THE MOST DESIRABLE LEVEL OF CONSUMER INVOLVEMENT:
FURTHER INSIGHTS INTO THE STAIRWAY TO HEAVEN.
By
Bianca Kistemaker 14-08-2014
MSc Strategic Innovation Management University of Groningen
Supervisor: Jo van Engelen Second supervisor: Rene van der Eijk
Word Count (Not including references and appendices):
12.843 Words
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CONTENT
ABSTRACT………3
INTRODUCTION………4
LITERATURE REVIEW………..……….7
METHODOLOGY………..……….18
RESULTS………..22
CONCLUSIONS………...…29
DISCUSSION……….33
LIMITATIONS AND FURTHER RESEARCH………..35
REFERENCES………36
APPENDICES………40
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ABSTRACT
This research looks into the way companies and consumers interact and co-create. Nijs (2013) introduces an method where customers, in step 4, initiate co-creation and become part of an emergent organization. This thesis investigates whether this type of involvement is most beneficial
compared to three relationships with less involvement. Secondly, it is expected that community building, social media and Word of Mouth are present in the interaction as proposed by Nijs (2013). These are already present in the other three interactions. The results show that more
involvement may not always be most preferable and only community building seems to be relevant for this highest interaction. This leads to several suggestions for further research.
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INTRODUCTION
Academic articles often start off with one or two sentences on the rapidly changing world. This global phenomenon is affecting every discipline and every kind of research. This thesis starts off with this same statement on a rapidly changing world as it is a critical aspect behind this research. Our world today is getting smaller and smaller and one of the reasons for this phenomenon is a more connected society, as 'we live in an age of ever-increasing global connectivity and integration, facilitated by the availability of open standards and a robust information infrastructure provided by the Internet' (Salisbury et al., 2011).
Information that someone possesses can be transferred to the other side of the world within seconds. This provides consumers, businesses and stakeholders with the opportunity of collecting more information and exchanging this information more easily with others (Hajli, Hajli, 2013). In order to cope with this increasing interconnectedness, firms need to approach their way of doing business differently. One aspect of the company where this different approach needs to be implemented is in the way they interact with their customers. More and more customers want to be engaged in the development of products, services and the company itself. This co-creation can take multiple forms, such as on line platforms to generate feedback from customers (Huertas et al., 2013).
While searching through the marketing literature, different types of relationships between a customer and a company can be identified which are established through the buying decision of a customer. Three of them are highlighted in this thesis. Firstly, a customer can buy a product once. This is often a impulse buy and does not mean that there is any real bonding between the customer and the company. When this bond is present, a customer will probably re-purchase from the company. Finally, when the customer is even more committed and enthusiastic about the company, he or she will talk to others to persuade them to buy from the company as well. For every type of buying relationship, different types of co-creation can be used to strengthen the particular relationship. Co-production of a product will increase the chance of a single buy, while evaluations after using a product to adjust it will probably strengthen the bond between customer and company.
Stairway to Heaven
Nijs (2013) developed a new method, where she involves customers even further in the company compared to the co-creation as described above. She points out that customers should not only be asked to evaluate, but could also be the ones initiating a particular movement or feedback moment for the company. An important element is that they can initiate a movement together with other customers as well without the company intervening. A case she provides in her study is the one of Veritas, a Belgian retail-chain, where she points out that 'The method proved to be very effective in ‘revitalizing’ the organization by making it
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open to its environment and by liberating collective creativity at the same time.' (Nijs, 2013). The method which she refers to is a model she calls the Stairway to Heaven. This model shows how a company can move towards a strategic intent in 8 steps. Customers are not the only ones that are included in this model as cooperating with the company. Other examples are the employees and other stakeholders such as suppliers.
This thesis however focuses on the changing relationship between customers and a company. The focus of this research lies on step 4 of the Stairway, which focuses on the action taken by consumers.
With the Stairway to Heaven, Nijs (2013) introduced the movement towards an emergent organization, 'an organization that is able to function well in a more complex and open context. While the organization builds value for society in a very dynamical way, many stakeholders start to think about co-creation with the organization as to create synergies that will make themselves more relevant.'(Nijs, 2013). The difference between Nijs (2013) and previous researches in marketing and co-creation is the interaction with the customer. In previous researches, researchers focused on how to get customers to buy a product, while Nijs (2013) identifies customers as being part of the movement of the emergent organization and they can initiate this themselves and most importantly together with other customers. As customers were able to have an influence on the final product, they are more likely to buy the product. In this thesis, this will be addressed as classic marketing and classic co-creation. Co-creation as introduced in the literature could be helpful as this explains the possibility for companies to exchange information with customers and include this in their product or service. This interaction or relationship is taken even further by Nijs (2013) and therefore the question rises whether this method is the answer to coping with the rapidly changing world.
Step 4 of the Stairway to Heaven is the action by the consumer. This thesis proposes that the other three previously mentioned relationships between customer and company, can also be established in this step.
The question rises whether the action as proposed by Nijs (2013) is most beneficial in comparison to the other three relationships based on buying decisions.
Research Question
Due to the increasing connected world, customers can more easily access and exchange information. This has caused to increase the willingness and need for co-creation. Nijs has introduced a new form where customers are even more involved than in classic co-creation. The action taken by customers is explained in step 4, which will be the focus of this thesis. Therefore, the question that is central in this thesis is whether this step as described in the method of Nijs (2013) can be seen as most beneficial compared to the other relationships and thus whether there is actually a hierarchy. This would imply that companies prefer this type of interaction with customers over the other three types of relationships. The action as described by Nijs (2013) includes the most involvement from a consumer. In order to answer the central question this thesis will answer the following sub questions:
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1. What are these four types of buying relationships? What kind of co-creation fits with these relationships?
2. Does every company in every situation try to achieve the action as described by Nijs? Is this type of involvement most desirable in every situation?
3. Can the other three identified relationships achieve the desired or optimal outcome?
4. Assuming there is a hierarchy, do the elements of the first three relationships appear in the fourth relationship as well? Does this mean these elements are needed in order to achieve the optimal outcome?
Structure
The first sub question will be answered in the literature part, where the differences among the relationships will be further explained. The types of co-creation belonging to the different relationships will also be further outlined. The literature review will also already highlight what has been published on the elements that are of importance in the relationships with customers, focusing on sub question 4. Sub question 2, 3 and 4 will finally be answered in the results and conclusion. The results are based on the empirical research performed in this thesis. The research consists of three in-depth interviews which are further outlined in the methodology section. After the methodology, results and conclusions, the discussion part will be presented, followed by suggestions for further research and the limitations of the research.
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LITERATURE REVIEW
This section of the thesis looks into the existing literature. Firstly, a brief introduction of co-creation in the literature will be provided. Afterwards the method called Stairway to Heaven by Nijs (2013) will be further introduced. This method is labeled as co-creation 2.0. The method is discussed in depth because it is
relatively new and not researched before in this particular form. The fourth step in the Stairway to Heaven is action. This refers to an action by a customer and the relationship that is established between customer and company. This thesis suggests that other actions than the one introduced by Nijs (2013) can be taken by consumers, leading to other types of relationships. Through the empirical research, the research tries to find whether the one proposed by Nijs (2013) is most optimal for companies. As explained in the introduction, the main question that needs to be answered in this section is what the four different relationships between customer and company entails and which kind of co-creation is belonging to the relationship.
These four different relationships are not the only four existing in the literature, rather they have been chosen for this research after a literature search. The four relationships will be explained after the introduction of the method by Nijs (2013). After the four relationships are further explained, the first propositions can be proposed. These propositions focus on sub questions 2 and 3. Afterwards, three issues from the literature have been chosen that focus on the final sub question which will lead to the last proposition.
Classic Marketing and Co-creation
As explained in the introduction, the changing world is asking for changes in the approaches by companies.
Co-creation as proposed by the existing literature is a first step in the right direction. Nijs (2013) takes this co-creation further with her approach. However, the existing literature on co-creation will be briefly explained first. This will be called classic co-creation in this thesis, in order to clearly state the differences among this type of co-creation and the approach by Nijs (2013). Internet and social media are drivers of the changing face of the world, which 'is defined as the way in which people interact to create, share, and/or exchange information and ideas in virtual communities and networks' (Katona, Sarvary, 2014). Not only have these channels led to receiving more information, it has also become easier for companies to exchange information with consumers and the other way around. This has led to the development of co-creation, where consumers create products and services together with the company. 'Through co-creation activities, such as events and online communities, organizations can now engage with consumers and explore together with them their emotions, feelings, and memories while generating deep insights’ (Ind et al., 2013). Vernette and Hamdi-Kidar (2013) have recognized this as happening both up-stream and down- stream, where customers join the production process and evaluate the product afterwards in order to improve the product or service. Ramaswamy and Grouillart (2010) mention that individuals are already willing for a long time to co-create and this is the time for organizations to respond to this willingness.
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In co-creation customers and companies together achieve the right product by creating something together that the customer wants to buy. Co-creation is a concept which is researched by several authors. It involves customers, in an active role, creating value together with a company (Kohler et al., 2011; Prahalad and Ramaswamy, 2004). It implies that to create economic value, interactions between consumers and company are taking place instead of focusing on a company's research and development department (Huertas et al., 2013; Cova et al., 2011). Ramaswamy (2013) mentions 'In short, the co-creative enterprise is not so much about ‘‘build it and they will come,’’ but much more about ‘‘build it with them, and they are already there' (Ramaswamy in Leavy, 2013). An example of how co-creation helps companies is when they ask customers to fill in an evaluation on a certain product in order to improve the product which will probably increase their sales. The main question that is asked here is how a company can make sure that a customer will buy a certain product or make use of a service.
The classic co-creation literature, as mentioned above, focuses on one particular question, being how will a customer buy our product or make use of our service? Without co-creation, literature has shown that there are high risks in product development processes. Vargo and Lunsch (2004) noticed that the involvement of customers could be an important source of overcoming the high failure that is associated with new product development. Prahalad and Ramaswamy (2000) started to recognize customers as a potentially critical competence for firms. Crowdsourcing is an example of how to get consumers to actively participate in the process of developing a product. An example of crowdsourcing is McDonald's where customers could design their own burger (Schumacher, Kuester, 2012). Other examples of co-creation are for example on line communities or the previously mentioned evaluation through a survey after a product or service is used.
Nijs (2013) involves customers even further in her approach, as will be explained below.
Stairway to Heaven
As the world is getting more and more connected, the increasing amount of connections is leading towards more complexity. Nijs (2013) proposes a new business logic as an answer to these changes. In order to cope with complexity, the normal linear thinking, planning and controlling is not suitable anymore and according to Nijs (2013) it needs to be replaced by non-linear, new thinking. It is of critical importance that this new thinking will be incorporated by both companies and individuals. Companies need to realize that this new way of thinking brings about new consequences for their way of doing business. Changes take place in their relationship with employees and suppliers and particularly their way of communicating with customers and their customer relationships. In the Imagineering Method, Nijs (2013) created a Stairway to Heaven model in order for companies to take a first step towards this needed change. This Stairway to Heaven involves several steps (figure 1).
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One of the relationships that changes is the one with consumers. Consumers have been able to gather more information than they could previously and more easily share this information with each other, which has led to co-creation as explained above. Nijs (2013) takes co-creation a step further than explained above, which is considered as classic co-creation for this thesis. She recognizes the need for organizations to respond and takes this further by recognizing customers as becoming part of the movement towards an emergent organization. One main difference is that Nijs (2013) explains that consumers will take initiative towards the company themselves instead of only cooperating when asked for. This can also be done together with other consumers, without the company intervening. They will thus initiate co-creation themselves or among themselves. To make sure that the difference is clear in the remainder of this thesis, this will be named co-creation 2.0.
As presented in figure 1, the Stairway to Heaven involves 8 steps. Nijs (20130) explains these steps at the level of an individual agent. The first step is the determination of a narrative or strategic design. This step involves seeing customers as moving from ‘passive customers of value’ to ‘active participants in value creation’’ (Nijs, 2013) on the part of the company. The narrative or strategic design that evolves out of this, will lead to a mind shift within people. Both people inside and outside the company will experience this mind-shift, which will eventually lead to the third step. In the third step actors change their behavior and roles. This role changing leads to action which focuses on the preferred strategic direction. As more people start to take action simultaneously, new behavioral answers will be found and positive feedback dynamics will be established, leading to step five. As the actions are further stabilized, more individuals will start to interpret the narrative and see how they can be part of the movement. This will lead to ‘developing basic principles, values and criteria for participation’. (Nijs, 2013) This is considered to be step 6, the collective action. This collective action will result in an organization that is more suitable to exist in a complex and open context, the emergent organization. Finally, this will lead to step 8, the strategic direction. This is ‘the field of value creation in which the organization can be relevant for society at large in a way that no other organization is able to do so’ (Nijs, 2013).
10 Action
This research focuses on step 4, where the mind-shift and taking on a role will result in the preferred action.
The Stairway to Heaven assumes a mind-shift due to a narrative or strategic design presented by the organization. The organization wants consumers to be inspired by this narrative or strategic design. This would lead to consumers talking together about it and preferably start to take initiative themselves or among customers. The customers will thus be cooperating and co-creating with the company. This mind shift is realized as an organization is moving from a shareholder-orientation to a relevance orientation (Nijs, 2013). This means that a mind-shift is realized from the purpose of the business itself towards a view where the business is seen in a wider perspective. This for example means that societal relevance is as important as the core business of an organization.
The relationship that follows from achieving a mind shift in customers, as proposed by Nijs (2013), goes further than buying a product or making use of a service and is more focused on the long-term. The mind shift can lead to people, in this case consumers, to start thinking about the firm and want to engage in the process, which could lead to co-creation. However, this co-creation goes further than just evaluation or co- producing, as explained above. This would also mean that customers are willing to take own initiative and become part of the movement of the organization, which includes discussing and thinking about it. This would imply that customers want to help a firm out, even when they are not explicitly asked by a company to do this for example through an evaluation of a product. The example of Veritas which was provided by
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Nijs (2013) has been given before. In this case customers can into stores to show the results without being asked to. Thus, customers themselves take steps in order to benefit the company and become part of the emerging organization.
Westerkamp (2014) focused on how a narrative will lead to the preferred mind-shift, which is step one to two. His thesis is based on the same interviews as this thesis. He identifies legitimacy and identification as important in order to achieve a mind-shift in people. However, even when someone identifies themselves with a product, service, brand or company, will this necessarily mean that they will take on a role? And afterwards the preferred action? Or can they also just simply buy the product? An example is Lays, who created a competition to create your own flavor. Many positive reactions were the result and three new flavors came into the stores. However, even though people did send in their suggestions, it stopped after the competition was over. This thus did not lead to consumers taking on a role and action designing the organization together. However, Lays might have had other reasons for the competition and this outcome can be the one they were looking for. The question thus rises whether the action as proposed by Nijs (2013) in step 4 establishes the relationship that is preferred by companies.
Thus, the buying decisions made by customers and the relationship following from this can also take a different form. The following sections will now introduce three other possible relationships between a customer and a company focusing on the buying decision of a customer. These three are not the only types of relationships, rather these have been selected after a search in the literature. Together with the action as proposed by Nijs (2013) four different types of relationships existing out of the buying decisions by
customers are established. All four have a different level of involvement with the company, which was necessary for this research. The type of co-creation possibly involved will also be further explained.
Buying (one specific event)
The first possible relationship is that an organization offers a product or service and possibly sets out a marketing campaign, leading to customers wanting to buy a product once. This action implies one single event where an individual buys a product or uses a service once. This single event is often an impulse buy, which is a purchase that is made after a shopper enters a store (Bellenger et al., 1978). This implies a purchase which was 'unplanned'. Rook (1987) explained the concept further, stating that impulsive buying 'occurs when a consumer experiences a sudden, often powerful and persistent urge to buy something immediately. The impulse to buy is hedonically complex and may stimulate emotional conflict. Also, impulse buying is prone to occur with diminished regard for its consequences' (Rook, 1987) He further explained that it often has more to do with grabbing a product than choosing one. Amos et al. (2014) further defined the concept as 'Impulse buying is a measure of the actual act of impulse buying regardless of whether it occurred because of chronic dispositional traits, unique situations at time of purchase, or some combination
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of factors.' (Amos et al.,2014) their research identified situational, dispositional and socio-demographical factors influencing impulse buying.
As shown in the definitions on impulse buying and a brief literature review, impulse buying is an example of a certain urge to buy a product. This does not imply that the next time a product will be bought again or that a customer has a particular bonding with a product. Therefore the need to join a community or fill in an evaluation form may be low. This is the case because a customer has no bonding with a product and will not necessarily buy the same product the next time. Thus, a customer will probably not need to or want to help in improving a product. For the same reasons why classic co-creation is not achieved, co-creation 2.0 will not be achieved as there is not enough bonding for the customer
However, an example of possible co-creation in impulse buying is mentioned in the article by Mugge et al.
(2009) where they talk about the example of Adidas. At Adidas, customers can design their own shoe by choosing the colors of the different parts themselves. This could thus lead to one specific buy. If it does not go further than customers developing a shoe for themselves, it will not lead to more than this specific buy.
This is unless a customer starts to bond with the company and wants to co-produce his or her shoe again.
The next relationship that could be step four will now be explained, being multiple purchases.
Multiple purchases (preference for a product)
This action and relationship is established as, after a narrative is set out, a customer starts bonding with product and keeps repurchasing the product. This is recognized in the literature as customer loyalty, which is known as the extent of a customer and its long-term relationship with a firm, or in this case a product (Fullerton, 2003). Slater and Narver (1994) already mentioned the importance of customer loyalty. They suspected expectation management to be key and explained that businesses 'must make a long-term commitment to understand their customer's expectations and how they change, motivate employees to view customer satisfaction as a primary objective, monitor customer satisfaction frequently and stay in touch with customers after the sale' (Slater and Narver, 1994).
In the light of co-creation, this type of relationship is an active relationship, where firms are involving their customers in order to create closer customer relationships (Randall et al., 2011). For customer loyalty the above type of co-creation, where a customer for example can design their own product, could be beneficial for future purchases as well. For example the designing of your own shoes as introduced above could be beneficial for future purchases as well. Vargo and Lusch identify this as one of two types in co-creation, being co-production. The second type is identified by Vargo and Lusch (2004) as value-in-use, as 'the performance of the service or product thus influences customer valuation of utility' (Randall et al., 2011).
This explains the usefulness of evaluating on customer's experiences with products or services in order to
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improve the product or service further. A second advantage of such an approach is that customers are involved in the process and therefore may already become more loyal to a certain product or service. An example of this type could be when consumers can fill in an evaluation form after using the product or service and the company takes this into account when further developing the product or service. The product will then become more aligned with the customers wishes and he or she might feel more bonding with the product. When consumers start to share this information with other's who start to buy the same product or make use of the same service, a domino-effect is noticed. This is the next relationship that is found in the literature.
Customer influences potential customers that become new customers
When a customer is excited or enthusiastic about a product, they will often talk about it with others.
Prahalad and Ramaswamy (2004) found that '‘firm-centric view of the world, refined over the last 75 years, is being challenged not by new competitors, but by communities of connected, informed, empowered, and active consumers’ (Prahalad, Ramaswamy, 2004, p. 8). The sharing of information between consumers is also known as Word of Mouth. 'Information provided by suppliers of consumer goods is no longer the major factor influencing these decisions and is now quickly being equalled by widely available opinions and experiences from other consumers' (Bronner and de Hoog, 2013). 'Opinions of other customers are appreciated because they are more likely to include negative information about a product or service than one could find in formal marketing communications '(Hamilton et al., 2014). Negative information is often more diagnostic and more influential and therefore more appreciated by customers (Baumeister et al. 2001;
Herr, Kardes, and Kim 1991; Richins 1983).
In the case of co-creation, Fuller (2010) found that a positive co-creation experience increase Word-of- Mouth. The same types of co-creation as mentioned above in two of the other relationships can be used to increase the amount that consumers talk to other consumers about the product or service. Consumers can help develop a product or service and their preferences will probably be incorporated in the product or service. Thus it will be more likely that they are enthusiastic and thus will stimulate others to buy or use the same product or service.
The relationship as proposed by Nijs (2013) between customer and company, focuses on more than just selling a product or service and asks customers to take on a role and become part of a movement. It seems to be the form of co-creation that has the most intensity, where consumers themselves take on the
responsibility or take on the responsibility together to approach the company. In the other three
relationships identified, customers co-produced with the company or gave their opinions afterwards. In the action as proposed by Nijs (2013) the customers really become part of organization. This research proposes that this relationship is probably the most beneficial for a company as it possibly provides an answer to the
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changing world and new thinking. In the end, companies want their customers to be as engaged as possible as they are considered to be a valuable resource, or even a critical competence (Ramaswamy in Leavy, 2013) in the development process. Customers are thus of high value. For customers on the other hand, it seems that they are more willing to co-create with the company. It thus provides benefits on both sides to have a relationship that is as intensive as possible. The following conceptual model has been established from this:
Figure 2: Hierarchy in relationships between customer and company
Within the hierarchy the intensity of the relationship and co-creation is thus increasing. Where a customer with one specific buy might only co-product, the customer becomes part of the organization in the fourth relationship. To see whether the method as proposed by Nijs (2013) can fill the gaps that this changing world is asking for, subquestion 2 and 3 need to be answered, which are Does every company in every situation try to achieve the action as described by Nijs? Is this type of involvement most desirable in every situation? And Can the other three identified relationships achieve the desired or optimal outcome?
Assuming that the method by Nijs (2013) is the most desired outcome, the following two propositions are proposed:
P1: For every company in every situation the action as proposed by Nijs (2014) is the most desirable.
P2: The optimal outcome cannot be achieved when aiming for a relationship that is lower in the hierarchy.
15 Elements in Co-creation
A second relevant relationship between the four relationships seems to be present. Assuming there is a hierarchy, every type of co-creation seems to be present in the next relationship when we look at the first three. While co-production is relevant for one specific buy, it seems to be useful for multiple purchases as well. While evaluation for multiple purchases seems to be a type of co-creation, it can also be useful to stimulate consumer to talk about it together. The way co-creation is achieved, for example through social media or a community also seems to be relevant in every relationship. The question thus rises whether this is the case for the fourth action as well, whether the elements of the first three are present. It seems to be the case, because consumers talking to each other about a product, service, brand or company seems to be relevant as they themselves will initiate co-creation in the fourth relationship. This can also be done
collectively with other consumers, which assumes that they talk to each other about it. This is already present in the third relationship as well. This would imply that these elements are also of critical importance in the fourth relationship; Therefore the third proposition is:
P3: Elements stimulating co-creation in the first three relationships between customer and client are also present in the fourth relationship (action proposed by Nijs (2013)).
Many elements can be found in the literature as being useful or of importance in co-creation. Three element have been chosen to investigate further. These are community building, social media and Word of Mouth. The first two have been chosen as they seem to be highly relevant for communication between company and customer. When the relationship becomes more intensive, communication is needed to be able to establish and maintain this relationship. Lu et al. (2010) suggests that online communities are new tools for businesses and consumers to interact, whereas Gruzd et al. (2011) suggests the same for social media. 'Online communities and social networking sites (SNSs) are an effective web technology for social interactions and sharing information' (Hajli, 2014; Lu & Hsiao, 2010). Word of Mouth has been chosen as consumers often highly value other consumers their opinion. Nijs (2013) already suggested consumers initiating a movement together without the intervention of the company. Word of Mouth thus seems important in order for consumers to stimulate each other to co-create together. The three elements are further explained below.
Community Building
In the case of Antwerp which is used in Nijs (2013) her research, one of the issues at the beginning of the case was that the inhabitants did not feel like belonging to a community. After the introduction of the narrative and the different activities that were used in this case, inhabitants started to feel part of the community and as a result started to be willing to be more involved. Community building has long been a way of enabling people to be part of something as well as for co-creation. 'A co-creation community is a
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place both to learn and to share that enables people to realize something of their own potential by exceeding their perceived limits' (Ind et al., 2013). Community Building can often take place in on line communities. Community building is a way for companies and their partners, customers and employees to connect with each other and exchange ideas and information (Ren et al., 2012).
Ind et al. (2013) recognize the importance of mutual sharing between companies and individuals as 'the gift of time and creativity builds the solidarity of the community and creates a responsibility on the part of the organization to share its knowledge. Without this sense of mutual giving, the community is not a
community.' (Ind et al., 2013). This mutual giving seems to support Nijs (2013) who explains the importance of both the company, as well as customers themselves to initiate co-creation. The part where customers themselves initiate the sharing as they feel part of a community is what is the proposed by Nijs (2013).
Therefore the following proposition is set:
P3a: Customers need to feel part of a community to stimulate the relationship between customer and company and reach the action as proposed by Nijs (2013).
Social Media
There are multiple types of media possible to use when a message needs to be delivered. Social media seems to be of importance as both consumers and companies have the ability to share their story. 'Major channels making this shift possible are different social media, like review sites, individual weblogs, Facebook accounts and Twitter messages' (Bronner and de Hoog, 2013). Kaplan and Haenlein (2010) suggest that it is a quick and direct way for companies to communicate with consumers. Dao (2014) suggests that 'Social media can therefore be utilized as an advertising platform to create and strengthen bonds between firms and customers, thereby developing more trustworthy relationships between the two sides than does traditional online media' (Dao, 2014). It is not only easy for companies to reach customers, but customers themselves or together with other customers can also more easily approach the company. As it is seems that social media is important in every business and aspect, it seems that it must also be the case when a company is aiming for step four as proposed by Nijs (2013). Especially as it is an easy way for consumers to communicate with each other and with the company, which is key to move towards a strategic intent, it could probably be the most important media type in order to achieve a the most intensive relationship.
P3b: Social Media is the most important media type to achieve the relationship proposed by Nijs (2013).
Word of Mouth
Consumers talking to other consumers is the most important aspect of the third action in the hierarchy.
However, it seems to be of vital importance for the fourth step as well, as 'Information provided by
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suppliers of consumer goods is no longer the major factor influencing these decisions and is now quickly being equalled by widely available opinions and experiences from other consumers' (Bronner and de Hoog, 2013). In the case of Veritas it is shown that after a while more passionate employees wanted to join the company and 'People involved had the experience of sharing the same passion and from there the group of customers became younger' (Nijs, 2013). This assumes that people are getting attracted through the stories of others about the success of the company. Secondly, as explained above, WoM is created through
communities of connected people, which is a part of this approach. Therefore it seems logical to include WoM as important. Thirdly, as other customers are often seen as a more trustworthy source of information, people may also be more inspired to join. This leads to proposition 2c:
P3c: through Word of Mouth consumers stimulate each other to become part of the emergent organization and is therefore needed to achieve the action as proposed by Nijs (2013) in step 4.
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METHODOLOGY
Research Design
This research focuses on theory development. Whereas theory testing looks into a question that can be answered with yes or no, theory development asks a more open question. Yin (2009) explained that a case study is appropriate for an open question, which is therefore the chosen approach for this research. A case study is appropriate for a second reason as this research is exploratory in nature which means that not much research has been performed on this specific topic before. The unit of analysis is multiple marketing campaigns, which are provided by three different marketing agencies. The purpose of the interviews was to ask questions on a case that succeeded and a case that was not successful in the eyes of the interviewee.
However, as the interviews went on, multiple cases came up and therefore the structure as outlined before changed. Therefore, the interviewer tried to look at all the cases afterwards to see which held useful information and which did not.
The questions focus on the four possible relationships as identified in the literature review and whether the fourth one is the most desirable. Secondly, the interviews focus on the elements in the first three
relationships, and if they are present in the highest relationship as well. This will be further outlined below.
The questions were prepared beforehand and focused on those subjects. However, there was a lot of room for other questions and often the interviewees told a story which was not interrupted as this would increase the reliability of the information because they were not pointed into a specific direction. This meant that there was also room for the interviewees to explain other reasons without them only focusing on the four subjects introduced by the researcher. The generalizability is assured as three different marketing agencies are interviewed in order to make sure the information does not come from one source. The main sources of the research were the interviews. The answers they gave were also backed up by written material and short movies.
Data Collection
As mentioned above, the data was collected through the use of three in-depth interviews. These interviews were semi-structured and were conducted with three employees belonging to three different marketing agencies (see table 1). After the first interview the interviewers spoke about the interview and how it went and what could be improved to get the most out of the other two as well. The interviews took between 1 and 3 hours and were conducted with two interviewers. These two interviewers both performed research on the Imagineering Method and one of them considered step 1 to 2. He thus focused on the narrative towards the mind-shift. The second researcher is performing this research and is thus focusing on the mind- shift towards role and action. Both interviewers prepared a set of questions and discussed beforehand how
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to structure the interview. The interviewees were asked beforehand through e-mail if they could look for a case that had been successful and one which did not succeed. They were asked to take into account co- creation while looking for these cases.
Who? Length of the interview
Interview 1 Ogilvy, Amsterdam, The
Netherlands
1,5 hours
Interview 2 Kessels Kramer, Amsterdam, The
Netherlands
1,5 hours
Interview 3 G2K, Groningen, The Netherlands 2,5 hours Table 1: interviews
The questions that were prepared for this research were focused on the propositions that were developed in the literature review. The method by Nijs (2013) was explained beforehand to the interviewees without revealing the purpose of the study. This was done in order to assure a non-biased response by the
interviewees. The questions focused on a few aspects. Firstly, the message of the campaign was relevant, as the interviewer wanted to know what the main purpose of the campaign was. This in order to see what type of co-creation took place and where they would be in the hierarchy. Secondly, questions focused on the three proposed aspects, which are community building, social media and Word of Mouth. These three aspects were chosen as they were already present in classic co-creation. It could therefore be expected that they will also be present in co-creation 2.0. The interviewees were asked what they thought would help achieving the highest level of involvement of consumers. This would help answering the third proposition.
As mentioned above, the interviewees were asked to come up with two cases. One that was successful and one which did not give the preferred results. The interviewee, in all three interviews, explained the case and afterwards questions could be asked. When questions that needed to be asked were already answered in the story of the interviewee, they were not asked again or asked again in a different manner to make sure the answers were understood correctly. Often, the interviewee already told a lot during the case
presentations and therefore some issues were already discussed. The examples were all completely different, as for example both services and products were used to illustrate the discussed material.
However, during the interview the interviewees often gave other examples and brought different cases into the conversation. Therefore, the interviewers had to adjust their structure and had to look into the different cases afterwards to see which were useful and which were not.
As the interviewer was aware of not wanting to stimulate the interviewee to answer the questions as they thought was expected, general questions were asked as well. These included questions such as: what was the reason for the success of the case? How did they get people to co-create? This was done to make sure
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that if the aspects proposed did matter, they were also mentioned without the interviewer specifically asking about them. After the questions were written down, the questions were read out to the other interviewer who found some uncertainties in the questions which were afterwards adjusted. The questions of the other interviewer and the questions for this research were taken together and put in a logical order to make the interview go as smooth as possible.
All three interviews were recorded and afterwards the transcripts were typed out. This process was divided between the two researchers. All three interviewees were asked if they were fine with the interview being recorded. Both the answers and questions were typed out and afterwards the interview was listened to once, to check whether everything was included in the transcript. Some sentences were corrected to take out spoken language, however the researcher tried to assure that this did not change the point or message of what was told. Also, the interviews were in Dutch and therefore the quotes in the results section are translated to English.
Data Analysis
In the data analysis, the researcher had to make sure that it would be a structured analysis in order to assure the trustworthiness of the results. Therefore the data was analyzed in multiple steps. Firstly, the transcripts of the three interviews were analyzed using coding. This was done by reading the transcript and marking all answers that had something to do with the two propositions. For the first proposition this was the purpose of the study and which action they achieved. For the second proposition this was everything on community building, social media and Word of Mouth. When this was coded, the words or sentences belonging to the different categories were written down in the right category. After this was done the transcripts were printed again and coded again on a blank sheet to recheck whether everything was
included. As the same words and sentences came up the second time and there were no differences among the two, no third time was needed to re-check the results. After this was done the words and sentences found in the transcript were analyzed to see whether they matched the proposition or if they were
inconsistent with the propositions that were derived from the literature. The conclusions that were derived from these three steps were written down systematically which resulted in the results section, including a section for both propositions.
Afterwards the transcripts were looked into again to check for other things that were mentioned. Even though other aspects were not included in the propositions, they were checked in order to be as complete as possible and suggest them for further research. In this part of the analysis it was important to be precise and only use the aspects that were actually relevant for this research. As the step from the narrative to the mind-shift is closely related to the step from mind-shift towards role and action afterwards it was important to only mention aspects that influenced the potential role of a consumer instead of the aspects that caused
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a mind-shift. As the same interviews were used for research on the first step in the Stairway to Heaven is, it always shows how closely related the steps and thus the research into the steps are. Therefore, the
researcher constantly referred to the explanations of Nijs (2013) on the different steps to make sure only relevant information is included in the results section. Also, the researcher discussed with the other interviewer what he used for his research. In this way they could discuss together what belonged to which step.
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RESULTS
This research tries to answer the question whether the action as proposed by Nijs (2013) in the Stairway to Heaven method is more desirable than the other three relationships outlined. The question is thus whether there is some kind of hierarchy. This implies that this is the preferred relationship between customer and company in every situation. In this section, the results of the empirical research will be discussed. Three interviews have been conducted with three different marketing agencies. The three interviewees have come up with multiple cases in the end. Not every case can be used for both propositions, therefore only the useful cases are included in these results. The results will be discussed according to the propositions as stated in the literature review. No conclusions will be given yet, as this will be done in the following section.
Proposition 1 and 2
The first two propositions discuss which relationship between customers and company is most desirable. In other words, whether the method by Nijs (2013) is the most preferred relationship. The first proposition states that in every situation and company this approach is the most beneficial. The proposition thus states:
P1: For every company in every situation the action as proposed by Nijs (2014) is the most desirable.
The second proposition states that the optimal outcome cannot achieved when a relationship that is lower in the hierarchy, when assuming a hierarchy, is achieved.
P2: The optimal outcome cannot be achieved when aiming for a relationship that is lower in the hierarchy.
In the interviews, the researcher looked at the cases and tried to find which of the four relationships
between customer and company were tried to achieve or achieved. In table 1 the cases are noted down and which of the four relationships they tried to achieve. Table 1 can be found below. It was not clear in every case to which relationship it belonged, therefore the researcher has only incorporated the cases that were of importance for these particular propositions. Below, the three interviews are briefly summarized including the useful information for this proposition. It also highlights which cases were successful and which were not. This is because it might suggest whether the fourth relationship is always the most desirable. When a case does not succeed when trying to achieve initiative by consumers, it might suggest that one of the other relationships is more desirable.
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Interview 1 – Case Action Succes Does it show that the
relationship as proposed by Nijs is the most desirable?
IBM Action as proposed by
Nijs (2013)
Yes Yes
Moleskine Preference for a product No No
Interview 2 – Case
Donor registration Customer influences potential customers that become new customers
Yes No
Burger King Preference for a product Yes No
Interview 3
Domesta Preference for a product Yes No
Table 1
Interview 1
In the first interview a clear case example was given at the beginning of the interview, which was about IBM.
IBM could not get into the offices of local authorities and therefore it made a video in which they showed how children came up with simple solutions to city problems. The solution that they came up with was initiated in Rotterdam, The Netherlands. Afterwards, other local authorities in for example Antwerp and Brussels called IBM to ask what they could do for them to build 'smarter cities'. IBM did not try to sell a product, but rather to ask a city for its problems and find a solution for it with the techniques the company has. They thus created a successful narrative. The company was able to create common ground with its customers and deepening themselves into their world. The interviewee pointed out that
'It is much more about starting a dialogue instead of buy this product. Together we will find the solutions that will benefit this city' (Interviewee 1)
This quote suggests that own initiative from the consumers, in this case the city council, is the action they are trying to achieve. This why this case can be grouped under the action as proposed by Nijs (2013). The case was successful, as it achieved initiative from consumers and created a dialogue between consumers and the company. They performed co-creation together, initiated by the consumers after the company setting out a narrative. As the company could not get into the offices of local authorities before with other approaches, it seems that this higher relationship was most successful for them.
The second case provided in the first interview was the case of Moleskine, which is a company producing
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note pads. Their customers are mainly creative artists. They therefore asked them whether they wanted to help them in creating a new logo for the company. They are already customers of the company and the company tried to bond further with them through this type of co-creation. This is the co-production as explained in the literature review. This case can be grouped under having a preference for a product, as these artists were already customers and the company tried to bond with them further. However, the artists got upset because they felt that the company used their artistic skills for their own benefit. The interviewee suggests that the artists felt unappreciated. This could be because of the target group or because of the wrong approach towards these customers. It shows that co-creation might not always be the right solution in every case.
Interview 2
In this interview two cases have been provided that are of relevance for this proposition. The second interviewee first introduces the case of the donor registration campaign. This was a difficult campaign, as they found they gave the consumers too much information in their previous campaign. Therefore
consumers did not act on it as they were overwhelmed by the amount of information. The interviewee recognized that is was difficult to get people to sign the registration form. The registration form included way to many questions and therefore people ignored the registration in general. Afterwards they started a new campaign which did not include anything more than just the simple question Yes or No. A large part of the target group still doubted heavily about the decision and through this simple question the campaign tried to stimulate people to make a choice, even when they decided to not be a donor.
Also, the agency asked several famous persons and normal consumers to act as a spokesperson for the campaign, as well as institutions who could order a poster to show that they said Yes to organ donation.
News programs and entertainment programs started to enhance the campaign as well and for example started to ask people at the red carpet if they were registered. This was what the agency tried to create, to get people to ask each other if they were already registered. This was one of the important aspects of the campaign as the interviewee states:
'We wanted to create that everyone asked everyone if they were already registered. That it would become more self-evident. If everyone asks one person if they are already registered.. ' (Interviewee 2)
As the purpose of the campaign was clearly to get people to talk about it together, we can group this case under the action of talking to other customers and in this way influence potential new customers. This is the third relationship proposed. The case was successful, as the interviewee explained that percentages of people who registered their choice to be a donor rose. This suggests that even though they did not try to achieve the relationship as proposed by Nijs (2013), they have still been successful in achieving their goal.
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The second case is the case of Burger King in Norway. On their Facebook page they had a high number of likes, however the customer engagement was low. Therefore, they awarded people who disliked their Facebook page with a free coupon for a visit to either the Burger King or the McDonald's. Thousands of people disliked the page, which caused them to keep the most important people who were really interested in the company instead of the ones only being interested in the sweet deals provided by the company. What they thus tried to focus on is bonding with their customers. Therefore the case can be assigned to the relationship of focusing on having a preference for a product. The case was successful, which shows that even when the relationship with the most involvement as proposed by Nijs (2013) is not achieved, it can still achieve the desirable outcome for the company.
Interview 3
The case that is provided is the case of Domesta. They asked the agency to share a message to celebrate theNew Year. Domesta is a housing cooperative. The message was Vitaal 2014 (vital 2014). The question that was presented towards the partners of the company was to share their idea for a 'Vitale Buurt' (Vital neighborhood). They tried to bond further with their clients and partners through this message. The company only received 10 responses. According to the interviewee this was due to several issues, of which one was that the message only went to a few people and there never was a follow-up on how they did or how the partners felt. However, the interviewee explains:
'It is ok that it only has a limited reach. You just need to try things' (Interviewee 3)
The interviewee thus explains that it is not an issue that there is only a limited amount of response. As they try to bond further with their customers and achieve multiple interactions with their partners and
customers that they send the message to. As explained above, the limited responses they received is not an issue, which suggests that they do not want to achieve more. This suggests that they probably do not desire to further move into the hierarchy.
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The third proposition focuses on whether the elements of the first three relationships in the are present in the relationship as described by Nijs (2013). Three sub-propositions are developed in order to give more insights into this proposition. These three propositions focus on three elements that are present in classic co-creation. These are community building, social media and Word of Mouth. To investigate these
propositions, the researcher looked at the three different interviews. The interviewees were asked what was needed in order to get as high as possible in the hierarchy.. The researcher only looked into the three aspects mentioned above. The different interviews will be briefly discussed according to the subjects. Table 2 shows a summary of the results. The proposition was as followed:
P3: Elements stimulating co-creation in the first three relationships between customer and client are also present in the fourth relationship (action proposed by Nijs (2013)).
Interview 1 Interview 2 Interview 3
Community Building (Important, can be a concrete community or a community build on common ground)
Create Common Ground Create Common Ground Examples of Apple and Peerby
Social Media
(Do not overestimate the power of social media.
Useful, but people do not want to be used)
Track conversations of consumers and fans on social media and blogs to find their perspective
People are getting cynical about participating in a like and share
advertisement
Can be the wrong medium sometimes People are getting allergic to be used by companies to share and like
Word of Mouth
(Unclear, not mentioned much)
x When it is too
commercial, people do not want to participate People do not always want to be the ones providing free marketing for companies
x
Community Building
Proposition A focused on community building and was suggested as:
P3a: Customers need to feel part of a community to stimulate the relationship between customer and company and reach the action as proposed by Nijs (2013).
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The first and second interviewee mentioned the importance of building common ground and focusing on one particular group. In the successful case of donor registration, there was a large core group. According to the interviewee this was because the story had depth. The third interviewee gave the example of Apple and PeerBy as successful communities where consumers can share their information without the intervention of the company itself. The company only provided the platform to use. In this interview they thus talked about an actual concrete community. However, in the first and second interview they talked about creating a community as being built on reaching common ground. The interviewee in the first interview explains that:
'.. create a common ground … to trigger your target group to start to dialog with the company' (Interviewee 1)
The key is thus that it does not have to be a clear community such as the example of Apple, but it can also be a community where a group of people feel they have common ground. A negative example has also been given. Ariel tried to stimulate housewives to provide each other with tips on how to do the laundry.
However, there was no social connection between the consumers which caused the campaign to fail.
Social Media
The proposition on social media was stated as:
P3b: Social Media is the most important media type to achieve the relationship proposed by Nijs (2013).
From the interviews it shows that social media can be useful in order to track conversations between customers and posts online to find the customers' perspective. This was mentioned by the first interviewee.
However, the third interviewee also explained that social media can be the wrong medium. This was for example the case for Domesta. Nobody really responded to their message to post something on 'Een Vitale Buurt'. On the other hand, they created a garden in another city where everyone can help out, which did work. He explains that social media is thus not always the preferred type of medium. On the other hand, both the second and third interviewee mention that social media and its use should not be overestimated.
As the second interviewee explains:
'People are getting more cynical on brands that have another contest or want you to share something.' (Interviewee 2)
The second interviewee mentioned the difference among two cases, Liga and the Donor registration campaign. Whereas people did not want to talk about the donor registration campaign on social media, the
