Is co-creation the future of service design with gen z?

Ignore Gen Z’s collaborative expectations at your own peril—while you’re busy designing for them in your boardroom, your competitors are already designing with them in digital spaces you haven’t even discovered yet.

The evidence strongly suggests collaborative design approaches are becoming central to effective service development for younger audiences. According to recent research, 72% of Gen Z consumers prefer brands that actively involve them in product and service evolution. This generation doesn’t simply want to consume—they expect to participate.

Take Glossier, which attributes over 45% of its product innovation to direct customer collaboration, or LEGO’s Ideas platform, which has transformed fan concepts into commercially successful products through community voting and refinement. These examples demonstrate how participatory design methodologies create both commercial success and authentic brand connections.

For brands seeking relevance with consumers born between 1997-2012, understanding this collaborative mindset isn’t optional—it’s imperative. As Gen Z’s spending power reaches an estimated $143 billion, organizations that fail to embrace inclusive design processes risk becoming irrelevant in an increasingly competitive marketplace.

Co-creation refers to the collaborative development process where brands and users work together as equal partners to design services that truly meet consumer needs. Unlike traditional approaches where companies create solutions internally and then seek validation, collaborative design invites users to participate from the earliest conceptual stages through implementation.

This methodology represents a fundamental shift from designing for users to designing with them. Traditional service design often relies on market research and focus groups to gather insights that inform internal teams. In contrast, collaborative service development blurs boundaries by treating customers as honorary team members who contribute ideas, critique concepts, and help refine solutions.

Techniques that particularly resonate with Gen Z include digital crowdsourcing, social media feedback loops, gamified ideation sessions, virtual co-design workshops, and ambassador programs that give participants insider access to decision-making processes. These approaches acknowledge younger consumers’ desire for transparency and meaningful participation rather than passive consumption.

Generation Z’s preference for collaborative development stems from core values that distinguish them from previous generations. Research from McKinsey reveals that 65% of Gen Z consumers prioritize authenticity when choosing brands—a value directly addressed through transparent co-creation processes.

Psychologically, participation fulfills fundamental needs for agency and recognition. Having grown up in an era of social media and constant connection, Gen Z expects two-way dialogue rather than one-way messaging. According to Pew Research, 76% believe their voice matters and should be heard by institutions and organizations.

This generation demonstrates a collaborative mindset that contrasts sharply with previous generations’ more individualistic consumption patterns. While Millennials pioneered digital participation, Gen Z takes this expectation further, seeing brand interaction as an ongoing conversation rather than a transaction. They’re 38% more likely than Millennials to provide feedback to brands and 23% more likely to expect that feedback to result in visible changes.

Implementing effective collaborative approaches requires systematic methodology rather than isolated initiatives. Begin by establishing dedicated channels for ongoing input—digital platforms where young consumers can submit ideas, vote on concepts, and participate in development conversations.

Key implementation tools include:

Brands can start by identifying specific service elements that would benefit from collaborative development, then creating structured opportunities for Gen Z participation with clear guidelines and incentives. The most successful approaches offer genuine influence while providing enough structure to make participation manageable and meaningful.

While collaborative design offers tremendous benefits, significant challenges require thoughtful navigation. Maintaining brand integrity while incorporating diverse inputs presents a delicate balancing act—how do you remain open to ideas while ensuring outcomes align with core brand values?

Intellectual property considerations also emerge when external participants contribute valuable concepts. Creating clear terms of engagement and attribution policies helps prevent misunderstandings about idea ownership and usage rights.

Perhaps the greatest risk lies in implementing tokenistic participation that appears collaborative but offers no genuine influence. Gen Z demonstrates remarkable authenticity detection skills and quickly identifies superficial engagement efforts. When Pepsi’s tone-deaf campaign with Kendall Jenner appeared to commercialize social justice movements, the backlash was immediate and severe.

Overcome these challenges by: establishing clear participation parameters, creating transparent decision criteria, balancing open ideation with structured frameworks, and most importantly, demonstrating how input directly influences outcomes through regular communication about how collaborative insights shape final services.

Several innovative companies demonstrate how effective collaborative development can drive business results across industries. Nike’s By You platform (formerly NikeiD) empowers customers to co-design personalized products, generating not just sales but valuable design insights. The program has contributed to a 63% increase in digital engagement among Gen Z consumers.

Spotify’s ongoing development incorporates user feedback through its dedicated ideas portal, testing environment, and active community forums. This approach helped the streaming platform achieve 76% penetration among Gen Z listeners—significantly higher than competitors.

In hospitality, Marriott’s innovation lab hotel concepts invite guests to experience prototype spaces and provide immediate feedback that shapes future property designs. This methodology has resulted in 28% higher satisfaction scores from younger travelers compared to traditionally developed properties.

The common success factors include: creating structured participation opportunities with clear purpose, implementing visible feedback loops, offering appropriate recognition, balancing open ideation with guidance, and demonstrating how collaboration creates mutual value rather than extracting free labor.

As collaborative design methodologies mature, several emerging trends will shape future developments. Extended reality technologies will enable more immersive co-creation experiences, allowing participants to interact with virtual prototypes in sophisticated ways. Blockchain and Web3 mechanisms may formalize participation through tokenized ownership models that reward contributors with tangible stakes in the services they help create.

AI-powered collaboration tools will likely enhance the scale and sophistication of co-creation by helping synthesize diverse inputs into coherent strategies while maintaining individual voices. The line between creators and consumers will continue blurring as participation becomes an expected part of the brand relationship rather than a novel approach.

For forward-thinking brands, the imperative is clear: develop robust, authentic collaborative frameworks that create genuine value for both participants and organizations. At Bängeri, we’ve seen how youth-centered innovation drives meaningful results when Gen Z collaborators are treated as valued partners rather than research subjects.

By embracing collaborative methodologies now, brands position themselves to build lasting relevance with a generation that will soon become the dominant economic force in global markets. The question isn’t whether co-creation matters—it’s how quickly your organization can develop the capabilities to implement it effectively.

Ready to make your brand Gen Z-approved? Let’s start the conversation at genz@bangeri.fi.