Volvo Co-Creates an SUV with Consumers
Vehicle maker taps into the collective intelligence of consumers to help it develop an SUV.
When co-creating with the crowd a company needs to decide how involved it wants outsiders to be, whether they are going to help with a specific one-off challenge or maintain a continuous presence through every stage of the innovation process.
A company’s most powerful tool is its knowledge, and co-creation provides a way of augmenting and enhancing that to create future value. Many organizations have come to the conclusion that consumer knowledge arising from experience is a key asset, and it’s becoming something of a no-brainer to work with it.
Swedish manufacturer of cars, trucks and buses Volvo sought co-creation partners for its XC90 NPD project to develop an SUV.
Involving Customers in the Dialogue
Volvo commenced its co-creation endeavor by engaging a small group of affluent women professionals in California to complement the traditional market research it was also conducting at the time. From their first meeting the company wanted to discover thoughts, expectations and opinions about SUVs in general which would help them in the project’s concept development phase.
A second meeting was scheduled for about six months later and elicited more focused opinions about the manufacturer’s XC90 SUV which were fed back into its development.
A number of subsequent meetings were held whenever senior company figures wanted to discuss further aspects of the project. At the final meeting, two years after the co-creation initiative kicked off co-creators were given the opportunity to drive the vehicle. In all, the project involved 24 external participants, and 16 of those were present from start to finish.
The insights they provided gave the company a deeper understanding of the target consumer which helped to influence its decision making and shape the final product that eventually came to the market.
There are numerous benefits of co-creation both for a company and for participating consumers: For a company the benefits include:
• Increasing the number of sources of new ideas and providing R&D departments with access to a richer reservoir of experiences.
• Reducing risk as companies are taking a less of a gamble when bringing a new product to market because it has been developed with the far reaching insights of consumers.
• Increasing the speed and quality of decisions related to innovation processes.
• In addition to more direct outcomes which can be quantified there are some intangible benefits from engaging consumers and these include increased customer loyalty, greater satisfaction with products and services and positive word of mouth.
• The crowd can be a constant presence providing insights and analysis as products and concepts are developed and fine-tuned.
For consumers the benefits include:
• Material rewards, such as money and goods.
• Public recognition and status.
• Being listened to and valued by a brand they like.
• Enjoyment of being involved in an engaging intellectual pursuit.
The participants of the Volvo XC90 NPD project were given $50 for every meeting, but this was less of an incentive to these affluent women than the opportunity to have their voices heard.
Co-creation is a relatively new trend that is only going to get bigger, and soon companies will discover that it will be difficult to ignore.
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