Integration of Customer Knowledge for the Generation of Service Innovation in the Music Industry

Abstract

Turbulent and fast moving changes in economies and short technology cycle times demand considerable knowledge from companies and their employees. These companies are urged to unleash their creativity and bound to be more creative to develop new product innovations and/or service innovations. Due to these market conditions, innovation processes become highly complex and companies must create new knowledge to be innovative. Innovation is one of the most important drivers of productivity growth besides skills, investment, enterprise, and competition. Knowledge-intensive service innovations have always been supported by the music industry as customers of this branch share a high internet and technical affinity. However, there are several problems with service innovations in the music industry. Besides the fact that the mobile music market is a fairly new market segment, the diffusion of knowledge about service innovations such as the service of digital full track music is not very high. The awareness of customer needs, therefore, should be the first priority for companies in the music industry. To obtain customer knowledge, which is tacit and hardly transferable without any affirmative action, and their needs, there are different ways of doing this, e.g., surveys, monitoring or interacting with customers. Customer integration is not only a key to obtain new service ideas, but also to prove the acceptance and the usability of a service. Although customer satisfaction is the key driver of service innovations, companies should also offer customers some different and new features and give the customers the opportunity to learn to use these features. The knowledge of customers’ needs helps to define unique selling proposition (USPs) and increase the awareness of customers towards service innovations.

Keywords: service innovation, innovation management, knowledge management, customer integration, music, music industry

JEL Classification: 031, 032