It is often mentioned in lectures or in trainings that we have to pay attention to our consumers’ needs and wants and strategise our marketing decisions to satisfy them accordingly, which in turn creates value for them (Sawhney et al., 2006, Tuli et al., 2007 cited in Grönroos & Voima 2013). In other words, this would mean that the consumers have the power to somewhat control what is produced to the market or what sort of service they are provided with because it is in accordance to their requirements.
photo credit: Archie Mcphee
A prime example of consumers having the power is in the case of the “new coke” during the 80s when Coca-Cola tried to create a new version of its coke with the intentions to prevent Pepsi from gaining more market share. Eventually, taste and emotional attachments that the consumers had with the original coke brought some of the consumers to boycott it, resulting in very poor sales. According to a Coca-Cola spokesperson, he mentioned, “When we look back, this was the pivotal moment when we learned that fiercely loyal consumers – not the Company – own Coca-Cola and all of our brands.” (Rachid Haoues, 2015)
Drawing back to the previous post about shopping on Instagram, the developers of the application came up with the concept as they gathered their consumer insights and found that it was essential and something their users needed so as to streamline their shopping experience. These examples just show how much consumers can impact the market environment.
Additionally, according to Prahalad and Ramaswamy (2000, 2002, 2004a, 2004b cited in Cova et al., 2011), there has been an increasing trend where companies have moved their focus of internal research and development to co-creation of value which happens through the interaction between the company and the consumer. This is especially important now with the influence of social media and its impacts on daily lives. When there is an involvement of the consumers and the company in creation, it is certain that it will increase the value of what the company initially had without the participation of its consumers (Cova & Dalli, 2009).
Therefore, with the importance of the consumers’ role in contributing to the potential profits brought about by the co-creation, shouldn’t they take a share of the profits made?
This brings us to the other side of the argument where consumers are seen as to be exploited during the process of co-creation because they do not receive compensation for any of their labour efforts that contribute to the companies’ profits (i.e. free labour) (Cova et al., 2011). To look deeper into this, it is noted by Franke Piller (2004 cited in Cova & Dalli, 2009) that interestingly, the more actively a consumer dedicates his/her efforts in a co-creation or production, the more they are willing to pay for it. This makes it a “double exploitation of working consumers” (Cova and Dalli, 2007 cited in Cova & Dalli, 2009).
For example, herb garden kits where consumers grow their own herbs but yet pay a premium for the kits as compared to just buying the herbs on its own. In actual fact, do consumers really want to grow their own herbs or is this because of marketing that brought about the concept of “free labour”?
Online in social media, the users are doing free labour for the platforms as they customise their profiles to their own likings, upload information, and in turn providing the companies with data. Additionally, they also co-create value by growing the amount of users through their connections, building communities and participating in social interactions (boyd, 2006, 2008a, 2008b cited in Ritzer & Jurgenson 2010).
With reference to Cova & Dalli (2009), the authors recognise that some of the consumers participate just to fulfil personal needs and wants. In this case, the consumers probably feel a sense of enjoyment and pleasure of being part of the production process and possibly likes being socially recognised for his/her efforts. (Doesn’t this equate to the exploitation of their emotions?)
Ritzer & Jurgenson (2010) also believes that the consumers involved in production (prosumers) can receive a sense of empowerment to control their production process. For example, how they want to grow the herbs or how they want to customise their profiles. Hence, it means that we should not just disregard the benefits that consumers received as they genuinely participate in co-creation or production because they like to and want to and are not just manipulated into such feelings by companies.
From the cases and references, it does illuminate the fact that some products and (self) services are created through marketing as it exploits the consumers’ emotions and sense of personal fulfillment, in actual fact consumers do not need them. Despite the lack of control when consumers are being exploited, I believe that consumers ultimately still have the power over the market especially if it is a collective effort as mentioned in the “New Coke” case.
What do you feel about this? Do you think marketers and companies have the power to dictate what’s in the market or does the power lie with consumers?
jeanne 