Variety is the Spice of Innovation: Mediating Factors in the Service Idea Generation Process

Abstract

To create a breakthrough service innovation, firms need to go beyond current customers' needs and tap into the needs of the future market. As marketing theory favours customer‐centric approaches, customer‐led ideation and co‐creation of innovation seem natural candidates for extracting the ‘sticky’ information nested in some of the most innovative customers' minds. Grounded in the service innovation literature, this paper extracts innovative service ideas from ordinary users (n = 388) in three different service domains and seeks to identify the salient characteristics of the most innovative customers. Past research shows that innovative users are more likely to be service defectors, frequently switching from firm to firm, and motivated by their predisposition to seek variety. Using a structural modelling strategy, variety seeking is tested as a mediating factor between the subjective knowledge level and the presence of high level unmet needs leading to the generation of innovative service ideas. The results show that variety seeking fully mediates the relationship between subjective knowledge and unmet needs. Several interpretations of the role of variety seeking on customers' behaviour are explored within the context of capturing innovative service ideas.