In search of innovation and market success, firms empower customers in new product development (NPD), leading to significant behavioral and psychological consequences. However, the literature lacks a comprehensive conceptualization and empirical overview, neglecting the situational nature of customer empowerment and the divergent effects on participating versus observing customers. This review systematically analyzes the literature and develops a conceptual framework integrating different customer empowerment situations and their psychological (e.g., firm perceptions, feelings of empowerment) and behavioral (e.g., product preferences, willingness-to-pay) consequences. The framework structures previous research, highlights similarities and differences, and sets the stage for future research, advancing understanding of why some customer empowerment strategies are more successful than others.
