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How Co-creation Differentiates Customer Experience

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Michael Porter famously wrote that companies differentiate themselves by performing a unique set of activities from their competitors’ or by performing the same activities differently. There are few activities that set new standards in customer experience, most companies will have to create rich experiences through the same set of activities.

C2B2C or outside-in is a fundamental mind shift that challenges even the best of organisations. Differentiate by performing the customer experience activities differently could be as organic as an organisation would want to, depending on the ratio of passive- and active co-creation.

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How Co-creation Differentiates Customer Experience

  1. 1. How Co-creation Differentiates Customer Experience By Gianluigi Cuccureddu May 16th, 2011 Discuss and feedback this article on the 90:10 Group blogDiscuss and feedback this article on the Facebook 90:10 Group Netherlands page Head of 90:10 Group Netherlands CMO Agora Media Innovation Connect through LinkedIn http://www.linkedin.com/in/gianluigicuccureddu Tel: +31 (0)6 41362612
  2. 2. How Co-creation Differentiates Customer ExperiencePaul Hagen wrote an article on the Forrester Research blog on Customer Experience and thechallenges coming with it:Here are some numbers: 86% of companies say customer experience is a top strategic priority for2011; 76% seek to differentiate based on customer experience; 46% have a companywide program forimproving customer experience currently in place and another 30% are actively considering it; and52% have a voice of the customer program in place with close to 30% more actively considering it.With the majority of companies focused on improving customer experience, how can a companyexpect to differentiate on it?Michael Porter famously wrote that companies differentiate themselves by performing aunique set of activities from their competitors’ or by performing the same activitiesdifferently. There are few activities that set new standards in customer experience, mostcompanies will have to create rich experiences through the same set of activities.Below a representation of the Customer Experience Cycle:Positioning is the part of the marketing process by which marketers try to create an image oridentity in the minds of their target market for its product, brand, or organisationcompared/in relation to competitors. Combining the phases of the Customer ExperienceCycle with positioning and seeing it through the co-creation lense creates these uniqueapproaches of the same set of activities shared by many organisations.When organisations are targeting the same target groups there’s still room fordifferentiation, because Core Competences are different for each organisation, offeringdifferent ways to market. Secondly, each brand/organisation is perceived differently in the
  3. 3. mind of the customer, this isn’t always the perception which marketeers had in mind, but itreturns competitive intelligence and means to enhance customer understanding.Co-creation offers ways to differentiate throughout the complete production phase, asPhilips has shown:Sense-checking with consumers along side the process, continuously adjust products (orservices) based on their perceived value and need to solve a problem. After having engagedthem in the production process, the same set of people can serve as highly loyalambassadors. In a co-launch this means an increased effectiveness and more importantly auniquely shaped perception/approach of the brand and product based on the positioning-perception dynamic.C2B2C“Customer understanding” is at the heart of the Customer Experience Cycle as shownabove, by really listening to customers, the complete consumer pool, competitors and otherplayers in the market, organisations have the opportunity to understand what’s needed. Notonly is the inner of the Cycle measurable and analyzable, all phases of the cycle can be betterunderstood from a customer point of view and not only from an internal operations point ofperspective…. Just by listening. It can lead to actions to enhance processes, if not it has beena good and free sense-check with the customer.C2B2C or outside-in is a fundamental mind shift that challenges even the best oforganisations. Differentiate by performing the customer experience activities differentlycould be as organic as an organisation would want to, depending on the ratio of passive-and active co-creation.

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