CONSUMER INNOVATIVENESS

Nama            : Hendri Dwi Rusmedia
NPM            : 13210214
Kelas            : 3EA14
Mata Kuliah  : Perilaku Konsumen #
Dosen           : AMARILYS ANDARITIDYA

CONSUMER INNOVATIVENESS

Defining Customer Innovation

I often get asked what I mean when I use the phrase "Customer Innovation". Here's my explanation:

Customer innovation incorporates a number of emerging concepts and practices that help organisations address the challenge of growth in the age of the empowered and active customer (both business and consumer). It demands new approaches to innovation and strategy-making that emphasise rapid capability development, fast learning, ongoing experimentation and greater levels of collaboration in value-creation. Customer innovation impacts upon all the following activities, functions and disciplines:

1. Marketing strategy and management
2. Brand strategy and management
3. Communications strategy
4. Customer experience design and delivery
5. Customer relationship management
6. Customer service design and quality management
7. Market-sensing and customer learning
8. Market and customer segmentation
9. Creativity and knowledge management including market research
10. Partner and customer collaboration
11. Organisational alignment and purpose (values, behaviour and beliefs)
12. Innovation strategy and management
13. Innovation valuation, measurement and prioritisation
14. Strategy-making

For me customer innovation is not only an important perspective on value-creation but a whole new strategy discipline that organisations must embrace if they are to pursue growth successfully in the future. Put another way, customer innovation impacts the fundamental means by which value is created and growth sustained.

One of the difficulties I encounter when explaining the concept is that the "Innovation" word is traditionally associated with products and technology. There is a section in The Only Sustainable Edge by Hagel and Seely Brown that eloquently defines Innovation from a much broader organisational and strategic perspective:

• We underscore the importance of innovation but we use the term more broadly than do most executives. Executives usually think in terms of product innovation as in generating the next wave of products that will strengthen market position. But product-related change is only one part of the innovation challenge. Innovation must involve capabilities; while it can occur at the product and service level, it can also involve process innovation and even business model innovation, such as uniquely recombining resources, practices and processes to generate new revenue streams. For example, Wal-Mart reinvented the retail business model by deploying a big-box retail format using a sophisticated logistics network so that it could deliver goods to rural areas at lower prices.
• Innovation can also vary in scope, ranging from reactive improvements to more fundamental breakthroughs... One of the biggest challenges executives face is to know when and how to leap in capability innovation and when to move rapidly along a more incremental path. Innovation, as we broadly construe it, will reshape the very nature of the firm and relationships across firms, leading to a very different business landscape.

Although Hagel and Seely Brown's book provides a great analysis of capability-building and new innovation mechanisms at the edge of organisations (through new dynamic forms of firm-firm collaboration) and specialisation, their discussion largely omits the customer-firm colloboration, open innovation perspective. But, from Hagel's most recent post and article in the Mckinsey Quarterly, this seems like it could be the subject of their next book! Here is a quote from the article:

• Cocreation is a powerful engine for innovation: instead of limiting it to what companies can devise within their own borders, pull systems throw the process open to many diverse participants, whose input can take product and service offerings in unexpected directions that serve a much broader range of needs. Instant-messaging networks, for instance, were initially marketed to teens as a way to communicate more rapidly, but financial traders, among many other people, now use them to gain an edge in rapidly moving financial markets.

Compulsive Consumption 

O'Guinn & Faber (1989:148) defined compulsive consumption as “a response to an uncontrollable drive or desire to obtain, use or experience a feeling, substance or activity that leads an individual to repetitively engage in a behaviour that will ultimately cause harm to the individual and/or others.” Research has been carried out to provide a phenomenological description to determine whether compulsive buying is a part of compulsive consumption or not. The conclusion reached after analysing both qualitative and quantitative data stated that compulsive buying resembles many other compulsive consumption behaviours like compulsive gambling, kleptomania and eating disorders (O' Guinn & Faber, 1989:147). Hassay & Smith (1996) hold a similar view and refer to compulsive buying as a form of compulsive consumption as well. Besides personality traits, motivational factors also play a significant role in determining the similarities between compulsive buyers and normal consumers. According to O'Guinn & Faber (1989:150), if compulsive buying is similar to other compulsive behaviours it should be motivated by “alleviation of anxiety or tension through changes in arousal level or enhanced self-esteem, rather than the desire for material acquisition.” Hassay & Smith (1996) also agree with the above inference and concluded from their research that “compulsive buying is motivated by acquisition rather than accumulation.

Consumers who are compulsive buyers have an addiction; in some respects, they are out of control and their actions may have damaging consequences to them and to those around them. Examples include uncontrollable shopping, gambling, drug addition, alcoholism and various food and eating disorders. It is distinctively different from impulsive buying which is a temporary phase and centers on a specific product at a particular moment. In contrast compulsive buying is enduring behaviour that centers on the process of buying, not the purchases themselves.

Consumer ethnocentrism

is derived from the more general psychological concept of ethnocentrism.

Basically, ethnocentric individuals tend to view their group as superior to others. As such, they view other groups from the perspective of their own, and reject those that are different and accept those that are similar (Netemeyer et al., 1991; Shimp & Sharma, 1987). This, in turn, derives from earlier sociological theories of in-groups and out-groups (Shimp & Sharma, 1987). Ethnocentrism, it is consistently found, is normal for an in-group to an out-group (Jones, 1997; Ryan & Bogart, 1997).

Consumer ethnocentrism specifically refers to ethnocentric views held by consumers in one country, the in-group, towards products from another country, the out-group (Shimp & Sharma, 1987). Consumers may believe that it is not appropriate, and possibly even immoral, to buy products from other countries.

Purchasing foreign products may be viewed as improper because it costs domestic jobs and hurts the economy. The purchase of foreign products may even be seen as simply unpatriotic (Klein, 2002; Netemeyer et al., 1991; Sharma, Shimp, & Shin, 1995; Shimp & Sharma, 1987).

• Attributes

Consumer ethnocentrism gives individuals an understanding of what purchases are acceptable to the in-group, as well as feelings of identity and belonging. For consumers who are not ethnocentric, or polycentric consumers, products are evaluated on their merits exclusive of national origin, or possibly even viewed more positively because they are foreign (Shimp & Sharma, 1987; Vida & Dmitrovic, 2001).

Brodowsky (1998) studied consumer ethnocentrism among car buyers in the U.S. and found a strong positive relationship between high ethnocentrism and country-based bias in the evaluation ofautomobiles. Consumers with low ethnocentrism appeared to evaluate automobiles based more on the merits of the actual automobile rather than its country of origin. Brodowsky suggests that understanding consumer ethnocentrism is critical in understanding country of origin effects.

Several antecedents of consumer ethnocentrism have been identified by various studies. Consumers who tend to be less ethnocentric are those who are young, those who are male, those who are better educated, and those with higher income levels (Balabanis et al., 2001; Good & Huddleston, 1995; Sharma et al., 1995).

Balabanis et al. found that the determinants of consumer ethnocentrism may vary from country to country and culture to culture. In Turkey, patriotism was found to be the most important motive for consumer ethnocentrism. This, it was theorized, was due to Turkey's collectivist culture, with patriotism being an important expression of loyalty to the group. In the more individualistic Czech Republic, feelings of nationalism based on a sense of superiority and dominance appeared to provide the most important contribution to consumer ethnocentrism.

• The Cetscale

Shimp and Sharma (1987) developed consumer ethnocentrism into a measurable construct through the use of the consumer ethnocentric tendencies scale (CETSCALE). The initial development of the CETSCALE began with 225 different questions, which were narrowed down to 100 before being sent to a survey group for the first purification study. Through repeated purification studies, the number of questions was finally reduced to 17. Repeated studies by Shimp and Sharma validated the CETSCALE in the U.S.

While the 17-item CETSCALE is the original version developed by Shimp and Sharma (1987), shortened versions have been used. One, with 10 items, was developed alongside the full version.

This is probably the most frequently used version of the CETSCALE, as a result of its relatively few number of questions (Balabanis et al., 2001; Klein, 2002; Klein et al., 1998; Neese & Hult, 2002; Netemeyer et al., 1991; Vida & Dmitrovic, 2001). Other versions have been used with success, including a version used by Klein (2002) with just four items that was found to have a .96correlation with the 10-item version.

The first major test of the validity of the CETSCALE in countries other than the U.S. was carried out in 1991 (Netemeyer et al., 1991; Wang, 1996). Netemeyer et al. surveyed students in the U.S., France, Japan, and West Germany and compared the results.

Both the 17-item version and the 10-item version were tested. It was found that both versions of the CETSCALE were reliable across the different cultures where it was tested. The results also helped validate the CETCSCALE as a measure of consumer ethnocentricity. Since that time, the CETSCALE has been used in many studies in many different countries and cultures.

Sumber  :

http://chrislawer.blogs.com/chris_lawer/2005/10/defining_custom.html

http://www.businessteacher.org.uk/free-marketing-essays/compulsive-buying/

http://design-marketing-dictionary.blogspot.com/2009/11/compulsive-consumption-behaviour.html

http://en.wikipedia.org/wiki/Consumer_ethnocentrism