How can you, as a customer, get more engaged and involved in the process that defines the very product you are holding in your hands? How can you actually participate in the very definition of the traits that will characterize a product you like?

Photo credit: Mikkel

Have you ever desired to get more from an item you purchased? To explore its possibilities in order to get the best out of it? Have you ever said: “I surely would have known how to make this better if they only had listened to me?”

According to marketing expert Mikkel, a time has come where the old-fashioned relationship between business companies and the customer will no longer suffice. A new production cycle is arising, where the end user takes control in the process of creating new products, and plays a crucial role in shaping that very product to suit her needs.

The more a company allows its customers to express their creativity on a brand new product, the more desirable that product will look to the target audience. The customers won’t have the feeling of buying something already pre-packaged, but they will rather be more likely to perceive a product which has multiple dimensions and benefits and which can provide a unique experience for each single user.

In this insightful report entitled “The Co-Creative Consumer”, marketing expert and web-designer Mikkel takes you into a journey exploring the emergence of a positive collaboration between consumers and brands creating products and services for them.

Here the full report in its entirety:

Intro by Daniele Bazzano

The Fragmented World

Businesses once had the control: they would develop a product which they advertised, then waited for people to buy it. Besides the necessary means of communication to make a sale, the businesses didn’t interact much with it’s surroundings. The economist Milton Friedman nailed this way of thinking with the words: “The business of business is business”, an expression of a business being a closed and independent entity.

In the previous 30 years, it’s however been discovered that many things influence the business, and that it may even influence it’s surroundings back. Now the talk is of the Corporate Citizen, en expression of the business being a part of, and being responsible to, the surrounding society and that it therefore must behave ethically correct.

This pattern of thinking originates back in the 1960’s growing ideology of holism: that everything is connected. It began in the spiritual awakening in the western world, but spread into more tangible areas like politics and consumer behavior. This was the beginning of a long term trend towards less faith in authorities, which reflected in many different areas of the societies, and culminated in the “fragmented world” as we know it today.

From the beginning of this change in paradigm, it certainly wasn’t all businesses that welcomed it: instead, an industry of consultants and writers began to advise the businesses to direct and control the slowly increasing loss of authority and the accompanying criticism. Companies understood that many factors could influence them, and they invented concepts such as image in order to control it. Thus they ran against the wind and fought the change, by hiring spokespersons and Public Relations directors to handle communications and image, but most of all to erect a breakwater against the criticism of outsiders. Businesses realized that boundaries disappeared, but reacted by re-erecting them. Even today we have not seen the climax of this peculiar contradiction in business communication.

Businesses today are keenly aware that there is little distinction between itself, its customers, its employees, the surrounding society and many other factors. They use concepts such as:

• Autocommunication
• Integrated Communication
• Corporate Social Responsibility
• Ethical (Social) Accounting

They’re all expressions of this holism. From Milton Friedman’s “the business of business is business“, the “business” of a company today is almost everything. Therefore there’s been an enormous increase in the amount of communication which the business must relate to, both that from it’s surroundings but also that which it transmits (and emits).

But businesses struggles to control their image (and with how to do it), their products and the amounts of communication. The term “fragmented communication” is used about a business that is unable to coordinate it’s communication, mostly outwardly. The ideal is controlling employees and departments so only the information which the management has green-lighted, gets out.

The problem is however that control is practically impossible – the technology is too advanced and the respect for authorities is too low. So an increase in the amount of communication has happened – and since the businesses desire to control and direct communication, there is so much more to monitor and control. The desire to control an increasing amount of information, results in the need to become “omnicommunicative“: watch and communicate about almost everything. The more “omnicommunicative” a business becomes, the more there is to monitor and control – and a negative spiral has begun. I wrote a bit about this in Information Overload.

There’s also been a dramatic increase in the amount of criticism of and animosity towards businesses. As mentioned above, the mix of the technological democratization and a lower faith in authorities, has made it prevalent to manipulate with a company’s products, or scrutinize it’s communications and internal conditions.

More important – the perpetrators and critics could be employees, customers, competitors or complete outsiders. They will investigate the company and it’s products, spread stories and find secrets which the company would rather not have published. A bit will be false rumors, but most will be the accounts of frustrated customers about bad service and products, publishing of confidential notes or rumors conveyed by employees. The newest official statements will be compared to earlier ones, the personal lives – past and present – of key officials will be googled, press announcements will be commented out of proportion, rumors will arise out of thin air and for a short moment be regarded as truth.

There’s so much of this criticism, that control is impossible – it doesn’t even make sense to talk about “fragmented communication” (nor “integrated“) any longer. We have to talk about the “fragmented world” or society, which is the new condition that everyone must work within: a uncontrollable world where everyone that has an opinion of the company, also is a part of it.

Attempts to direct and influence this fragmented world, for instance through PR-people, will fare badly – one cannot control a fundamentally uncontrollable world – at least not without losing ethical capital. The Internet contains plenty of examples of businesses that has attempted to edit, direct, correct and manipulate the communication that concerns them. The consequences has only been negative attention and a reduction of their ethical capital in the eyes of their customers and other parties. By trying to protect their reputation, they’ve hurt it.

Living in Chaos

Every mistake the business commits, and every injustice that random interested parties claim or believe to have been committed, will be published. Therefore the business can not wait for the criticism to arise and grow, but it must seek out the criticism, in order to answer and deal with it before it grows too big. This is not meant to suppress or manipulate the criticism, but to recognize “just” criticism, explain the business’ dispositions and choices, kill false rumors and generally engage in a dialogue.

The result of such a behavior will be a better image, deeper contact to customers, interests and the business’ surrounding world, which is vital to running a business the next many years.

Pirate copying will be a condition of existence that can not be avoided either – the clever business will even draw lessons from the pirates or at least accept them as a permanent existence. In it’s essence, piracy means that products and public relations materials will be copied and/or used in other ways then the business had intended.

• In one end of the scale, it means that a logo or product photos is used by third parties, for example, for presentations, ads or on webshops – and often distorted to bad quality or with inappropriate colors. If anything good can be said of this, it would be that the “perpetrators” do it to celebrate your business or to facilitate sales of your products.
• In the other end of the scale, it means that the (copy-) protection of technological or software products is bypassed, and that they perhaps are then modified to the benefit of the consumer. Modification of physical objects soon becomes, with the advent of the 3D-printer, so accessible that unhappy or curious consumers will disassemble the business’ products, copy the parts and build a modified version.

  First they’ll be based on plastics but later also of metal and wood, and all sorts of mechanical or static objects could be altered: the user will simply either insert the object in, or download a schematics to, a copy machine which then produces a physical copy. Already the Internet contains many guides to do it yourself in your very own way of adjusting or using products in alternative ways – for example Ikea-furniture.

Releasing and copying equals publicity and for small producers it may be the only way ahead: movie producer Eric Wilkinson’s Man From Earth didn’t have many chances before it was copied, uploaded to the internet and mentioned on the pirate-news service ReleaseLog – which regularly links to obscure movies that mainstream media won’t touch. Instantly the buzz exploded across the net: it got good remarks from those that downloaded it, and Wilkinson even wrote a thank you note to ReleaseLog who naturally published it as a form of legitimizing piracy.

But the method of free releasing has already been used in music: big names such as Prince, Nine Inch Nails, and Radiohead can naturally best afford to release free albums, and do so as political or societal statements. But also small artists can to a degree live from distributing parts of their music for free and are angry at the established music industry.

Unleash Creativity

Apart from the fact that attempts to control may end with a negative reputation, it also ignores a huge vein of creativity: the business has to realize that it’s solution not necessarily is the best.

Basically, the historic development has gone from custom-made over mass-produced to customized. The lessened attention to authorities means that consumers to a lesser degree will accept a mass produced product, but desire some form of individualization. On the other hand, other consumers not only want an individual product but rather a creative experience from (de-)constructing the product: the entertainment and challenge from producing new content to the game can be far greater than playing the game itself.

Especially within computer games, companies have found that “modability” (modification ability) dramatically increases the consumers’ satisfaction, the lifespan of the product and for these reasons slightly increases sales. Around the games, little active communities arises of users producing small programs, mods that can be implemented in the game and thus give it added or new functionality such as new rules or looks.

Computer games such as The Sims, Spore, or Little Big Planet which contains various tools for creative expression and/ or content creation, find that a group of customers doesn’t even play the game itself but rather produce content for it. Others find that the less linear the game is, and the more free choices it offers, the better the customers like it.

The bottom line is that the function of the original product which the consumer didn’t like, she can now change by implementing a “mod” or following instructions made by other consumers. The business has thus, without further investment, has an unhappy customer turned to a happy one. The more creativity and freedom the product offers, the greater value it’ll have – because customers owning the product can produce more content for the product.

Michael Yon is the best PR-worker of the American army, despite his presence being unwanted by some, and the fact that he’s not even in the military! US army has for years used “embedded reporters” to achieve a better image: the philosophy is that the closer the journalist is to the action and to the soldiers, the better coverage and sympathy will he convey.

Unfortunately the army is not happy with the reports of most journalists, and most journalists aren’t happy with the Iraq/Afghanistan war or the military itself – a really bad match. That’s why the former special forces soldier and now self-made journalist Michael Yon is the best asset the army could desire: He’s always at the very front line, and has great sympathy for the soldiers and civilians and enjoy their respect. He utilizes his knowledge of the army to get “under the skin” of everyone, and for describing the action – and people involved in it – which is valuable when one needs to find out what’s really going on. Among other things, Yon could see how, long before most others could, the center of the war would change from Iraq to Afghanistan. And the army doesn’t even pay him to do all this – his readers do.

Neil Gershenfeld is behind FabLabs, which brings semi-advanced tools to local communities and let people experiment and build. At TED06 Neil talked about kids that made better solutions than scientists: how his term “technology of one” or “personal fabrication: products for a market of one-person” is

1. An extreme way of utilization of creativity
2. An effective form of aid
3. A new way of producing good, and to view a product life cycle.

CoCreation – Maslow’s For Businesses

Click above to enlarge the picture

Psychologist Abraham Maslow devised the human hierarchy of needs: that we need sleep more than friends, and that we can only concentrate on playing music after we’ve had a bite to eat. The fundamental factor is thus the cumulative amount of resources. Above is a graphic of three pyramids:

1. First Maslow’s original hierarchy of needs
2. Then my interpretation of it for use with businesses
3. And lastly one for use in relation to products and customers and the relationship between them.

As the hierarchy of needs is true for an individual person, it’s also true for a business: without tools and employees there’s no reason to have a PR-strategy: but the more needs of the hierarchy that are fulfilled, the more successful the business can become.

The hierarchy of needs also pertains to customers: they need to receive and be able to use the product, but if there’s no possibility of having it repaired, there’s less reason to buy it. The more individual needs a product fulfills, and the better it fulfills them, the more reason to buy it.

According to Maslow’s for businesses there’s an increasing element of involvement between the customer and the product she buys: the more it allows her, the more value it has to her. A product should ultimately and preferably fulfill up to and including the top field in the blue pyramid. “Maslow’s for businesses”, as it’s pictured above, is fundamentally true, but an important exception is that some products may well fulfill certain fields better than other fields. The more fields of the pyramid a product or service fulfills the more desirable it is to the customer, and the fewer fields the product fulfills the better it has to be in these few fields, in order to be competitive.

In reality this shows as branding: a certain angle is given to a product by the producer:

• One phone has a stylish or weird design
• Another phone is very easy to use
• A third phone has exceptional service and is of a sturdy quality, etc.

Systems and solutions that leave the control to the customer, according to the top field in the hierarchy, are the products that will win. Today it’s mostly seen in customization options such as:

• Building your Toyota
• Configuring a new Dell-computer
• Coloring your Nike shoes via a web interface

Even though the product in itself is not allowing any form of creativity, it may achieve a competitive advantage if it is “attached” such a possibility in a PR or sales situation.

The New Ideology

The new age is not as much about technology, but mostly about the ideology surrounding web 2.0. Businesses use the new media but doesn’t understand their nature – that’s also true for the companies I just mentioned above.

However, it’s especially true for news media: the printed and TV publications dwindle while the online versions struggle to find the correct format and use of the internet – and journalists are secretly bewildered as to what their role is in this new world. The large majority of businesses (and media) don’t understand the very important fact that consumers expect to be engaged in a different way then 10 years ago, that monologue has been replaced by dialogue and that mass production has been replaced by individualization. And the word dialogue should be understood both in terms of communication, product development and support/service. The businesses that can realize and materialize the new ideology of the CoCreative Consumer, can save lots of money, develop new and better products more efficiently and faster, and make their customers happier.

The mantra is no longer that the “customer is king”, but rather that the “fan club is king”. The former slogan was about service and therefore re-active, while the current slogan is about product development and therefore pro-active.

• From considering technology as developed and delivered from top to bottom, we now need to consider it from bottom and up.
• From delivering complete products, businesses must now – to a degree – deliver tools.
• From telling customers what to buy, businesses must now listen for what customers want to buy.
• From being an arranger of the customers experience, the business must now be an adviser to the customers experience.

Technology is in some cases the means, but it is never the end – a new and open thought pattern is the goal. This way of thinking implies being able to balance in chaos, not maniacally attempting to regaining control in/of chaos. The business must face that it, and its products, will be discussed, abused, stolen and criticized. However, this fact can be turned to one’s own advantage, amongst other things through utilizing the CoCreative Consumer.

Business and the New Ideology

Click above to enlarge the picture

A completely new product life cycle is arising:

• Previously the product was developed by the business after research and planning, and was considered and presented as the final result which consumers could buy or leave be.
• Now the product is a starting point for modifications, which in turn are starting point for social interaction, which in turn are starting point for new products – where after the circle is repeated.

What’ll happen in reality is that some of the customers that bought the product will modify it and then spread this modified version to friends or other customers, in the forums where they meet. The business will discover these new ways of using the product, and they will build it into new versions of the product. There is therefore synergy between the engaged customers, the CoCreating Consumers, and the business.

It’s also important to remember that Pareto’s principle, also known as the 80/20 rule, is true for the CoCreative Consumer: 20% of the customers will do 80% of the modifications, and only a handful will create the really great modifications: find them, engage them, involve them and hire them.

Future business models will far more often be based on dialogue and start with the consumer – or more precisely in the product or the business as a social magnet. Kevin Kelly and Seth Godin use the terms True Fans and Tribe Management, while the Danish Institute for Future Science terms it Creative Man. All of those means that businesses no longer mass produce to unknown customers, but instead have a close and symbiotic relationship with the most engaged ones. Far more “open” products will be made that engages the fan club and is designed to make change and modifications possible.

Therefore new business models will arise: such as ransom-systems, where the artist only produces next album or writes the next book, when the production costs have been covered by the fans. In reality, the producer and fans thus make a contract in which the consumer to a large degree is determining how the product should be – which in turn is secured a certain circulation. Another kind of business model is that one version of the product is free, while another and typically more advanced version costs money.

The CoCreative Consumer is based on procedurality: that content is created on the fly. Though the expression comes from the software industry, I use procedural creation in the sense that the producer delivers the tools and a frame which the consumer fills with content. Procedural products are thus tools and frames for creativity: a saw is not per se a procedural tool but a pencil or Adobe Photoshop is. Online services such as Ebay, Youtube or Wikipedia are based on this principle.

Access / Hindrance

The degree of modability in the product or of dialogue between business and consumer, will have an increasing impact – consumers simply won’t be hindered or interrupted. The consumer’s options for dialogue with the business or/and modability of the product will be seen as Access and yield a positive response, while the lack of Access will be regarded as Hindrance: a hostile act towards the consumer which yields a negative response.

Examples of Access can be:

• easy ways of contacting the business
• download of PR-materials or product-specifications
• forums for exchanging views with other customers or possibilities for product modification.

Access is about the business handing over control to the customer or basing procedures on that which is best and easiest for the customer.

Examples of Hindrance would be:

• Redirecting callers between departments
• Copy protecting software
• Demanding unnecessary registration

Hindrance is about the company keeping control or basing procedures on that which is easiest and best for itself.

Practical Advice

Design to Or with The Fan Club

Include the customer in product development – the prize is avoiding features that consumers doesn’t want, and instead focusing on features which they crave or even the invention of completely new products and features. The more You listen to consumers, the better a product can be delivered, bad reviews are avoided and you gain great sympathy. Note however that it’s important which customers you listen to and how you do it: they have a different agenda than You do, and the amateur-users have different agendas and needs than the professional-users.

Make Procedural Products

Build in a kind of tools, make products that are frames for creativity or allow lots of freedom. The higher on “Maslows’ for businesses” the product is, the more value and life span it will have. One of the most procedural products that exist is the pencil.

Connect to Many Networks

Physical networks can be plugs/sockets or modability: they allow the consumer to adjust the product’s function, expand it’s connections or work in alternative ways. Social networks can be conveying contact to other consumers or secondarily related groups or networks. Knowledge networks can be a library of schematics, links to relevant encyclopedia resources, or conveying consumers tips on modification.

Hire the CoCreative Consumer

Arrange “tweak” contests and encourage the alternative uses of Your products, or accept suggestions for new products – and reward the good ones. The idea is to search for opportunities and future employees – it’s not a celebration of Your business or Your products, it’s a celebration of the consumer/participants and their creativity. The people that “mod” are often long time customers or in related ways interested in Your field , and furthermore technical competent and creative: it’s amongst these that the best of Your future employees are to be found. Observe the creativity in the destruction and the construction in the deconstruction – and remember the 80/20 rule.

Embrace the Fragmented World

Be close to criticism, seek, engage and listen to those that discuss and use Your products. A new job title could be “information detective”, who’d assist Your business in surveying it’s surroundings: who mentions it, how and where? The dualistic advantage of being close to the criticism is that you’re also close to the ideas.

Employees need to have the freedom to satisfy your customers. It will always be cheaper to offer extraordinary service or re-ship a product too many than it is to anger your customer.

The media loves a good story and the internet never forgets. When problems are spotted in the horizon, quickly inform as many interested parties as possible. Safety measures rather annoys your customers than actually prevent piracy: it’s also proven that great sales are not made by copy protections, but from the product being great.

Be Like Lego

After having written the most of this article, I had the opportunity to talk to the communications boss of the Danish toy producer about their methods and how Lego views the CoCreating Consumers. I already knew that Lego likely was a relevant example to include, but I was surprised to learn that the company actually is a living example of most of what you’ve just read in this article:

1. The Lego brick, as a product, is located at the top field of “Maslow’s for businesses”, it’s an extremely “creative product”, and there are many different kinds of blocks, sets and ways to use them – even virtual ones.
2. Lego, as a company, has a very close relationship with their customers and put lots of effort into using them as a creative resource.
3. 5 years ago, Lego found out that they can no longer control their surroundings, and since then they’ve worked on adjusting to living in chaos. However, they’d still like to crush the pirates.

Don’t Be Like…

I make the last touches on this article I discover that Spore publisher EA has put a heavy copy protection on the game, and the negative reviews were being deleted from Amazon – costumers are furious! The next day it was corrected, but the damage has still been done. It doesn’t even matter why/how it happened, it only matters that customers got angry and lost faith in EA and Amazon.

First I was happy that my ideas was proven correct, but then i simply turned sad and dumbfounded. My mind began listing similar examples of negligent and stupid behavior by businesses towards consumers – and you might begin to list a few of your own. Business technology has never been more advanced – yet business behavior is still in the mud

Ordforklaring – The Dictionary

• Access / Hinderance

– The degree of interaction possibility in a product or with a business. The more Access and the less Hindrance, the more sympathy and success.

• Circular Product Development – Symbiotic relation between business and consumer regarding new products
• CoCreating Consumer – Ideology surrounding the dialogue with engaged customers. The closer a product can be developed with the engaged customers, the better.
• Fragmented World – Expression of the business’ lack of control, not even it’s own employees. The fragmented world consists of interested partied that relates to the business and which it must create a good relationship to, in order to survive.
• Maslow’s For Business – The human hierarchy of needs in relation to products: the more interaction and creativity it allows, the more desirable it will be to the consumer.
• Modability – Modification Ability: the customer’s possibility to adjust the business’ product.
• Procedural Products – Tools or frames for creativity and content, which the consumer contributes to or works with.

Originally written by Mikkel for Design Af Mikkel and first published as “The CoCreative Consumer” on July 20th 2007

About the author

Mikkel is a marketing expert and web-designer. He focuses his attention on communication techniques and how information should be provided to be as efficient as possible. On his own site Design Af Mikkel he writes: “My philosophy is about balance, about holism. About reaching each other in the best way, about doing it honestly and about having fun along the way.” Mikkel has written some valuable papers about the importance of customer engagement and “The CoCreative Consumer” is one of them.