Tag Archives: added value

Articles

Crowd contesting for innovation in transportation

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There are number of ways how to induce innovation in the different fields. One of the interesting methods for generating new innovative ideas and approaches is crow contesting. Crowd contesting is an open contest that allows anyone to participate with his/her idea. To guarantee the outcome quality, a strict contest requirements and schedules has to be followed by every participating individual or team. To motivate participants for joining and actively devoting their effort, different types of incentives are used, such as monetary rewards, public recognition, and sponsorship funding offers. Furthermore, often times a passion in the particular field of contest is the main driver for participants. Crow contest is an efficient way of leveraging a power of competition to generate new ideas and approaches based on the theme of the contest.

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Business Case, News

Tesla Powerwall: you and me can live off the utility grid

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Last week, Tesla announced the so-called Powerwall. The Powerwall is a home battery that can be charged via solar panels or via the grid when utility is low. By using the Powerwall, electricity can be stored when the sun is out and it can be used when electricity demand is the highest. Furthermore, the battery can be used as an emergency backup in a power failure as well. [1] Tesla also announced the Powerpack, which “is designed to scale infinitely”[2] and is targeted to (large) businesses. However this article will focus on the Powerwall to see whether it’s you and me can that can add value to a more sustainable world.

So, how is the electricity demand distributed? First, in the morning there is a peak in the amount of electricity used. You are not having breakfast in the dark, right? Then, during the day the electricity demand is decreasing rapidly. For instance, less light is being used and devices are using their batteries (thing about mobile phones). Last, the electricity demand is going sky high in the evening. Think about your own evenings: you are using your oven to prepare your meal, then you’re switching on your TV to watch a movie and then you put on multiple lamps to brighten your living room. Tesla’s Powerwall can store electricity produced during the day, to meet the electricity demand peak in the evening hours.

Electricity Demand Distribution. Source: http://www.teslamotors.com/powerwall?utm_campaign=&utm_source=direct-ts.la&utm_medium=ts.la-twitter&utm_content=awesm-inlinelinkcreator
Electricity Demand Distribution. Source: http://www.teslamotors.com/powerwall?utm_campaign=&utm_source=direct-ts.la&utm_medium=ts.la-twitter&utm_content=awesm-inlinelinkcreator

By using Tesla’s brand new product in combination with solar panels, consumers can become fully independent from the utility grid. Consumers can start adding value to the world’s energy efficiency usage themselves! There is no need to point fingers at the big energy providers; you can take action yourself. But does the Powerwall provide the perfect solution for all of us? No, not yet. In an article about the Powerwall, Christopher Helman (Forbes) describes that Tesla’s latest innovation doesn’t make economic sense unless your house is solar panelled and entirely of the grid.[3]

Although the Powerwall isn’t economically feasible yet, the US government announced 30% federal tax credits of the battery price. Furthermore, California has a 60% be-a-fool-to-not-try-this rebate.[4] These rebates will increase the adoption of the Powerwall among people who can afford it and who are willing to live more sustainable. The income generated via the early adaptors can be used for further development of the batteries, which then will lead to decreasing prices. Besides, prices for solar panels are decreasing as quickly as batteries nowadays. Therefore, there is a huge potential market for Tesla: more and more consumers can start adding value to the worlds energy efficiency.

Battery and Solar costs. Source: http://www.bloomberg.com/news/articles/2015-05-01/tesla-s-powerwall-event-the-11-most-important-facts
Battery and Solar costs. Source: http://www.bloomberg.com/news/articles/2015-05-01/tesla-s-powerwall-event-the-11-most-important-facts

To conclude, the introduction of Tesla’s Powerwall allows consumers to start living completely off the grid. Although it’s not economically feasible for the entire world yet, it’s a great first step. Early adaptors and innovation will lead to decreasing prices and more Powerwall users. So from today, let’s start adding value to a more sustainable world together!

[1] http://www.teslamotors.com/powerwall?utm_campaign=&utm_source=direct-ts.la&utm_medium=ts.la-twitter&utm_content=awesm-inlinelinkcreator

[2] Elon Musk during the Tesla Powerwall launch event in Los Angeles on April 30th, 2015: http://www.teslamotors.com/powerwall?utm_campaign=&utm_source=direct-ts.la&utm_medium=ts.la-twitter&utm_content=awesm-inlinelinkcreator

[3] http://www.forbes.com/sites/christopherhelman/2015/05/01/why-teslas-powerwall-is-just-another-toy-for-rich-green-people/

[4] http://www.extremetech.com/extreme/204702-what-the-tesla-powerwall-home-battery-means-inexpensive-time-shifting-for-solar-energy

Articles

Word-of-mouth: oral versus written

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Word-of-mouth has always been important. It has a crucial impact on customer behaviour. If someone recommends a certain product, it is more likely (more than 50%) that in the end this person purchases the product. Currently, it becomes even more interesting because the digital era makes it easier to communicate with each other. Nowadays there are more different channels you can use to spread the word easy and fast. Different channels of communication will influence the potential customer. But is there a difference between oral and written communication? Does the way of communicating affect a certain message? And could this be an opportunity for a company?

For me there is a difference in a way that written communication feels more anonymous. This is why I first thought that this would cause low-content and less interesting messages since people feel less responsible for their own messages. However, if I think a bit further I do think that in written communication someone feels also less social pressure to answer right away, which means that they have more time to think about their message. This could result in more refined, complex and interesting messages. At the same time written communication can feel more permanent (you cannot remove it easily) and the writer can be worried about the receivers’ expectations: e.g. my audience is expecting the world from me, now I have to live up to that by writing something really valuable. This is related to your online reputation.

Berger and Iyengar (2013) were curious and therefore did some research about the difference between oral and written communication and how this affects the content of the message. The results show that if there is more time to construct and refine a message (i.e. asynchrony), people will indeed talk about more interesting products and brands. Also a higher level of self-enhancement will support this effect. When there is enough time to construct and refine a message, people with a higher level of self-enhancement will take the opportunity to use this time to choose interesting products and brands to talk about.

Knowing the fact that asynchrony improves the interestingness of the message, written communication scores higher than oral communication. If someone asks you to tell something about a certain topic, you will feel the pressure to answer within a few seconds. You probably feel less confident about the topic and would tell more straightforward, less interesting and more accessible things. However, if someone asks you to write it down, the first thing that you probably think is: how shall I formulate this? What would be the most appropriate way? etc. There are immediately multiple things to think about before you are actually writing something down. You will give yourself more time to construct the message. This supports the research, which shows that in written communication interesting products and brand are mentioned more often.

But how could companies benefit from these findings? Companies want customers to talk about their interesting products and, as we have seen, written communication is an appropriate way to do so. At the same time there is an upcoming trend of digital communication: the impact of digital word-of-mouth is powerful because of reasons such as speed and its one-to-many nature. This means that companies should respond to this trend by investing in written communication platforms and a strategy for digital word-of-mouth.
People obviously prefer to talk about interesting brands. So in addition to supporting written communication platforms, companies should also give customers a reason to talk, evoke interest and surprise people by engaging, equipping and empowering customers. Like NikeSupport is doing with responding on conversations on websites (engage). These three E’s are important for building up a digital strategy and to make sure that customers are evaluating the brand as a more interesting one. Companies should take these insights into account to spread the positive word of mouth.


References:
Berger, J., & Iyengar, R. (2013). Communication channels and word of mouth: How the medium shapes the message. Journal of consumer research, 40(3), 567-579.

http://www.forbes.com/sites/kimberlywhitler/2014/07/17/why-word-of-mouth-marketing-is-the-most-important-social-media/

http://www.socialemailmarketing.eu/2010/05/wordofmouth-in-the-digital-age-introducing-wordofmouth-equity/

http://www.dotrising.com/2015/01/16/how-important-is-word-of-mouth-in-the-digital-age-infographic/

Articles

Smart customer, Smarter business

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Firms knowledge about its’ customers over the last years has skyrocketed. With the rise of the internet came revolutionary ways to differentiate customers. The use of different tracking mechanism allows for a company to track the customer. The combined information that is gathered can be converted into a customer profile. Nowadays it is essential for shops to determine groups within those profiles. Easy ones are age, gender and location, but as more data is analyzed more profiles can be distinguished. This blog post will focus on a few of these customer profiles that are a bit harder to determine than age or gender.

Strategic pricing is nothing new, segmentation between customers has been done for ages but it is time to bring it to the next level. Consumers are smarter than ever. Searching costs have dropped with increased ease of use of search engines. Reviews and technical information are for most product categories widely available, this relatively new development leads to improved product informedness; the consumer is better aware of what is in the market. Same goes for the price of products. Comparison sites make it much easier to quickly determine the average industry price, leading to a better price informedness; a customer that knows the value of the product. These factors together lead to a higher consumer informedness.

With all this information available to the consumer, it becomes more and more difficult to define the perfect pricing strategy for your products. Research at the Erasmus University Rotterdam in collaboration with the Singapore Management University suggest that there is no perfect pricing for a product group. First of all the research made a difference between two types consumers. A commodity Segment and a differentiated segment. The first consumer group has a strong preference for choosing the product that offer the best price. The second group is willing to pay more if that means that the product fits better to their needs.

The groups were analyzed using data that was collected through a series of stated choice experiments in two different contexts. Results were clear, one pricing strategy for a product just isn’t enough. A company needs to develop different pricing strategies depending on the kind of customer it is facing. The research found that different levels of informedness amplified different consumer segments. Consumers of the commodity segment, who highly valued price, where more influenced by a product offering high price informedness. Whereas the differentiated segments behavior was stronger amplified by an increase in product informedness. This means the firm needs to make sure the type of information available of the product matches with the type of customer that is interested in buying the product.

For the company this leads to a necessity to use advanced tracking tools to determine the kind of consumer it is facing, and adjusting not just the price, but all the information available about that product. This will have as a possible result that customers see a totally different price and description compared to their friend or family member, even though it is exactly the same product. And for you: As a consumer you will get product and price information that is ‘tailor made’ to fit to your preferences, which sounds nice but it could for example mean that you pay a much higher price because the company knows you are using an expensive laptop.

Sources:

– Li, T., Kauffman, R.J., van Heck, E., Vervest, P., and Dellaert, B. (2014). Consumer Informedness and Firm Information Strategy. Information Systems Research 25(2) 345-363. http://ink.library.smu.edu.sg/cgi/viewcontent.cgi?article=3194&context=sis_researc
– Tsekouras, D. (2015). ‘Consumer Centric Digital Commerce session 4’. Business Information Mangement. RSM Erasmus University.

Business Case

If This, Then That. Wait, what ?

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You just got back from your trip to Australia, and there is this cool picture of you in Australia you really want to share with all your friends. You know you will have to share this photo of you riding a kangaroo on-every-single-social-network you are on. How many is that again ? Oh, definitely more than three.
Do you know what this means ? Yes. You are going to repeat the exact same step every-single-time.
Now I am asking you : aren’t you tired of constantly repeating the exact same task ?
It would be great if in one, and one action only, all these repetitive and boring tasks could be done all-at-once.
Well, IFTTT – If This, Then That – would be the solution to your problem. IFTTT – pronounced like lift without the l – is an app that manages links between your different accounts and actions.
Many linked actions, or recipes, are displayed on the app.
Recipes
The only thing you need to do, is to select one of these recipes, and let IFTTT do the rest of the job for you.
Clever isn’t it ? But what happens when you cannot find your perfect recipe ? Well, this is when the trick comes.
As a matter of fact, IFTTT is an Application Programming Interfaces – API – which allows different applications to interact together. This, allows every user to turn into a programmer and develop their own app, which facilitates the app-creating process for everyone. Also, experts in programming can use this service as well : indeed, they do not have to share their codes with the community, and therefore risk their codes to be stolen. Users can therefore develop their own recipes after selecting two accounts, or channels, and linking them to two predefined actions, or triggers.
In reality, channels are not online accounts only. Indeed, some of them can control certain internet connected devices such as Philips Hue light bulbs, Dash – which tracks your driving data – or WeMo – which allows you to switch on/off your light from anywhere – for example.
Thus, you select the channels you want to program and the predefined triggers.
Screen Shot 2015-04-24 at 18.12.45
 
These triggers are predefined actions that you ask the channel to execute. The actions can be :
  • Active : actions are executed by yourself, if you post a new photo on Facebook for example
  • Passive : actions are automatically executed by the channel itself i.e weather forecast.
Creating a recipe is not about building an action you wish existed only. Indeed, it is also about personalizing, and being more accurate on your trigger and the action you take. For example, you might not want to receive all the photos you post on Facebook in your Dropbox, or maybe you do not want to receive the weather forecast every day by text, but once a week by email.
This, is the recipe I created for myself. Thus, I do not have to check all my forecast websites every day, but just wait for my iPhone to tell me when it is time to go surfing !
To sum up, IFTTT is an extraordinary application which allows Applications to interact with each other. Many recipes are available and, if none matches your needs, you can create it yourself, just like a developer ! This, will avoid you to do repetitive boring tasks, and therefore, make you gain time !
Business Case

Get more done with freelancers

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Imagine yourself as an entrepreneur in a startup who worked on a product for quite a while. Eventually, you come in contact with investors and customers who are really interested in your product. Due to the size of your company and the lack of a professional company website these customers are less likely to buy something from you.

Imagine yourself now as a mobile developer. Previous years you trained yourself to design and build mobile applications and had some great projects you worked on. However, the company that had you on their payroll fired you. Although with your skills it wouldn’t be difficult to find a job, but you want more flexibility than your previous job.

Both scenarios are possible within the platform Odesk.com. Odesk is a freelancer platform that creates its value by the number of businesses that are posting jobs on the site, but also the freelancers that are offering their services on the platform. Thus, the supply and demand create the value of the platform while the platform is a mediator for the users.

Freelancers are users that offer their skills and experiences on the platform, for a price they consider to be right. When there are a lot of competitors, it’s best to compete with price. This also stimulates people with a rare skill to offer their services since no competition would influence the price. Also, freelancers are able to apply for a listing job.

Businesses on the other hand can post jobs on the platform. When posting jobs, its common to fill in details for the job. Freelancers could apply to the job and businesses can pick someone out of the crowd. Businesses can select on experience and skills, but also writing style to pick the person that fits best to the job. This way, connecting to people jobs is a two-way relation.

Besides oDesk being a mediator in freelancers finding jobs, oDesk offers protection to the businesses with their tool that captures work-in-progress snapshots of freelancers working on the job. Also, businesses only have to pay when they approve the work that has been done. In return for the services oDesk offers, Odesk receives a 10% fee of each payment. If the freelancer works per hour, Odesk receives 10% of the hourly rate.

oDesk is operating since 2003, and has more than 1 million businesses that used their services. A while ago, oDesk and their competitor elance joined forces and are now connected with each other. Together, they have 9.7 million freelancers signed up; 2 million businesses that use their services and approximately $940 million worth of work done annually.

oDesk is ensuring the world becomes more connected and is supporting competition among its users. However, since the world nowadays gets more connected through more platforms, I wonder what their next big step will be in staying competitive with other businesses that might enter their market.

References:

https://www.odesk.com/

http://www.elance-odesk.com/

Business Case

The social buying website

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Ever had the experience that you spotted something cool on a social website such as Instagram and Pinterest and you wanted to get it, but more often than not you could not find a shop to buy it from? As a consumption economy we always want new and fancy things in our lives and online shopping has made this much easier.

The website Fancy.com solves this problem by allowing the direct connection between seller and buyer in a social environment. Fancy is the place that allows you to discover and buy amazing things curated by the global community. So how does this business model work?

fancy-app

The website can be compared to many different websites, it allows you to buy high-end things on a website as as good looking as Tumblr/ Pinterst and most importantly as money-driven as Amazon. It is based on a new retail model that allows you to shop by accidentally discover new items instead of you deliberately searching for them. In fact it works much the same way as Pinterest, only the website has a direct purchase button at every product displayed.

It works as followed, you spot something on the internet and save the image because you like it. After that you go to the website and upload the photo of the product including a title, you add a link to the companiy and set it under the correct category. The image is than posted on you Fancy feed and is indexed by the Fancy database. The company is then notified that the product is on the Fancy website and the company can then ad a direct buy link. After this my image, that I uploaded, is visible on my news feed and all my friends are able to buy the product directly on the Fancy website. Fancy business model is taking a 10% commission on each of the products sold,

Naamloos2

This business model is such an success that even Pinterest is planning to introduce a “buy” button that would let users purchase some items from inside the online scrapbooking service. This would mean direct competition with a website that already controls a 23% of traffic to e-commerce sites (Business insider, 2015). Furthermore, the approach used by Fancy can create problems in the institutional arrangements, the user generated content has a lingering problem with liability. Especially copyright infringement is a constant threat for the Fancy website, the wrong content can result in a law suit against the website itself.

However, it can be concluded that this new social buying trend is potentially changing the way we shop, this also means that websites such as Amazon need to compete with a new kind of buying behaviour. After all, for most consumers this trend is a welcoming site, it creates new value in the online shopping experience.

Sources:

Fancy.com

Business insider: http://uk.businessinsider.com/pinterest-buy-button-2015-2?r=US

Business Case

How Co-Creation Complements Internal R&D Activities and Drives Innovation: The Nivea Case

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You might have heard of Nivea’s new product: Nivea Invisible for Black and White (check out all the available products: http://www.en.nivea-me.com/products/Deodorants/black-and-white). This ‘revolutionary’ new deodorant is Nivea’s latest co-created product.

Throughout the development process of the deodorant, Nivea has worked with consumers, not against or separate from them. This case is a nice demonstration of how co-creation can become a valuable part of a business’s innovation strategy.

Co-creation process

Nivea Co-Creation Program

Source: SlideShare (2015)

The figure shows how Nivea enabled customer empowerment in the development of the deodorant. In addition to the figure, I would argue that there is also a step 0, which is the problem discovery phase, applicable for both the consumer (discover your own need) as well as Nivea (hunt up the customer need and set up the co-creation program). Stage 0 forms the basis for step 1, which is more the translation of consumer needs into user solutions (thus assuming that a consumer knows his/her needs).

The co-creation program shows a niceand Nivea, where the consumer is involved in the new product development. This involvement leads then to the development of better products and at the same time reduction of costs and risks in general if customers in a given domain are willing and able to deliver valuable input. This effect is also amplified because the Internet allows companies to build strong online communities through which Nivea can listen to and integrate thousands of customers from all over the world.

What Can We Learn From Nivea’s Co-Creation Program?

Looking at how co-creation can shape an organization’s internal processes and can foster innovation, it is important to note that much of the value lies in the co-creation process, rather than the end results. When companies aim to integrate co-creation ambitions, they should set up strong team-based responsibilities and metrics for the process instead of the outcomes. Moreover, incentives tied to both the process and the results should then foster innovation through trial and error. Co-creation is not necessarily the best way of product development, but it surely adds value in many ways, most of them tied the process in which consumers are involved in the product development:

  1. Better advertising interpretation
  2. Consumers’ understanding of the companies’ decision making
  3. Identifying lead users to influence the online communities
  4. Products that better reflect consumer needs
  5. Increasing (post) word-of-mouth

In the case of Nivea, consumers had full empowerment. In both the generation of ideas and solutions as well as the selection of the best ideas, consumers were put in charge. Additionally, consumers were given the opportunity to provide improvements of the ideas and raise questions or concerns about the ideas. From a methodological perspective co-creation with consumers proved to be most effective when qualitative and quantitative techniques are applied in alternating sessions for ideation and for evaluation and selection.

Key Take-Away

In the end, co-creation needs to be considered as a programmatic approach that aligns internal R&D capabilities and external knowledge and creativity beyond single projects.

References

http://blog.hbs.edu/dighbs/some-thoughts-on-netnography-and-digital-co-creation/

http://www.ideaconnection.com/open-innovation-success/Nivea-Co-Creates-with-the-Crowd-to-Eliminate-Stain-Pr-00365.html

http://www.slideshare.net/HYVE/2011-0228-nivea-invisible-for-black-white-deodorant

http://www.michaelbartl.com/article/getting-closer-to-the-consumer-how-nivea-co-creates-new-products/

Articles

World’s Smartest Lightbulb meets Smart users!

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According to Randall et al (2005) moving the specification decisions of a product from producer to user can be a valuable decision considering that the user is the agent in the value chain with the most knowledge about user preferences.

In the case of Philip’s HUE, this was certainly situation. The HUE lighting system uses LED bulbs – with a twist! Opposed to being controlled by a switch, the Hue bulbs are controlled with your smartphone using an IOS app. The light lets you switch between a wide spectrum of colours and brightness settings, allowing you to customize the lighting in your home around mood or setting (Forbes, 2013). The “how many years does it take to change a lightbulb” is an amusing creative video that will allow you to get a feel for the product.

When the product was launched late in 2012, HUE had an enthusiastic group of users and hardware/software developers seeking to deliver extending compatible apps and integration with other products. Thus, Philips answered to this by formally launching HUE LED Lamp APIs and a software development kit. This opened the playing field for third party developers to create new, exciting applications using light (Philips 2013).

This was no mistake considering that the HUE community created rich functionality for an enhanced customer experience (Philips 2013). A cool example is that external developers have created apps that integrate Hue with music. Hue Disco controls HUE lamps dynamically based on the music beat picked up by the microphone in the smartphone (Ledsmagazine, 2013). Another example is a scheduling application that can integrate with a phone’s calendaring application.

The developers can use the new tools to more easily develop apps and this is still happening today. For example, manufactures currently working on universal TV remote controls are considering adding HUE support (LedsMagazine, 2013). Other devices such as thermostats might integrate HUE as well. (LedsMagayine, 2013)

According to Kevin Toms, Developer Advocate of Hue’s software developers’ platform, the response from the HUE community has been incredibly positive (Philips, 2013). Philips thus aims to continue redefining the possibilities of light by enabling developers to create apps that customers want and need.

Summary

How did Philips leverage developer communities for innovation?

  • Creating tools, guidelines and software libraries to support development
  • Facilitating Hackathons and Developer conferences
  • Being present and supporting discussions on social media (Twitter, Facebook, Community-founded sites)
  • Embracing the community!

Screen Shot 2015-04-19 at 13.11.02

Results: Generating Innovation and PR that translates into sales!

Screen Shot 2015-04-19 at 13.10.37

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Articles

Choose your customers strategically

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Have you ever complained about a service or product at your most favorite firm’s Facebook page? Nowadays, we live in a complex world with an overload of choices. This results in different types of customers with their own specific demands, but it is hard to comply with every single niche. Firms are confronted to choose which type of customers they want to serve. This is the reason whether you feel neglected by your favorite firm or not.

In this article you will understand why a particular firm has a legitimate reason to turn down your requests and ideas. First, a theoretical part will be discussed. Followed up by a practical implication. At last, a discussion point is stated.

A framework called ‘Strategic Value Assessment (SVA)’ is elaborated in the article “Strategic Value Assessment and Explorative Learning Opportunities with Customers” by Nijssen et al. (2012). Initially, it starts with the innovator’s dilemma, i.e. firm struggles between the choice of responding to customers’ requests and protecting the long-term competitive position. Consequently, SVA provides a priori assessment of partner selection within the dynamic environment we live in. Why is SVA beneficial? A collaboration with every single customer is very costly and do not add value to the firm. Such a perspective best guarantees that the selected collaboration will bring strategic value, and specifically, allow for taking in new knowledge that stimulates new business development. It will safeguard new, exploratory learning that will materialize in future cash flow and revenue.

figure 1

In figure 1, a figure with all the variables and hypothesized relations are disclosed. The dependent variable “explorative learning” is the ability to extract knowledge from the collaboration with a customer and develop technological extensions and turn it into appealing new products for new markets and customers.

Secondly, ‘intensity of collaboration’ increases the involvement and interaction between the two parties. As a result, the two parties become more familiar with each other. Therefore, familiarity increases the chance of exchanging knowledge.

Thirdly, ‘lead users’ are a source of radical new product ideas. Without SVA the firm cannot distinguish the good and bad projects. However, with SVA, the firm chooses only the product ideas of lead users and avenue to future growth.

Lastly, under conditions of strong ‘dependence’, firms pursue short-term sales and profits by collaborating with customers that reduces the strategic and long-term effectiveness of the collaboration which results in focusing mainly on existing products and neglects developing new products for potential customers and markets.

Testing these variables with a sample of Dutch SME’s consisting a total of 136 firms provides the following insights:

  1. SVA has a positive impact on explorative learning which is beneficial to the firm for retaining a competitive advantage and sound future revenues. Also SVA has a directly influence on lead users and intensity of collaboration.
  2. Implementing SVA as a framework increases the likelihood that a firm will collaborate with its lead users.
  3. Reflecting partner selection at the start of the project (a.k.a. fuzzy-front end) of a new product development process evades the dependency problem. SVA prevents becoming too committed to only one option in an early stage rather than exploring all the potential opportunities.
  4. SVA can be used to distinguish the good ideas from the bad ones. It may serve as a justification to reject less promising new product venues suggested by current customers.

A practical implication:

Today, co-creation is a common phenomenon and widely discussed in the literature. However, refusing a customer and its requests put the relation between the two parties in jeopardy. Therefore, the short-term profits of the firm might decrease. If the firm raises awareness of the SVA as a motivation for the firm’s move, the customer’s understanding increases. Hence, this may preserve the relationship.

Discussion statement:

A limitation of this paper is the focus on Dutch SME’s which are relatively small in comparison with Amazon, Google or Apple. Assume the sample includes financial unconstrained high tech firms with a higher budget for R&D projects in combination with customer collaboration. The sample in the paper involved an average of 33 FTEs and 96% of all firms have 1 to 99 employees.

At the firm’s perspective, is it a good decision to implement SVA and deliberately pursue only the requests of lead users instead of the plebs?

My opinion:

I think it would be a matter of business strategy that the firm pursues. Choosing between focus strategy and an industry wide target strategy.

Nijssen, E.J, Hillebrand, B, de Jong, J.P.J, & Kemp, R.G.M. (2012). Strategic Value Assessment and Explorative Learning Opportunities with Customers. Journal of Product Innovation Management, 29, 91–n/a. doi:10.1111/j.1540-5885.2012.00960.x

Business Case, News

Thank god it’s Friday!

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A creative gateway to the festival Extrema Outdoor, the design and inspiration for a new buddha to buddha bracelet or the design for a new tattoo for Dré Hazes. These requests or so called Calls for Creation have already been answered, co-created and fulfilled using the Created on Friday platform.

Created on Friday is a video-based platform in which clients, creative minds and followers are connected in Creation Stories. With already 12 co-created final products and 16.000+ creative minds and followers, they are experiencing a promising start. What makes this platform different related to others and how does the consummation look like ?

Creating a Creation story process

1st Friday – Call for creation

On the 1st Friday at midnight, the client submit a Call for Creation video. With uploading this video based Call on the online platform, a client opens the request for action towards creative minds. As already presented above, the topic of call for creation can be anything of choice based on the client request for a unique concept e.g. design, art or a new marketing campaign.

During the first week, anyone with a creative mind can respond on a specific Call for Creation by uploading their creative solution. Again this response will be delivered in the format of a video-pitch. The video pitch will be shown to online crowd, to give them a proper feeling and understanding of the solution proposed by the creative mind (person, company). The online public or followers, in turn, will vote for their favorite videos resulting in a dynamic top 5 ranking on the basis of video views and votes during this week.

2nd Friday – Winner gets chosen,  nr 2,3,4,5 announced

On the 2nd Friday the top-5 will be frozen and the client decides which pitch will be awarded as the number one. Interesting fact is that the client still can decide to choose a winner outside of the top 5. Having said that the client’s favorites are presented in a frame on the client’s Call for Creation page. This way the client can influence indirectly followers’ voting behavior. The nr 2,3,4,5 of the video-based pitching contest will be awarded with money. Besides the financial rewarding, the top-5 creative minds and their solutions will be announced on the platform making use of a video. In this way the creative mind talents will be shown to all the followers. On top of that, the winning creative minds will be part of the Created on Friday wall of fame.

During the second week, in a Meet & Making of, the client and winning creative mind co-create, further develop and fine-tune the winning idea into a final creation. Taking into account that the client is responsible for all the resources needed to come up with the final creation.

3th  Friday – Final creation

After 14 days of pitching, voting and co-creating the final product will be presented. Not surprisingly, this will be done using a video message on the Created on Friday platform.

 Success

Using online video content during the creation story, allows both clients, a creative mind and followers to share their findings and ideas towards a large crowd. In my opinion, the use of different social media channels ( YouTube, Facebook, Instagram ), makes Created on Friday a unique marketing “machine”.

Secondly I am really curious about the impact Created on Friday could have on nowadays marketing/design agencies. Noticing that these agencies mostly of the time charge a lot of money and consume more than 2 weeks to come up with a final product.

Since it’s founding by the end of 2014 , already 12 Creation Stories have been created. In my opinion, many more will follow. Top priority will be the supply of new Calls for Creation by clients.

Created by: Luut Willen

References :

Business Case, Mini Cases, Opinion

You and Me will Shake Up the News Industry

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Using your Twitter account to create your own TV channel, something that became reality last February with the introduction of the Meerkat app. It’s very easy: open the Meerkat app, log in with your Twitter account and press ‘stream’ to start broadcasting. The broadcast will be shared via your Twitter account and can be followed by any other Twitter users.[1]

Meerkat is a promising application: the start-up got over 4.2 million dollar in funding and has over 120,000 users already.[2] Furthermore, after the successful introduction of Meerkat, Twitter launched its own streaming application called Periscope. Both Meerkat and Periscope allow Twitter users to broadcast anything they like. I’m conviced that these streaming apps will shake up the news industry.

Already, news organisations started experimenting with both Meerkat and Periscope. The Economist correspondent Henry Curr answered questions send in via Twitter, using a Meerkat stream. According to the Economist, ‘Meerkatting’ is perceived more informal and a great way to engage with their Twitter audience.[3]

Twitter already got a great impact on the news industry. 78% of all journalists use social media on a daily basis (of which Twitter is used the most) and 74% of all journalists believe that social media have more rapid impact than traditional media. But it’s not the news organisations that will shake up the industry; it’s going to be you and me.

Already, consumers are adding value to the news industry by sharing information about any kind of occurrences on social media (both text and pictures). This is already being used by journalists to pick-up the latest news flashes: 45% of all journalists put out 60%-100% of all they publish as soon as possible – without checking facts – and correct later if possible. Just 20% of the journalists always check the facts before publishing.[4] Via the streaming apps, consumers can start adding value to the news industry by sharing directly what they see: it’s an additional point of view next to traditional news organisations and, moreover, viewers can interact with the broadcasters. Concluding, you and me can help sharing news quicker and more reliable.

So from now on, news organisation are becoming of less importance in providing news to societies? No, that’s a misunderstanding. Meerkat and Periscope were widely used after an explosion in York City. Some were stating that these broadcasts were introducing a new era of journalism, while others were less convinced by the usage of the streaming apps. Jacob Brogan, Future Tense research associate, stated that “People weren’t getting information from either that they couldn’t have found more easily and more clearly on Twitter” because “it was too far from the scene to reveal more than the fact that the fire was still burning”.[5] I do not think that Brogan isn’t right there, but the ‘Meerkatters’ aren’t replacing journalists. While news organisations will remain the most reliable source for news, ‘Meerkatters’ can show news from a different angle and, moreover, followers can interact with the Meerkatters.

You and me are not going to take over news organisations – we shouldn’t even want to do that – but we are going to add value to the news industry!

[1] http://www.emerce.nl/nieuws/nieuwste-sensatie-sociale-media-meerkat

[2] http://mashable.com/2015/03/15/twitter-meerkat-graph-users/

[3] http://www.theguardian.com/media/2015/mar/30/meerkat-periscope-live-streaming-apps-news-twitter

[4] http://www.ing.com/Newsroom/All-news/NW/2014-Study-impact-of-Social-Media-on-News-more-crowdchecking-less-factchecking.htm

[5]http://www.slate.com/articles/technology/technology/2015/03/meerkat_and_periscope_the_live_streaming_apps_aren_t_changing_the_news.single.html

Business Case

ZEEF: Taking on Google by using… humans.

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Recently a new Dutch start-up has been getting some media attention. They have given themselves the name Zeef (the Dutch word for a sieve), a name that will start to make sense if you continue on reading. Zeef has taken on a rather ambitious goal; challenging Google by changing the way people search for information online. Their trick essentially revolves around sieving the information on the web to only show the relevant bits to people searching for a specific keyword. The interesting thing about Zeef is that this sieving is done by humans.

On Zeef, the information you can search through is managed by so-called curators. As a curator, you can create a page about a topic you like, let’s say backpacking. All the content on this page about backpacking is managed exclusively by you, the curator of the page. Curators can then add links to other websites with relevant information on backpacking on this page, and categorize these links into blocks on the Zeef page. So you might find a block with all kind of links about things to take on your backpacking trip and another block will show you all kinds of websites you can use to find hostels. It is also possible to add images or just blocks of text to your Zeef page, but the main aspect is the collection of links to websites relevant to the topic. The idea behind this is that humans are far better capable of deciding whether a website is relevant to this topic than algorithms, such as Google’s, ever will be. Now you might think “How do I know if this random person who created the page on backpacking is actually knowledgeable on the topic?”, and this would be a fair question since anyone can become a curator and setup a page within minutes. Zeef has tackled this problem by allowing other curators to ‘challenge’ a already existing page on the topic by creating their own page on the same topic. So let’s say you come across the backpacking page on Zeef and think you can do better. You can then simply create a page on the topic on backpacking as well, and when someone then searches on backpacking he/she will be able to choose between the two versions. If you like a page you can vote for it, and this way a ranking of multiple posts on the same topic is created.

(A page I created on Zeef: https://the-grid.zeef.com/axel.persoon)

Zeef

Zeef has a really interesting approach, as it basically argues that a recommendation system by humans is better than a recommendation system based on a algorithm. And there might be some truth in that statement. As mentioned in the paper by Tsekouras & Li, people appreciate the effort made by recommendation agents. I can imagine that this appreciation of effort is even larger if people know the recommendation agents are human. The strength of Zeef lies in its numbers, and perhaps over time we will see a extensive hub of information completely curated by humans instead of algorithms.

Business Case

Minecraft aka Digital Lego

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“It isn’t like other games. There are no instructions, no levels, no mission structure, no story, no lives, no points, no clear goal. The only aim is to survive”

User design and co-creation have emerged as a mechanism to build brand loyalty, to fit products to the heterogeneous needs of a market, and to differentiate the offerings of a manufacturer. More than ever, customers want to make their own choices and demand uniqueness. Minecraft was born in the context of our increasingly individualized and digitalized world.

You start Minecraft in the middle of a randomly generated, “blocky-looking” world about eight times the size of Earth and are completely free to do what you want. You can go exploring, or you can get creative.

Minecraft allows users to create their own environment and build new structures with the building blocks provided by the game designers. At the start of the game, the player is placed on the surface of a procedurally generated and virtually infinite game world. The game world is procedurally generated as players explore it. Minecraft also enables multiple players to interact and communicate with each other on a single world.

The game was created by Markus Persson and was recently sold to Microsoft for $2.5 billion. Without any advertisements, Minecraft had 1 million purchases, less than a month after entering its beta phase.

In addition to Minecraft, there are several games that allow users to generate content. For instance, Sim City lets players build up their own city within the game constraints. The novelty of Minecraft is that it offers infinite creativity and control!

Like in mass customization, in Minecraft users are active co creators and are the beneficiaries of their creations. However as some of the best Minecraft creations can be shared, they might benefit others (game developers, architects etc.) But why do customers benefit from playing Minecraft? Firstly because it’s fun, second because it enables users to create experiences that are tailored to their needs and finally, because it may fulfill their social needs, in particular when publicly showing their creations.

Check out some of the best creations: http://www.bbc.com/news/technology-29211032

“It offers infinite creativity and control”

By giving so much freedom, is Minecraft able to maximize users’ satisfaction? Given that Minecraft players may not fully understand their needs or may have different levels of skills, the game bears the risk of a “design defect”: a choice of design parameters that does not maximize user satisfaction (Randall, T., Terwiesch, C., & Ulrich, K.T. (2005). This design defect concept reflects a misfit between the game designed and the one that might have been designed, despite the fact that the user is in control of all of the design decisions. Minecraft mitigates this risk by including some default options that enhance customer satisfaction. For instance, gameplay by default is in first person, but players have the option to play in third person mode.

References

Randall, T., Terwiesch, C., & Ulrich, K.T. (2005). Principles for user design of customized products. California Management Review, 47(4), 68.

http://gamificationnation.com/gamification-mechanic-monday-co-creation/

http://www.wired.co.uk/magazine/archive/2012/07/features/changing-the-game

Articles

Getting paid while doing nothing at all!

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Throughout the world people join forces to build the kind of economy that we want to see. We share our homes, our cars, our knowledge, our time and our money. SnappCar is a Dutch platform offering a mediation service for those who want to rent their car to others and for those who want to rent a car. With this service SnappCar creates more consumer value, but it also asks for active consumer participation. Ronald Kleverlaan of CrowdfundingHub indicated SnappCar as the number one amongst all crowd-funding projects last year. The crowd-funding yielded more than half a million Euros through crowd-funding!

According to SnappCar, every day 23 million cars are not driving for 23 hours a day in Europe. This is waste of products, space and money, especially because a lot of people cannot afford to have a car themselves. SnappCar’s mission for 2018 is to have 1% less cars in Europe, which will lead to a reduction in CO2-emision as a result of the production of cars. SnappCar thinks they can make this impact by letting car owners earn money by renting their car to others for shorter periods of time.

They idea is very simple, you have something that costs a lot of money and you only use it for a small amount of time, so why not rent this product to others, to earn some money back? Besides the money you earn, you also help others by providing them your car for a lower price then the traditional car rental agency. As stated on Snappcar’s website “You will live a more conscious life and you meet friendly people in your neighborhood.” SnappCar provides all-risk insurance, 24/7 road assistance, contracts, payments and a trustworthy community, as to ensure that participants do not have to worry paperwork and other negative side effects.

SnappCar is a user-friendly platform as it provides all the information you need when renting a car. As you can see below on the images, it has information about the car owner, the average rating, the price per day, some images of the car itself and the specifications of the car. It is also possible to read some reviews or post a review yourself after borrowing a car. These reviews and ratings help other users make their decision to rent a car more easily. In the United States, SnappCar just received as one of the first Dutch companies a B Corporation certification. B Lab awards this label to companies that achieve solving social and environmental goals.

Snip20150403_4Snip20150321_6

A major negative effect of the car sharing platforms is that traditional companies such as car manufacturers, car dealers, but most of all car rental agencies will face a potentially huge decline in sales. This counts for other sharing platforms such as Airbnb as well, but in the end the big winners of the sharing economy are the consumer as they can easily get cheaper products and services. But in order to achieve this result renting the products should be as easy as owning the product!

http://www.nu.nl/weekend/3905769/de-deeleconomie-wordt-deelmaatschappij.html

https://www.snappcar.nl/snappcar-in-het-nieuws

http://www.telegraaf.nl/dft/ondernemen/socialezaken/23819780/__SnappCar_goed_op_weg__.html

http://feb.kuleuven.be/eng/ew/Articles%20press/2013/JK_DeStandaard_250513.pdf

Articles, Business Case, News, Opinion

Recommendation Agent 2.0

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Just like Don Corleone in the epic Godfather movie, the folks at Washington-based e-commerce giant Amazon are about to make offers to their business partners, the company hopes they can’t refuse. That the firm, like Corleone, relies on ‘capos’ to enforce these offers, can be doubted, but they have a treasure the Mafia never possessed. Amazon’s immense knowledge about their business partners, generated from all sorts of data, takes the firm to a stage where it plans to rely a huge part of its channel domain on its recommendation system. But let me explain.

After establishing overnight delivery years ago and the introduction of the ‘drone delivery service’ last summer, the firm filed a patent in January with the bulky name ‘anticipatory shipping’. The idea behind it could revolutionize the e-commerce environment. According to techcrunch.com the system is the next ‘step towards cutting out human agency entirely from the e-commerce roundabout’ (1). When set up properly the automated collaborative filtering algorithm will learn from the behavior of registered consumers and anticipate what they could possibly be interested in, before the consumers themselves think about it. When matched with a specific product, Amazon plans to wrap the item and send it towards the potential customers before an order has been placed. This means slashing down shipping time by relying on clients’ historical buying patterns, preferences expressed via surveys, demographic data, but also browsing habits, wish-lists and even mouse movements (1). Essentially, the system entirely outsources the consumers’ shopping experience and direct communication with Amazon on basis of an online recommendation agent.

Continue reading Recommendation Agent 2.0 →

Articles, Business Case, Opinion

Students-to-Students: Making Free Study Spots Visible

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As any consumer that switches from one company to the other, I’m prone to compare the one to the other. With universities, this is no different. When I switched from Utrecht University (UU) to Erasmus University Rotterdam (EUR), I saw a lot of points that both universities did differently and where they could learn from each other. But the one thing that the EUR needs most, I know exactly what that is.

As any good student, I regularly spend a lot of time on the university, working on projects, reading articles, doing research for my thesis, you name it. In between classes, before or after, I spend this time behind university computers (as I didn’t own a laptop) in the library, in computer rooms, etcetera. However, space is scarce in Utrecht’s university library. Whole generations of students have already been complaining that there are never enough study spots. Discussed measures have gone from a time limit on any computer use to banning HBO students from the library, but these were all rendered impossible to implement for the university. Of course there already existed a rule (and the on-screen timer that goes with it) that you are not allowed to spend more than 30 minutes away from your computer, or you’ll  be logged out and lose your current files, but this solves little as students usually don’t take other peoples stuff away if they want to sit somewhere.

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Opinion

The worst will be best, and the best will be worst

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Lately, I stumbled over the blog post “All around the world, you’re a great way to fly – Selling an experience“. The post contains a list of “profound services, which only the best airlines offer” (1) . It reminded me of heated discussions about the positioning and quality of airlines today, and how low-cost aircarriers’ (LCA) terrible reputation is a constant topic in media. Websites express the ‘general disgust’ about these firms (2), and passengers even take over planes (3). So, is it justified that many people perceive LCAs as the ‘worst airlines’ and most people think similar as the folks below?

Ryanair-Seats

Continue reading The worst will be best, and the best will be worst →

News, Opinion

Radio Rent-out!

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So after looking around on the web in search of some interesting customer co-creation contests and products, I found this (quite interesting, yet not good-looking) website (http://www.co-creatornetwork.com/index.htm) in which you could ‘buy’ your own airtime, and create a radioshow.

For 85$ a week you get an one hour show. Although the theme at this point is your general enlightenment, and transcending your earthly state, it’s an interesting idea to transfer this idea to mainstream radio. If for example you are a fan of techno music, only listening to your radiostation, because it really fits your taste of music but you miss certain songs, or think you could do a better job. It might be an idea for radiostations to rent out hours, or give them away in a competition (in which listeners give either creative suggestions, or Continue reading Radio Rent-out! →