1. CO-CREATION’S
5 GUIDING
PRINCIPLES
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT.

2. A White Paper by
Martijn Pater, Fronteer Strategy
Amsterdam, May 2009
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT.

3. Co-creation’s
5 Guiding Principles
OR .... WHAT IS SUCCESSFUL CO-CREATION MADE OF?
In this white paper, we identify different types of co-creation
(suitable for different types of challenges), present 5 guiding
principles for success, discuss the value of co-creation and
present a number of inspiring cases from around the world.
3

4. Co-creation -
what is it?
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 4

5. We define co-creation as the
practice of collaborative product
or service development: developers
and stake-holders working together.
5

6. Co-creation -
where does it come from?
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 6

7. Customers want more
involvement with their products
Traditional business
processes have changed
An enormous
amount of
knowledge has
become
accessible Co-creation is part of the
Open Innovation trends
going on since the 50‘s
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 7

8. Because of these trends,
companies face
challenging questions
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 8

9. How to innovate
from the core?
How to get - or stay -
connected with customers?
How should I deal with the risk of
commoditisation?
Where can I find
future growth?
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 9

10. But markets change and
new rules apply...
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 10

11. 99,995% of the people
don’t work at your
company...
They might have some
good ideas...
Why not capture them?
But opening up can be scary
- most companies hesitate to
share ideas and strategies
11

12. Co-creation -
how does it work?
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 12

13. There is always 1 initiator
- either company or just a
single person - that decides
to start the initiative
Contributors will be joining
along the process, but the
initiator determines who can
join and under what conditions
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 13

14. 1% Creators
10% Synthesisers
If you open up, keep in
mind the ‘1% rule’
100% Consumers
Only 1% of people in any
community generates the
majority of the creative output
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 14

15. Co-creation is more than a
tool, it’s a program of change
It can be used to...
... tackle your toughest strategic challenges
... get a fresh perspective on your business
... develop breakthrough new ideas
... unlock the world outside and bring it inside
... connect with partners, customers, consumers
... bring excitement to the floor
FRONTEER
... work with the 1% most creative people
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 15

16. 4 Types of Co-creation
There are many ways to go about
Co-creation, and which to choose depends
on the challenge and objectives at hand.
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 16

17. The 4 types of co-creation
are based on 2 dimensions:
Ownership
who owns the challenge &
the outcome?
Openness
who can join the challenge?
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 17

18. The 4 types of co-creation
Anyone Crowd of Community of
can join People Kindred Spirits
Open- Crowd of people
ness
Selection Club of Coalition of
process Experts Parties
Initiator Initiator + Contributors
Ownership
18

19. Crowd of people
For any give challenge there
might be a person ‘out there’
with a brilliant idea
Threadless enables contributors to send in and
rate t-shirt designs. Profits on sold items are
shared with the designer. Not bad: a full 30%
profit margin selling t-shirts with no R&D cost,
low investments and hardly any employees.
19

20. Community of kindred spirits
People or groups with a similar
goal develop something for the
‘greater good’
The Linux open source operating system
software was developed by users and for
users. The software code is free to use and
owned by nobody. It started with one
simple e-mail with a request for help.
20

21. Nokia organises ‘lead user’ and
‘expert’ co-creation sessions to
develop visionary new products
and services.
Club of experts
For specific, time-pressured
challenges when expertise and
breakthrough ideas are needed
21

22. Heineken has successfully developed
the ‘Beertender’ in co-operation with
Krups. A development period of 10 years
resulted in the first true packaging
innovation in beer in a long time.
Coalition of parties
In certain complex situations
parties with specific skills team
up to share knowledge, ideas
and investments
22

23. 5 Guiding Principles of
Co-creation
Successful co-creation initiatives tend to have
a number of characteristics in common.
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 23

24. 5 Guiding Principles of Co-creation
24

25. 5 Guiding Principles of Co-creation
Inspire
participation
24

26. 5 Guiding Principles of Co-creation
Select the very best
Inspire
participation
24

27. 5 Guiding Principles of Co-creation
Connect creative minds
Select the very best
Inspire
participation
24

28. 5 Guiding Principles of Co-creation
Share results
Connect creative minds
Select the very best
Inspire
participation
24

29. 5 Guiding Principles of Co-creation
Continue development
Share results
Connect creative minds
Select the very best
Inspire
participation
24

30. Inspire participation
Trigger people to join your
challenge
Alessi has been inspiring designers
for many years to contribute to the
Alessi brand, in return for exposure
and shared gains.
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 25

31. Select the very best
Find the best ideas and the
best people
Innocentive is a platform where scientists and
other experts are gathered to solve tough
scientific challenges. Their track record is
impressive: 30% of all problems posed are solved
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 26

32. Connect creative minds
Enable people to work
together and find that
‘spark’
Lego developed new generation Mindstorms
products together with lead users of the
Mindstorms Developer Program. They have
helped Lego improving their product ranges far
beyond Lego’s wildest dreams.
27

33. Share results
‘Giving back’ is crucial*
Co-creation was part of many of Apples
successes and also drives the Apple iPhone
App store success. The profits are shared,
70% is for the developer, 30% for Apple.
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 28 *Compensation doesn’t have to be monetary, sharing IP is a next step

34. Continue development
Co-creation only delivers
when it is a longer-term
engagement
Procter & Gamble set high co-creation
standards: 50% of new products should come
from outside the company. P&G’s Connect &
Develop platform invites external people &
companies to innovate with them.
29

35. 4 Areas of Value
Return on investments in co-creation
can be found in several areas.
FRONTEER
STRATEGY
INNOVATION.
CO-CREATION.
BRAND DEVELOPMENT. 30

36. 4 Areas of Value in Co-creation
Generated Value
s
n off
pi
r eS
u
F ut
s
n off
pi
tS Resul
ts
r ec ture
Di Fu
R esults
D irect
Time
31

37. Direct results correspond with the
project goals that have been set: often
new products and services, which
generate economic value
Direct spinoffs cannot be measured in
terms of profit, but create enormous value.
Unexpected effects can occur like new
contacts, collaborations and brand
ambassadors.
32

38. A successful new product introduction
can generate a snowball effect within a
category, creating future results
Future spin-off effects are
unpredictable. Side-effects of certain
actions are hard to oversee, but what
we can say is that action taken now will
have an effect sometime in the future.
33

39. FRONTEER martijn@fronteerstrategy.com
STRATEGY
I N N OVAT I O N.
C O - C R E AT I O N.
B R A N D D E V E L O P M E N T.