Value creation and co-creaiton in the consumer sphere online retail

Abstract

Intense business competitiveness, accelerated by web technological advancement of recent years, poses challenges for online organisations to remain relevant in the market, while continuing to serve customers needs and wants, as well as acquire new customers in a cost effective manner. Nowadays, online consumers possess a much greater bargaining power and are capable of exercising their consumer choice behaviour to a much larger degree than in the recent past. An increasing number of academic scholars and business practitioners maintain, that success of the future business will depend on how organisations manage to revise their existing business practices and bring the customers into the process of value co-creation. The research set out to explore opportunities for value creation and co-creation between online firms and online consumers. In-depth interviews conducted with 22 participants provided further insights into the notion of value creation and value co-creation in online retail. Expansive literature review allowed to form solid academic grounds, upon which the investigation was built and evolved to its conclusion. Coupled with theoretical premises, key research findings suggested that online firms can indeed co-create value with existing customers in the closed-to-firms customer sphere, where only customer-to-customer interactions take place. Enhancement of customers' value perception plays key role in the process of value co-creation in the customer sphere. As a result, online firms may reduce cost on acquiring new customers and consequently excel in revenue growth and business prosperity.