Block II/ Consumer Generated Content

Unit II: Consumer Generated Content

Confidentiality & Proprietary InformationThis is a confidential document prepared by i-Nurture. This document, or any portion thereof, should not be made available to any persons other than the authorized and designated staff of the company/institution/ Vendor to which it has been submitted. No part of this document may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of i-Nurture.Contents1.1Objectives51.2Introduction51.3Consumer Generated Content51.4Definition and Insights on Consumer Generated Content81.4.1Why are Consumers Interested in Creating Content?91.4.2Why Consumer Generated Content has become a Trend Now?91.4.3Consumer Generated Content: Do-It-Yourself (DIY) Advertising101.4.4Product Development111.4.5Create and Sell141.4.6Ongoing Conversations151.5Future of Consumer Generated Content181.6Opportunities201.7Co-creation - The Creation of Value201.8The Four Building Blocks of Co-creation211.9Four Innovation Levels231.10The Array of Co-creation Experiences241.11Seeing the Marketplace as a Forum, Not a Target261.12Knowledge Creation271.13Summary281.14Glossary291.15Self-Evaluating Questions291.16Activity291.17References29

BLOCK II Branded Content Evolving TrendsUnit I Consumer Generated Content1.1ObjectivesAfter studying this unit, you should be able to: define and provide insights on consumer generated content discuss the various places in which consumer generated content is being used define co-creation as a concept of creating value explain the four building blocks & the four innovations of co-creation describe the process of creating knowledge in co-creation 1.2IntroductionAs todays consumers are increasingly becoming immune to traditional promotional activities, content is emerging as a powerful way to connect with them. A few companies have taken a new approach to how they create, produce, and distribute brand-supported content by listening to and involving consumers in conceptualizing, planning and delivering the products and services. The content thus created is popularly known as the Consumer Generated Content or User Generated Content (UGC).1.3Consumer Generated ContentAs a measure of grass-roots approach to publishing, the photography magazine Better Photography features photographs by its readers who want to share their work in print. Each topic is based on a particular theme and anyone can submit a photograph on Better Photographys website.

The members of the online travel community TripAdvisor offer thousands of opinions on hundreds of destinations across the globe, suggestions and photos for everything from cheap eateries, luxury accommodations to must-see attractions that traditional guidebooks cant offer.

The BBC has been encouraging people to submit pictures and videos, which may be used on any BBC News platform, or in the In Pictures section of the BBC website. Along with telling the citizen reporters where to email their content to, BBC also provides a cell phone number so that images taken on cell phones can be sent instantly.

The IBN Live television channel in India offers people to film, write, and produce their own news content. The channel covers politics, sports, events and anything that residents want to film and are prepared to upload for others to watch. It even offers selected stories to be featured on CNN-IBN network.

Due to the abundance of new channels (mobile, IP based TV, online niche publishing), there has been an insatiable need for consumer generated content. Consumers hunger for opinionated, authentic, non-corporate material has also been contributing to the cause. An increasing number of companies are creating avenues wherein consumers can provide all the content, not just a few TV ads or reviews and opinions. From a business and innovation angle, the customer-made content or co-creating with customers is one of the most important one to watch. This is because these trends tap into the collective experiences, skills and ingenuity of hundreds of millions of consumers around the world is a complete departure from the inward looking, producer-versus-consumer innovation model so common to corporations around the world.1.4Definition and Insights on Consumer Generated ContentConsumer generated content can be defined as The phenomenon of organizations creating goods, services and experiences in cooperation with experienced and creative consumers, tapping into their intellectual capital, and in exchange rewarding them for what actually gets produced.1.4.1Why are Consumers Interested in Creating Content?A few reasons can be stated as to why consumers take part in the co-creating process. Any or all of the following may be considered: Status: People like to be observed, show off their creative talent and thinking abilities. Reward: A well-deserved reward or a profit share for helping a company can be a morale booster. Lifestyle: People like to see the goods, services and experiences that are tailored to their needs, especially in cases where in theyre personally involved. Employment: User-generated content is turning out to be a vehicle for finding employment, as it can help companies recruit their next product designers, copy writers or brilliant strategists. Fun and Involvement: People are likely to enjoy the satisfaction derived from making and creating, especially if co-creating with brands they love.1.4.2Why Consumer Generated Content has become a Trend Now?For ages, consumers have been sharing their insights, complaints, and thoughts about the products they consume, simply because they didn't have adequate means to interact with companies, or with other consumers. But it is not the same in this technologically advanced time period. These wired, empowered, information hungry, opinionated and experienced consumers can exert their direct influence on what companies develop and produce for them.The same consumers are also creative and have access to sophisticated technologies and online distribution channels to show companies what it is they expect from them, using text, audio, image and video and in many other formats. Adding to them, there are thousands of lead users, early adopters, business professionals sharing their experiences, and thus creating a global brain, waiting for companies to tap into its experiences and skills. Any brands next big idea could come from Bangalore or Singapore, if companies open up to smart individuals from around the world. If they dont, their competitors will.1.4.3Consumer Generated Content: Do-It-Yourself (DIY) AdvertisingNestle launched a user-generated activity called Me & Meri Maggi to celebrate the 25th anniversary of Maggi. Consumers could participate on the campaign website by including their stories, recipes, videos and slogans. This was supported by a massive promotional activity across TV, print and the Internet, beside on-ground activities.

ITC Foods Bingo Mad Angles asked consumers to create their own print and TV ads for it on a designated website. Other users could rate these ads. Users created 309 print ads and 69 video ads in just a month.

A campaign by Cadbury Dairy Milk Silk on Facebook had participants upload their photographs of face close-ups with different expressions. Every week, 3 participants were chosen on the basis of most interesting expressions and showcased.

Indigo Nation launched a Facebook campaign called Wacky at work, wherein users had to upload crazy work pictures. They then had to get their friends to vote for them. The grand prize was a brand new wardrobe from Indigo Nation.

1.4.4Product DevelopmentOne of the easiest ways for brands to tap the collective intelligence of their consumers is to announce product or service development contests open to consumers from around the world. Such contests are not just the usual send-us-your-idea-and-win-a-gift and as such. The Nokia Concept Lounge took place in 2005. It invited designers to share ideas and design the next new phone. Not surprisingly, entries came from all over, with the winner being a Turkish designer. His design of a wrist-band style phone won the contest.

In 2004, the Dutch supermarket chain Albert Heijn did something different. Instead of installing suggestion boxes that most of the customers don't use, they asked customers for detailed feedback on how to improve their stores, through websites, leaflets and billboards. More than 55,000 customers commented on service, assortment and convenience levels in over 700 stores in The Netherlands. 700 submitters of won one-minute shopping sprees, with individual stores committing to implement suggestions as soon as possible.Similarly, the Electrolux Design Lab 2005 received entries from over 3,058 design students from 88 countries around the world. Participants were asked to design household appliances for the year 2020. Twelve finalists participated in a six-day design event that included workshops, model building and a competition for cash awards, appliances and more.

The automobile maker Hyundai is inviting users to write their most innovative and original story in the form of a script for its i10 television commercial, staring Shah Rukh Khan. Hyundai has named the contest Write Your i10 Story.

P&Gs Connect + Develop program and other innovation projects produce more than 35% of the companys innovations. In fact, R&D productivity at Procter & Gamble has grown by nearly 60%. P&G has launched hundreds of new products for which some aspect of development came from outside the company. For instance, some of P&Gs most successful connect-and-develop products are Olay Regenerist, Swiffer Dusters, the Crest SpinBrush, and the Mr. Clean Magic Eraser.

1.4.5Create and SellMoving past contests and gifts, co-creators are receiving a share of anything that gets developed based on their input, suggestions, design or ideas.The Austrian manufacturer Frenkenburger asked its customers to come up with new flavours for its natural hemp milk drink- Trinkhanf. The plain hemp milk is highly nutritious but is tasteless. So to further expand the Trinkhanf line, Frenkenburger challenged creative customers to create tasty new flavours using fruits, herbs, or other natural ingredients. In return, Frenkenburger paid the winner one euro-cent per bottle sold.

Another example of create and sell is of LEGOs. LEGO invited children and other building enthusiasts visiting their site to design models and take part in competitions. A popular contest entitled winners to have their model mass produced and receive a 5% royalty on each set sold.

1.4.6Ongoing ConversationsCo-creation is an ongoing conversation. In many ways can be the Holy Grail of marketing. The following examples elucidate the same.The Indian FMCG major Hindustan Lever Ltd (HLL, now, Hindustan Unilever Ltd, HUL) identified new marketing communication programs that could capitalize on the growing popularity of new and emerging media like the Internet among the Indian youth. To keep its Sunsilk brand relevant to its target group (young females), HLL started an online social network community called the Sunsilk Gang of Girls (GoG). It was the first all-girl online community in India. The community quickly caught the attention of the target audience as it was promoted by the company with a 360-degree media communication activities.HLL continuously updated the content and added new features to GoG to keep it relevant to the target audience. It also took this initiative to come up with shopping mall activation programs and participation in college youth festival events. Experts felt that HLL was rewarded for it efforts and got good brand recognition and connected with the target group efficiently.

The online review site MouthShut.com helps consumers make informed shopping decisions. A shopper can find reviews on a range of business or brands right from large corporations to local businesses, all written by average consumers accounting for millions of reviews on hundreds of thousands of products.MouthShut.com connects shoppers with products through reviews, opinions and feedback. It also gives each consumer an option to build his/her own circle of trusted advisors whose reviews they can rely upon while making a purchase decision. For instance, which phone to buy, which movie to watch, which restaurant to dine at, which airline to trust, these and several other product related queries can be addressed by reading reviews on the site. The circle of trusted advisors can also be expanded to the global community of like-minded consumers. As all reviews are written by average shoppers, people find such reviews more trustworthy and helpful.

In the UK, the French multinationaltelecommunicationscorporationOrange set up Talking Point, where customers can tell the company how they feel about all sorts of things - not just phones. Orange promised to listen, and to use the info to shape the way they think about and do things in the future. There were questions even such as what in your life would you like to see technology improve?.

1.5Future of Consumer Generated Content Citizen Journalism: Citizen Journalism provides inspiration to any brand wanting to turn its customers into 'reporters', sending in findings, observations, and suggestions. And as the model is already highly popular, brands can expect more consumers to get and enjoy the concept. For example, OhMyNews, the South Korean citizen participatory journalism showcase, boasts more than 7,00,000 daily readers and 41,000 citizen journalists, who receive USD 20 for a newsworthy piece. Similarly the South African www.reporter.co.za, pays contributors 5 Euros per accepted story.

Rewards: As co-creators get smarter and realise the value of their ideas, the value for co-created goods and services will go up. If brands don't pay a fair share, talented co-creators will deviate their loyalty. So the challenge for brands would be to turn an inevitable development into a strength, by handsomely rewarding the next big idea. Intermediaries: Sites such as 2TalkAbout.com help start and manage the conversation and co-creation processes between the brand and consumer. With traditional brands hesitating to really open up to their customers, fearing a deluge of hitherto unanswered questions, complaints and suggestions, there's money for these intermediaries in helping companies handling their customers in a much controlled environment. Non-Businesses: Politicians and city-governments are benefiting on the power of co-creation. In Lewisham, UK, residents help to keep the city clean by having installed special software on their camera phone, and taking a picture of graffiti or overflowing litter bins, enter location details, and send it to the local council. Cleaning crews would be sent to resolve the issue. The Ever Growing Consumer Generated Content: The rise of the consumer society as a source of hundreds of millions of free-spending consumers purchasing finalised goods, brands are hoping to leverage over the thought of millions of highly informed, ambitious professionals eager to join their global open-innovation team.1.6OpportunitiesThe customer-made trend is about innovation, which of late is the sole factor determining a brands success or failure. And this innovation style implies the end of traditional producer/consumer relationships, letting go of control, and realising that the entire world could be a companys advisorThe examples and insights above elucidate a solid starting point for any company to start its own brainstorming sessions, innovation summits, and strategic meetings. The insights and learning can be used to develop an effective strategy and then implement it.1.7Co-creation - The Creation of ValueIn the future, the competition between companies will be built on a new approach to the creation of value. It will be an individual-centred co-creation of value between consumers and companies. As all consumers will be having different preferences, this value creation process must be flexible enough to accommodate a wide range of co-creation experiences.That has some other broader implications: Instead of attending just to the quality of their firms products and services, managers will need to attend to the quality of the consumers co-creation experiences. Quality will be dependant on the delivery of customer experiences rather than improvements in operational efficiency. As the value added will unique to each consumer, the marketplace will become more of a forum and less like a shop. In such an environment, the competitive advantage will accrue to the firms which can blend innovation with customer experiences. Firms will have many opportunities to co-create value in ways that will be fundamentally different from those which existed in the past.

1.8The Four Building Blocks of Co-creationThe four basic building blocks of the value co-creation process which companies can combine in a number of different ways to deliver quality customer experience are:1. Conversation: There must be ongoing conversations between the business and the customer in order to co-create. To be effective, these conversations must be: Focused on issues of interest. Specific rather than general. Empathetic, orderly, and detailed.2. Access: Earlier, companies generated revenue by selling products and services. However, the goal of the consumer was not just buy or own a product but to access a desirable experience. And in the era of co-creation, the notion of access to experience would be prominent. This difference will create many new business opportunities. For e.g. cyber cafes provide online connectivity on a pay-per-use basis rather than requiring consumers to buy a computer. In this way, an entire community of consumers become approachable.3. Risk-evaluation: Consumers now demand more information about the potential damage a product or service can cause. In the co-creation era, consumers want to know about and debate the risks. They may then decide whether they are prepared to take risk-benefit trade-offs or not.4. Transparency: For meaningful co-creation to occur, consumers must have access to all the information the company has available. Trust cant be built without the complete disclosure of information.These building blocks of the co-creation process can be arranged in a number of different ways, allowing companies to differentiate themselves quite effectively and advantageously from competition.

1.9Four Innovation Levels A community of consumers are environments within which consumers (individually or collectively) co-create and enjoy their own product experiences. To help such communities evolve, companies should use four aspects of innovation:1. Granular: Offering consumers the ability to specify the desired level of experience. By allowing consumers to specify their level of involvement, companies create the conditions where strong and vibrant user communities can develop. 2. Extensible: This appears when companies allow consumers to experience established activities in new ways, as well as empowering them to create new ideas. By allowing the customer to do things in a they want, more ideas and possibilities open up.3. Linkage: Many commercial transactions require a chain of events to occur for the transaction to happen smoothly. Linkage means to redevelop that sequence using a better set of tools, making the entire customer experience seamless, fast and easy. 4. Ability to Evolve: Here, a company learns from its co-creation experiences to develop better experience environments in the future. In this way, a firm selling a product or service shapes itself to the consumers preferences, but not demand that the customer change.Innovation in the co-creation environment will be quite different. It will combine consumer insights, imagination and advanced technology into experiences which are intensely personalized. Instead of trying to invent cutting edge technologies, companies will be more focused on how well additional technologies complement those already in use to create a better customer experience environment.

1.10The Array of Co-creation ExperiencesThe key dimensions of a personalized co-creation experience are:1. Events which are experienced by consumers.2. The context with which an event occurs.3. The form of the individuals involvement.4. The personal meaning consumers attach to such an event.It should be noted that personalization is more than customization of products and services. Personalization requires that customers become active participants in carefully staged and developed experiences. In this system, a customer becomes fully engaged in shaping and co-creating the experiences. Or in other words, the customer is required to become an experience innovator using the tools and processes provided by a company.

Similarly, such consumers may belong to a number of communities, each of which may want to enjoy experiences with the firm in the future.

1.11Seeing the Marketplace as a Forum, Not a TargetIn the traditional marketplace, a company extracted value from the consumer by selling its products and services. However, in the case of experiences, this function no longer exists as each transaction will be highly individualized. From the co-creation perspective, all interactions between the company and consumer are opportunities to create and extract value. In such a circumstance, the marketplace becomes more of a forum where firms and consumers negotiate over what specific experiences are to be included in the offering.Viewing the market as a forum will present the following four aspects: 1. The roles will constantly shift. As circumstances change, so too will behaviours. Sometimes, consumers might originate experiences, while at other times the company will be the originator.2. Supply and demand will be replaced by capacity. The ability of a company to scale up and down rapidly to meet changing consumer demand for personalized experiences will become highly desirable and valuable. 3. Firms will stop thinking in terms of products and services and instead will develop planning tools for a better understanding of the co-creation processes.4. Businesses will realize that brands will evolve through the customers personal experiences. The co-created experience will overtake all other considerations and will eventually become the brand.

1.12Knowledge CreationTo co-create value continually, companies must continually co-create new knowledge. Companies must create knowledge environments that facilitate discovery and encourage action in the new competitive spaces created. To do that, both social infrastructure and technical infrastructure will be required.To build a social infrastructure which facilitates the co-creation of knowledge, a company should: Start with respect for the individual consumers and their unique contribution to the creation of value. Identify meritocracy where the best expertise is used, regardless of job titles. Organize internal knowledge around communities of practice rather than on administrative lines. Dismantle rigid organizational structures and replace with talents across organizational units. Recognize contributions made regardless of job titles. Embed the four building blocks of co-creation as the basis of knowledge co-creation throughout the entire organization.To build a technical infrastructure which also facilitates the co-creation of knowledge, a company should: Make information available to everyone in real-time and seamlessly. Make all data available in multiple formats audio, video, images, text, statistics so to facilitate people explore the databases themselves. Develop an easy data interface which can be used by anyone in the firm. Facilitate sharing of information. Allow managers to go through old data, add new insights and then use that information moving forward. 1.13SummaryCompanies should invite their customers to engage in customer-made goods, services and experiences. They should open up to the millions of consumers who may have an expert opinion, insightful suggestion, new business idea and so on.All trends seriously alter consumer expectations. Once they become accustomed to customer-made being an option, consumers will deviate from brands that don't communicate, respond to feedback, act upon suggestions, keep releasing new products, hoping someone will like it.

1.14Glossary Holy Grail: an object or goal that is sought after for its greatsignificance. Trade-off: An exchange of one thing in return for another, especially relinquishment of one benefit or advantage for another regarded as more desirable. Meritocracy: people selected on the basis of their merit or ability.1.15Self-Evaluating QuestionsTwo Mark Questions1. What is consumer generated content?2. What is the difference between consumer generated content and co-creation?3. Why consumer generated content has become a trend now?Five Mark Questions1. Explain the four building blocks of co-creation.2. Explain the four innovation levels of co-creation.3. Explain the concept of seeing the marketplace as a forum, not a target.Ten Mark Questions1. Why are consumers interested in creating content?2. Where is used consumer generated content being used?1.16Activity Are consumer complaints and user reviews a form of co-creation? Explain your views in 250 words.1.17References Norton Fausto Garfield, Branded Content, Anim Publishing, 2011 Joe Pulizzi, Robert Rose, Managing Content Marketing: The Real-World Guide for Creating Passionate Subscribers to Your Brand, CMI Books, 2011 Ulrike Arnhold,User Generated Branding: Integrating User Generated Content Into Brand Management, Gabler Verlag, 2010 A. G. Lafley, Kevin Roberts, Lovemarks: The Future Beyond Brands, Powerhouse Books, 2005 Rory O'Connor, Friends, Followers and the Future: How Social Media Are Changing Politics, Threatening Big Brands, and Killing Traditional Media, City Lights Books, 2012 Patrick Hanlon, Primal Branding: Create Zealots For Your Brand, Your Company, And Your Future, Free Press, 2006 Rick Mathieson, Branding Unbound: The Future of Advertising, Sales, and the Brand Experience in the Wireless Age, American Management Association, 2005 Nick Wreden, FusionBranding: How To Forge Your Brand for the Future, Accountability Press, 2002

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