The Open Design Effect

Abstract

Some firms pursue open design activities—that is, they freely share innovation-related knowledge with the outside world instead of keeping it secret or protected via patents. Through a series of lab and field studies, this research examines consumer beliefs and reactions to firms’ open design activities and documents a positive open design effect: presenting a product as open design (vs. not) increases its attractiveness to consumers. This effect emerges because consumers view firms that freely share innovation-related knowledge as providing benefits to society. Consistent with this societal benefits account, the effect is found to be stronger when (1) moral (vs. selfish) firm motives are made salient and (2) many (vs. few) other firms have already utilized the shared knowledge. Moreover, the evidence suggests that the effect is anchored in the notion that open design activities involve outflows of firm-internal (vs. inflows of firm-external) knowledge. By showing that consumers judge the way firms undertake innovation as more (vs. less) beneficial for society, this research extends the literatures on open design, open innovation, corporate social responsibility, and marketplace morality.