Co-creation is the actions of more than one person or party, bringing something into existence. In business, it is a strategy and process focusing on the joint creation of value by customers and company. An interactive relationship, customers and staff function as active participants. It is becoming more common for service providers to let customers co-create value - this mutual creation of services enhancing the consumption experience of customers. The co-creation of value is an application for a product and goods-based businesses as well as services and experiences. Marketing helps facilitate this mutual creation and enjoyment of value - business has moved away from the traditional model of customers purchasing goods or services – now, customers can engage in dialogue with suppliers during each stage of product design and product delivery. Value co-created at multiple points of interaction. “Co-creation is about joint creation of value by the company and the customer. It is not the firm trying to please the customer.” (Prahalad & Ramaswamy, 2004)

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Co-creation is the actions of more than one person or party, bringing something into existence.
In business, it is a strategy and process focusing on the joint creation of value by customers and company. An
interactive relationship, customers and staff function as active participants. This mutual creation of services
enhancing the consumption experience of customers.
The co-creation of value is an application for a product and goods-based businesses as well as services and
experiences. Marketing helps facilitate this mutual creation and enjoyment of value - business has moved away
from the traditional model of customers purchasing goods or services – now, customers can engage in dialogue
with suppliers during each stage of product design and product delivery. Value co-created at multiple points of
interaction.
WHAT IS THE CO-CREATION OF VALUE?

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• Allowing the customer to co-construct personalised service experience to suit her context
• Joint problem definition and problem-solving
• Creating an experience environment in which consumers can have active continuous dialogue and co-
construct personalized experiences
• A variety of unique customer experiences
• Innovative experience environments
“Co-creation is about joint creation of value by the company and the customer. It is not the firm trying to
please the customer.” (Prahalad & Ramaswamy, 2004)
CHARACTERISTICS OF CO-CREATION

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THE CO-CREATION OF VALUE
Encouraging active involvement from the customer, co-creation of value is on-demand and made-to-order. A
collaborative effort. The customer’s experiences and perceptions influence their considerations of value and
highly informed consumers are willing to pay more for businesses who can meet their requirements.
Customers and other stakeholders such as suppliers are actively involved in the problem-solving process;
participating in suggesting ideas, designs, concepts and solutions for products and services. This can be
throughout the entire process, from idea generation to the end-user.
“Marketing should be viewed as a set of processes and resources with which the company seeks to create
value propositions. Processes include the procedures, tasks, mechanisms, activities and interactions which
support the co-creation of value.” (Storbacka, 2007)

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Inviting and encouraging active involvement and participation from customers, Co-created experiences are
unique and value-rich. Often, the quality of the consumer experience depends on the nature of their
involvement. Co-creation is an interactive relationship between the customer and the experience, the focus on
facilitating the co-creation of diverse experiences that consumers enjoy.
An example of a co-created experience is concerts. The audience can choose whether they have a seat, or
whether they stand near the stage and their active involvement as a community in activities such as singing and
dancing. Staff are also actively involved to co-create this customer experience.
Rather than playing a passive role, consumers are wanting to take more of an active role in co-creating
experiences. Consumers want empowerment to co-create a personalised experience.
CO-CREATED EXPERIENCES

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Co-creation provides unique experiences for customers. Customers are expecting more personalised and
customised services where they can choose how they interact with the firm.
Co-created value can provide financial benefits to customers, as it can be cheaper for them to design a custom
offering rather than paying more and receiving some features or services they do not want or need.
The biggest benefit to customers of co-create is that it makes them happier. The enjoyment of the consumption
of experiences increases the wellbeing of those individuals. The collaborative activities of these experiences
provide both hedonic wellbeing and eudaimonic wellbeing through the co-creation process. Hedonic wellbeing
comes from a sense of pleasure, where eudaimonic wellbeing coming from a sense of meaning. The social
benefits from connecting with other people during an experience can provide both these benefits.
THE BENEFITS TO CUSTOMERS

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There are several benefits to businesses who managing value co-creation with their customers.
• High-quality interactions resulting in improved efficiency and effectiveness in operations
• Improved relationships and enhanced customer loyalty
• Maximise the lifetime value of desired customer segments
• New sources of competitive advantage
• Enhanced knowledge and skills to develop new offerings and improve existing ones
• Shorter time-to-market for new offerings
• Increased financial performance of profit margins and sales of new offerings
• Improved working environments and teamwork
THE BENEFIT TO BUSINESSES

8. Daniel Hopper
Marketing Specialist - BYB MARKETING
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