The Role of Social Media Technologies in Service Innovation: Perceptions of Exceptional-customer-engaged Value Co-creation

Abstract

Social media technologies have greatly facilitated customers’ self-empowerment, and have given rise to a handful of exceptional customers who engage in service innovation. Compared with the more common customer behaviors like word-of-mouth and review-and-feedback, exceptional customers actively integrate their heterogeneous resources and creatively cooperate with firms to innovate service. Nevertheless, there have been relatively few studies on how information technologies enable such customer engagement and the co-creation of service innovation. We adopted a qualitative approach and conducted a comparative analysis of two cases, including a pair of firms and their cooperating exceptional customers, to reveal two value co-creation mechanisms enabled by social media technologies: customers as communicators who facilitate the individualization of product promotion through resource sharing and digital engagement with firms; and customers as innovators who facilitate the individualization of brand design through resource convergence and co-creation of new value propositions with firms. This study discovered the enabler role of social media technologies in service innovation and value co-creation between firms and exceptional customers, as well as a theoretical basis and practical guidance for market innovation in the digital era.