Lessons from communities

Although it is still too early to develop useful frameworks for success with cocreation, they will no doubt emerge over the next few years. Meanwhile, some lessons about how to proceed are coming out of both the consumer and the professional online communities.

Participative media supply some of these lessons. Our research suggests that 25 percent of Western Europe’s Internet users now post comments and reviews about consumer products of all kinds (exhibit). User-generated media sites are growing in numbers of visitors and participants by 100 percent a year, traditional sites by perhaps 20 to 30 percent.

These numbers suggest that people are more and more willing to participate with companies online and that companies can tap into that willingness today. To give an example, in the online environment Second Life, where participants assume three-dimensional likenesses called avatars and interact digitally with each other, approximately one participant in ten is cocreating with companies—for example, testing prototypes or helping to design new products and services. We expect that percentage to rise. At present, Second Life has few brands (virtual destinations, within the site, created by companies well known in the offline world), and participants generally don’t know how to interact with them. In fact, during our recent research on the behavior of Second Life participants, we found that only four in ten members know about the possibility of cocreating with their favorite brands. When they do become aware of this, 60 percent of them say they would be willing to experiment with cocreation.

Research that we and others have conducted on consumers participating in online communities demonstrates that most cocreators recognize that the brand—not they—will own the resulting intellectual property. Why then do they get involved? Rewards and fame were certainly motivators, but participants are largely interested in making a contribution and seeing it become a reality. An important factor we’ve found in our Second Life study is the extent to which participants are willing to trust brands. In choosing between competing ones, brand affinity is the most important factor for users willing to cocreate, and 40 percent of would-be cocreators will refuse to cocreate with companies they don’t like or trust.⁹

Our research also suggests that companies will need a combination of incentives to encourage consumer participation. In a recent analysis of user-generated video sites,¹⁰ we found that participants had various nonfinancial motives, such as fame, fun, and altruism. This insight has been confirmed by the Second Life research, which found that only one-third of the users who cocreate with brands do so for a financial reward. Furthermore, people who seek to increase their online fame often expend considerable effort enlisting others to join their networks in hopes of increasing the size of the audience, thereby helping to create a larger pool of participants for cocreation itself. One key seems to be attracting participants with as many kinds of motives as possible, so that they reinforce each other. Of course, incentives might have to evolve if cocreation reached the limits of individual “volunteerism.” Communities could, for instance, start paying participants for their contributions or actively promote their reputations outside the community—say, in marketing campaigns.

In professional online communities, trust and affinity are important. At the Myelin Repair Foundation (MRF), for example, scientists from five universities have accepted a complex IP-sharing agreement that will let MRF retain the rights to license discoveries to pharmaceutical companies. This novel medical-research model is based on cocreation among a closed group of researchers who aim to develop a drug that will treat multiple sclerosis (MS) by promoting the repair of myelin, the coating surrounding the nerve fibers that MS affects. MRF hopes to complete its work within five years—75 percent faster than the time required by current research models—and half of the royalties will be put back into the foundation to finance future projects. Since the researchers started work, in 2004, they have identified ten targets and three therapeutic candidates, developed 11 tools to study Myelin, and published nearly 20 scientific articles.

Cocreation through evolution

Companies do not have to reconceive their business systems to start experimenting with distributed cocreation. In many cases, the first step is to identify where it may already have spouted within the company. At LEGO, for example, the executive team recognized the possibilities in part because of the success of a product launched in 1998: Mindstorms, programmable bricks originally developed as an educational tool through a partnership with the MIT Media Lab. A remarkable community of Mindstorms enthusiasts—adults as well as children—embraced the product and began to share designs online. This success prompted LEGO’s executives to consider how the company could use its online LEGO Gallery to harness the creative efforts of customers to develop ideas or products in its main toy-brick business.

Companies have other ways as well to experiment with cocreation by using existing systems or resources. When the telecom operator BT decided to allow third-party software developers to create applications for BT’s network (a variant approach to cocreation), it could take advantage of the fact that its internal software developers were already familiar with the practices of open-source software and were designing standardized Web interfaces for many of its existing business applications.

Even the most advanced businesses are just taking the first few steps on a long path toward distributed cocreation. Companies should experiment with this new approach to learn both how to use it successfully and more about its long-term significance. Pioneers may have ideas about opportunities to capture value from distributed cocreation, but fresh ones will appear. To benefit from them, companies should be flexible about all aspects of these experiments.

Notes:

⁹ Paul Alpar and Steffen Blaschke, Web 2.0 – Eine empirische Bestandsaufnahme, Wiesbaden, Germany: Vieweg+Teubner, 2008.

¹⁰ Jacques R. Bughin, “How companies can make the most of user-generated content,” mckinseyquarterly.com, August 2007.