Thesis; Master Programme, Marketing

Linnæus University, School of Business and Economics in Växjö

Authors:

Jimmie Borgqvist & Daniel Lindberg

Tutor:

Sarah Philipson

Title:

Customer involvement in Service Innovation – a study of the banking industry.

Background/Problem:

Services are commodities in most service industries and the

companies are not putting enough into innovation of services to differentiate themselves from

their competitors. Since the services are commodities it does not make the customers

committed to a certain company nor does it make the customer chose the best service, since

they are so much alike. To be able to adapt the services to the customers the companies need

to know what the customers want. This research is proposing that the way to find out what the

customers want is through customer involvement in the service innovation process.

Purpose:

The purpose of this thesis is to identify opportunities for service companies to

involve customers in the service innovation process.

Theory:

The theoretical framework is built up out of the concept of customer involvement in

service innovation, which is a research area that has been put aside for customer involvement

for product innovation. Despite this the area has some interesting articles and this research is

built up around Alam’s (2002) model of customer involvement.

Research question:

What preferences do customers have when interacting in service

development and what kind of involvement is best suited for their needs?

Method:

The empirical study of the research was performed through a pre-study with semistructured

telephone interviews and the actual study consisted of internet surveys. The

telephone interviews were conducted with three experts in the area of customer involvement

in service innovation and the banking industry. The surveys had 300 responses within the

sample of the study. The sample consisted of Swedish bank customers in the ages of 18 to 25.

Conclusion:

Customers wants communication methods which are not involving face-to-face

interaction. Instead they prefer mobile applications, social networks and the internet bank.

Customers prefer to innovate together with other customers and employees of the bank.