences. Many don’t know how to do it. Co-create is an easy, non threatening (and cost effective) method – it can be trialled with just 1 session.
Response:
3 important aspects. 1. Getting the right people to attend. 2. Getting a succinct, easy-to-understand set of tasks 3. Inspiration and fun (the room/tools to work with etc)
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• How does Co-Create impact the work you produce for your clients?
• When starting a Co-Create session what is the one thing you are looking for to come out of the session?
• From your experience of the Co-Create sessions,what do you think the participants get out of the experience and do you think it that their attitudes towards the brand change as a result of being part of the sessions?
• And similarly what do you think your clients get out of the sessions?
Response:
A big shift. The insights last for months and can be drawn opon for a series of campaigns.More important though – the campaign results are showing that co-created projects are more effective!
Response:
Interest. Engagement. Understanding of the audience. Brilliant ideas. (ok that’s 4!)
Response:
Yes. Participants tend to become ‘brand enthusiasts’ after a 4 hour session – even if they came into it a little skeptical / cautious of the brand - if we have recruited based on audiences that we believe have the potential to like a brand!
Response:
Excellent value for money (research and ideas in one!). Confidence to steer/approve a campaign that develops as a result.
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• By looking on your website is it safe to say that Co-Create by Sharp is primarily a methodology that can help the work you produce for your clients resonate with its target audience more accurately?
• How do you feel Co-Creation can deliver competitive advantage to those brands who operate this way?
The Future of Co-Creation• Where do you see the potential or direction you wish to take Co-
Creation developing over the next few years?
Response:
Yes. Our experience and capability is making Ideas that work. Doing this in a way that engages key segments of the audience in the original ‘idea seed’ development (them and us) is just a better way than doing it on our own.
Response:
It just gives the edge. In a highly competitive world where brands are desperate to be more relevant (data driven etc) and engaged (social media/gaming/apps etc) – Co-Creation says to audiences – ‘we value your thoughts and ideas….. and will invest in these to make more customers like yourselves satisfied’
Response:
Co-Creation across the globe – working out how we do it more online/virtually (note –this is distinct from crowdsourcing ideas as per mystarbucksidea ….)
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• What is your idea of a truly ‘consumer centric’ organisation and can you think of any brands that are or come close the the concept of a business totally centered around its customers?
Response:
Truly consumer-centric is working with consumers NOT just for their review mirror behaviors (typically what data analytics and research does) but also for their FORWARD behaviors and ideas of how to encourage more people to connect with the relevant brand…..
I think mystarbucksidea is very engaging and customer-centric. Threadless is great example, all products are made and voted for by customers…
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