Consumer and AI Co-creation: When and Why Human Participation Improves AI Creation.

56 Pages Posted: 24 Sep 2021

See all articles by Mengxia Zhang

Mengxia Zhang

University of Southern California

Tianshu Sun

University of Southern California - Marshall School of Business

Lan Luo

University of Southern California

Joseph Golden

Collage.com

Date Written: September 22, 2021

Abstract

Firms are increasingly leveraging artificial intelligence (AI) to automatically create personalized products (e.g., custom photo products, home designs) for consumers. While AI automation substantially saves consumer effort, it may also reduce consumer engagement potentially leading to a high dropout rate. We conduct three studies to investigate whether and how firms should nudge consumers to participate in product co-creation with AI automation. Using a field experiment involving 128,153 consumers, we find that a simple nudge can significantly increase consumer participation in product co-creation with AI by 12%. The nudged participation further increases immediate purchase by 22% and post-experiment purchase by 2%. Such purchase lifts are greater when consumers create more complex projects, have prior creation experience, or have lower opportunity costs of time. Our second experiment explores how and why firms should encourage consumer-AI co-creation. We learn that nudging attention (e.g., prompting a preview of the creation) rather than participation does not increase purchase and revisit intentions, and that mandating participation is less effective than nudging participation. Mediation tests show that the IKEA effect (‘I made it myself’) plays a bigger role than preference fit in explaining the positive effects of nudging participation. Our third experiment further investigates the interplay between AI creation and nudging participation. We find that nudging participation increase purchase and revisit intentions only when AI creation is present. The consumer-AI co-creation brings the best of both worlds by leveraging AI to save upfront effort and prompting humans to engage in the creative process only if desired.

Keywords: AI, consumer co-creation, Human-AI collaboration, Field experiment, LATE, E-commerce

Suggested Citation

Zhang, Mengxia and Sun, Tianshu and Luo, Lan and Golden, Joseph, Consumer and AI Co-creation: When and Why Human Participation Improves AI Creation. (September 22, 2021). USC Marshall School of Business Research Paper Sponsored by iORB, No. Forthcoming, Available at SSRN: https://ssrn.com/abstract=3929070 or http://dx.doi.org/10.2139/ssrn.3929070

Mengxia Zhang (Contact Author)

University of Southern California ( email )

2250 Alcazar Street
Los Angeles, CA 90089
United States

Tianshu Sun

University of Southern California - Marshall School of Business ( email )

3670 Trousdale Parkway
Bridge Hall 310B
Los Angeles, CA 90089
United States

Lan Luo

University of Southern California ( email )

Hoffman Hall 319
Los Angeles, CA 90089-1427
United States

Joseph Golden

Collage.com ( email )

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