The customer as co‐producer

TLDR

Industrial buyer‑seller interaction is a well‑studied work logic, whereas consumer markets increasingly adopt a customer co‑production model enabled by advanced consumers, flexible production, and information technology. The study seeks to understand how to organize consumer‑producer interaction to maximize learning and strategic benefits. The authors examine the role of front‑line staff, noting that limited feedback channels and insufficient authority and competence hinder effective learning. Consumer co‑production is growing but typically involves only one or two value‑creating activities, yielding mainly short‑term benefits, while strategic learning gains remain limited.

Abstract

Buyer‐seller interaction in industrial markets is a widely applied work logic, which has been thoroughly researched both empirically and theoretically. Addresses, in contrast,the interactive way of working in consumer markets, which is referred to increasingly under the heading of “customer co‐production”. Results indicate that company‐consumer interaction is becoming more frequent in a wide range of consumer industries, but in contrast to such interaction in industrial markets it generally encompasses only one or two of the value‐creating activities of design, production or consumption, and the benefits are mostly short‐term: a better fit for the consumers and the advantage of more differentiated offerings for the companies. However, the strategic benefits of learning that enhance the innovative capability of the producers and add to the competence of the users, still seem limited. One reason for this may be lack of channels for feedback, since it is the front‐line staff who interact with the consumers. Also, they lack the authority and competence for undertaking the feedback role. A growing population of advanced consumers, flexible production modes and the widespread application of information technology all help to create a potential for this logic, but in order to exploit its benefits to the full, more knowledge is needed about how to organize the interaction with a view to learning.