Nama Iin Suprihatini
NPM 13210395
Kelas 3ea14
Comsumer Inovation
Defining Customer Innovation
I often get asked what I mean when I use the phrase "Customer
Innovation". Here's my explanation:
Customer innovation incorporates a number of emerging concepts and
practices that help organisations address the challenge of growth in the
age of the empowered and active customer (both business and consumer).
It demands new approaches to innovation and strategy-making that
emphasise rapid capability development, fast learning, ongoing
experimentation and greater levels of collaboration in value-creation.
Customer innovation impacts upon all the following activities, functions
and disciplines:
Marketing strategy and management
Brand strategy and management
Communications strategy
Customer experience design and delivery
Customer relationship management
Customer service design and quality management
Market-sensing and customer learning
Market and customer segmentation
Creativity and knowledge management including market research
Partner and customer collaboration
Organisational alignment and purpose (values, behaviour and beliefs)
Innovation strategy and management
Innovation valuation, measurement and prioritisation
Strategy-making
For me customer innovation is not only an important perspective on
value-creation but a whole new strategy discipline that organisations
must embrace if they are to pursue growth successfully in the future.
Put another way, customer innovation impacts the fundamental means by
which value is created and growth sustained.
One of the difficulties I encounter when explaining the concept is that
the "Innovation" word is traditionally associated with products and
technology. There is a section in The Only Sustainable Edge by Hagel and
Seely Brown that eloquently defines Innovation from a much broader
organisational and strategic perspective:
We underscore the importance of innovation but we use the term more
broadly than do most executives. Executives usually think in terms of
product innovation as in generating the next wave of products that will
strengthen market position. But product-related change is only one part
of the innovation challenge. Innovation must involve capabilities; while
it can occur at the product and service level, it can also involve
process innovation and even business model innovation, such as uniquely
recombining resources, practices and processes to generate new revenue
streams. For example, Wal-Mart reinvented the retail business model by
deploying a big-box retail format using a sophisticated logistics
network so that it could deliver goods to rural areas at lower prices.
Innovation can also vary in scope, ranging from reactive improvements to
more fundamental breakthroughs... One of the biggest challenges
executives face is to know when and how to leap in capability innovation
and when to move rapidly along a more incremental path. Innovation, as
we broadly construe it, will reshape the very nature of the firm and
relationships across firms, leading to a very different business
landscape.
Although Hagel and Seely Brown's book provides a great analysis of
capability-building and new innovation mechanisms at the edge of
organisations (through new dynamic forms of firm-firm collaboration) and
specialisation, their discussion largely omits the customer-firm
colloboration, open innovation perspective. But, from Hagel's most
recent post and article in the Mckinsey Quarterly, this seems like it
could be the subject of their next book! Here is a quote from the
article:
Cocreation is a powerful engine for innovation: instead of limiting it
to what companies can devise within their own borders, pull systems
throw the process open to many diverse participants, whose input can
take product and service offerings in unexpected directions that serve a
much broader range of needs. Instant-messaging networks, for instance,
were initially marketed to teens as a way to communicate more rapidly,
but financial traders, among many other people, now use them to gain an
edge in rapidly moving financial markets.
Example for consumer innovativenss
For example, based on this research, Tellis, who has experience
launching new products via his past service as a sales development
manager at Johnson & Johnson, recommended that businesses employ a
“waterfall strategy” (i.e., a country-to-country tiered release) versus a
“sprinkler strategy” (all at one time) for new products, making sure to
vary their approach depending on the country and product category.
Governments can apply this research when introducing new products, such
as fuel-efficient cars, and services to their citizens. “This study
tells them whom to target first in which regions,” Tellis said.
Management consultant firm A. T. Kearney funded the study’s data
collection, while Don Murray, executive chairman of Resources Global
Professionals, provided the annual grant to the USC Marshall Center for
Global Innovation, which paid for the data analysis.
Compulsive Consumption Consumer
O'Guinn & Faber (1989:148) defined compulsive consumption as “a
response to an uncontrollable drive or desire to obtain, use or
experience a feeling, substance or activity that leads an individual to
repetitively engage in a behaviour that will ultimately cause harm to
the individual and/or others.” Research has been carried out to provide a
phenomenological description to determine whether compulsive buying is a
part of compulsive consumption or not. The conclusion reached after
analysing both qualitative and quantitative data stated that compulsive
buying resembles many other compulsive consumption behaviours like
compulsive gambling, kleptomania and eating disorders (O' Guinn &
Faber, 1989:147). Hassay & Smith (1996) hold a similar view and
refer to compulsive buying as a form of compulsive consumption as well.
Besides personality traits, motivational factors also play a significant
role in determining the similarities between compulsive buyers and
normal consumers. According to O'Guinn & Faber (1989:150), if
compulsive buying is similar to other compulsive behaviours it should be
motivated by “alleviation of anxiety or tension through changes in
arousal level or enhanced self-esteem, rather than the desire for
material acquisition.” Hassay & Smith (1996) also agree with the
above inference and concluded from their research that “compulsive
buying is motivated by acquisition rather than accumulation.
Example Compulsive Consumption Consumer
Examples include uncontrollable shopping, gambling, drug addition,
alcoholism and various food and eating disorders. It is distinctively
different from impulsive buying which is a temporary phase and centers
on a specific product at a particular moment. In contrast compulsive
buying is enduring behaviour that centers on the process of buying, not
the purchases themselves.
Consumer Ethnocentrism
is derived from the more general psychological concept of ethnocentrism.
Basically, ethnocentric individuals tend to view their group as superior
to others. As such, they view other groups from the perspective of
their own, and reject those that are different and accept those that are
similar (Netemeyer et al., 1991; Shimp & Sharma, 1987). This, in
turn, derives from earlier sociological theories of in-groups and
out-groups (Shimp & Sharma, 1987). Ethnocentrism, it is consistently
found, is normal for an in-group to an out-group (Jones, 1997; Ryan
& Bogart, 1997).
Consumer ethnocentrism specifically refers to ethnocentric views held by
consumer in one country, the in-group, towards products from another
country, the out-group (Shimp & Sharma, 1987). Consumers may believe
that it is not appropriate, and possibly even immoral, to buy products
from other countries.
Purchasing foreign products may be viewed as improper because it costs
domestic jobs and hurts the economy. The purchase of foreign products
may even be seen as simply unpatriotic (Klein, 2002; Netemeyer et al.,
1991; Sharma, Shimp, & Shin, 1995; Shimp & Sharma, 1987).
Example for consumer ethnocentrism
For example, according to Burton (2002) and Quellet (2007), consumers
are concerned with their cultural, national and ethnic identities
increasingly in more interconnected world. Some consumer researches
determined that people make their purchasing decisions on information
cues. Information cues can be intrinsic (e.g., product design) and
extrinsic (e.g.,brand name, price)(Olson, 1977; Jacoby ,1972). But
extrinsic cues are likely to be used in the absence of intrinsic cues or
when their assessment is not possible(Jacoby, Olson and Haddock, 1971 ;
Olson, 1977; Jacoby, 1972 ; Jacoby, Szybillo and Busato-Schach, 1977 ;
Gerstner, 1985).
Also, according to some researches, it was thought that there is a
relationship between attitudes toward foreign retailers’ products and
some demographics characteristics such as gender, education, income and
age.
When doing this research, it was aimed at determining consumer attitudes
towards foreign retailers’ products. The research starts with a
literature review which includes international retailing in Turkey,
attitudes towards purchasing foreign retailers’ products (general
review), effects of age and education level on attitudes, influence of
consumer ethnocentrism on attitudes towards foreign retailers’ products
respectively. Secondly, methodology part that has explanations about how
this research was conducted, was presented. Then, findings which
derived from questionnaire results and its SPSS analyses, are presented.
At the last stage of the research, discussion, limitations and future
researches are discussed.
Sumber :
http://chrislawer.blogs.com/chris_lawer/2005/10/defining_custom.html
http://www.businessteacher.org.uk/free-marketing-essays/compulsive-buying/
http://en.wikipedia.org/wiki/Consumer_ethnocentrism