Effectively Co-creating Products with Social CRM to Increase Customer Retention

As a dedicated coffee drinker and an admitted Starbucks addict I was excited when Starbucks offered me the opportunity to provide them with my ideas for their business! Yes, Starbucks has taken a step towards co-creation. As of the third day of 2013, Starbucks has received over 67,500 responses. Comments are solicited on:
  • Food and Beverage ideas – new product and product improvement 
  • Experience ideas – ordering and store atmosphere 
  • Involvement ideas – community and social responsibility 
What is exciting about this process of co-creation is that the consumer is being considered, for the first time, as part of the design team.

Starbucks is not the only company to embark on co-creation. Market leaders such as Coca Cola, Lego and Apple have all engaged their consumer base in co-creation of products.

Meeting customer expectations to increase satisfaction
Every company looks for a competitive advantage. Co-creation can provide this advantage when applying their knowledge, skills and resources to help customers achieve satisfaction. One of the best methods for doing so is involving the customer directly in the creation process. There should be multiple popular and easily accessible channels for customers to share their suggestions or the entire idea of co-creation is worthless - maximum participation is vital. Social CRM automatically captures inputs through multiple channels and displays details through a single view for users, thereby negating navigating between multiple screens and attempting to identify and respond to relevant customer conversations. 

When the customer is involved the company must be aware that to create the desired level of satisfaction they may need to draw on additional industry partners. Partners who can provide the required knowledge, skills or resources to help provide the customer with the desired end result. The overall goal is always to co-create value. Value for customers as well as the company must be considered.

Creating the co-creation platform
Companies which wish to fully engage in a co-creative environment, must provide for their customers a platform through which they can share information. This is more than just using your CRM software to analyze the customer base, there must be a platform for interactive communication. This is not to say that the CRM base should be ignored in this process, but should be used to selectively target customers who are most likely to become engaged in the co-design process.

Going back to the original Starbucks example, as an iPhone app user for my Starbucks card I receive regular emails for the company asking me specific questions. These can involve new product introductions, including the opportunity to sample new products, soliciting of feedback within hours of an in-store experience, or simply providing information of a community event that is happening. By engaging me in the process I become a more loyal customer with the likelihood of increased long term profitability.

The co-creation platform can be, as in the example, an application on a smart phone, but it can also be developed through social media (Facebook, twitter), email, or traditional print and direct mail solicitations. Which platform is selected will be dependent upon the partners involved.

Social CRM will also ensure healthy and helpful two way interactions between brands and customers to benefit both. Using a CRM solution to collate all the feedback and responses from each customer across channels, future products can be designed which closely match customer needs and require minimal tweaking to match existing expectations. In addition, data mining can be used to offer better customization and service options to specific segments of customers.

The long term benefits of co-creating products
Co-creation doesn’t mean the company will no longer benefit from the initial sales to the customer, nor does it replace the traditional means of market entry. What it does mean is that the value of the product or service to the customer will increase with the ability to integrate their feedback or suggestions. By the integration of customer collaboration the need for “hard sell” cross sell or up sell begins to be eliminated. The customer collaboration provides long term advantages to the company.

Almost all major product or services businesses ask for customer feedback, but,  not incorporating all relevant suggestions into their offerings will lead to higher churn rates. Poor active listening will make customers perceive them as selfish product-centric organizations. The company that engages the correct partners and listens to the customer will be ahead of the competition in customer experience, customer loyalty and long term profitability. 

Effectively co-creating products and services in line with customers' real-time feedback is facilitated by social CRM which also ensures extensive word-of-mouth advocacy along with the capabilities to track customer and competitor activities across social networks through a user friendly interface.