Defining
Customer Innovation
I often get
asked what I mean when I use the phrase "Customer Innovation". Here's
my explanation:
Customer
innovation incorporates a number of emerging concepts and practices that help
organisations address the challenge of growth in the age of the empowered and
active customer (both business and consumer). It demands new approaches to
innovation and strategy-making that emphasise rapid capability development,
fast learning, ongoing experimentation and greater levels of collaboration in
value-creation. Customer innovation impacts upon all the following activities,
functions and disciplines:
Marketing
strategy and management
Brand strategy and management
Communications strategy
Customer experience design and delivery
Customer relationship management
Customer service design and quality management
Market-sensing and customer learning
Market and customer segmentation
Creativity and knowledge management including market research
Partner and customer collaboration
Organisational alignment and purpose (values, behaviour and beliefs)
Innovation strategy and management
Innovation valuation, measurement and prioritisation
Strategy-making
Brand strategy and management
Communications strategy
Customer experience design and delivery
Customer relationship management
Customer service design and quality management
Market-sensing and customer learning
Market and customer segmentation
Creativity and knowledge management including market research
Partner and customer collaboration
Organisational alignment and purpose (values, behaviour and beliefs)
Innovation strategy and management
Innovation valuation, measurement and prioritisation
Strategy-making
For me
customer innovation is not only an important perspective on value-creation but
a whole new strategy discipline that organisations must embrace if they are to
pursue growth successfully in the future. Put another way, customer innovation
impacts the fundamental means by which value is created and growth sustained.
One of the
difficulties I encounter when explaining the concept is that the
"Innovation" word is traditionally associated with products and
technology. There is a section in The Only Sustainable Edge by Hagel and
Seely Brown that eloquently defines Innovation from a much broader
organisational and strategic perspective:
We
underscore the importance of innovation but we use the term more broadly than
do most executives. Executives usually think in terms of product innovation as
in generating the next wave of products that will strengthen market position.
But product-related change is only one part of the innovation challenge.
Innovation must involve capabilities; while it can occur at the product and
service level, it can also involve process innovation and even business model
innovation, such as uniquely recombining resources, practices and processes to
generate new revenue streams. For example, Wal-Mart reinvented the retail business
model by deploying a big-box retail format using a sophisticated logistics
network so that it could deliver goods to rural areas at lower prices.
Innovation
can also vary in scope, ranging from reactive improvements to more fundamental
breakthroughs... One of the biggest challenges executives face is to know when
and how to leap in capability innovation and when to move rapidly along a more
incremental path. Innovation, as we broadly construe it, will reshape the very
nature of the firm and relationships across firms, leading to a very different
business landscape.
Example
for consumer innovativenss
The
projected sales potential for Internet commerce indicates that businesses must
understand those consumer characteristics that will influence consumer adoption
of this medium for shopping. An empirical study conducted here (n = 403)
investigates the extent to which open-processing (more general innovativeness)
and domain-specific innovativeness explain the conditions under which consumers
move from general Internet usage to a product purchase via the Internet. The
results of our study find that generally higher amounts of Internet use (for
non-shopping activities) are associated with an increased amount of Internet
product purchases. Importantly, however, this relationship is moderated by
domain-specific but not general innovativeness. Implications for business
practice and academic research are provided.
Compulsive
Consumption Consumer
O'Guinn
& Faber (1989:148) defined compulsive consumption as “a response to an
uncontrollable drive or desire to obtain, use or experience a feeling,
substance or activity that leads an individual to repetitively engage in a
behaviour that will ultimately cause harm to the individual and/or others.”
Research has been carried out to provide a phenomenological description to
determine whether compulsive buying is a part of compulsive consumption or not.
The conclusion reached after analysing both qualitative and quantitative data
stated that compulsive buying resembles many other compulsive consumption
behaviours like compulsive gambling, kleptomania and eating disorders (O' Guinn
& Faber, 1989:147). Hassay & Smith (1996) hold a similar view and refer
to compulsive buying as a form of compulsive consumption as well. Besides
personality traits, motivational factors also play a significant role in
determining the similarities between compulsive buyers and normal consumers.
According to O'Guinn & Faber (1989:150), if compulsive buying is similar to
other compulsive behaviours it should be motivated by “alleviation of anxiety
or tension through changes in arousal level or enhanced self-esteem, rather
than the desire for material acquisition.” Hassay & Smith (1996) also agree
with the above inference and concluded from their research that “compulsive
buying is motivated by acquisition rather than accumulation.”
Example Compulsive Consumption
Consumer
Another form of compulsive personality is compulsive buying disorder.
Compulsive buying is different from regular consumers and different from
hoarding because it is about the process of buying.It is not about the items
bought. In fact, these items are usually never used and are just put away.They
are only bought purely for the sake of buying. People who are addicted to
buying describe it as a high or say that it gives them a buzz.Often, when
someone suffering from this is depressed, they will go out and buy items to
make themselves feel better. However, compulsive buying has negative effects
which include financial debt, psychological issues, and interpersonal and
marital conflict.To those who suffer from compulsive buying, to them, the act
is the same as using a drug.
Consumer
Ethnocentrism
Consumer ethnocentrism gives individuals an understanding of what purchases
are acceptable to the in-group, as well as feelings of identity and belonging.
For consumers who are not ethnocentric, or polycentric consumers, products are
evaluated on their merits exclusive of national origin, or possibly even viewed
more positively because they are foreign (Shimp & Sharma, 1987; Vida &
Dmitrovic, 2001).Brodowsky (1998) studied consumer ethnocentrism among car
buyers in the U.S. and found a strong positive relationship between high ethnocentrism
and country-based bias in the evaluation of automobiles.
Consumers with low ethnocentrism appeared to evaluate automobiles based more on
the merits of the actual automobile rather than its country of origin.
Brodowsky suggests that understanding consumer ethnocentrism is critical in
understanding country of origin effects.Several antecedents of consumer
ethnocentrism have been identified by various studies. Consumers who tend to be
less ethnocentric are those who are young, those who are male, those who are
better educated, and those with higher income levels (Balabanis et al., 2001;
Good & Huddleston, 1995; Sharma et al., 1995).Balabanis et al. found that
the determinants of consumer ethnocentrism may vary from country to country and
culture to culture. In Turkey, patriotism was found to be the most important motive for
consumer ethnocentrism. This, it was theorized, was due to Turkey's
collectivist culture, with patriotism being an important expression of loyalty
to the group.Example for consumer ethnocentrism
for example ethnocentrism is the center of everything, and all others are scaled and rated with reference to it. He further characterized it as often leading to pride, vanity, beliefs of one's own group's superiority, and contempt of outsiders.Robert K. Merton comments that Sumner's additional characterization robbed the concept of some analytical power because, Merton argues, centrality and superiority are often correlated, but need to be kept analytically distinct.Anthropologists such as Franz Boas and Bronislaw Malinowski argued that any human science had to transcend the ethnocentrism of the scientist. Both urged anthropologists to conduct ethnographic fieldwork in order to overcome their ethnocentrism. Boas developed the principle of cultural relativism and Malinowski developed the theory of functionalism as guides for producing non-ethnocentric studies of different cultures. The books The Sexual Life of Savages in North-Western Melanesia, by Bronisław Malinowski, Patterns of Culture by Ruth Benedict, and Coming of Age in Samoa by Margaret Mead (two of Boas's students) are classic examples of anti-ethnocentric anthropology.
sumber :
http://chrislawer.blogs.com/chris_lawer/2005/10/defining_custom.html
http://www.businessteacher.org.uk/free-marketing-essays/compulsive-buying/
http://en.wikipedia.org/wiki/Consumer_ethnocentrism