A Community of Me: The Role of Participation Allocation in Determining the Effectiveness of Consumer Empowerment Strategies

Abstract

Past research has shown that consumers who are empowered to select what products a firm offers show a stronger demand for the selected product than non-empowered consumers due to an increase in psychological ownership of the product. However, this research has not systematically examined what influence the amount of participation an individual perceives themselves as having in a collaborative design process has on their degree of psychological ownership.  This article investigates the effect that consumers’ perceived amount of participation has on psychological ownership of a product and whether reference group dynamics impact this effect. Two studies demonstrate that any perceived amount of participation, whether large, small, or ambiguous, equally increases consumers’ psychological ownership of a product, future loyalty intentions toward the company, and underlying demand for the product, compared to attributing full influence to a single “winner”, which is equal to allocating no participation to consumers. In cases of non-empowering participation allocation strategies, psychological ownership increases when in-group members are perceived to have a significant influence on the product while future loyalty intentions toward the company decrease when dissociative out-group members are perceived to have a large influence. This effect is moderated by consumer’s degree of association with their in-group.