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[Podcast] Causes and Impacts of Co-Creation Behavior: Vietnamese Gen Z and Brand Engagement

23 November, 2024

Keywords: Brand engagement, Brand loyalty, Extrinsic motivation, Intrinsic motivation, Transcendent Customer Experiences (TCEs).

In the digital age, Vietnamese Gen Z has been presenting their tendency to actively participate in co-creation with brands, forming new values ​​in the brand-customer relationship. This behavior gives businesses the opportunity to approach young customers closely and helps them gain a deeper understanding of how to engage customers in the long term. In this research, the author from University of Economics Ho Chi Minh City (UEH) pointed out the causes and the impacts of Gen Z’s co-creation behavior and analyzed the opportunities that businesses can seize from this trend, helping to build a more effective approach strategy to Gen Z.

Co-creation behavior between customers and brands is a current prominent trend, especially with Gen Z – a group of young people who not only consume but also contribute to creating content, products and even messages for the brands they love. Gen Z – a generation that grew up with social networks and modern technologies – often desire to experience interaction and to accompany brands at a higher level than the previous generations. What makes Gen Z distinctive from other previous generations is their interaction habits and immersion in co-creation activities with brands. Not only stopping at the role of consumers, Gen Z aims to participate in the process of building, and adjusting products, services and even brand stories.

In the context of the Vietnamese market, where Gen Z is increasingly having a voice and influencing consumer trends, understanding the motivations that drive co-creation behavior and its impact is essential for businesses, this study aims to identify factors that stimulate co-creation behavior and assesses the level of influence of this behavior on brand engagement and loyalty, creating a basis for effective approach strategies in the future.

Co-creation behavior: The new trend of Gen Z

Co-creation is the process in which customers participate in creating value with businesses, including contributing ideas for products, participating in design or sharing experiences and suggesting service improvements. For Gen Z, co-creation is not simply a personal act, actually, this is a way for them to express their own identity, knowledge and creativity.

For example, customers contribute ideas and suggest changes to the style, packaging, color, material, and design of products to better suit their actual needs. In addition, they can use tools provided by manufacturers to customize products and services to bring the most complete personal experience. In particular, customers will participate in content production listed as posting messages, sharing, commenting, giving feedback and reviewing the quality to improve products and services. These are considered “co-creation” behaviors of customers.

Furthermore, this research demonstrates that Gen Z tends to desire brands to listen to them, meet special needs and even customize products according to their personality. Customer involvement in this process strengthens the connection and helps them be responsible and have ownership for the brand they accompany.

What drives Gen Z’s co-creation behavior

Gen Z’s co-creation behavior originates from two main sources: intrinsic and extrinsic motivation.

  • Intrinsic motivation: Curiosity, self-actualization, and entertainment play an important role in engaging in co-creation activities. This is consistent with Maslow’s hierarchy of needs, in which self-actualization represents the pinnacle of human motivation. This intrinsic motivation drives Gen Z to contribute ideas to the brands they love. This helps them feel like they are part of the brand, connecting with the brand more closely and sustainably.
  • Extrinsic motivation: Financial motivation, social recognition, and a sense of belonging to a community are the major extrinsic factors. Gen Z is more likely to engage in co-creation activities when they see the opportunity to receive financial benefits or social recognition. Being part of a brand community enhances their engagement.

Therefore, the intrinsic and extrinsic motivations that drive consumers to engage in co-creation behaviors (prosumption) and the outcomes that this activity brings to the brand, with a particular focus on digital applications of local businesses and high-tech brands, the study has presented that both intrinsic motivations (listed as curiosity, self-actualization and entertainment) and extrinsic motivations (listed as financial benefits, social recognition and a sense of belonging to a community) are the main factors that drive co-creation behaviors of Gen Z. In addition, the study explores the causal relationship between Gen Z’s co-creation behaviors and their loyalty to the brand, and  the creation of Transcendent Customer Experiences for brand users.

The Impact of Co-Creation on Brand Engagement

Promoting Self-Actualization: Brands should design co-creation activities that meet consumers’ needs for self-expression and mastery. This can increase engagement and create deeper connections with the brand.

Creating Fun Experiences – Transcendent Customer Experiences: Entertaining and curiosity-provoking activities can attract initial interest and keep consumers engaged throughout the co-creation stages. Transcendent customer experiences are identified as an important outcome of co-creation, allowing Gen Z to become emotionally attached to the brand and creating a deeper personal connection. This connection transcends functional interactions and creates a “living with the brand” experience.

Combining intrinsic and extrinsic motivation: To engage effectively, brands should combine emotional appeals (listed as curiosity, self-actualization, and entertainment) with extrinsic factors (listed as financial gain and recognition in the community).

Building brand loyalty and engagement: Co-creation activities help strengthen the emotional bond between consumers and brands. Positive customer experiences, especially through co-creation, will increase loyalty, satisfaction, and engagement with the brand.

Research results conclude that co-creation activities can lead to stronger consumer-brand relationships and increasing loyalty and emotional engagement. When consumers contribute to product development or service enhancements, they feel more connected to the brand, making the relationship more sustainable. Studies illustrate that co-created consumers are twice as likely to be loyal than non-co-created consumers as they have invested time and effort into the relationship. Therefore, brand managers, especially in the digital space, should consider incorporating a co-creation strategy to improve customer satisfaction and loyalty.

Solutions to enable Gen Z to co-create

Increasing Gen Z engagement through digital platforms: Businesses need to leverage social media platforms and online interactive technologies to enable Gen Z to deeply participate in the product creation process. Activities listed as product idea competitions, content co-creation programs on video platforms, or enabling customers to test and to provide feedback on products can help increase their engagement.

Ensuring optimal customer experience: To create sustainable relationships, businesses need to focus on improving the quality of products and services, and continuously adjusting products based on customer feedback. A positive and friendly customer experience will make Gen Z more satisfied and proud of the brand they co-create.

Policy implications of Gen Z co-creation behavior impact on brands

The study contributes to building a theoretical framework based on the co-creation behavior of Gen Z consumers in the Vietnamese market. Moreover, the results provide values ​​for approaching knowledge building in this field together with a thorough understanding of how businesses can leverage the power of this young customer group to develop appropriate strategies to meet their needs and to provide more personalized self-service experiences.

Therefore, through analyzing the causes and motivations for co-creation behavior, the study has provided practical solutions to enhance brand engagement, loyalty and product innovation. Co-creation behavior is not only a temporary trend but also a strategic factor for businesses to build a strong customer community and to maintain a competitive position in an increasingly volatile market context.

The full-text article Causes and impacts of co-creation behavior: Vietnamese Generation Z and brand engagement can be accessed HERE.

Author: Dr. Pham Nguyen Phuong Nhi – University of Economics Ho Chi Minh City.

This article is part of the series spreading research and applied knowledge from UEH with the message “Research Contribution For All”, UEH respectfully invites readers to wait for the next UEH Research Insights isues.

News, photos: The Author, UEH Department of Communications and Partnership