Social Media and Service Innovation in Tourism - Research Opportunities from a Service Dominant Approach


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Social Media and Service Innovation in Tourism - Research Opportunities from a Service Dominant Approach

  1. 1. Marianna Sigala, University of the Aegean, Greece ENTER PhD workshop 2014 Product dominant logic The market is separate from the value creation process Social Media and Service Innovation in Tourism: Research Opportunities from a Service Dominant Approach The MARKET The firm creates value Marianna Sigala University of the Aegean The consumer destroys value: Is a target for the firm Intermediaries facilitate the transfer of value  Product, possession, place, Product, possession, place, credibility & time utilities Service dominant logic The market is integral of the value creation process Assumptions about the market The market exists, is given and stable  The market is a target to exploit  The market is a constrain to a firm and it has to be managed  Market understanding, sensing and forecasting are the key issues  Information alertness and awareness are must  RE-ACTIVE RE- VALUE-INEXCHANGE  The firm: The consumer: The Collaborator in Collaborator in co-creating value Market: co-creating value and competitor in and competitor in extracting extracting economic value economic value The Market: is a service ecosystem responsible for the cocreation of experiences of value-in-context of an individual at a specific moment and place PDL SDL Use – destroy value created by firms Co-create value by integrating resources Role of firms Create value Create value propositions Role of goods Embed value Vehicle of operant resources  Creators of value Firms – value chains Actors, network partners, firms, customers  Process of value creation Value is added by adding attributes Value co-creation Value driver Transaction value Value in use / value in context Measurement of value Nominal value of exchange Adaptability, viability of the actors Purpose of value creation Firm Profits Mutual betterment Resources used Operand resources Operant resources Role of customers The market is a forum/space for coco-creating tourism experiences Value is not distributed but co-created coMarkets and Demand are contextual (space + time)  Markets do not pre-exist pre Markets are dynamic and ever changing  The aim is to collaborate with customers to coco-create markets  PROACTIVE 1
  2. 2. Marianna Sigala, University of the Aegean, Greece Thus, to co-create value, cofirms must be able to: ENTER PhD workshop 2014 CoCo-creation within the context of cybercyber-intermediaries Access, adapt and integrate resources from network partners and make their resources accessible, adaptable and integratable SOCIAL WEB ADVERTISING Campaigns Tripadvisor •Selling licenses •Selling Ads •Selling reputation monitoring services FACEBOOK -social graph for personalised advertising and information provision CUSTOMER RESOURCES •UGC: wikis, customer reviews, videos •Social Capital: (networks and relations amongst people) d l ti t l ) •Trust creation: reputation systems •eWOW •Collective Sense making (folksonomy) •Collective ranking of importance •Collective sentiment analysis FOURSQUARE Redefine how we live in a city by inviting friends and experiencing places also with those not being there TOURISM FIRM •Promotion •Service improvement •Competitor benchmarking – innovation MARKET INNOVATION is A CONTINUOUS WORK-IN-PROGRESS WORK-INA value creation ecosystem that can scale up or d l down rapidly and idl d reconfigure its resources in real time to accommodate shifting consumer desires, to discover, influence and create latent needs, and allow the coneeds, cocreation of personalised experiences Social seating application KLM with Meet and Seat Select who seats next to you based on Facebook , Linkedin profile etc 2
  3. 3. Marianna Sigala, University of the Aegean, Greece ENTER PhD workshop 2014   Tourism Intermediaries should continuously upgrade their service ecosystem by ‘plug & y y p g playing’ new actors that can exchange and integrate resources for co-creating value ! What is the role of distributors in a market ?     To enable and educate customers how to cococreate value Provide customers with access to resources at the i ht l th right place, time, situation / context and ti it ti t t d space for integrating them and creating value Create an open environment for enabling the actors to meet and exchange resources for cococreating value Enhance and support the creativity of customers     DEDE-think of service distribution RERE-think of service participatory design and value co-creation coDEDE-Think of distribution chains (sequential) Re-Think of distribution networks and open p ecosystems (value flows in any direction) DeDe-Think of C2B, B2C, B2B, B2C ….. Models Re-Think of Actor-2-Actor interactions and Actorresource exchange interfaces (everyone is an actor) IntegratedIntegrated-connected capability a critical asset for building a competitive business model The HRS friends app, which is in beta, shows users a map of where their Facebook friends live or where they have recently checked-in using the social checkednetwork  The app also enables users to view available hotels in p p group the area where friends or people within their g p live or search for properties with those ‘liked’ by ‘liked’ friends highlighted in the results.  Facebook check-ins and data from Foursquare are checkalso used to create a heatmap of areas of interest in a city enabling travellers to draw on friends’ experiences before finalising plans. 3
  4. 4. Marianna Sigala, University of the Aegean, Greece ENTER PhD workshop 2014 If firms have to create markets, then… how they can do it? 'the term market is everywhere and nowhere" (Venkatesh et al., 2006: p. 252) WHAT IS A MARKET AND HOW MARKETS ARE FORMED AND EVOLVED ? Market theories should recognise that: markets do not simply exist, but rather they are formed and are continuously evolving g  markets are malleable, dynamic, subjective, and subject to multiple change efforts  (e.g. Rosa et al. 1999, Kjellberg and Helgesson 2006, Depeyre and Dumez 2009, Storbacka and Nenonen 2011, Kjellberg et al. 2012) 4
  5. 5. Marianna Sigala, University of the Aegean, Greece Evolution of marketing theories from  developing process-based models that processdescribe market changes (e.g. product life cycle, market maturity, market readiness imply a limit to exploit markets that are given and already exist) To  better understanding the processes of market construction and operations ENTER PhD workshop 2014 Research goal FROM  'market sensing' => market driven strategies TO  ‘market scripting’ => market driving strategies A middle ground market hypothesis (Granovetter, 1985 and 1992; Geiger et al., 2012) Two extremes of market theories:  the traditional economic approaches, approaches, which are characterised as 'under'underunder socialised', socialised', as they view the market as a solely price mechanism (materialised approach)  the classic structural sociology approach, approach, which is categorised as 'over'oversocialised' socialised' A similar way of thinking is found in the approaches explaining the technology-society relation technologyHOW TECHNOLOGY SHAPES EXPERIENCES AND VICE VERSA PHILOSOPHICAL VIEWS on technology     Technological determinism: technology causes determinism: certain ways of doing or ways to come about Social constructionist view: technology is socially constructed – outcome of social processes / practices Phenomenological approach: Heidegger (1977) “the Enframing” Enframing” Technology is revealing and challenging, as it is an horizon of meanings that reveals the world in various ways Middle ground market approaches have a better ability in addressing market emergence, formation and change, because: 5
  6. 6. Marianna Sigala, University of the Aegean, Greece    the highly materialised and socialisation approaches treat change as exogenous (caused by technical conditions or social developments taking place independently of the market under study); the approaches low in both dimensions do not consider change at all; all; the middle ground approaches (that recognise the blurred impact of socialisation and materialisation) materialisation) treat change as endogenous and demonstrate how markets posses the capabilities, dynamics and the mechanisms to continually create and retain forms. ENTER PhD workshop 2014 THUS markets are increasingly viewed as self-empowered ever changing self'socio-technical arrangements sociosocio arrangements' (Kjellberg & Helgesson, 2007; Callon 2007) Helgesson, Market plasticity CORE QUESTION Nenonen et al. (2013) WHAT IS THE MARKET CHARACTERISTIC ENABLING THE MARKETS TO FORM AND CHANGE ? The ability to change, form/create and retain a shape  It includes change but also stability   Plasticity IS NOT elasticity Factors that can create Market Plasticity 1. 2. 3. 3 4. 5. Exchange Object (value creation) Market Actors (number & roles) roles) Market structure (relations/networks amongst actors) Market Institutions regulating markets (legal, social, cultural, economical, political) political) Market practices An examination of the business models of tourism cyber-intermediaries for cyberinvestigating the ways in which they perform tourism markets to rism  The role, manipulation and Influence of the 5 features of market plasticity 6
  7. 7. Marianna Sigala, University of the Aegean, Greece ENTER PhD workshop 2014 Business models & market perfomativity  the business model is a ‘market device’ defining how actors relate to markets (Callon and Muniesa, 2005) Muniesa, business models perform the market (MacKenzie and Millo, 2003; Pollock and Millo, Williams, 2009; Storbacka and Nenonen, Nenonen, 2011a)  Flight search engine that maximises miles earned Changing market practices Normalised practices Representational practices Comparing the cost to drive with the cost to fly 7
  8. 8. Marianna Sigala, University of the Aegean, Greece ENTER PhD workshop 2014 Ways of consuming services zero commission for hotels travellers pay to access the database (3$) Market structure 8
  9. 9. Marianna Sigala, University of the Aegean, Greece ENTER PhD workshop 2014 Market actors: roles, functions and numbers Changing market practices Exchange practices (negotiation, payment, risks of purchasing) 9
  10. 10. Marianna Sigala, University of the Aegean, Greece Use miles to pay for products ENTER PhD workshop 2014 Pay with your mobile phone Sell second hand tickets Price guarantee services 10
  11. 11. Marianna Sigala, University of the Aegean, Greece ENTER PhD workshop 2014 Purchase of price options You can delete the intermediaries but you can never delete the distribution services ! TO SUMMARISE •Cyber-intermediaries manage to survive when they give travellers the resources, platforms and value propositions to co-create value = i.e. to perform markets Impact of the Internet on tourism markets    eliminating players in a market (deconstruction approach) building a new or modified set of players in a market (construction approach) changing the functions performed by players (functional modification approach) either directly or indirectly by changing the mind-set of mindmarket players (e.g., customers, competitors, and other stakeholders) How can we create markets: 2 concepts  CONTEXT of transactions Τhe OBJECT of transactions  Which are the markets  What value is being and how they are exchanged, created, created, i.e. where How value is being cococreated and how people How tourism experiences are transact created 11
  12. 12. Marianna Sigala, University of the Aegean, Greece ENTER PhD workshop 2014 How can we start ΤHINKING UP SIDE DOWN ? Does competitive advantage relate to the level of innovativeness or the ability to normalise, routinise, normalise, routinise, institutionalise and retain a market? Learning outcomes for constructing markets Learning abilities Market structure Building the abilities to engage with and shape markets Learning outcomes for constructing markets Social capital theory Resource-based view Networking Market practices Exchange practices: Normalised practices: Representational practices: Practice theory -ability to change existing mental models and institutionalise new (cognitive market learning) - ability to overcome the institutions, e.g. existing understandings and patterns of actions Formating normalised practices: - Ability to use normalisation practices for stabilising the business models Formating representational practices: - Ability to knowledge and to engage in dialogues for creating inter-subjective meanings or consensus THANK YOU ! social normalisation formalization, institutionalization, routinization, and materialization Formating exchange practices: - Ability to reconfigurate resources within a network in order to actualise value proposition and economic exchanges Theories Market structure Market pictures (Interpretations of the market): How actors interpret the market network (where it starts and where it ends) Market practices Exchange practices: Financial transactions. exchange object Price formation mechanisms. Customer readiness (to participate in the market and use the product). Normalised practices: Technological standards Legislation. Social and relational norms. Representational practices: Commonly agreed terminology. Market research & statistics Coverage in media. Market/industry associations. Market pictures (Interpretations of the market): How actors interpret the market network (where it starts and where it ends) Learning “with the market” “with Ability to actively engage in network and tie/bonds formation and structure development Μarianna Sigala University of the Aegean ( Embeddedness Structuration theory 12