Modelling co-creation and its consequences: one step closer to customer-centric marketing

Abstract

This is a study of co-creation and its marketing outcomes. The theoretical and conceptual literature on co-creation suggests causal paths between co-creation and its consequences. This study develops a research model to test the causal relationships between co-creation and the marketing outcomes of satisfaction, trust, relationship strength, attitudinal and behavioural loyalty. While the concept of co-creation is not new, Vargo & Lusch (2004) highlight the relevance of co-creation as a customer-centric means of generating value in contemporary market conditions. Most early empirical research on co-creation adopts interpretive methods to explore the value-generation capacity of the concept. More recently, positivist studies on co-creation have emerged, however they investigate the issue in a narrow context and offer only a partial view of the consequences of co-creation.

This study adopts a positivist stance to study the influence of co-creation on a nomological net of marketing outcomes. Additionally, this study investigates the causal paths between co-creation and trust and co-creation and relationship strength, two paths which are theoretically postulated, but not yet tested.

This study adopts a two-stage, quasi-experimental research design. The quasi-experiments are operationalised by means of experimental scenarios and survey questionnaires. The scenarios provide the means to vary the level of co-creation and the questionnaire captures the participants’ perceptions of co-creation and, its influence on the dependent marketing outcome variables.

Stage 1 of this study is a pilot, where a student sample is adopted to test co-creation and its marketing outcomes in a single B2C service context. Structural equation modelling analysis of the dataset shows that, as postulated, co-creation has a positive influence on marketing outcomes and this preliminary study has been published (Rajah, Marshall, & Nam, 2008).

The quasi-experiments for the main study comprise a within-subject, multiple business context research design. The aim of the multiple contexts is to investigate whether co-creation is generalisable across different business contexts. The main study institutes both theoretical and methodological refinements into the research model developed in the pilot. Specifically, the work institutes improvements to the new co-creation and relationship strength scales, measures attitudinal and behavioural loyalty as separate constructs, and develops new scenarios for the multiple business contexts. The within-subjects design for the main study means each participant provides data for two scenarios. Thus 290 non-student participants yield 563 good responses.

Analysis of the dataset for the main study, through structural equation modelling, shows a good measurement model yielding robust statistics of reliability, convergent and discriminant validity for the constructs. Overall, the structural model provides confirmatory support for the positive influence of co-creation on marketing outcomes. Multi-group invariance testing (MGIT) shows similarities in structural paths for the marketing outcomes for the B2B and B2C market contexts, and only moderate differences in the structural paths for the product and service business contexts. Thus, the results of the research provide confirmatory evidence of co-creation’s influence on marketing outcome constructs, hitherto only postulated.

The contributions of the study are first, it provides empirical support for the influence of co-creation on downstream marketing outcome constructs. The results show that co-creation is closely related and is part of the nomological net of marketing outcome constructs in the research model for this study. Second, the thesis contributes by synthesising an operational definition of co-creation. Third, the study contributes by developing new scales for the co-creation and relationship strength constructs. Finally, the multi group invariance testing reveals results show that co-creation is generalisable across several business contexts. Post-hoc analysis indicate that co-creation could occur in the forms of transactional and relational marketing exchanges.