Transformation of value in co-creation: modalities and thresholds

Purpose This paper aims to focus on how value is generated as part of co-creative modalities in service transactions. The progression of value creation ranges from utilitarian to hedonic and experiential value over repeated transactions that entail crossing specific thresholds that enhance deeper trust when the customer consumes the same product/service bundle over time. Design/methodology/approach In this paper, the authors synthesize various theoretical narratives and advance propositions for understanding the modalities and processes underlying the repeated transformation of co-creation values in repeated transactions over time. Findings The propositions provide a basis to investigate how the firm is able to engage with the customers to move from basic forms of value creation to more advanced forms such that the firm is able to manage the value creation modalities leading to superior value generation. Research limitations/implications This paper provides a basis for firms to understand how value is co-created and transformed. Specifically, the evolution of customer values is assessed from value-in-exchange and value-in-use to value-in-experience. The role of thresholds in the evolution of value is integral in the progression from utilitarian, hedonic, to experiential value. Moreover, in repeated transactions, the role of trust underpins the processes underlying different thresholds. In practice, firms should seek to engage the customer at a higher level in the creation of co-creative modalities of value creation. Originality/value This paper provides a theoretical context of the evolution and transformation of such value in co-creation. Extant research has yet to delve into such value creation accounts from the perspective of the firm (service provider) and its customers.