From minor alterations, to complete start-to-finish designs, as many as 30% of online shoppers see value in being able to customize products to their liking (Bain Insights, 2013). Co-creation is not a new concept, but with the growth of social media platforms, companies are now more connected than ever to their customers.
For several reasons, organizations can benefit from allowing customers to customize their purchases. Earlier this year, Oreo held the #MyOreoCampaign during which it asked its customers to send in their ideas for cookie flavours that they would like to try. Several customers were then surprised with a personalized package containing a special batch of their flavour idea in the form of an Oreo cookie. Thanks to this unique campaign, Oreo was able to leverage several key benefits to aid in the development of new products.
Data. The campaign allows Oreo to interact and learn from its customers. Traditionally, companies have produced products based on a series of educated guesses and averages that appeal imperfectly to large groupings of customers. A campaign like #MyOreoCreation allows customers to tell Oreo exactly what they want. Customer submissions end up in Oreo’s “Wonder Vault”, left for careful review and testing if the idea is deemed to be a potential hit. This provides Oreo with a bank of data that it can use to develop and inspire new products that are in-demand even before they exist in material form.
Low Cost Innovation. By successfully engaging customers, Oreo can forego hiring a large team of researchers to develop and test a wide range of new flavours (most of which will inevitably fail), and instead can enlist the help of its customers at a relatively low cost. With more options on the table, and a global social media presence, Oreo can produce a large number of new flavours, and can get instant feedback online. This high quantity of information at a low cost means that Oreo can produce more innovations, increasing their chances of discovering the next big flavour that will end up on supermarket shelves (Skrovan, 2017).
Share. Another major benefit from this campaign is the ability for Oreo to share their interesting creations to a broad audience. There is an element of fun and playfulness associated with deeply personal products, and consumers often get excitement out of personal treatment and recognition form larger companies. According to Forbes, one of the five most important elements of product customization is this propensity for customers to share their personal experience on social media. (Skrovan, 2017) Co-creators are often proud of their experience, and are very willing to publicly thank the company for the positive outcome.
Revenue. Although customer co-creation at Oreo is not directly aiming to provide an additional revenue stream, campaigns of this nature can occasionally lead to a product discovery that ends up as a part of the regular product line. Involving customers in the design process effectively expands the research and development team, and leverages the diversity of their own target markets. In fact, several customer creations have ended up for sale in the cookie aisle at major retailers.
Lessons for Others
Although social media is generally under-utilized with respect to research and development efforts, it is an increasingly important way for companies to reduce development costs, build hype, and earn loyalty from its customers. With the #MyOreoCreation campaign, Oreo has been able to involve customers in their production process, and make them feel like an important member of the Oreo family.
Industry: Consumer Packaged Goods
Name of Organization Contact: N/A
Authored by: Lucas R. Coady
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Bain Insights. (2013, November 5). Having It Their Way: The Big Opportunity in Personalized Products. Retrieved from https://www.forbes.com/sites/baininsights/2013/11/05/having-it-their-way-the-big-opportunity-in-personalized-products/#e23359116b98
Skrovan, Sandy. (2017, June 30). Oreo turns to social media to create kettle corn, avocado and other flavours. Retrieved from https://www.fooddive.com/news/oreo-turns-to-social-media-to-create-kettle-corn-avocado-and-other-flavors/446227/