Co-Creation in Advertising and Marketing

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The way in which brands communicate, and how consumers live their lives, is of significant importance to each entity. However, now, more than ever before, the two have become intertwined. This is resulting in one of the biggest developments that the advertising and marketing industry have witnessed in this generation. In a world that is increasingly lacking relevance and individuality, brands and consumers are constantly seeking to be heard amongst the crowd. Over the years brands have stressed the importance of listening to their customers. However, simply listening to customers is now being called into question, and instead the idea of working alongside them is being considered.

The modern consumer relishes having more power than ever before and they are willing to use this new found control. Brands can no longer ignore this development, and indeed, should not try to ignore it. There are significant benefits to brands and consumers working together in order to learn more about each other. One huge benefit of this is the potential for organisations to change and structure the way in which they do business, not just how they market and advertise themselves. This collaboration of brand and consumer is now more commonly referred to as Co-Create, a methodology which embraces the collaboration of both brand and consumer and delivers mutual benefits for both.

This study will research the effects that Co-Creation has had on the advertising and marketing industry. Furthermore, it will establish the key contributing factors that have given rise to Co-Creation, and how its methodology is implemented. An investigative case study and interviews are used as the basis for the research in this study. This provides highly informed data which will be used to conduct a thorough analysis and draw an educated conclusion on the topic of Co-Create.

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Co-Creation in Advertising and Marketing

  1. 1. STUDENT No. 08005446Dissertation submitted in partial fulfillmentof the requirements of theBA (Hons) ADVERTISING MANAGEMENTof Northumbria UniversityNAME!! ! Matthew MOOREDEGREE! ! BA (Hons) Advertising! ! ! ManagementSUPERVISOR! Dr Elmira DjafarovaTITLE!! ! Co-Create in Advertising and! ! ! MarketingDATE!! ! 5th April 2012CAMPUS! ! City Campus East
  2. 2. DeclarationsI declare the following:-(1) that the material contained in this dissertation is the end result of myown work and that due acknowledgement has been given in thebibliography and references to ALL sources be they printed, electronic orpersonal.(2) the Word Count of this Dissertation is: 10,728(3) that unless this dissertation has been confirmed as confidential, I agreeto an entire electronic copy or sections of the dissertation to being placedon Blackboard, if deemed appropriate, to allow future students theopportunity to see examples of past dissertations. I understand that ifdisplayed on Blackboard it would be made available for no longer than fiveyears and that students would be able to print off copies or download. Theauthorship would remain anonymous.(4) I agree to my dissertation being submitted to a plagiarism detectionservice, where it will be stored in a database and compared against worksubmitted from this or any other School or from other institutions using theservice.In the event of the service detecting a high degree of similarity betweencontent within the service this will be reported back to my supervisor andsecond marker, who may decide to undertake further investigation whichmay ultimately lead to disciplinary actions, should instances of plagiarismbe detected.(5) I have read the University Policy Statement on Ethics in Research andConsultancy and the Policy for Informed Consent in Research andConsultancy and I declare that ethical issues have been considered andtaken into account in this research.SIGNED: ............................................................DATE: 05/04/20122
  3. 3. STUDENT NAME! ! ! ! Matthew MOOREDEGREE! ! ! ! ! BA (Hons) AdvertisingManagementDISSERTATION SUPERVISOR! ! Dr Elmira DjaforovaDISSERTATION TITLE! ! ! Co-Create in Advertising andMarketingDATE!! ! ! ! ! April 2012KEYWORDS!! ! ! ! Co-Create-and-Collaboration! ! ! ! ! ! Modern-Consumer! ! ! ! ! ! Advertising-and-Marketing! ! ! ! ! ! Brand-RelationshipsAbstractThe way in which brands communicate, and how consumers live theirlives, is of significant importance to each entity. However, now, more thanever before, the two have become intertwined. This is resulting in one ofthe biggest developments that the advertising and marketing industry havewitnessed in this generation. In a world that is increasingly lackingrelevance and individuality, brands and consumers are constantly seekingto be heard amongst the crowd. Over the years brands have stressed theimportance of listening to their customers. However, simply listening tocustomers is now being called into question, and instead the idea ofworking alongside them is being considered.The modern consumer relishes having more power than ever before andthey are willing to use this new found control. Brands can no longer ignorethis development, and indeed, should not try to ignore it. There aresignificant benefits to brands and consumers working together in order tolearn more about each other. One huge benefit of this is the potential fororganisations to change and structure the way in which they do business,not just how they market and advertise themselves. This collaboration ofbrand and consumer is now more commonly referred to as Co-Create, amethodology which embraces the collaboration of both brand andconsumer and delivers mutual benefits for both.This study will research the effects that Co-Creation has had on theadvertising and marketing industry. Furthermore, it will establish the keycontributing factors that have given rise to Co-Creation, and how itsmethodology is implemented. An investigative case study and interviewsare used as the basis for the research in this study. This provides highlyinformed data which will be used to conduct a thorough analysis and drawan educated conclusion on the topic of Co-Create.3
  4. 4. AcknowledgmentsFirst and foremost, I would like to thank Elmira for her valuable help andguidance throughout the dissertation.I would also like to thank my mum, dad, brother, girlfriend and friends whoare always there for me when I needed them most.Finally, a huge thank you to the employees at The Sharp Agency Ltd whotook the time to be interviewed, your time and patience was greatlyappreciated.4
  5. 5. Contents1. Chapter One: Introduction!81.1 Aims and Objectives!91.2 Chapter Structure!101.2.1 Introduction!101.2.2 Literature Review!101.2.3 Methodology!101.2.4 Findings and Analysis!111.2.5 Conclusion!112.0 Chapter Two: Literature Review!112.1 Introduction!112.2 The Modern Consumer!112.2.1 The Role of Technology!122.2.2 Increased Choice and the Appetite for Relationships!132.2.3 Consumer Communities & Consumer Generated Content!142.3 The Evolution of the Brand Consumer Relationship!152.4 Generating Value with Customers.!162.4.1 The Co-Creation of Value.!162.4.2 The Building Blocks of Co-Creation (DART Model)!172.4.3 What Role Consumer Experiences Play in the Co-Creation ofValue.!192.5 The benefits of Co-Create!202.5.1 A Deeper Level of Understanding a Brands Customers!202.5.2 Co-Create Empowering Consumers to Release TheirPotential!215
  6. 6. 2.5.3 Consumers Perceived Ownership of Brands!222.6 Implementing Co-Creation in an Organisation (Bhalla Model)!232.6.1 Listen!232.6.2 Engage!232.6.3 Respond Externally!242.6.4 Respond Internally!242.7 Summary!243.0 Chapter Three: Methodology!253.1 Introduction!253.2 Research Philosophies & Approaches!263.3 Data Sources!283.3.1 Primary Data!293.3.2 Secondary Data!293.4 Triangulation!293.5 Participation Observation!303.6 Data Collection Method!303.6.1 Case Study Approach!303.6.2 Interviews!313.7 Sample Approach!313.8 Sample Size!323.9 Limitations!333.10 Ethical Issues!333.11 The Sharp Agency Case Study!343.11.1 Aesica Pharmaceuticals!353.11.2 National Union of Students!366
  7. 7. 4.0 Chapter Four: Findings & Analysis!374.1 Case Study Findings!374.2 Interview Findings!384.2.1 Using Co-Creation as the Cornerstone to Operating theBrands Strategic Marketing Activities!384.2.2 The Co-create Process and it’s Effects!404.2.3 The future and Potential of Co-Create!425.0 Chapter 5: Conclusion!435.1 Introduction!435.1 Conclusions on the topic of Co-Creation!445.2 Limitations of the Study!465.3 Further Investigation into the Study!46Reference List!48Bibliography!52Appendices!54Appendix A - Reflective Statement!55Appendix B - Interview responses from SCD1 (The Sharp AgencyLtd)!56Appendix C - Interview responses from SCS1 (The Sharp AgencyLtd)!617
  8. 8. 1. Chapter One: IntroductionPrior to this study taking place, the author took part in a 48-week industrialplacement at an advertising agency commencing the third year of theirdegree. It was during this placement the author was introduced to anagency that worked with clients, but also helped develop how the clientworked with their own customers in a very unique way. The method ofworking was referred to by the agency as ‘Co-Create by Sharp’. Theagencies approach to work meant that it would work closely withconsumers in order to gain an insightful contribution that would go towardsthe work produced for their clients. The main driving force behind theagencies decision to adopt this approach was to produce work morerelevant to the intended audience.For many years, brands have looked for new and innovative ways to sellmore products or services, gain more market share, and overall strive forincreased competitive advantage using various marketing activities. Fromthe birth of ‘modern advertising’ post the Second World War (Pincas andLoiseau, 2006); the advertising industry has seen a significant rise inexpenditure, with reports concluding UK advertising expenditure in thethird quarter of 2011 reaching £3.8bn (Advertising Association, 2012). Aconclusion that can be drawn here is that the relationship between brandsand consumers has evolved significantly over the past 60 years to becomeone that is more complex than anyone could have previously anticipated.It is apparent that within the current relationship between brand andconsumer they expect more from each other. Brands expect more in depthdata from consumers enabling them to build a better picture of theircustomers, ultimately helping to create a more accurate communicationtool. Customers expect a whole lot more, they want to be treated likeindividuals rather than a mass market, and developments in technologyhave given them the sort of power that brands can no longer ignore.8
  9. 9. Considering that the evolution of marketing and advertising has resulted inbrands and consumers growing closer together, the questions that ariseare: how close can they get? And, what are the implications for thoseinvolved? Many believe that Co-Creation is the platform to provide thiscloseness, equating in substantial benefits for both parties (Ramaswamy,2004). One benefit would be to gain unparalleled insight into consumersand another creating mutual value producing long term loyalty fromcustomers, thus delivering long term success for brands.The research in this study on the subject of Co-Creation is centeredaround why the approach can be considered more relevant today than atany other time, what can come out of brands adopting Co-Creation, andwhat are the practical steps to Co-Creation? A significant amount ofliterature signals towards the fact that working more closely withcustomers benefits brands, and how certain elements, in particulartechnology, have been the major influence behind Co-Creation.1.1 Aims and ObjectivesThis study will include primary and secondary research in order to furtherinvestigate Co-Create in advertising and marketing, as well as contributingfactors. The secondary research used for this study will include literatureon the subject of Co-Create and areas surrounding the modern consumer,the relationship between brands and their consumers, and the phenomenaof the Co-Creation of value through the mutual experiences consumershave with brands. The review of the literature will expose if there is a needto further investigate information around the subject of Co-Create andwhether this is a significant development within the industry.The secondary research in this study will shape the approach of theprimary research, which is in the form of an investigative case study usinga number of semi-structured interviews with experienced members of the9
  10. 10. marketing industry. The primary data will provide the information needed todecipher an educated conclusion to the hypothesis “How has Co-Creationaffected the advertising and marketing industry?”1.2 Chapter Structure1.2.1 IntroductionThe introduction will include what the topic of the study involves and thebackground surrounding Co-Create and to why the topic of Co-Create waschosen. It outlines the series of chapters to follow to complete explorationof the topic that provides purpose, understanding, and a clear path for thereport to follow.1.2.2 Literature ReviewThe literature review in this study is a comprehensive look into previousresearch on the specific subject of the study as well as the keysurrounding factors that are integral to gaining a better understanding ofCo-Create.The review includes literature from textbooks, journal articles, websitesand newspaper articles. It brings to light areas in the study that requirefurther research. The literature review is structured in a way thataddresses what factors have played a significant role into why Co-Createis possible, what Co-Create is, and how to implement it, and finally whatare the implications for brands and consumers?1.2.3 MethodologyThe methodology will outline the means in which the primary research hasbeen conducted. The section highlights why primary and secondaryresearch was used, and their significant importance with regards tocollecting the required data to conduct the study. Information on the datacollection methods used in the study is included, as well as possible10
  11. 11. limitations, and the ethical issues relevant to the study. Included at the endof this chapter is an investigative case study based on The Sharp AgencyLtd, which will provide the platform for the case study findings up toChapter 4.1.2.4 Findings and AnalysisThe findings and analysis of the study are presented in the form of casestudy results and transcripts from the semi-structured interviews. Theresults of the research will be analysed in order to be consistent with theoriginal hypothesis of the study. The primary and secondary researchconducted in this study will feature in the analysis section.1.2.5 ConclusionThe data that has been collected and subsequently analysed will form thebasis in which to draw an accurate conclusion on the subject of how Co-Create has impacted on the advertising and marketing industry.2.0 Chapter Two: Literature Review2.1 IntroductionThis chapter will provide an account of previous research and theoriesbased around the subjects of collaborative marketing as well as Co-Create. Current knowledge of how consumers and brands have developedover time, as well as the specific factors that can be attributed to the shifttowards brands working with consumers will be discussed in the followingchapter. Pongsakornrungsilp & Schroeder (2011, p304) describes Co-Create as “the process by which both consumers and producerscollaborate, or otherwise participate, in creating value”.2.2 The Modern ConsumerToday’s modern consumer has become a more influential stakeholderresulting in brands now having to reassess the way in which they interactwith their customers (Prahalad & Ramaswamy, 2004). Cova & Dalli, (2009)11
  12. 12. have also discussed how there are ‘various’ signs which suggest that therole of the consumer is changing within today’s marketplace. Bhalla (2011,p4) discusses how today’s consumer is “one that is better educated, morecollaborative, and infinitely more resourceful than at any time in the past”.The emergence of this new type of consumer has helped in giving rise to anew marketing approach referred to as Co-Creation.2.2.1 The Role of TechnologyWith regards to the changing relationship between a brand and itsconsumers, advances in technology can be considered to be the biggestcontributor to how the relationship has changed (Rust, Moorman & Bhalla,2010), with significant emphasis being placed on the internet as a majorfactor in facilitating the relationship change (Prahalad & Ramaswamy,2000). This point is further endorsed by Mainwaring, (2011) who discusseshow the use of technology has allowed consumers to gain the power toshift and influence corporate thinking.The significant influence that the internet has had can be attributed to thenotion with it consumers can now with the internet can be exposed toalternative information, meaning they do not have to solely rely oninformation from brands to decide whether they wish to establish arelationship (Prahalad & Ramaswamy, 2004). Gabriel & Lang, (2006, p26)highlight the importance that access to information has in the consumerdecision making process by stating “choice without information is not realchoice”. Consumers are now armed with information such as alternativeproducts, services and up to date prices (Clemons, 2008), which has ledto brands having to rethink the way in which they interact with consumersbecause of this more transparent marketplace (Clemons, 2008).In addition to providing new opportunities for consumers, technology alsoprovides opportunities for brands by giving them more ways in which to12
  13. 13. approach their customers (Ballantyne, 2004). Addis & Holbrook, (2001, p.53) discusses the importance of a good relationship between brand andconsumer which is further helped by advances in technology. They statethat that “Such a relationship must be built upon the sort of continuingdialogue now made possible by new communication technologies”.2.2.2 Increased Choice and the Appetite for RelationshipsToday consumers are exposed to a previously unprecedented level ofchoice (Schwartz, 2005), with the market place providing many differentoptions for a wide range of different consumer needs (Clemens, 2008).However despite this abundance of choice it has also been argued thatmore choice does not necessarily help improve the consumer brandrelationship; as in some cases an increase in the level of choice forcustomers has not always provided a better consumer experience(Prahalad & Ramaswamy, 2003).In some cases the reliance of brands on mass marketing tools in order toreach large populations has led to the isolation of customers, and theirdesire for a more personal interaction with their favourite brands. (Rust,Moorman & Bhalla, 2010). The major problem with a mass marketingapproach to today’s consumers is that it implies that the vast majority ofconsumers have similar tastes (Beckett & Nayak, 2008). As a result of thismass marketing, resentment has developed towards marketers from theconsumer explaining their new found willingness to build more meaningfulrelationships with their favorite brands (Cova & Dalli, 2009).In an age where customization is becoming more common, the need forinteraction between a brand and it’s consumers is imperative if it is tosucceed in accurately delivering what consumers need (Rust, Moorman &Bhalla, 2010). Beckett & Nayak, (2008, p306) discuss this point stating“consumers demand greater interaction with producers in the solving of13
  14. 14. their needs and to be recognized as individuals”. One of the biggestcatalysts in why today’s consumers are craving relationships is theconfidence brought out of the fact that they are exposed to this wealth ofinformation, meaning they feel more at ease when talking to brands on amore equal footing (Prahalad & Ramaswamy, 2004).2.2.3 Consumer Communities & Consumer Generated ContentWhen large groups of consumers come together to form communities itcan become a significant tool which can influence a consumer’srelationship with a brand, but also as a tool that can support a brand in theinnovation process (Rossi, 2011). Cult brands such as Harley Davidson inthe US, and Ducati in Europe, have benefited significantly from fanaticalbrand communities that have not only helped create strong brand loyalty,but also a highly informed knowledge base that brands can use forinnovation (Cova & White, 2010). Part of the reason why a community’sinfluence can be so powerful lies in the close bond that exists betweenmembers as a result of sharing a common interest or passion, makingthese communities very influential amongst fellow consumers (Bagozzi &Dholkia, 2002).There is strong evidence to encourage brand managers to work with theconcept of consumer communities by providing consumers with the toolsneeded to grow communities ‘customer competence’ rather than simplyexploit customers (Beckett & Nayak, 2008) This has been demonstratedby the Harley Davidson and Ducati examples, and the argument thatconsumers desire a more in depth relationships (Schau, Muniz & Arnould,2009).In addition to consumer communities another development brought on bythe changing habits of modern consumers is the emergence of ConsumerGenerated Content (CGC). Initially CGC was considered to be a casual14
  15. 15. hobby for some consumers, but overtime it has developed into a highlyinfluential source of information which rivals established sources such asnews and entertainment (Cova & Dalli, 2009). CGC has previously beenused in advertising campaigns where consumers are invited to produceadverts for their best loved brands, as used in the Doritos SuperbowlAdverts (Muniz & Schau, 2011). There is scepticism however as to how farbrands are willing to go with CGC, and also with more consumer centricapproaches in general. This is due to concerns of brand managers overhanding so much control to the consumer (Muniz & Schau, 2011).2.3 The Evolution of the Brand Consumer RelationshipIn previous years the focus of how businesses operate has graduallychanged from one which focuses on products produced in factories forcustomers, to one which leans towards the customer’s needs (Wikstrom,1996). Whilst this change has happened in stages deriving from existingcustomer orientated practices such as “customer orientation” and“customer segmentation” all indicators point to the future stage one inwhich the customer as co-producer (Wikstrom,1996).There are numerous examples of influential figures in business who haveexpressed their own opinions on the shift towards a more collaborativeway of thinking including Threadless.com, a t-shirt manufacturer whichrelied heavily on the use of customers of co-producers commenting “thecustomer is the company” (Schau, Muniz & Arnold 2009, 30-31). Kitchen,(2011) also acknowledges the shift in thinking in industry over time byreferring to the following quotes by influential figures in the world ofbusiness and marketing:Henry Ford - “If I had asked people what they wanted they would havesaid a faster horse”.15
  16. 16. David Ogilvy - “Advertising people who ignore research are as dangerousas generals who ignore decodes of enemy signals”.IBM CEO - “Successful organizations Co-Create products and serviceswith customers”.Addis & Holbrook, (2001) discuss how consumers have become ‘feelersas well as thinkers and doers”, which highlights a significant shift fromprevious generations. This development has caused the approach ofbrands that develop, produce, and market products or services withoutinteraction with consumers to become outdated (Prahalad & Ramaswamy,2004).2.4 Generating Value with Customers.The traditional concept of value creation has centered around value beingcreated from within the company through its own marketing activities, asconsumers were considered to be “outside the firm” (Prahalad &Ramaswamy, 2004). Other traditional approaches to the creation of valuerelate to the consumer’s perception of price as well as the “sacrifice” thathas been given in order to receive the product or service (Ravald &Gronroos, 1996). Pongsakornrungsilp & Schroeder, (2011) however,discuss how a new approach may deliver better results by concentratingnot on how companies can create value for consumers, but rather on howthey should create value with consumers; or in other words ‘inside outthinking’ (Prahalad & Ramaswamy 2004).2.4.1 The Co-Creation of Value.The Co-Creation of value is essentially based on the idea of the companyand customer viewing each other as equals and working together, which interm will create deeper relationships and higher value (Prahalad &Ramaswamy, 2004). The success of the Co-Creation of value liessignificantly in the emergence of the “modern consumer” and the changedmarket brands find themselves in, which is heavily influenced by the16
  17. 17. factors previously discussed such as technology (Rust, Moorman & Bhalla,2010), increased choice (Schwartz, 2005), and the changing brand-consumer relationship (Schau, Muniz & Arnould, 2009).2.4.2 The Building Blocks of Co-Creation (DART Model)In order to collaboratively create value with customers we have to look atthe building blocks of how consumers and brands need to interact. Dialog,access, risk-benefits, and transparency are the established basis for howthe interactions between the two parties will collaboratively develop value(Prahalad & Ramaswamy, 2004).Dialog can be considered to be one of the most important elements ofDART as the market place can be considered to be series of exchanges orconversations between customer and an organisation (Levine, Locke,Searls & Weinberger, 2001). The dialogue between the two parties mustbe deep and meaningful, with a willingness on both sides to work togetheras equal partners (Prahalad & Ramaswamy, 2004). This elementconstitutes much more than just listening to consumers, it is the deepunderstanding of what consumers are experiencing in order to betterunderstand the emotional, social, and cultural context of experiences(Prahalad & Ramaswamy, 2004).Previously a consumer’s access to an organization had been easier tocontrol, and in some cases had been taken advantage of due topossessing more information than the customer (Prahalad & Ramaswamy,2004). This is often referred to as information asymmetry which is definedas “when a party or parties possess greater informational awarenesspertinent to effective participation in a given situation relative to otherparticipating parties” (Clarkson, Jacobsen & Bathceller, 2007, p. 828). Thisis not the case anymore as consumers are more connected (Bhalla, 2011).Due to this development access and transparency are integral to the Co-17
  18. 18. Creation of value, as there is very little brands and consumers can keepfrom each other (Prahalad & Ramaswamy, 2004). In turn dialogue accessand transparency will lead the consumer to having a better idea of the riskor benefits involved in the interaction (Prahalad & Ramaswamy, 2004).Nike takes an active role in consumer groups to advise on issuesimportant to it’s customers, as in the case of Nike running shoes(Ramaswamy, 2008). The information that is provided by Nike as a resultof working closely with it’s customer can help with issues such as trainingmethods, and how to prevent injury. This information allows customers tofurther improve the experience they have with their running shoes, whichin turn will create higher perceived brand value in the eyes of consumers.The insights gained from the close relationship between Nike and itscustomers embodies Co-Creations ability to create competitive advantage.Table 2.1 DART Model of the Nike case (Ramaswamy, 2008).Dialogue AccessNew rich dialogue betweenthe runner and Nike betweenthe runner/listener and Apple,among runners and betweenrunners and running experts.Nike provides access to it’scustomers through the iPodNano/Sport Kit device andthe Nike+ web site.Transparency Risk-ReturnFor runners, Nike+ makestransparent a huge range ofinformation about runningincluding routes, trainingknowledge, and how arunner’s progress compares.Nike learns a lot aboutindividual runners that waspreviously opaque to thefirm.For runners, Nike+ reducesthe likelihood of getting hurtby giving them informationabout proper trainingmethods. For the company,the risk of losing customersis lowered because runnersare interacting with Nike+frequently.18
  19. 19. 2.4.3 What Role Consumer Experiences Play in the Co-Creation ofValue.In an age where marketplaces are saturated with infinite levels of choice(Schwartz, 2005) it is clear the that in order for brands to compete theyneed to switch from merely pushing products onto consumers, to buildinglong term relationships with them and maximising customer lifetime value(Rust, Moorman & Bhalla, 2010).Rust, Moorman & Bhalla (2010) discuss at length the concept of acustomer-cultivating company, which places emphasis on securingrelationships as opposed to securing sales. This new outlook is anexample on how brands are looking at consumers differently, asking ‘whatcan you do with us?’ rather than ‘what can we do for you?’ (Bendapudi &Leone, 2003).As brands look for new ways in which to gain competitive advantage anew emphasis placed on the quality of experience a consumer will havewith a brand is gaining significant importance (Ramaswamy, 2003). Ahigher quality of experience can arguably be achieved with a consumercentric company as it allows “individual customers to co-construct theirown consumption experiences through personalized interaction, therebyco-creating unique value for themselves” (Ramaswamy, 2003).A large part of creating increased value with customers lies in the type ofrelationship between a brand and it’s consumer has, this is particularlysignificant in the service industry when what the customer is actuallypaying for is less tangible (Ballantyne & Varey, 2006).The key to building good relationships with consumers, and in turncreating increased value, lies in ensuring a consumers experience with thebrand is an enjoyable one (Prahalad & Ramaswamy, 2004; Payne,Storbacka & Frow, 2008). Holbrook (2006) describes the key aspects of apositive consumption experience as “Fantasies (dreams, imagination,19
  20. 20. unconscious desired); feelings (emotions such as love, hate, anger, fear,joy, sorrow); and fun (hedonic pleasure derived from playful activities oraesthetic enjoyment)”. As a result, many leading organisations are lookinginto how to capitalise on the use of engagement experiences as a newfoundation for value creation (Ramaswamy, 2009).2.5 The benefits of Co-CreateIn order to understand why a brand should adopt Co-Create as alegitimate way in which to operate, it is important to understand what Co-Create is not. It is not the outsourcing of resources to customers or thestaging or influencing of consumers. It is an in depth brand to consumerinteraction that satisfies the needs and attitudes of today’s consumer(Prahalad & Ramaswamy, 2004). The possibilities that Co-Creation cangive a brand depend on the quality of the ‘transactions’ between consumerand brand, which tend to move more quickly than other insight tools.Essentially as each party interact with each other, they are learning moreabout each other as well as creating mutual value (Wilkstrom, 1996).2.5.1 A Deeper Level of Understanding a Brands CustomersA key part of how Co-Creation works is continuous dialogue. It is thisdialogue which creates deeper understanding between the participants(Ballantyne, 2004). Although Ballantyne (2004) also may argue thatdialogue between a brand and its consumers is nothing new, it is theinteractive process of learning together that sets Co-Creation from otherinsight tools. This interactive process has been made all the more possiblewith the advances in Customer Information Systems (CIS) by improving abrands ability to understand its customers (Zahay & Peltier, 2007).The fact that !Co-Creation is a consumer centric approach to operating anorganization means that it makes it perfect sense to collaborate withconsumers as deeply as possible in order to learn more about consumers;20
  21. 21. as who knows more about a brand’s consumer than the consumersthemselves? (Beckett & Nayak, 2008).2.5.2 Co-Create Empowering Consumers to Release Their PotentialWhen the ideas and opinions of consumers really matter in the shaping ofhow an organization operates it will give a real sense of empowerment tothose consumers who participate in the Co-Creation process and as aresult will reshape consumers into ones that are fully engaged in the brand(Beckett & Nayak, 2008).One less reason to why brands should not be worried about working asequal partners to consumers is the consumer’s potential to be creative andinsightful. Consumers are far more engaged in the world around them, andthe advancement of technology has meant that the ‘threshold to creativity’has been lowered (Cova & Dalli, 2009). Cova and Dalli (2009) elaborateon this point by arguing that “While building a car still requires a complexset of competencies that only an organization can possess, consumerscan, conversely, easily manipulate other products and services, thanks totechnology” (Cova & Dalli, 2009 p316-317). A recent study (see table 2.2)on innovation in business stated that customer generated ideas wereconsidered to be the best ideas (Promise, 2009). In addition to their abilityto create good ideas, a consumer’s willingness to experiment also lendsitself greatly to the idea of Co-Creation (Prahalad & Ramaswamy, 1999).21
  22. 22. Table 2.22.5.3 Consumers Perceived Ownership of BrandsIt is more common today for consumers to assume ownership of thebrands they love, especially those with a fanatical following. Cova andDalli, (2009) explain this phenomenon by describing how consumers areincreasingly regarding brands as ‘shared cultural property, and howfamiliarity with a brand gives consumers a sense of ownership of thatbrand. This sense of ownership will lend itself to Co-Creation in the sensethat brand lovers will wish to assist the brands they admire.22CustomersHead of business unitsGeneral employeesBusiness partners and suppliersIn-house R&D teamCEOOther C-level employeesSalesSpecial innovation teamOutsourced R&D teamOther0 13 25 38 50
  23. 23. 2.6 Implementing Co-Creation in an Organisation (Bhalla Model)In order for an organization to develop a core Co-Creation capability, thereare four main interrelated components which need to be implemented, asdemonstrated in Fig 2.3 (Bhalla, 2011, p17).Figure 2.32.6.1 ListenThe modern consumer has regular interactions in a manner of differentways including media, brands, public forums and with fellow consumers.These interactions are valuable in both content and sentiment, meaning itis imperative to the Co-create process that brands listen to consumers(Bhalla, 2011). Shirky, (2008) has discussed at length how people are infact becoming their own media outlet working in direct competition to moreestablished media such as newspapers.2.6.2 EngageBy getting consumers to engage with a brand it will provoke conversationsand response which will subsequently deliver fresh insights that maypreviously have gone unnoticed (Bhalla, 2011). Social media has in recent23
  24. 24. years played a large role in making it easier for brands to engage withcustomers (Chu & Kim, 2011). Brands such as Timberland have used thesocial media site Facebook to launch campaigns which call for activeparticipation from consumers over a particular subject, for example theTimberland Earthkeeper Movement (Timberland, 2012).2.6.3 Respond ExternallyOnce a brand has begun to listen and engage with consumers, it isimperative for this brand to respond to the information it has discovered byensuring the right Co-Create vehicles are put in place this can be doneboth decisively and consistently (Bhalla, 2011). This was done by theCompany Nike through the development of the Joga.com website whichallowed Nike football fans to upload their football skills alongside theirfavourite Nike sports stars (Ramaswamy, 2008)2.6.4 Respond InternallyResponding internally is much like externally with regards to ensuring thatthe right facilities are put in place in order to encourage a collaborativeenvironment but for employees as well as customers (Bhalla, 2011). Thisis because in order in order for an organization to be truly based on Co-Creation the collaborative journey must start at home (Ramaswamy,2009).2.7 SummaryIt is clear that there are many different factors have come togetherresulting in the emergence of Co-Creation. Technology has been amassive driving force behind how the modern consumer can contributesignificantly to the Co-Creation process. The power at the hands ofconsumers means they are more informed when making decisions andmore confident when it comes to wanting more meaningful relationships24
  25. 25. with they brands they love, which as a result has forced brands to standup and take notice.Co-Creation can benefit brands in a number of different perspectives. Itcan provide unrivaled insight into consumer thinking and behavior as wellas instilling an approach to working closely with customers that canproduce long term loyalty.In order for an organisation to truly adopt a Co-Creative approach to itsmarketing activities or marketing strategy it has to adhere to a particularset of criteria. Included in the varied amount of literature the criteria willchange slightly, although it is safe to conclude that key key aspects of Co-Creation centered around open and in depth communication, mutual trustbetween the two parties and lastly the willingness to act pursue Co-Creation as a core element of a brands operations.3.0 Chapter Three: Methodology3.1 IntroductionThis chapter will outline the methods of research that will be conducted inorder to collect the required data to complete this study. In addition to this,any ethical issues and limitations faced during the study will be addressed.The chapter will also include an in depth case study on The Sharp AgencyLtd (Sharp), a full service advertising agency which had adopted acollaborative working philosophy with its clients called Co-Create bySharp.In order to guide the direction of the research the dissertation will question“what effect has Co-Creation had on advertising and marketing?”.25
  26. 26. 3.2 Research Philosophies & ApproachesResearch is a process which means many different things to manydifferent people, whether it is for business or academia. As a result a cleardefinition for research is hard to find (Hussey & Hussey, 1997). However,despite the seemingly difficult task of defining research, there seems tobe a collective consensus cited in (Hussey & Hussey, 1997) that:• Research is a process involving inquiry and investigation.• Research has to be systematic as well as methodical.• Finally, that by conducting research it will increase knowledge.Baker & Foy (2008) discusses how research has had a pivotal role in thedevelopment of civilisation. He uses the example of how the use of aprocess of trial ad error has improved insight and understanding, whichhas consequentially provided a foundation for development. Taking theconcept of how research can aid development and progress, looking morespecifically at business or management research, it is clear that researchcan help the field of business to, for example, help managers draw onknowledge to aid them in the decision making process (Saunders, Lewis &Thornhill, 2007).The use of adequate research in this study is integral to gaining the vastamount of information necessary to complete satisfactory analysis whichwill provide the basis for an educated discussion. This will then allow aconclusion to be drawn on whether there is a need for further research(Quinlan, 2011).When we consider the ambiguity surrounding the term ‘research’, it isunsurprising that the process itself can also be a complex one (Cavana,Delahaye & Sekaran, 2001). The different ideas on how research shouldbe conducted, contributing to the complexity of the term can be broadly26
  27. 27. catergorised under three related schools of thought also referred to asparadigms (Hussey & Hussy, 1997; Baker & Foy, 2008) these arePositivist, Interpretivist and Critical research (Cavana, Delahaye &Sekaran, 2001).With regards to this particular study, the main basis of research will beconcerned with the Phenomenological school of thought. Within thePhenomenological paradigm are both Qualitative and Quantitativemethods of research (Hussey & Hussey, 1997). The key definingcharacteristics that distinguish the two methods cited in (Baker & Foy,2008) are based in the results that each method delivers. For example,quantitative results are considered to more robust leading to results andrecommendations, whilst qualitative are viewed as lacking in robustness,resulting in indecisive outcomes (Baker & Foy, 2008). Recent years haveseen increasing opinion that qualitative and quantitative research are nolonger being considered as ‘polar opposites’, but can actually beconsidered to be very similar in nature (Baker and Foy, 2008). Forexample, much of the theories and practices of both quantitative as well asqualitative data are closely associated with each other (Baker & Foy,2008). Hussey & Hussey (1997, p. 72) comment that “a mixture ofapproaches... allows you to take a broader, and often complimentary, viewof the research problem or issue”. This will benefit the study throughexpanding the opportunity to collect more varied data.Despite the now established links between quantitative and qualitativemethods (Baker & Foy, 2008) they are varying practical data collectionmethods that will deliver the varying result styles. For example aquantitative method can include questionnaires and surveys, whilst aqualitative method can involve observations or interviews (Hussey &Hussey, 1997). For the purposes of this study it is imperative that thecorrect data collection methods are assessed in order to establish which27
  28. 28. ones will provide the best quality data to aid the study (more informationon data collection methods will be included later in this chapter).Another important factor to consider in the research process is how toestablish the accuracy in what is being recorded. In order to decipher this,the methods of Induction and Deduction are used (Ghauri & Gronhaug,2005). Deduction can trace it roots from scientific research, as it involvesthe development of a original theory or hypothesis which is then subjectedto rigorous testing to establish its validity (Saunders, Lewis & Thornhill,2007). Induction is a method which requires the understanding of theinformation gathered, before taking these results to form a theory orhypothesis (Ghauri & Gronhaug, 2005; Saunders, Lewis & Thornhill,2007). However despite the significant differences between the twomethods it is not impossible to use the two simultaneously (Saunders,Lewis & Thornhill, 2007).3.3 Data SourcesIn order to gather sufficient information to enable a deep understanding ofCo-Create and the many factors surrounding it, this study will utilise bothprimary and secondary data sources.Primary data refers to information that has been gathered first handspecifically for the research project in task (Zikmund, 2003). Secondarydata as described by Burns & Bush (2006) is data that has previouslybeen collected by someone other than the researcher for a differentpurpose than the one at hand. Aaker, Kumar & Day (2001) discusses howsecondary data sources can be considered to be one of the most costeffective ways of accessing information by looking at the usuallyoverwhelming amount of information that already exists on a chosen topic.28
  29. 29. 3.3.1 Primary DataPrimary data can be used in instances where information is gathered for aspecific research project. As research into the knowledge surrounding Co-Creation is limited, this particular study used primary data collection inorder to produce accurate information which could be used in theassessment of the original hypothesis (Ghauri and Gronhaug, 2005).3.3.2 Secondary DataThe study began with a literature review outlining previous research on thesubject of Co-Creation, collaborative marketing, and the important factorsthat contributed towards this approach to marketing. In order to completethis review of the literature, books, journal articles, webpages, and onlinedata sources such as NORA were used. Conducting the literature reviewwas an important stage in the study, as a literature review provided theopportunity to explore the particular field, which then delivered greaterawareness and understanding (Ridley, 2008). In addition to helpingdiscover what knowledge exists about the subject, the review alsohighlighted gaps in the knowledge, which helped establish where theprimary research for this study could be directed in order to be used lateron as a foundation to analyse the data (Ghauri and Gronhaug 2005).3.4 TriangulationTriangulation is described by Yin (2003, p97) as the “rational of usingmultiple sources of evidence”, which according to Adami and Kiger, (2005)will serve two purposes when applied to research strategies these are forconfirmation and completeness of the study. With regards to the study,triangulation was used in terms of gathering material from information onThe Sharp Agency Ltd and a selection of it’s campaigns to be used in acase study and two of the agency partners. The use of multiple sources ofevidence is advocated by the common perception that using triangulationcan add further substance to the study (Patton, 2002).29
  30. 30. 3.5 Participation ObservationPrior to this study, the author was employed on a 48 week placement atSharp, enabling the authors own observations during this period to assistsignificantly in the triangulation process. Jorgensen (1989, p. 12) holds theopinion that “participation observation is exceptional for studyingprocesses relationships among people and events”. The justification forusing this method lies in the authors extensive knowledge on the finerdetails of the agency, as well as the thoughts and behaviour of personsinvolved in the interview process.3.6 Data Collection MethodIn order to collect the necessary qualitative data required for this study, acombination of semi structured interviews and a case study researchapproach based on The Sharp Agency Ltd, along with a number of theirclients were used. These methods were used to the opinions of keyindustry figures on the both the reasons why a Co-Creative approach was,used and how effective the approach is, along with examples of Co-Creation in action.3.6.1 Case Study ApproachThe first part of data collection was to conduct a case study on The SharpAgency Ltd (Sharp). This was conducted in order to gain information onthe way a business implements and endorses a collaborative approach tobrands working with their customers. The fact that Co-Creation can beconsidered to be contemporary phenomenon with some real life context,was the defining factor as to why a case study approach was used (Yin,2003).The case study looked at the beginnings of the agency and how it hasgrown during its short existence (Estd 2010). Is also aimed to establishwhat Co-Creation is, in a practical everyday sense, by examining what30
  31. 31. techniques were used in Co-Create sessions to deliver the insight neededin order to produce great work for clients.3.6.2 InterviewsThe interviews conducted in this study alongside the Sharp case studywere designed to gain greater insight into the reasons for using Co-Create, and decide what effect is has had on the advertising andmarketing industry (as the original hypothesis would suggest). Theinterviews that were conducted can be described according to (Gubrium &Holstein, 2001, p83) as “qualitative interviewing”. This is because theinterviewees were informed and highly experienced professionals in theirfield. Therefore, they are viewed as “meaning makers, not passiveconduits for retrieving information from an existing vessel of answers”.In order to gain a more balanced and overall wider perspective whentrying to discover the studies original hypothesis, the questions that wereformulated for members of Sharp are slightly different reflecting theparticipants differing roles in the agency.3.7 Sample ApproachTo ensure the research carried out is as fair and accurate as possible, asample approach to the research will now be discussed in further detail(Kent, 1999). Sampling is an important step in the research process due toconstraints such as availability of finances, time, or the availability of thesubject population (Cavana et al, 2001).The use of samples in this study, which is based around qualitativeresearch in the pursuit of gaining a better understanding of the situationsinvolving Co-creation, is entirely justified (Kent, 1999). This justificationarises from the use of what is known as Purposive sampling (Kent, 1999),which is also referred to by Quinlan (2011) as Non-Probability sampling.Purposive or Non-probability sampling, allows the researcher to calculate31
  32. 32. the amount of bias, and determine the variation of sampling procedure(Kumar, Aaker & Day, 2002). The use of this particular techniqueeliminates the certain constraints on research such as costs and thesignificant work involved in gathering a large sample (Kumar, Aaker & Day,2002).The sampling technique included within this group of sampling to beadopted in this study is judgemental sampling, also known as purposivesampling (Quinlan, 2011). This technique was chosen in light of the factthat the organisation based in the case study, and persons chosen tointerview, were picked because of their significant knowledge around thesubject of Co-Creation. The parties involved in the data collection processhave significant capacity to further inform the existing research on thesubject.3.8 Sample SizeThe sample size is an important factor in the research process in order toproduce well balanced findings. Taking this into consideration, it isessential, that the sample is of adequate size to ensure a satisfactory levelof accuracy in the data (Saunders et al., 2007).The sample type used in this study was chosen on the basis that theorganisation (Sharp) at the centre of the case study and the intervieweesare specialists in the field of Co-Creation. The author decided thatincreasing the population of the research sample would not be beneficialas it was not possible. Increasing the sample size was not possible at thistime as the author was restricted by the size of the organisation and theresources available.32
  33. 33. 3.9 LimitationsIn order to put the studies findings into context there must be anassessment of the limitations that could of occurred in the results collectedfor this particular study (Ghauri and Gronhaug 2005).• The necessary information needed to conduct a thorough case studyfor the purposes of this study not being easily accessible.• The interviewees not being forthcoming with the desired amount ofinformation. Gubrium & Holstein (2001) describe these as “reluctantrespondents” who can fall into two categories depending on whetherthey have allowed an interview to take place, or are finding it difficultto open up during an interview. The categories are called access andresistance respectively.3.10 Ethical IssuesThe research undertaken for this study was conducted in accordance towhat is considered ethical research. During the there were no exclusioncriteria, for example based on race, ethnicity or sex. The reason for thiswas for both ethical considerations and as a descriptive of your samplepopulation. Aaker, Kumar & Day (2001, p13) argue that in conductingethical research “Researchers have responsibilities to their profession,clients, and respondents, and must adhere to high ethical standards toensure that both the function and information are not brought intodisrepute”.During the construction and execution of this study, the NorthumbriaUniversity Code of Ethics was adhered to at all times, for examplepersonal consent forms and organisation consent forms were used.The author of this study did not interview any persons under the age of 18,and the research that was conducted was explained to participants in full33
  34. 34. possible before they took part in both the interview and their case study.Participants were given the opportunity to ask questions and to withdrawfrom the study at any time without prejudice as well as being offeredconfidentiality. The storage of information was taken highly seriously withthe collected data being stored in password protected files.3.11 The Sharp Agency Case StudyDuring late 2009 Richard and Darlene Sharp were working on a newnameless agency that would see them break away from previous highranking positions at well established advertising agencies. After years oftheir work taking them to places far from their home in Huddersfield, WestYorkshire, it was time to set up their own agency in Richard’s home townwhere they had brought up their family. The only difference was that Sharpwas going to be a different kind of agency, which would work like very fewothers within the industry.Several months later both Mandi Taylor and Tom Wass joined Sharp aspartners, bringing a wealth of marketing industry experience from previoushigh ranking positions. With the four partners in the agency established,they began building an advertising agency, which was not going to operatelike the agencies they all had worked with previously. In fact it wasnt goingto be an ‘advertising agency’ per say, but a Co-Create Agency.“We don’t do things at people, we do it collaboratively with them. Whetherit be your customers, partners or your stakeholders, we have a pioneeringmethodology called CoCreate by SHARP that involves the people thatmatter the most to develop ideas that make things happen” (Sharp 2010).Sharp has provided work with its clients all through the workingmethodology of Co-creation. This has taken the agency to working withfanatical sports footwear consumers, highly specialised pharmaceuticalscientists, the health enthusiasts of Sheffield, empowered students whoare striving for change, and the personality loving customers of a34
  35. 35. worldwide hotel brand. The agency is an environment that embracesideas, both the ideas of those who work there, as well as the ideas of itsclients and client’s customers. This openness to working with others at anylevel needed is the bedrock of Sharp’s working philosophy, which is Co-Create by Sharp.3.11.1 Aesica PharmaceuticalsIn 2010 Sharp was challenged with creating a new brand image for globalpharmaceutical company Aesica that would reflect the organisations truenature in an industry suffering from a very universal image. Aesica is aninternational brand that needed a brand image to reflect its diversity,friendly approach to business relationships, and expertise. In order todevelop a lasting solution to this problem, a collaborative approach wasused by Sharp at every stage of the brand development.Key stakeholders from across the globe were encouraged through Sharp’sCo-Create session to actively take part in the shaping of the company’simage. Every stakeholder had a voice, an opinion, and an overall differentapproach to how they wanted to tackle the problem. This gave the Sharpteam invaluable insights into the people who matter, as well as a sense ofownership of the brand that was subsequently jointly created by thestakeholders.The new brand image for Aesica has been rolled out across all of thebrands communications. This image is concise and reflective of the rangeof diverse people who collaboratively created it with the guidance ofSharp.35
  36. 36. 3.11.2 National Union of StudentsSharp were challenged with producing a campaign that informed millionsof people who study in the UK about what the NUS actually did. The clientwas eager to know what students thought about what the organisation did,and what they thought about them. In response Co-Create by Sharp wasable to provide the platform to solve this problem.In this instance Co-Create was initially used to gain insight into whatstudents thought the NUS did, and what it stood for. This process wasresourceful for all involved, it gave the insight needed for both client andagency as well as informing the client’s core audience on what the NUScan do for them as students.After this period of gaining insight, students (as key stakeholders) wereinvited to play an active role in developing ways in which to communicatewhat they had learnt about the NUS during a regulated Co-Create session.The result of this collaborative process was a campaign based around aplatform on the NUS being created which gave students a voice to helpshape what the NUS could do for them. Alongside the website was ananimation entitled ‘I Am The Change’ which encouraged the idea thatindividuals matter, and that the individual has the power to influencechange. Co-Create by Sharp not only allowed for a development processwhich enlightened both brand and consumers, but in addition a campaignwhich accurately spoke to a core audience of students, and one whichwas heavily influenced by core stakeholders.36
  37. 37. 4.0 Chapter Four: Findings & AnalysisThe following chapter includes analysis from the data collected for thepurposes of this study. The first section of this chapter will include thefindings from the case study based on Sharp, which will also be reinforcedusing relevant responses from the interviews.The second part of this chapter will include an analysis of the responsesgathered from the interviews which were conducted as part of this study.The analysis of these responses corresponds to the particular subjectareas surrounding Co-Creation as highlighted in the literature review. Therespondents in this analysis will be referred to as:• The Sharp Agency Senior Creative Director - CD1• The Sharp Agency Heads of Strategy and Client Services - SCS14.1 Case Study FindingsThe origin of Sharp and its Co-Create philosophy was heavily influencedby the partner’s previous experiences at other agencies. Both CD1 andSCS1 were determined that the agency would be one which is defined bycharacteristics significantly different to other agencies. All of the workproduced by the agency for its clients is developed by some type ofcollaborative or Co-Creative process, this was what was going to definethe agency.The process of Co-Creation can give the agency a wealth of insight whichis put into the campaign development process. This can deliver campaignsthat resonate more with key stakeholders. The fact that in both examplesin the case study that the clients learnt a lot about themselves and theircustomers represents Co-Creates capacity to be a useful insight tool.37
  38. 38. When a brand uses Co-Creation it actively creates value with importantstakeholders. A sense of ownership and relevance were natural results ofCo-Creation in the instances of Aesica and NUS.4.2 Interview Findings4.2.1 Using Co-Creation as the Cornerstone to Operating the BrandsStrategic Marketing ActivitiesThe partners of Sharp had a clear vision of creating an agency distinctfrom those they had experienced in the industry before. In previous roles,‘more traditional’ types of research were used when it came to customerengagement. SCS1 specifically referred to these methods to be ‘shallow’in terms of trying to gain deeper insight, which could unlock great ideas forclients work. The notion that previous methods of working in previousagencies provided inadequate insight on the consumer is a viewsupported by Ballantyne (2004), who discusses the use of Co-Create as amore in depth tool for the gaining of information between thoseparticipating.In the experience of both SCD1 and SCS1, customers gain a great dealfrom collaborating with their favourite brands. They both highlighted traitssuch as honesty, and a willingness to listen to their needs, rather thanbeing ignored and only treated as one of a large group as things that areimportant to customers. There are many instances in the literatureresearched for this study which highlight the importance of what customerexpect out of today’s brands. Beckett and Nayak (2008) highlight how amass marketing approach is no longer as of much a viable option forbrands as it used to be.There is also less of an excuse for brands continuing to ignore the needsor thoughts of consumers. Small brands as well as large are now able to38
  39. 39. harness the power of technology, thereby interacting with consumers onan unprecedented level (Addis & Holbrook, 2001; Ballantyne, 2004).Technological factors such as social media were cited in the interviews askey reasons as to why there is a better opportunity for more in depthengagement.The role of technology has clearly enabled more engagement withconsumers, but there are other important factors which have influencedthe development of the brand-consumer relationship. The data collectedshows that confidence amongst consumers has been a real driving forcebehind consumer power. There is a strong consensus amongst therespondents that increased access to information and the ability to shareinformation has given rise to such phenomena as consumer communities,consumer generated content, and consumer ownership of brands. Thishas handed more power to consumers bringing more equality to themarketplace, as consumers feel more at ease with the concept of beingable to ask for what they want from brands, as well as having a platform touse their own ability to create a meaningful influence on brands (Promise,2009). The issues of increased consumer power and the consumer’s newfound confidence to contribute are closely linked to technology, as this hasprovided a platform for these factors to develop as described in theliterature by Mainwaring (2011), as well as Addis and Holbrook (2001).Both SCD1 and SCS1 agree that increased consumer power is a positivething for consumers, but a note of caution was also apparent in theresponses. The idea that brands need to look carefully at how they dealwith this change in power, should they embrace it or try to claim backsome of this perceived loss of power? The general consensus is thatbrands need to embrace it, and importantly, listen to consumers more thanthey have ever done previously in order to harness the great potential thishas. Prahalad and Ramaswamy (2004) have written extensively on the39
  40. 40. benefits of interaction between the two parties. They have reached theconclusion that only in-depth interaction can satisfy the needs of today’smodern consumer.In order for brands to fully adopt Co-Creation there has to be a substantialwillingness to do so. In the experience of the respondents, theirencounters with a brand’s willingness in adopting this methodology hasshown that they were either skeptical, or that they were unsure of how toget closer to their customers. However, they all agree that once brandshave looked deeper into Co-Create and gained a better understanding ofhow it can improve their business, the brands have become excited aboutits potential.4.2.2 The Co-create Process and it’s EffectsThe respondents opinion of Co-Create is varied in terms of what they lookto get out of the sessions, but the planning of a Co-Create session clearlydependent on the brand and its particular needs. SCD1 states that theirneeds to be a clear objective for the session, allowing the brand tomeasure how successful the session was in order to fulfill a particularcampaign brief. SCS1 highlights the ingredients which will allow for asuccessful Co-Create session are ensuring the ‘right’ people attend,developing a succinct and easy to understand set of tasks for the session,and, importantly, ensuring there is a fun and engaging environment to putparticipants at ease. Both agree that the sessions must encourageparticipants to interact fully and become completely engaged with thebrand. This will provoke meaningful conversations which are needed togain insight from consumers. This is highlighted by Bhalla (2011) as animportant element to the Co-Create process.The general consensus from the interviews were that the effects of Co-Creation are significantly different for all involved, these being the brand,40
  41. 41. consumer, and the agency. In this study the agency was Sharp. For theagency and brand in particular, it will provide great insight into whatconsumers think about a brand as well as what these consumers wouldchange if they had control. This will subsequently provide an agency likeSharp with a wealth of tools at their exposure to produce work that is morerelevant, and work which can speak to consumers in ways other forms ofcommunication may not. This again relates to how Co-Create can be usedas an insight tool, and how it is then used by agencies like Sharp to aidthem in the campaign development process (Ballantyne, 2004). In fact,insight was regarded as the most important thing the respondents wantedout of each session.The Co-Create sessions are usually attended by a number of employeesfrom the brand, which means the session will give the employee thechance to learn from and interact directly with their consumers. When abrand has attended a session, it has at times resulted in them gaining a lotof information about their brand which they had not considered previously.One case for Co-Creation was suggested from SCS1 is that brands aregetting value for money from these sessions as they are essentially gettingmarket research as well as idea from one session.What consumers can gain from these sessions is a renewed sense ofpassion or loyalty towards the brand. This results from a brand using theirtime and resources to actively engage with its customers in more in depthways than other forms of consumer participation, such as focus groups.The overwhelming feeling in these sessions was that participants wereencouraged by the genuine want of a brand to hear customer’s opinionsand to work with them as partners in projects or on a more long termbasis. The respondent’s also discussed how many participants are already‘brand enthusiasts’ or are converted to ones after the session. Thishighlights how Co-Create can create value between a brand and its41
  42. 42. consumers. The literature researched in this study has repeatedlyemphasized how engagement and collaboration between the two partieswill create value and so produce fruitful long-term relationships (Prahaladand Ramaswamy, 2004).In regards to the question of whether Co-Creation delivers competitiveadvantage, the overwhelming opinion is yes. This is because both brandsand consumers are craving for ‘relevance’ in their relationship, which ismain motivation for both SCD1 and SCS1. This matter is discussed atlength by Rust, Moorman & Bhalla (2010), who highlight how consumerscrave the information they are given by brands to be relevant to them.They also discuss the issue of mass marketing which was discussed inboth the literature review and earlier in this chapter. The opinion on howCo-Creation can deliver value and long term relationships is also animportant driving force behind how the methodology can delivercompetitive advantage. The respondent’s opinion that brands which useCo-Create are showing customers they value their opinions and arewilling to invest in order to gain customer satisfaction in terms of products,services, and communication mirrors the literature of Bendapudi & Leone(2003).4.2.3 The future and Potential of Co-CreateThe data gathered from the respondents puts the future and potential ofthis methodology in the hands of two main elements, these are furtheracceptance by both brands and consumers, as well as further advances intechnology.There are clear indications that companies are beginning to take notice ofwhat Co-Creation can do for them. Both respondents were asked to namea company that came close to being truly ‘consumer centric’ and bothresponses were Threadless.com a company that has been mentioned42
  43. 43. before in the literature (Schau, Muniz & Arnold, 2009). The existence ofcompanies like Threadless.com are a clear indicator that successfulcompanies can be built purely around customer as co-producer. SCS1also highlighted the coffee shop brand Starbucks that created themystarbucksidea.com, which was a platform for customers to put their ownideas of how to improve their own experiences at the Starbucks outletsand then vote on their favorites (Ind, Fuller and Trevail, 2012). Famousindustry developments such as loyalty cards can be traced to themystarbucksidea.com project (mystarbucksidea.com, 2012).5.0 Chapter 5: Conclusion5.1 IntroductionThis chapter will form a conclusion of the study in order to demonstratethat the original goal of the study has been achieved. The secondaryresearch included in the study has covered the topic of Co-Create directlyas well as the contributing factors that surround Co-Create. As Co-Createis not as well known as other areas of business and marketing, theintention of the study was to introduce the concept of Co-Create, examinethe factors which have helped it’s development, and study what effect thismethodology can have on the industry. The primary and secondaryresearch included in this study has been used to provide information toallow a discussion of Co-Create. They have also been used to suggesthow this subject can be researched further due to Co-Create being anunder-researched subject; this study should be used as a starting point forfurther research.43
  44. 44. 5.1 Conclusions on the topic of Co-CreationIt is clear that without the ‘modern consumer’ Co-Create as we now knowit would not exist. The literature has discussed at length how consumersare now more connected to each other, more informed, and moreconfident. This change has led to consumers expecting more from brands(Prahalad and Ramaswamy,2004; Bhalla, 2011). There has been aseismic shift in how companies provide for their customers. They are nownot only providing products they think customers will want, but actuallyinteracting with customers, and developing products alongside them inorder to maintain the relevance of their brand (Cove and Dalli; Kitchen,2010).The modern consumer is a major influence behind the emergence of Co-Create, but the primary and secondary data gathered in this studydemonstrates that it is technology which drives the modern consumer.There is an extensive body of literature on how technology hastransformed modern advertising and marketing, including Prahalad &Ramaswamy (200), Rust, Moorman & Bhalla (2010), and Mainwaring(2011). These authors have stated how technology, and in particular theinternet, have provided a platform for consumers to impose a significantamount of influence on brands, as well as opening doors to developingrelationships. There are many examples of brands using the Internet, inparticular social media sites such as Facebook and YouTube, in order toprovide forums for communication between the two (Chu and Kim, 2011).The literature also focuses on Nike and Timberland, as both these brandsuse the Internet to engage with a loyal customer base (Ramaswamy,2008; Timberland, 2012).In an age where most industries and markets are becoming increasinglysaturated with infinite levels of choice, the research conducted for thisstudy demonstrates that consumers are not ‘sheep’ and do not expect to44
  45. 45. be treated as such. Mass marketing communications are wasted onconsumers because they have grown accustomed to an intense level ofpersonalisation and are tired of the abundance of choice available to them(Prahalad & Ramaswamy, 2003; Schwartz & Barry, 2005). The insightgaining potential of Co-Create is a definitive solution to this, as it allowsagencies or brands to take the opinions and ideas of consumers andproduce work which is more relevant, thus making it more personal to theconsumers.As discussed in both the primary and secondary research, Co-Create isnot merely a market research tool. It is a working methodology that if fullyembraced by an organisation, can shape its whole operation around whatis most important to its survival its customers. By having this closecollaboration between the two parties it will create value, and mostimportantly this value has the potential to last significantly longer and bemore profitable than a brand which only hold passive relationships withcustomers, merely concerned with hunting for the next sale. The literaturehas spoken extensively about the Co-Creation of value (Prahalad &Ramaswamy, 2004), this phenomena is closely linked to the quality ofrelationship that exists between the consumer and the brand. The qualityof these interactions will depend on the philosophy of the company. Forexample Rust, Moorman & Bhalla, (2009), discuss how a company can bedescribed as one which ‘cultivates customers’ meaning that it looks toacquire relationships with consumers rather simply looking for the nextsale at any cost. This approach of putting such a high importance onbuilding relationships will contribute significantly to the Co-Creation ofvalue.Models such as the Bhalla (2011) model, and the DART analysis(Ramaswamy, 2008), are important to consider when determining whetheror not a brand is operating collaboratively. The Dart model highlights the45
  46. 46. criteria to consider in order to ensure a brand is truly working withconsumers on a equal footing. However, what is particularly importantabout the Bhalla model is how it makes particular reference to ensuringthat the outcomes and the findings of the Co-Creation process areimplemented either internally or externally. This is very important asdespite brands and consumers knowing more about one another, thesuccess of this methodology very much depends on both parties willing totake action in order implement the outcomes.5.2 Limitations of the StudyThe study has several limitations. Firstly, the primary research wasconducted using a small sample population. It was limited to this smallsample as it used one agency, as in the experience of the author Sharphad all the necessary expertise within the organisation to be able to gatherenough data for the study. This means it can be difficult to draw a moregeneral industry wide conclusion for this study, but due to the under-researched nature of the topic this was in the best interests of the study.Also, the semi-structured interviews which were used cannot deliver thesame level of in depth data as would come from a more developedinterview form. There were also issues of the extended periods of timeneeded for the interviews, as though participants were willing to take partthey did have time constraints.All of these constraints can be dealt with, but unfortunately are not feasiblefor the author to do so at this time. The main reason for this is the lengthand timescale placed on the authors dissertation.5.3 Further Investigation into the StudyEven though the topic of this study can be considered to be under-researched due to its clear potential to have a significant impact on thefuture of the industry there is significant ground for further study on this46
  47. 47. topic. Any further research on this topic must not include the limitationsthat this study has faced.Future research on the topic can include additional agencies and brandsthat use Co-Create as a methodology as well as those who do not. Also,the use of consumers in the research would help to give another point ofview to the analysis and conclusion stage.Areas that show significant potential in where the subject areas can befurther investigated would be what is the future of Co-Create? And, howfar the collaboration between the brand and the consumer can be taken? Itis clear from the study that pioneers in the subject area, such as Sharp,Threadless.com, and Starbucks have set the benchmark for what can beachieved in the area of Co-Create, but the impact on the industry and theextent to which it can reach is yet to be identified.47
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  54. 54. AppendicesAppendix A - Reflective StatementAppendix B - Interview responses from SCD1 (The Sharp Agency Ltd)Appendix C - Interview responses from SCS1 (The Sharp Agency Ltd)54
  55. 55. Appendix A - Reflective StatementAs an advertising student and being on an industrial where Co-Creationwas my first taste of working in advertising it was only natural I was goingto choose this particular topic for my dissertation. It was a topic that initiallyinterested me and which although had been introduced to was something Iknew a small amount of background knowledge on. Although I was awareof Co-Creation and collaborative marketing, I knew very little about thebackground knowledge and theory which make up the topic. This meantthat I needed to go right back to the beginnings of Co-Creation inmarketing and advertising however this came as no chore as it was a topicI enjoyed it came as particular interest to me.Conducting my primary research was very successful. Obtaining the selectnumber of interviews not only provided me with viable and reliable resultsbut helped me immensely when it came to analysing my findings. Myfindings not only allowed me to draw conclusions on my hypothesisindicated before the research but also brought to light evaluations of otherareas which were not previously foreseen. My conclusions andevaluations supported by my research provided an in depth understandingof the effect Co-Create has on the industry.on reflection the study was a very fulfilling and enjoyable experience. Inow have a greater understanding of Co-Create and the important factorssurrounding it.55
  56. 56. Appendix B - Interview responses from SCD1 (The Sharp Agency Ltd)Introduction• When forming Sharp was it your original goal to build an agencybased around a ‘Co-Create’ methodology or has it developed sincethe agency was founded?• Looking back to your previous experiences in the industry and theway you approached delivering client work, what were the keystumbling blocks you felt that pushed you towards a morecollaborative style of working?Consumers and Brands• Drawing on your experiences of working with consumers andyourself as a consumer, what has change for you in how you caninteract with brands?Response:Not specifically. We did have a focus on close collaboration with clients,so the way of working had started and then grew to wider stakeholdersand although we were co-creating we didn’t decide to call it co-create untilabout a year later, and it soon became clear to us that this was amethodology that we should build the business around.Response:In the other agencies I worked for they did have their methodologies ofworking, but the only customer involvement tended to be traditionalresearch. It always surprised me that this was the case and conversationsat SHARP about this aspect of other agency methodologies was part ofthe thinking that led us towards co-create as our USP.Response:The consumer has changed. They used to be passive and now they havea voice like never before. And they love to share their ideas and aredeveloping a new type of relationship with brands that are open to theirinvolvement.56
  57. 57. • What do you think consumers expect from the favorite brands withregards to their relationship?• Do you agree with the statement that consumers have more powerthan ever before and if you do you think this is a good thing?• In your opinion why do you think such things as ConsumerCommunities, Consumer Generated Content and consumers whohave a sense of ownership of brands have developed over recentyears?• What are your opinions on how influential these three factors are?Response:They expect to be listened to, and reject brands that don’t care what theythink.Response:Yes I agree and it’s a good thing for sure.Response:The ease of how consumers can now become involved through socialmedia has created in many consumers and addiction of involvingthemselves in communities of like minded people.Response:It simply can’t be ignored.57
  58. 58. • How do you think brands should deal with the apparent loss ofcontrol of what information consumers are subjected to?• Do you feel or have you experienced first hand apprehension frombrands about working more closely with their customers?Co-Create• Could you take me through how you would design a Co-Createsession for a client and what things you take into consideration?• As Creative Director how does Co-Create impact the work youproduce for your clients?Response:The brands need to listen carefully, and then take part in the conversationto ensure that they act in the best interests of their customers.Response:At first they are unsure, but once they realise how they can become partof the conversation they seem quite keen to get involved.Response:Their needs to be a clear Objective and a focus on what the output needsto be. Every session is individually planned around the objective andoutcomes, so each session is different.Response:It provides insights that wouldn’t normally be available so in that respect ithelps fuel more relevant work.58
  59. 59. • When starting a Co-Create session what is the one thing you arelooking for to come out of the session?• From your experience of the Co-Create sessions,what do you thinkthe participants get out of the experience and do you think it that theirattitudes towards the brand change as a result of being part of thesessions?• And similarly what do you think your clients get out of the sessions?• By looking on your website is it safe to say that Co-Create by Sharpis primarily a methodology that can help the work you produce foryour clients resonate with its target audience more accurately?Response:Fresh insights.Response:We find that they have a really rich experience. Contribute in a way theynever imagined, and seem to be fans of the brand when they leave!Response:Clients are always refreshed and encouraged by what they hear.Response:Yes.59
  60. 60. • So it is safe to suggest that in your opinion by using Co-Create bycan cut down in what some may consider to be the risk involved incommunicating with consumers?• How do you feel Co-Creation can deliver competitive advantage tothose brands who operate this way?The Future of Co-Creation• Where do you see the potential or direction you wish to take Co-Creation developing over the next few years?• What is your idea of a truly ‘consumer centric’ organisation and canyou think of any brands that are or come close the the concept of abusiness totally centered around its customers?Response:Yes.Response:It provides them with relevance.Response:I think it will mature as an idea, and become more acceptable. Moreexamples of success will start to find their way into the market and morebrands will start to consider it.Response:A truly consumer centric brand is one that listens, understands anddelivers for its customers.Threadless.com60
  61. 61. Appendix C - Interview responses from SCS1 (The Sharp Agency Ltd)Introduction• When forming Sharp was it your original goal to build an agencybased around a ‘Co-Create’ methodology or has it developed sincethe agency was founded?• Looking back to your previous experiences in the industry and theway you approached delivering client work, what were the keystumbling blocks you felt that pushed you towards a morecollaborative style of working?Response:No. the agency’s philosophy has been, since the start : Ideas that makethings happen. And this idea ‘happened’ to us when we were working ona particular project for the NHS Sheffield. It was a tough project …. Andwe decided that the best way to tackle an ‘image campaign’ to promoteNHS Sheffield, was to develop the very earliest ideas together withpeople of the city itself. And though we didn’t know it then – Co-Create,now the centre of our universe, was born!Response:Agencies usually get away with a rather shallow understanding of abrand’s audiences, their triggers and motivations to buy/download/donate…. And even when there are research reports and data analytics towork with, these are not nearly as powerful as a Co-Creative processactually involving the audience/s in idea generation from the start.This is what is fresh and exciting about it.The investment of time and insight is upfront. It removes guess work. Itsmore rigorous.It gives greater confidence that you will engage the audience moreeffectively.61
  62. 62. Consumers and Brands• Drawing on your experiences of working with consumers andyourself as a consumer, what has change for you in how you caninteract with brands?• What do you think consumers expect from the favorite brands withregards to their relationship?• Do you agree with the statement that consumers have more powerthan ever before and if you do you think this is a good thing?• In your opinion why do you think such things as ConsumerCommunities, Consumer Generated Content and consumers whohave a sense of ownership of brands have developed over recentyears?Response:The world has changed. I think 2 things have driven this : Technology andconfidence.Technology (Web 2 and 3!) enables social engagement, influence andcreations of things meant to be shared. And an increasingly confidentbase of consumers who know that their opinion matters ( to brands and toother users) and that they exert immense power (good and bad)especially when they act in communities.Response:Honesty. Endorsement by other consumers (validate that its thought to begood). Entertainment.Response:Yes. And yes. But brands need to understand how to work with this.Response:Technology and confidence.62
  63. 63. • What are your opinions on how influential these three factors are?• How do you think brands should deal with the apparent loss ofcontrol of what information consumers are subjected to?• Do you feel or have you experienced first hand apprehension frombrands about working more closely with their customers?Co-Create• Could you take me through how you would design a Co-Createsession for a client and what things you take into consideration?Response:Immensely powerful. Especially where consumers CARE about thesubject/brand.Response:Its not loss of control. Its about interested, ‘hungry’ consumers creatingcontent and sharing what appeals to them, essentially ignoring stuff that isnot real or interesting.Response:Clients all want to get closer to their audiences. Many don’t know how todo it. Co-create is an easy, non threatening (and cost effective) method –it can be trialled with just 1 session.Response:3 important aspects.1. Getting the right people to attend.2. Getting a succinct, easy-to-understand set of tasks3. Inspiration and fun (the room/tools to work with etc)63
  64. 64. • How does Co-Create impact the work you produce for your clients?• When starting a Co-Create session what is the one thing you arelooking for to come out of the session?• From your experience of the Co-Create sessions,what do you thinkthe participants get out of the experience and do you think it that theirattitudes towards the brand change as a result of being part of thesessions?• And similarly what do you think your clients get out of the sessions?Response:A big shift. The insights last for months and can be drawn opon for aseries of campaigns.More important though – the campaign results are showing that co-created projects are more effective!Response:Interest. Engagement. Understanding of the audience. Brilliant ideas. (okthat’s 4!)Response:Yes. Participants tend to become ‘brand enthusiasts’ after a 4 hoursession – even if they came into it a little skeptical / cautious of the brand- if we have recruited based on audiences that we believe have thepotential to like a brand!Response:Excellent value for money (research and ideas in one!). Confidence tosteer/approve a campaign that develops as a result.64

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