New service development: learning from and with customers

TLDR

New service development requires understanding latent customer needs, and recent research stresses proactive learning through customer involvement and observation in real action. The paper aims to apply market and learning‑orientation theory within a service‑centered model to review literature on customer involvement in innovation. A field experiment in Sweden with end‑user mobile phone services was conducted, using a design that departs from traditional service value‑in‑use by borrowing product‑innovation techniques to support learning in customer co‑creation. Consumers’ service ideas were found to be more innovative, in terms of originality and user value, than those of professional service developers.

Abstract

New service development relies on the complex task of understanding and anticipating latent customer needs. To facilitate proactive learning about the customer, recent findings stress customer involvement in the development process and observations of customers in real action. This paper draws on theory from market and learning orientation in conjunction with a service‐centered model, and reviews the literature on customer involvement in innovation. A field experiment was conducted in Sweden with end‐user mobile phone services. The design departures from the nature of service that precepts value‐in‐use and by borrowing from relevant techniques within product innovation that supports learning in customer co‐creation. The experiment reveals that the consumers' service ideas are found to be more innovative, in terms of originality and user value, than those of professional service developers.