Value co-creation is best known for its use in business-to-consumer situations. The main success stories of Uber and Airbnb are lauded worldwide for making millions in revenue, without actually owning the physical assets needed for the service they provide. However, value co-creation also exists within the business-to-business market. An example is the Salesforce AppExchange platform.
About the company
Salesforce is a global technology company specialising in CRM and customer centric business processes. Since starting in 1999, the company has helped more than 150.000 clients grow and serve their customers better.
Business model
Salesforce’s business model revolves around selling licenses to use the different Salesforce products. In simple terms, their value proposition is that they help business deliver more value towards their customers by helping them understand and service their customers in a better way. This is done via one of more of their seven cloud based solutions. These solutions include:
- Sales cloud – CRM & Sales automatization
- Service cloud – Online service centres, and customer support
- Marketing cloud – Customer Journey management
- Community cloud – Client communities & teams
- Analytics cloud – Business Intelligence
- App cloud – App creation
- IOT cloud – IOT data integration
Because all of their products are run from the cloud, there are no high service or maintenance costs for clients and clients can run their operations from anywhere. Besides the company itself, Salesforce has many partners around the world that specialize in and use their technology to implement customer based business solutions.
Customer value co-creation within Salesforce
Even though the current Salesforce platform was already a success, the company felt that it could serve its clients more if it opened up the platform to more input from other corporations. During the growth of the company, many small subgroups of clients formed. All the subgroups had unique needs and circumstances. As it would be impossible to add all these needs into the current Salesforce feature list, they decided to establish a two-sided network in which business partners could co-create extra functionality to the core product (Muzellec, Ronteau & Lambkin, 2015).
Via API’s and toolkits, business partners could build their own Salesforce extensions and sell them on the AppExchange platform. This way, Salesforce’s client needs could be better served and business partners had the chance to utilize the large network of Salesforce’s clients. Following the value co-creation framework of Saarjärvi, Kannan & Kuusela (2013), the exact specifics of have co-creation is achieved can be established
| “Value” | “Co” | “Creation” | |
| Customer (business partner) | Customer benefit: Income through application fees or expansion of own customer base | Use of firm resources: Salesforce App Innovator Resources (account manager, marketing resources, partner community, etc.) | Integration mechanism: Through API’s & Toolkit’s and the Force.com platform |
| Firm | Firm benefit: Extra platform functionality to better service client needs | Use of client resources: Client time and development expertise | Integration mechanism: Through new application listings on the AppExchange platform |
Further reading:
Hannu Saarijärvi P.K. Kannan Hannu Kuusela, (2013),”Value co-creation: theoretical approaches and practical implications”, European Business Review, Vol. 25 Iss 1 pp. 6 – 19 Permanent link to this document:http://dx.doi.org/10.1108/09555341311287718
Muzellec, L., Ronteau, S. and Lambkin, M. (2015). Two-sided Internet platforms: A business model lifecycle perspective. Industrial Marketing Management, 45, pp.139-150.
Consumer Value Creation 