Internet-Based Customer Collaboration: Dyadic and Community-Based Modes of Co-Production

Co-production, which is the generation of value through the direct involvement of customers in the creation of a service context and in the design, delivery, and marketing of goods and services that they themselves consume, implies customer-firm collaboration. The nature of this collaboration, however, is highly dependent on the organization’s service design, which increasingly includes Internet technology, as well as customer communities. Whereas dyadic co-production implies a single customer’s involvement with a firm, community-based co-production implies multiple customers simultaneously engaged in value-adding activities with a firm. In order to build a theoretical understanding of these modes of customer collaboration and to explore the role and implications of Internet technologies within them, we develop a contingency theory of customer co-production designs. We then use cases of Internet-based services to highlight the benefits and challenges of relying on Internet technology to implement customer co-production.