Customer-favourable idea versus company-adoptable idea: comparative analysis through elaboration likelihood model

Abstract

Recent years have witnessed the growing trend of open innovation, and participating customers have become an important source of innovation for companies. The effectiveness of this open approach remains a matter of controversy, however. We examine the value of customer ideation in a coffee brand community by employing the ideas posted by community members and investigating whether they are customer-favourable and/or company-adoptable. Using the elaboration-likelihood model (ELM) that explains the factors for persuasion, we propose several hypotheses on how the content/contextual factors of ideas relate to both customer favourableness and company adoption. The hypothesis tests, via ordinary least-squares and binomial logistic regression models, show that customer-favourable ideas have a positive but marginal effect on company adoption, while the antecedents of customer favourableness differ from those of company adoption. We also confirm that peer engagement has a moderating effect on the relationship between idea content factors and company favourableness. This study offers theoretical implications by extending the ELM research stream and also provides managerial implications that can lead to a more effective exploitation of open innovation communities.