Abstract The service-dominant logic (SD logic) provides a novel and valuable theoretical perspect... more Abstract The service-dominant logic (SD logic) provides a novel and valuable theoretical perspective that necessitates a rethinking and reevaluation of the conventional literature on innovation. This literature is built upon a goods-dominant logic and has resulted in a restricted and out-moded perspective that overlooks many major discontinuous innovations. In this article, we show how many innovations can be better understood by deploying a SD logic perspective.
Through mass customization, firms can offer individualized products at little additional cost, wh... more Through mass customization, firms can offer individualized products at little additional cost, which has prompted extensive research into the supply side but less investigation of consumer attitudes. Customers' willingness to pay more for mass-customized products may depend on their desire for unique products and use of such products in their self-presentations. It also may reflect their avoidance of the negative attributes of standardized, off-the-shelf products.
F rom the perspective of traditional product innovation theory, it remains difficult to understan... more F rom the perspective of traditional product innovation theory, it remains difficult to understand how Google, just seven years after its founding, has achieved a valuation of billions of dollars and enjoys a market capitalization that surpasses a long list of business giants, including Coca-Cola Co., Honda Motor Company, and British Airways. Similarly, traditional marketing and strategy literature, with its focus on the transaction between the producer and a consumer, is ill-suited to explain the emerging pattern of Wikinomics 1 or Open Business Models, 2 for which the line between producer and consumer is not only blurring, but vanishing. New types of innovations are changing the competitive landscape through new technology, such as high-speed Internet, powerful and cheap memory capacities, and mobile devices. For these new forms of innovation, traditional approaches lack explanatory power. Consider, for example, how a DVD movie rental company like Net-flix could upstage the long-standing market leader Blockbuster, despite the latter's access to more advanced technologies, including TV-on-demand and Internet-TV. Using traditional innovation theory, it also is difficult to understand how the Swedish furniture retailer IKEA can consistently earn high profit margins by selling contemporary furniture at low prices or how free, quick-read newspapers such as 20 Minuten and Metro have disrupted the media industry in several European countries. Quite simply, firms that focus on the distinction between products and services are shortchanging their own ability to innovate. We argue that service-logic innovation is a customer-oriented term and, as such, demands no artificial
Aboulnasr, Khaled. See Chaudhuri, Arjun. Ahearne, Michael. See Jelinek, Ronald. Albaum, Gerald, C... more Aboulnasr, Khaled. See Chaudhuri, Arjun. Ahearne, Michael. See Jelinek, Ronald. Albaum, Gerald, Catherine A. Roster, James Wiley, John Rossiter, and Scott M. Smith (2010), “Designing Web Surveys in Marketing Research: Does Use of Forced Answering Affect Completion Rates?” Journal of Marketing Theory and Practice, 18, 3 (Summer), 283–291. Arnold, Todd J., Timothy D. Landry, and Charles M. Wood (2010), “Prosocial Effects in Youth from Involvement in an Experiential, Cause-Related Marketing Event,” Journal of Marketing Theory and ...
Service innovations reportedly involve innovating intangible products, but this article argues fo... more Service innovations reportedly involve innovating intangible products, but this article argues for a more radical service-logic perspective that challenges the traditional, attribute-based view of innovation. Rather than innovating products and services, the focus here shifts toward innovating customers' value co-creation roles. This article presents a case-based managerial framework that indicates service-logic innovations change the customer's role as a buyer, payer,
Abstract The service-dominant logic (SD logic) provides a novel and valuable theoretical perspect... more Abstract The service-dominant logic (SD logic) provides a novel and valuable theoretical perspective that necessitates a rethinking and reevaluation of the conventional literature on innovation. This literature is built upon a goods-dominant logic and has resulted in a restricted and out-moded perspective that overlooks many major discontinuous innovations. In this article, we show how many innovations can be better understood by deploying a SD logic perspective.
Through mass customization, firms can offer individualized products at little additional cost, wh... more Through mass customization, firms can offer individualized products at little additional cost, which has prompted extensive research into the supply side but less investigation of consumer attitudes. Customers' willingness to pay more for mass-customized products may depend on their desire for unique products and use of such products in their self-presentations. It also may reflect their avoidance of the negative attributes of standardized, off-the-shelf products.
F rom the perspective of traditional product innovation theory, it remains difficult to understan... more F rom the perspective of traditional product innovation theory, it remains difficult to understand how Google, just seven years after its founding, has achieved a valuation of billions of dollars and enjoys a market capitalization that surpasses a long list of business giants, including Coca-Cola Co., Honda Motor Company, and British Airways. Similarly, traditional marketing and strategy literature, with its focus on the transaction between the producer and a consumer, is ill-suited to explain the emerging pattern of Wikinomics 1 or Open Business Models, 2 for which the line between producer and consumer is not only blurring, but vanishing. New types of innovations are changing the competitive landscape through new technology, such as high-speed Internet, powerful and cheap memory capacities, and mobile devices. For these new forms of innovation, traditional approaches lack explanatory power. Consider, for example, how a DVD movie rental company like Net-flix could upstage the long-standing market leader Blockbuster, despite the latter's access to more advanced technologies, including TV-on-demand and Internet-TV. Using traditional innovation theory, it also is difficult to understand how the Swedish furniture retailer IKEA can consistently earn high profit margins by selling contemporary furniture at low prices or how free, quick-read newspapers such as 20 Minuten and Metro have disrupted the media industry in several European countries. Quite simply, firms that focus on the distinction between products and services are shortchanging their own ability to innovate. We argue that service-logic innovation is a customer-oriented term and, as such, demands no artificial
Aboulnasr, Khaled. See Chaudhuri, Arjun. Ahearne, Michael. See Jelinek, Ronald. Albaum, Gerald, C... more Aboulnasr, Khaled. See Chaudhuri, Arjun. Ahearne, Michael. See Jelinek, Ronald. Albaum, Gerald, Catherine A. Roster, James Wiley, John Rossiter, and Scott M. Smith (2010), “Designing Web Surveys in Marketing Research: Does Use of Forced Answering Affect Completion Rates?” Journal of Marketing Theory and Practice, 18, 3 (Summer), 283–291. Arnold, Todd J., Timothy D. Landry, and Charles M. Wood (2010), “Prosocial Effects in Youth from Involvement in an Experiential, Cause-Related Marketing Event,” Journal of Marketing Theory and ...
Service innovations reportedly involve innovating intangible products, but this article argues fo... more Service innovations reportedly involve innovating intangible products, but this article argues for a more radical service-logic perspective that challenges the traditional, attribute-based view of innovation. Rather than innovating products and services, the focus here shifts toward innovating customers' value co-creation roles. This article presents a case-based managerial framework that indicates service-logic innovations change the customer's role as a buyer, payer,
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