From a customer perspective, scholars know a good deal about what motivates customers to participate in co-creation activities, and the ways co-creation activities might influence customer perceptions of the value of new products and services. From a firm perspective, scholars know that innovation strategies that involve co-creation carry the potential to bring substantial benefits to companies’ product development efforts, but no research to date has addressed why some firms can successfully pick winners and losers when evaluating customer-submitted new product ideas while others cannot. In fact, despite the tremendous promise of directly involving customers in new product ideation, scholars have still reported very high (over 50%) failure rates of cocreation innovation initiatives (Verhoef, 2013). In this research, we investigate some of the cognitive characteristics and biases of teams that might influence their ability to recognize the best ideas from customers in an evaluation and selection context.

In Study 1 we investigate this issue by examining the interaction of goal motivation (approach/avoidance) and depth of information processing (reflexivity) of NPD teams. The results are based on video content analysis of go/no-go evaluation and selection meetings at Quirky where the firm reviewed 186 product ideas submitted by end consumers. Decisions made by Quirky’s development team are compared against willingness to consider purchase ratings by a panel of 1860 consumers. Our findings show that approach-oriented teams make better product selection choices (i.e., pick products rated more favorably by consumers) when reflexivity is low, and that avoidance-oriented teams make better product selection choices when reflexivity is high. In Studies 2 and 3, we examine the goal motivation by reflexivity interaction in the lab, using a between-subjects experimental design. We also look at a potential mediating mechanism, cognitive-based decision-making vs. affect-based decision making, and a moderating factor, the use of checklists in the customer co-created product idea selection process.

Our work has important implications for both scholars and managers, offering deeper insight into how the cognitive characteristics and decision-making practices of teams influences their ability to recognize good ideas when they see them. We also offer suggestions for improving the overall success rate of customer cocreated innovation initiatives, and future research directions in this area.

Authors: Matthew B. Shaner, Ph.D. (George Mason University), Charles H. Noble, Ph.D.(University of Tennessee), Darren Dahl (University of British Columbia)