Philips Reaps the Benefits of Collaborating with Consumers

Published Aug-20-12

Breakthrough:
Philips engages an expert crowd to help it make key decisions before entering a new market.

Company:
Philips, Netherlands

The Story:

To make the most of co-creating with consumers companies should view the practice as much more than market research, and engage the crowd in meaningful ways. Using it as simply a marketing exercise or as a way to garner quick product ideas is to miss out on the rich insights and creativity of the crowd.

Maximizing the benefits of this form of open innovation is possible when companies understand that co-creation is part of the innovation process, with consumers as partners.

One way to make co-creation more effective is to involve consumers at the outset and conduct significant research with them.

Sleeping Giant

Global consumer electronics giant Philips is a company that understands this all too well. Before entering the Chinese market with a range of sleeping solutions the company needed to assess market potential and consumer needs. It wanted unique insights into Chinese sleeping behaviors rather than rely on already available quantitative insights.

Sleep Well Community

So it created an online research community known as the Sleep Well Community which consisted of 50 Chinese people with sleeping problems and 10 co-researchers. For three weeks in March/April 2011 participants shared details of their sleeping problems and their perceptions of the Philips brand.

The community website had different rooms for different research questions and a facilitator streamlined the conversations. These two-way discussions built high quality and deep insights.

By being available 24/7 the Sleep Well Community helped to illustrate problems and discover solutions, while the co-researchers challenged analyses and shed light on findings that the company didn’t fully understand. The end result was that the community confirmed the market potential of China to Philips and delivered numerous ideas and insights.

Letting the Outside In

Consumers are always having conversations about your products and social media is giving them the power to have an impact on the brands they purchase. This is an opportunity not a threat. Giving the consumers a seat on the board and bringing their voice into the center of your business can reap numerous rewards as you learn from their experiences and insights.

More company are realizing the value of maintaining online communities. Here, they are not only observing the conversations but moderating them as well to gather ever deeper insights and new thinking.

There is a potential risk that consumers who take part in research communities might concentrate too much on their individual needs but if a participating company shares insights, market information and feedback and keeps the conversations going they become more meaningful and yield richer insights.

Company-centric ideation and creation may well be going the way of the dodo as the new frontier of co-creation turns previously passive consumers into active ones providing information that can be turned into actionable insights.

To stay competitive and to gain advantages in today’s marketplace companies need to learn to let go and allow external expertise a say, whether it’s for creating new products, to improve existing ones or to explore conceptual ideas.

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