Your winter tires get stolen from your garage. That is a bummer! Luckily, you have a household insurance policy. You file a claim at your insurance company but guess what? Your cars belongings are not covered by this insurance (Gaastra and Lasthuizen 2013). That does not sound very logical right? Well that is what the majority of the people on Onderling, an initiative of Dutch insurance company FBTO, also agreed upon. And that is why FBTO ended up paying out the money still (Emerce 2016). 

In order to innovate successfully, companies are increasingly seeking for new product or service ideas outside their boundaries (Nishikawa, Schreier, Fuchs, Ogawa 2017). Online communities are of increasing importance to businesses as they give companies new ways to interact with their consumers and can be used as input to innovate the offerings of a company (Ren et al. 2012).With the establishment of Onderling, FBTO tries to innovate beyond the existing way of doing business, making an attempt to address the problem arising between consumers and their insurance company.  Jeppesen Lakhani (2010) argue problem-solving effectiveness is vital to superior organizational performance. The goal of FBTO is to bring consumers and the company closer together. On the online platform everyone can join in the conversation and vote for real, actual claims and statements about insurances (Emerce 2016). 

This is how it works: you report a loss. When this loss is not insured according to the conditions, people insured at the company and employees of the firm have the opportunity to present their claim to the community on onderling.nl– experts already made the decision at this point. The community has the option to vote whether a claim should be paid and add their reasoning. For instance, someone could say the conditions do not classify this case clearly or it should be an exception to the rule. If 60% of the community decides the claim should get paid out, that is what will happen. Additionally, FBTO reassesses if the conditions as they designed it should be adjusted. This way, people help FBTO improve their products, communication and services (Emerce 2016; Gaastra and Lasthuizen 2013; Kruiper 2013) In summary, following the value co-creation framework of Saarjärvi, Kannan and Kuusela (2013), value is created by reassessing rejected claims and improving offerings from the gained insight provided by consumers. This value is created through B2C, in the form of re-evaluation and through C2B in the form of opinions and ideas. The mechanism used for co-creation is co-development, where FBTO can improves its offerings and gets to know what is important to their customers (Saarjärvi, Kannan and Kuusela 2013).Essentially, by providing feedback to improve offerings, they become part of the production process (Tsekouras 2019). 

The platform created by FBTO can be seen as a form of social computing, which is concerned with the intersection of social behavior and computational systems. The platform is a modern example of a technology giving rise to new ways of co-creation and interaction between companies and consumers (Oestreicher-Singer and Zalmanson 2013). FBTO created the platform to regain the trust of consumers and enhance transparency in the insurance industry, shifting from a service centric business to a customer centric business (Tsekouras 2019).The online community can provide users with useful informationm, support or  it can be a venue for discussion (Ren et al. 2014).The latter is the main strength of the website. The more people give their opinion, the more it becomes visible what people find important when it comes to insurance. With these insights FBTO can adjust their offerings to the needs of the customer. Even though the concept sounded promising, in the beginning the question was whether the concept would be successful. Would the insured be people loyal to each other and vote to pay out the money for every case? The opposite was true. Customers appeared to be critical and often agree with the choices of FBTO (Kruiper 2013).

According to Dellaert (2017),  FBTO’s system design could be efficient since it attempts to maximize joint payoffs for both the company as well as the customers. So, do customers see the added value of the new concept? Research shows they do. As you can see in the graph alongside, every aspect is assessed more positively after the implementation of Onderling (Gaastra and Lasthuizen 2013). Furthermore, the last few years FBTO has been declared most customer-friendly insurance company of the year multiple times. Overall, it seems customers see the added value of the concept. However, as with any business idea, FBTO experiences some challenges. The analysis also pointed out respondents were not very familiar with the platform. Only 23% of the people insured at FBTO ever visited the website of which 16% felt like voicing their opinion (Gaastra and Lasthuizen 2013). Furthermore, the biggest challenge is to involve the customers.Community engagement plays a primary part in creating sustainable competitive advantage,yielding higher profits and gaining loyalty from consumers (King, Racherla and Bush 2014).It is important to find users that have an high attachment to the community (Ren et al. 2014) Ren et al. 2014 highlight that a key downfall for companies is to attract the critical mass and engage them. This is no different for Onderling. When you want to let customer think along and incorporate their ideas, this demands organizational commitment. It is one thing to les customers think along, but the feedback from the community has to be processed and something has to be done with it. This means customers have to be top priority (Ren et al. 2014). On the one hand, the objectives of the organization have to be met, on the other hand it is extremely important task to represent the interests of the community members (King, Racherla and Bush 2014). Although it is proven that customer input did actually contribute to the improvement for products and services, it is not always easy to show employees of the firm the added value of customer interaction and to motivate them to actively support the community(Gaastraand Lasthuizen 2013).

So, what is next? To stay relevant, FBTO keeps experimenting with new ways of doing business that go beyond their existing boundaries. In 2016, FBTO started a trial where customers could decide for themselves what they wanted to insure, without policy conditions (Emerce 2016). In case of damage, the crowd would decide if you get your money or not, in a similar way as Onderling. The first trial did not gave the desired results but FBTO will try to keep innovating and serve their customers in the best way possible. Just like Henry Ford, the founder of the Ford Motor Company, once said about co-creation “Coming together is a beginning, staying together is progress, and working together is success” (Sanders and Stappers 2016).

Sources

Dellaert, B. G. (2017). The consumer production journey: marketing to consumers as co-producers in the sharing economy. Journal of the Academy of Marketing Science, 1-17.

Emerce. (2016) FBTO start crowdverzekeren. Retrieved from https://www.emerce.nl/nieuws/fbto-start-crowdverzekeren[03-03-2019].

FBTO. (n.d.) Nieuws en blogs. Retrieved from https://www.fbto.nl/nieuws-en-blog/paginas/consument-beslist-op-onderling-nl.aspx[07-03-2019].

Gaastra, S., & Lasthuizen, M. (2013) De kracht van onderling.nl. Retrieved from https://tudl3047.home.xs4all.nl/Synthese/wp-content/uploads/2015/08/Studie-3-Kracht-van-Onderling-FBTO.pdf[10-03-2019].

King, R. A., Racherla, P., & Bush, V. D. (2014). What we know and don’t know about online word-of-mouth: A review and synthesis of the literature. Journal of interactive marketing, 28(3), 167-183.

Jeppesen, L. B., & Lakhani, K. R. (2010). Marginality and problem-solving effectiveness in broadcast search. Organization science, 21(5), 1016-1033.

Kruiper, R. (2013) Crowdsourcing en co-creatie met FBTO. Retrieved from https://www.emerce.nl/best-practice/crowdsourcing-cocreatie-fbto[05-03-2019].

Nishikawa, H., Schreier, M., Fuchs, C., & Ogawa, S. (2017). The value of marketing crowdsourced new products as such: Evidence from two randomized field experiments. Journal of Marketing Research, 54(4), 525-539.

Oestreicher-Singer, G., & Zalmanson, L. (2013). Content or community? A digital business strategy for content providers in the social age. MIS quarterly, 591-616.

Ren, Y., Harper, F. M., Drenner, S., Terveen, L., Kiesler, S., Riedl, J., & Kraut, R. E. (2012). Building member attachment in online communities: Applying theories of group identity and interpersonal bonds. Mis Quarterly, 841-864.

Saarijärvi, H., Kannan, P. K., & Kuusela, H. (2013). Value co-creation: theoretical approaches and practical implications. European Business Review, 25(1), 6-19.

Sanders, E. B. N., & Stappers, P. J. (2008). Co-creation and the new landscapes of design. Co-design, 4(1), 5-18.

Tsekouras, D. (2019) Lecture 1: value co-creation.