Customers In Product Development Research Articles

Product Development in Crowdfunding: Theoretical and Empirical Analysis

Problem definition: Crowdfunding goes beyond raising funds. Entrepreneurs often use crowdfunding to solicit feedback from customers to improve their products and may therefore prefer to launch their crowdfunding campaigns using basic versions of their products with fewer features. However, customers may not be persuaded by a campaign if the product appears to be underdeveloped. In view of this tradeoff, a key question for entrepreneurs is how much to develop a product before launching a crowdfunding campaign. Methodology/results: Analyzing a game-theoretical model and testing its predictions empirically, we study (1) how the development level of a product at campaign launch, measured by the initial number of product features, influences whether customers will make comments that help entrepreneurs improve the product; (2) whether entrepreneurs continue to improve the product during the campaign; and (3) whether the campaign is successful. We show that, as the number of product features at campaign launch increases, the likelihood that customers will make comments and that the product will be improved during the campaign first increases but then decreases. Furthermore, the likelihood of campaign success first increases but then decreases with the number of product features at campaign launch. Finally, by analyzing the interactions between customer feedback, product improvement, and campaign success, we show that customer feedback motivates entrepreneurs to improve the product during the campaign. Moreover, entrepreneurs should take account of the initial number of features and customer feedback when improving the product, because otherwise product improvements can harm campaign success. Managerial implications: Our study provides practical insights on how entrepreneurs can use crowdfunding to aid product development and improvement. Specifically, entrepreneurs should avoid overdeveloping their products before crowdfunding campaigns because, as well as decreasing the chance of campaign success, this could hinder their ability to save development costs (e.g., market research costs) through involving customers in product development. Supplemental Material: The online appendices are available at https://doi.org/10.1287/msom.2022.0344 .

Co-creation with Customers in Product Development and Services: An Empirical Analysis for Competitive Advantage

Co-creation with Customers in Product Development and Services: An Empirical Analysis for Competitive Advantage

Gaming the system

Purpose of this paper Reviews the latest management developments across the globe and pinpoints practical implications from cutting-edge research and case studies. Design/methodology/approach This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context. Findings One of the features of modern business is the increased involvement of customers in product and service development. Managers are consistently being told to engage with customers more and create a feedback loop so that what they develop can be enhanced. Articles in glossy executive magazines recommend this approach; product managers recommend this approach; it seems that any firm that did not include its users in enhancing its latest offering is doomed to failure. And yet, what evidence are there that such approaches actually benefit the bottom line? Like many developments in corporate culture previously, does the inclusion of customers in product development make sense, or is it simply another corporate fad? Practical implications Provides strategic insights and practical thinking that have influenced some of the world’s leading organizations. What is original/value of paper? The briefing saves busy executives and researchers hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and easy-to-digest format.

Interactions and Participation on Social Commerce Websites: Exploratory Study

An increasing number of organizations are adopting social commerce (SC) to engage and occupy customers in product development, sales and support activities. Therefore, it is imperative for retailers and marketers to know customers’ adoption behaviour towards SC websites and the benefits they gain through voluntary contribution of information on these websites. The study attempts to identify customer participation through development of a conceptual framework based on the uses and gratification (UG) approach. The importance of non-altruistic motives, that is, benefits shape member’s participation on SC websites, is confirmed by results. According to the results, two interaction characteristics, that is, human interactivity and member identity are essential for building trust in SC website. Findings of the study also conclude that interaction characteristics strongly affect three benefits, that is, personal integrative, social integrative and hedonic. Hence, it is implied that benefits gained by members on SC website interactions shape their participation intentions. Therefore, SC websites must be designed keeping in view both usage and benefits by members.

Customer involvement, fashion consciousness, and loyalty for fast-fashion retailers

PurposeThe purpose of this paper is to investigate how customer involvement in product development creates an emotional connection, satisfaction, and subsequent loyalty toward fast-fashion retailers across high vs low fashion-conscious consumers.Design/methodology/approachBoth qualitative and quantitative methods were used to gain understandings of the impacts of customer involvement. To explore customers’ general perceptions of fast-fashion retailers, a focus group interview with 11 US students was conducted. Data for a hypothesis test were obtained from 306 US female consumers and analyzed through structural equational modeling.FindingsThe findings underscored the relational benefits of involving customers in product development and the substantial moderating impact of female customers’ fashion consciousness.Practical implicationsThe study’s findings support that the customer-brand relationship can be solidified by proactively involving customers in product development. This is beyond benefits derived from leveraging customers’ operant resources in product innovation. Thus, apparel retailers should take such interactive opportunities to build relationships with customers. Also, involving customers in product development can be a critical way for fast-fashion retailers to establish an emotional bond with and loyalty from consumers with a low level of fashion consciousness. Thus, any digital opinion platform designed to foster customer involvement should be managed with the customer-brand relationship in mind.Originality/valueThis study contributes to the emerging body of literature on customer involvement in product development in fast-paced retailing by elucidating the psychological process through which their participation strengthens the customer-brand relationship manifested in emotional, evaluative, and behavioral responses to the brand, and by identifying a consumer attribute that fortifies this process.

Business creation in networks: How a technology-based start-up collaborates with customers in product development

This paper deals with business creation in networks by setting the focus on how technology- based start-up companies collaborate with customers in product development. The aim is to analyze the pattern of customer collaboration by using the industrial network approach as theoretical point of departure. The method consists of a process-based single case study. The focal case is Oxeon, a Swedish rapidly growing university spin-off company commercializing a new technology for making carbon fiber composites. The development of products and applications has taken place in close collaboration with their customers. The paper addresses three research issues, which are related to the timing, mutuality and organizing of the collaboration. The analysis of the Oxeon case results in identification of five crucial aspects on the management of customer collaboration: (i) the need for involving customers early, (ii) the choice of application areas, (iii) the mutual process of choosing and getting chosen as collaboration partner, (iv) the external networking role of the start-up, and (v) the internal organizing of the start-up in relation to its ambitions for external interaction with customers. The results are summarized by formulating a set of propositions that can be taken as starting point for further research.

Marketing strategy and customer involvement in product development

PurposeThis paper aims to investigate the impact of a firm's marketing strategy on involving customers in new product development. Special attention is to be paid to three facets of a marketing strategy: product differentiation, competitor orientation and brand profiling emphasis.Design/methodology/approachA survey with quantitative questionnaires was used in the context of relationships between Norwegian suppliers and international buyers.FindingsTwo facets of marketing strategy, product differentiation and competitor orientation, positively impact customer involvement. Furthermore, specific investments dedicated to the relationship are also positively related to customer involvement, and customer involvement increases customer profitability.Research limitations/implicationsThe study relies on data from the suppliers, and future studies should also include customer data to explore possible effects of the customer's marketing strategy on joint involvement in new product development.Practical implicationsThe study shows that managers seeking to involve customers in product development should carefully develop their marketing strategy and build commitment through specific investments.Originality/valuePrevious studies show that firms can benefit from involving customers in new product development. This paper extends knowledge in the field by exploring how different facets of the firm's marketing strategy can increase or decrease the possibilities for involving customers.

Different Roles, Different Strokes: Organizing Virtual Customer Environments to Promote Two Types of Customer Contributions

In recent years, many companies have established virtual customer environments (VCEs) that offer facilities ranging from online discussion forums to virtual product design centers to partner with their customers in product development and product support activities. In this study, we focus on one form of VCE, online customer forums, and propose that the relevance of four distinct theoretical perspectives—social capital theory, social exchange theory, involvement, and social identity theory—to explaining customer participation will be contingent on the nature of the customer contribution context, that is, whether the contributions are to the customer community (through product support) or to the company (through product ideation). We propose a model suggesting that customers' prosocial behavior and expectations of private rewards will shape contributions to the community, whereas their perceived innovation partnership with the company and expectations of private rewards will shape a contribution to the company. We also contend that these effects will be moderated by customers' identification with the community and with the company. Our empirical findings offer support for the model and indicate that online customer forums (and more broadly VCEs) should be tailored to fit the nature of customer contribution sought. Implications for research and practice in customer co-innovation, online peer-to-peer communities, and customer relationship management are discussed.

Virtual Customer Environments: Testing a Model of Voluntary Participation in Value Co‐creation Activities

An increasing number of firms are hosting virtual customer environments (VCEs) to involve their customers in product development and product support activities. While the benefits to companies from hosting such VCEs are clear, another closely related issue has received far less attention: Why do customers participate voluntarily in value cocreation (here, product support) activities in such virtual customer environments? This study seeks to answer this question by developing and testing a conceptual model that draws on the uses and gratifications approach to consider an integrated set of four benefits that customers gain from their interactions in VCEs. The research model also incorporates the interaction‐based antecedents of these customer benefits. Drawing on concepts and insights from the areas of computer‐mediated communication and brand communities, the key characteristics of customers' interactions in the VCE are identified and related to the aforementioned four types of benefits. The study hypotheses are tested using data collected from customer participants of the VCEs of two firms, Microsoft and IBM. The dependent variable, customers' actual participation in the VCE, is operationalized as a time‐lagged variable, and the data for this are sourced from the Netscan database. Results offer strong support for the model and indicate that customers' participation in product support activities in a VCE is motivated not just by their “citizenship” or norm‐related behavior but stems primarily from their beliefs concerning the benefits of engaging in such activities. Results also show the impact of key interaction characteristics of VCEs on such perceived benefits and imply the need for firms to carefully design their VCEs to enhance customers' perceptions regarding potential benefits. The research model and the findings hold important implications for research and practice in customer coinnovation and product development. The model provides the basis for identifying the appropriate set of VCE design features. Companies can test the efficacy of their VCE design features by focusing on how such features augment the four types of benefits discussed and thereby ensure continued customer participation. The study findings also hold broader implications for practice in the customer relationship management area, particularly with regard to the potential to combine customers' VCE interactions with appropriate offline product‐related activities and to view the VCE as an integral element of the firm's overall customer relationship management initiative.