To Own or Not to Own: How Ownership Effects User Innovation? - An Empirical Study in the Rowing Sport Market

Abstract

Theory distinguishes between lead users and “common” users, where lead users have a higher propensity to innovate. We propose to cluster users with similar characteristics (e.g. use intensity) into user groups (e.g. professionals and non-professionals) within a community. In line with theory, we expect that professionals are more likely to be lead users, hence to have a higher innovativeness. Previous user innovation research also proposes that ownership (i.e. patent rights that allocate ownership for the output of user innovation processes) is hardly an incentive for users to start innovating. Drawing upon property rights theory, we argue however that ownership plays an important, albeit different role in user innovation processes. To initiate innovation activities, it is important for users, whether they possess the ownership for the products they use (private ownership) or whether others possess it (non-private ownership). Hence, we study the impact of ownership on users’ innovation behavior. Often a particular ownership paradigm dominates a user group or even a community. If users cannot influence the dominate ownership paradigm, we propose it to be a contextual factor for user innovativeness.

This study was conducted in the German rowing community. Despite many similarities with previously studied sport markets, the rowing market differs with regard to the dominate ownership paradigm. While in previously studied sport markets equipment ownership resides predominantly with the users, in the rowing market it remains largely with sport clubs or associations. As, a small fraction of users still owns it rowing equipment, wherefore we could conduct however a comparative study. A survey to professional, former professionals and non-professional rowers yielded 743 responses.

Our results reveal that professional rowers are not significantly more innovative than their non-professional counterparts per se. However, we find that the ownership paradigm has a strong effect on users’ innovation behavior. Only in cases where rowers own their equipment (independent of whether they are professional or non-professional users) they have a significantly higher propensity to innovate.

Our results contribute to the discussion about contextual factors that determine whether and to what extent users develop innovations in different markets. We conclude that user innovations can be expected to take place less in markets where the non-private ownership paradigm dominates (e.g. where products are rented or leased). We finally discuss possibilities (e.g. sponsoring equipment, licenses to innovate) how to incentivize users to innovate even in those environments.

Keywords: User innovation, User groups, Ownership, Property rights