One of the crucial factors for company’s growth and strength is
developing new products to compete other companies in the market. However, not
all new products have the chance to succeed (Geise, 2017). Involving customers
in new product development could be of great value and can play a role in the
success of the new product (Brockhoff, 2003; Stenmark, Tinnsten & Wiklund,
2011). Eriksson and Hilletofh (2010) argue that during the new product
development, deep understanding of customer needs should be considered rather
than the technology of the product. In the 70s, consumers were considered as
passive buyers and their roles was defined in the consumption stage while in
today’s market, consumers considered as partners who participate in the
creation process (Agafitei and Avasilcal,2016). Co-creation is the term that
used to describe the collaboration between the company and its consumers to
develop a new product (Liljedal, 2016). According to Agafitei and Avasilcal
(2016), the term co-creation has been mentioned for the first time in 2000 and
it defined the active consumers who participate in defining the value of the
new product or service. Gheron and Rera (2016) described the co-creation as a
booming activity that has been implemented nowadays by companies to include
their customers in the creation process by generating ideas and giving an
insight to the company to develop a new product or improve an existing one.
Customer participation defined as the extent to which they are
involved in the new product development (Fang, 2008). Brockhoff (2003) mentioned
that the degree of customers’ co-creation should be measured and they should be
selected based on their potential stage of contribution. A research by Fang,
Palmatier and Evans (2008) measured customer participation by breadth and depth
of co-creation. The breadth refers to the range of customer involvement in the
NDP stages (concept generation, prototyping, and product testing) while the
depth refers to the level of consumer involvement in each stage of the NDP. Another
research by Hoyer, Chandy, Dorotic, Kraftt and Singh (2010) measured customer participation
by scope and intensity of co-creation. The scope refers to the tendency of the
company to collaborate with consumers through the NPD process stages while the
intensity refers to which extent the company is relying on co-creation in the
NPD different stages. Nambisan (2002) relate the consumer role in NPD to four
areas: customer and value creation, customer as resource, customer as co-creator
and customer as user. Companies that work with open innovation strategy
consider customers as valuable resource for new ideas generation (Geise, 2017).
Companies find consumer co-creation, a successful approach for
ideas generation and mirroring closely what consumers need (Hoyer, Chandy,
Dorotic, Kraftt and Singh, 2010). Ideas generation was a manufacturer-active
role rather than a customer-active role, Hippel (1978) developed a new
customer-active paradigm where companies develop new products according to the
customers’ request who communicate their needs opposite to the
manufacturer-active paradigm where companies search for customers’ needs then
develop the product.
The development of new communication technologies participated in
changing the producer-customer relationship and has its implications on the NDP
(Nambisan, 2002). According to Luo and Toubia (2015), online platforms for idea
generation give companies access to consumers’ ideas, categorize ideas and
offer free navigation to consumers across these categories. Vere (2014) argue
that social media enabled a new way of consumerism where consumers are playing
an active role in product design and production through the virtual communities.
Roberts and Piller (2016) mentioned that
social media is not limited in Facebook and Twitter but it includes special forums
and blogs which provide information that lead to successful new products. Companies
across industries start establishing virtual customer communities where
customers share knowledge and participate in new product development (Nambisan,
Luo and Toubia (2013) argue that consumers who participate in the
NDP can be classified to low-knowledge consumers and high-knowledge consumers
and both are facing different challenges in the task of idea generation.
One of the challenges in customer involvement in NPD is to understand
what motivates customers to be part of generating ideas and testing or
evaluating the product (Agafitei and Avasilcal, 2016). Some of the motivation
factors according to Hoyer et al. (2010) can be financial rewards or social benefits.
Companies should communicate the reasons that will motivate the consumers and
show the value that they will get from their participation (Liljedal, 2016). From the other side, Brockhoff (2003) argue
that consumers also should clarify their involvement strategy in the NPD
process to get an equivalent value for their participation.
Sanden (2007) argue that outsourcing parts of the creation process
puts demands on the company and requires a shift in mindset; customers should
be considered and treated as partners by the company’s employees who take part
in that collaboration.
Customer involvement in many cases can be limited to interviews and
product testing due to two reasons; first, it can be costly for the company and
second, many companies do not agree to reveal information about any new
products before releasing it (Stenmark, Tinnsten and Wikland, 2011).
Sanden (2007) stated that “customer involvement effort should start
with a definition of the project’s prerequisites in terms of corporate,
marketing and innovation strategies, and cultural and organizational factors
such as skills and competences needed and the organization of the project”.
Understanding customers’ motivation to participate in the new
product development process can be beneficial for both customers and producers