Customer co-creation is a powerful technique through which customers and vendors can jointly work together to create value.
I define this as “the purposeful action of partnering with strategic customers and employees to ideate, problem solve, improve performance and/or create a new product, service or business.”
Today, almost two decades after customer co-creation was introduced as an academic concept by Venkatram Ramaswamy and the late C.K. Prahalad of the University of Michigan Business School, this promising process is finally finding its way into the mainstream.
Co-Creation Creates Value
Companies as diverse as Zappos, DHL, The LEGO Group and Starbucks are now working with customers to engage them in everything from product creation to corporate strategy.
Yet the prospect of sharing the kind of detailed strategic and financial information necessary to interact openly and transparently with your top customers can be daunting.
Breathe easy. Your company can start harnessing the power of customer co-creation in a way that’s a lot less intimidating — by better understanding the customer experiences your company provides.
That’s because consistently delivering the kinds of customer experiences that create value are key to building trust and credibility. And creating those high-value customer experiences in turn creates a virtuous cycle: When you invite customers to help your company in more strategic areas, your trust deepens those customer relationships by expanding engagement, encouraging accurate and truthful interactions and improving product performance.
Start with Qualitative Journey Maps
You can begin a customer co-creation initiative by taking three steps that invite your customers to work with you to create better, more valuable customer experiences:
- Use qualitative interviews to develop detailed “outside-in” journey maps — both pre- and post-purchase — for each key customer segment.
- Use that interview data to identify key interactions and gaps where the current experience your company is delivering deviates from those journey maps. Often the best way to do this is by putting together a cross-functional team in an internal workshop setting.
- Follow up your internal effort by inviting 6-10 strategic customers to a co-creation workshop aimed at helping your internal team to prioritize and improve the experience gaps. Enlist your strategic customers to help you set new success metrics and targets.
Create Listening Opportunities
Inviting your strategic customers makes a great starting point because they have a vested interest in making the time to participate.
What’s more, implementing what comes out of the workshops demonstrates your commitment to keeping the communication lines wide open and minimizes your risk exposure as a company.
But don’t get carried away and invite every customer to your co-creation workshops. Reserve participation for customers who represent your most strategic future growth market segments. That keeps the number of workshops manageable and your team focused on the right actions needed to move the needle.
Conduct a Co-Creation Workshop
Customer co-creation workshops will be most successful when you:
- Host your customers — all expenses paid — at a nice but not elaborate location. Make sure that you include quality time for customers to network with each other in the agenda.
- Company attendees should be the same people who participated in the internal gap analysis. Make sure that the customer representatives you invite are all peers in terms of responsibility and authority. Ideally, you want to invite two individuals from each company who represent different departments or functions.
- Facilitate your workshop using an expert with deep knowledge and experience in journey mapping, co-creation and customer experience. Remember, your objective is to redefine in detail the highest-value journey.
- Create a learning opportunity for your sales, marketing and engineering departments by inviting them as silent observers.
- After each workshop, have the facilitator share and validate the outcomes with each customer including sharing an implementation plan with milestones, periodic report-outs of progress and questions from customers who participated in the workshop(s).
Customer co-creation is neither a one-time project nor a race to some finish line, but rather a new mindset and company philosophy.
Every company’s co-creation strategy will be different based on its unique market dynamics, organizational culture, competencies and customer segment characteristics.
As you implement the process, feel free to keep what works for you and your customers and discard the rest. And above all, think of best practices as learning opportunities, not a definitive recipe for success.
I liked your article with just one caveat:
It is not always wise to start with your customer when working on improving customer experience. That may be counter-intuitive but here is why:
Don’t ask your customer to help you improve their experience if your organization is not ready to act on the customer feedback. You see, if I am the customer and you ask my opinion, I then give it to you in good faith but then if I see no change and no improvement, then I would wonder how much you actually value my opinions.
Do you see how asking customers to help with CX only works if your business can actually effect positive change ?
Here is a link to an article I wrote on this just recently, together with my suggestions on how to solve this challenge, ity is called “How NOT To start Customer Experience Initiatives.”
Hi Peter, Great point. It is assumed that companies who embark on co-creation have a commitment, the resources and the closed-loop communication processes established to act on the outcomes. I am, however, glad that you called this out in case reader did not have this assumption.
More than that, I have actually seen organizations that have spent quite a lot of money on NPS but then did not know what to do with the score other than to aim to “do better next year”.
Thank you for your great article.