Consumer Involvement in New Product Development - Essay Example

Consumer Involvement in New Product Development By + Introduction In the 21st century, advanced technology has provided unlimited amounts information through different platforms. The different platforms provide an array of communication agents from one person to another. The effects of these communications can be so great that it sometimes creates a new product. Customers all over the world can discuss a product through different chat rooms like blogs. The customers now have some sought of voice in the products’ creation and evaluation (Hoyer et al., 2010). In the light of these new forms of communication and voice in the matter of product creation, the customers now feel that are a major part of product creation or improvement (Sun et al., 2010). Customer Involvement In the development of new products, customers participate to give new ideas to help create the products through communication (Yang et al., 2011). The process, referred to as co-creation, employed by the developers, is important in the new product development sector. In this case, customers may come up with new goods or services or simply try to improve on what is already circulating in the market to fulfill their needs. These ideas shared by customers reach the intended producer through different avenues like the company website or through social media. Co-creation used this way is a symbiotic relationship in which the customers and the firms collude and make a product where the customer will enjoy interacting with the product and the producer will meet the customer’s needs (Hoyer et al., 2010). Producers nowadays use this mode of collaboration as a way to reduce time in the production process and ease their thinking and the uncertainty that comes with the new product, questioning whether the product fits the market and carrying out surveys for gauging where most customers lie, either in favor or out of favor (Lundkvist & Yakhlef, 2004). The scope of co-creation is the extent to which an organization decides to involve the consumer in the development stages up to the post launch stage. Threadless.com is a T-shirt manufacturing company high on scope and they depend on co-creation for manufacturing their products. The consumers submit T-shirt designs online and the company employees and visitors to the site vote. The designer who wins gets a monetary compensation and retains the rights of the design. The co-creation process does not end there, but after launching the product. In the end, it serves as a marketing strategy (Hoyer et al., 2010). The relationship shared between the consumer and the manufacturer is quite a difficult situation in terms of informational dispensation. According to Lundkvist & Yakhlef (2004), the information is asymmetrical in nature because the customer has the need for information and the manufacturer holds the solution information and this forms some sort of independency on each other. The ‘need’ information is on the customer’s end, where a customer has needs that the manufacturer can satisfy. The manufacturer on the other hand, possesses the solution to the problem. The information required to reduce the chances of product failure lies with the customer and the manufacturers have to find the information (Bhuiyan, 2011).The process of finding the information is difficult and less possible through the normal research and development techniques (Wynstar & Pierick, 2000). Language according to recent research is not just a means of transferring thoughts from one person to another but as a process in which conception of new ideas take place. The use of conversation between the customer and the manufacturer makes the customer an active agent in the manufacturing process. Conversation therefore, becomes a medium upon which new ideas come to life as the manufacturer and the consumer share their ideas (Lundkvist & Yakhlef, 2004). Throughout the years, most innovations are objects that are physical and are perceptible to touch, which makes it easier to get customer feedback in time to save the product from failure. The features are not the same as compared to the service department. Services are intangible, diverse and inseparable (Alam & Perry, 2002). These traits make services harder to achieve customer satisfaction since the customer involvement is at the delivery stage and requires a more personal relationship with the customer over a long period. These makes the new product development easier to create a product since it is an interactive process between the customer and the manufacturer. Many are the times that customers are motivated through psychological and economical persuasions. These are mental states of the customer and do not guarantee a long time involvement or loyalty to the product. Researchers have not yet found a way to pin these motivations to a continuous customer involvement in the manufacturing process. The use of symbols and ideas that stick is still the way that a manufacturer can use to secure a long-term relationship (Lundkvist & Yakhlef, 2004). The process of obtaining the relevant information from the customers is costly. The information needed is expensive to acquire and use in the set location and in turn makes it difficult for most manufacturers to understand the customer’s needs. A research conducted indicated that 120 research and development managers felt that the customer’s needs were the number one priority before the market growth. The same researchers discovered that 71% of the respondents delayed their product developments because of inadequate definitions of the product (Sanden 2007 cited in Gupta & Wilemon, 1996). The diverse needs of the consumer steepen the slope for the manufacturers since it is difficult to develop a new product that will cut across different cultures, beliefs and people. Most firms use a lot of money in market research because of the common assumption that the consumer’s needs are homogenous so they can reduce the marketing costs (Ritter & Walter, 2003). Many techniques used in market research fail due to the difficulty of delivering enough details to at least summarize the customer’s needs and be able to produce products that will cater for the present and future needs (Sanden, 2007). A survey conducted in showed that traditional research methods obtain their data at the focal point of the market where majority of the respondents do not give long lasting information but give information based on their present experience and surrounding. The other mistake with traditional methods is the process through which information reaches the research and development department in firms (Fuschs & Schreier, 2011). The information goes through the marketing department, which later on conveys the message to the new product development team, which now deals with the information provided. The problem with this method is that information is subject to distortion because by the time it reaches the R&D it is in third person. The problem with this is that people might omit or forget to deliver messages as soon as they get it. The new product development teams should get the information directly from communicating with the consumer (Sanden, 2007). In the case of radical innovations, which are new products that upset the norm, the customer’s role remains undetermined. However, under certain conditions their roles are experienced. In one of the case scenarios, the firm must move from the point of the relationship where the customer is buyer and the firm a seller and view the customer’s input as important and valued. The input is the firm’s resource (Antikaenen, 2011). The uncertainty that comes with the lack of customer’s response of the product is minimal because of the information obtained from the customer (Johnson , 2007). Despite the fact that co-creation has been a productive process, there are instances that customers do not help in the radical innovations. The firms that dwell so much on the co-creation process try to maintain their customers by keeping them satisfied, this results to companies allocating a lot of time and money in co-creation. Allocation of resources is poor and instead of going to develop, new products that are innovative they allocate the resources to maintaining the current customer’s wishes. In the case of disk industry, in the 1960s to 1990s, the major companies used co-creation as a way to stay relevant in the industry. They made better disk drives with increased capacity. The other small firms that came along simply made the product better. They reduced the size while increasing the capacity of the drives. Then in time, they became the same size as the predominant model. The customers then preferred the new model and shifted to this version. The small firms did not have the resources to allocate to co-creation and new product development. They simply pumped all of it to the development of the disk drives. The larger firms lost their customers to smaller firms because they spent too much time in co-creation and forgot to develop their product further (Johnson , 2007). Conclusion The information provided shows that major changes occur when the customer is involved directly in the research process. The strategists should be able to incorporate the customer’s input since it is fundamental in reducing the costs in the end (Kristensson et al., 2008). The market is a diverse place, so the researcher should diversify to obtain better results. The customers are external partners in an organization and an indispensable resource (Gruner & Homburg, 2000). The radical innovations cause a unique challenge because the product is not conventional or normal. They are goods that are penetrating the market for the first time so they very challenging. It does not mean that the customer’s input is not of use. The customer’s input can help build perspective on how the product will hit the market (Renko & Janakiraman, 2008). Bibliography Alam, I. & Perry, C., 2002. A Customer-Oriented New Service Development Process. Journal of Service Marketing, 16(6), pp.515-34. 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