Consumer engagement in product policy

The market environment is changing continuously. Successful companies know that it is necessary to innovate their products. The result of innovation is a new product. The new product can take the form of a real new product (that has not been a part of market offer before), or it can be a modification of an existing product. Product innovations can essentially be done in two different ways. The first way consists of a new product development that arises from minimal contact with the market (i.e. inside the company). Such product innovations arise, mainly, as managers' ideas. The second way, is consumer engagement in product policy. Engaged consumers are considered to be a company's partners. This second way reduces the market risk for product innovations, because consumers reflect their own expectations into the proposals. They provide valuable ideas and help to identify upcoming trends. There are three basic types of consumer engagement in product policy. Simply said, we speak about (a) crowdsourcing, (b) customisation/customerisation and (c) a combination of the previous methods. The result of crowdsourcing is the variety of consumers' proposals. The company chooses one or more of them and it uses it in its market offer subsequently. Crowdsourcing can be characterised as “the voice of consumers”. Customisation/customerisation means that the basic variant of any product is adapted to suit individual requirements. Simply said, such products are tailored to the needs of an individual. The third type is a combination of the two previous methods. A product that has arisen as a result of customisation/customerisation is included in the standard company's offer. Consumer engagement in product policy is very applicable for small and medium-sized enterprises. Taking advantages of consumer engagement, there is no need to spend large sums on the innovation process. Examples from business practice are contained in this paper