Evolution of Customer-Centric Innovations in Modern Ecosystems: Servitization Approach

Abstract

This study investigates the evolution of customer-centric innovations within modern business ecosystems through the lens of servitization, a concept gaining momentum in contemporary service delivery frameworks. Recognizing the limited exploration of servitization beyond manufacturing, particularly in the context of value-added services, this research employs a multiple case study methodology focused on the tea sector in India and Nepal. Drawing on seven diverse entrepreneurial cases and supported by a thematic analysis, the study identifies nine critical factors influencing successful servitization, including knowledge gaps, procurement strategies, market segmentation, and customer engagement. Central to this investigation is the transformative role of structured training interventions, exemplified by the Chaya School of Tea, which catalyzed innovation and performance improvements among participating businesses. The findings highlight how digital tools, customer education, and strategic planning contribute to product–service integration, yielding enhanced quality, operational efficiency, and sustainable growth. This research contributes to theory by refining the concept of “servitization of services” as a strategic approach for empowering ecosystems through complementary offerings that transcend traditional service delivery. This work provides both conceptual and empirical insights into how service firms, particularly in under-researched sectors, can leverage servitization to drive long-term competitiveness and ecosystem-wide value creation.

1. Introduction

Servitization generally refers to the expansion of service offerings by producers, transforming ancillary services into a core function that provides a competitive advantage. In scientific discourse, it is often associated with the transition from selling products and basic services to delivering integrated product–service systems, which emphasize the evolution of customer-centric innovations in modern ecosystems. Research in the field has predominantly focused on such systems, examining advanced lifecycle services and business model transformations [1,2,3]. The concept has been further shaped by high-profile cases of strategic shifts from product-centric models to service-oriented approaches by global corporations’ ecosystems, such as IBM, Xerox, Rolls-Royce, and Dell [4,5].

Thus, being recognized in the economic literature as a key driver of the modern economy by the end of the 20th century, in the early 21st century, the topic underwent a surge in foundational research on product–service systems, contributing to the growing prominence of servitization and related concepts such as service-oriented business models.

Recent advancements in servitization research have identified several emerging trends, which are transforming the landscape of this field. A thorough examination of the scientific literature indicates the following important developments: the integration of digital technologies [6,7,8]; an emphasis on sustainability [9,10,11]; advancements in performance analysis [12,13]; the evolution of business models [14,15]; a focus on requirement analysis [16]; industrial applications [7,12]; collaborative consumption [17,18]; the impact of artificial intelligence (AI) [19,20]; the co-evolution of platform architecture, platform services, and platform governance [21,22,23]; the development–services–operations (DevServOps) approach [24,25]; and, obviously, many others. A full analysis of these patterns is offered in the Literature Review section of this paper. It is vital to emphasize the observed research gap. These trends underscore a dynamic and evolving field, with digitalization, sustainability, and innovative business models at the forefront of servitization research, lacking a servitization approach, and considering the evolutionary perspective of customer-centric innovations in modern ecosystems research. Given all of the recent advances in product–service systems research, which have revealed numerous emergent patterns, it is clear that these achievements are fundamentally based on the emergence of the evolution of customer-centric innovations within contemporary ecosystems, a topic that has received little attention in the literature.

The primary objective of this research is to elucidate the evolutionary trajectory of customer-centric innovations within contemporary ecosystems through the lens of servitization. This is further examined by analyzing servitization in service delivery organizations, emphasizing how enterprises augment their offers through the incorporation of value-added services. It delineates the progression of servitization from product-oriented to customer-centric paradigms, highlighting the impact of digital technology on the transformation of service delivery.

A multiple case study approach was chosen, as the research problem and questions are still empirically new and theoretically undefined. This has been utilized to clarify the functioning of the evolutionary pathway in product–service systems.

This paper addresses theoretical deficiencies in servitization research, especially within non-manufacturing sectors, and suggests an enhanced conceptualization of servitization, considering the evolutionary approach of customer-centric innovations in modern ecosystems, focusing on service firms, and thus drawing significant potential for research implications.

The Literature Review part of this article is dedicated to explaining the findings from the most recent literature review in the field of customer-centric innovations within modern ecosystems through the lens of servitization to compose the theoretical grounds for further investigation. The Materials and Methods section describes the material selection, research questions, and research methods, as well as analyzes the methodology’s strengths and shortcomings. The Results section covers the multiple case study research findings in detail, thoroughly following the disclosure of the research questions. The Discussion section critically evaluates the research findings in light of the findings of other authors. Finally, the study concludes with a general assessment of the findings and an outline of potential future research trajectories.

2. Literature Review

Servitization emerged as a strategic concept in the economic literature with the seminal work of Vandermerwe and Rada [26], who highlighted the role of added services in value creation. Its academic traction intensified in the early 21st century, particularly following key reviews by Baines et al. [27,28], which catalyzed a wave of research on product–service systems (PSSs) and service-oriented business models [3]. Although servitization originated in the manufacturing sector, it is increasingly recognized as a transformative, cross-sectoral paradigm. Several emerging thematic trends in the literature further illuminate existing research gaps—many of which are directly addressed by this study.

Digital servitization and technological integration. The integration of digital technologies has fundamentally redefined the nature of product–service systems (PSSs). The transformation into digital PSSs has enabled real-time customization, enhanced the customer experience, and facilitated the development of self-adaptive service models. Digital platforms embedded within these models not only streamline service delivery but also significantly enhance operational efficiency, as highlighted by Barravecchia et al. [6], Chuang and Chen [7], and Kim et al. [8]. These platforms support scalable, modular service offerings, marking a shift from rigid, transactional services to fluid, user-responsive systems.

One of the gaps that emerges in this context is that much of the current literature emphasizes technological enablement without sufficiently contextualizing how these tools influence service delivery dynamics in specific, especially underrepresented, sectors like agriculture or retail. Our manuscript addresses this by exploring how digital literacy, platform-based knowledge transfer, and structured training impact servitization in the tea industry, a non-digital native sector.

Servitization for sustainability and lifecycle optimization. The recent servitization literature underscores sustainability as a central concern in the evolution of business ecosystems. Tukker et al. [9], Zhang et al. [10], and Rabetino et al. [11] examine how digital tools and service-based strategies contribute to long-term sustainability performance. This includes extending lifecycle utilization through monitoring, maintenance, and user behavior optimization, alongside social sustainability aspects such as inclusiveness and regional economic revitalization.

Despite such contributions, there remains a notable lack of empirical studies that connect sustainability-driven servitization with grassroots entrepreneurial ecosystems, especially in rural or semi-urban contexts. Our study contributes directly to this gap by analyzing cases where servitization enhances not only business performance but also local community engagement and social capital through education and skill-building.

Performance monitoring and customer satisfaction. Advancements in performance analysis, particularly using Internet of Things (IoT) technologies, have introduced new ways to monitor service quality and ensure customer satisfaction. Flores-García et al. [12] and Leocádio et al. [13] emphasize the role of smart PSSs in optimizing product usage, predicting failures, and personalizing service offerings based on usage data.

However, while these technological tools are well studied in manufacturing and high-tech sectors, their application and benefits in traditional service delivery—where IoT integration is still nascent—remain largely unexplored. Our research bridges this divide by documenting how structured training and tacit knowledge acquisition serve as proxies for digital performance monitoring in lower-tech sectors like tea entrepreneurship.

Business model innovation and circular integration. The evolution of business models in response to digitalization is another core theme in the servitization literature. Studies by de la Torre and Sanchez [14] and Vidickienė et al. [15] show how digital platforms enable business model transformation, supporting circular economy practices and enabling more sustainable value delivery. These shifts represent a movement from one-off transactions to relationship-driven, usage-based service models.

Nevertheless, this transformation has not been evenly studied across sectors. Existing research often overlooks small and medium-sized enterprises (SMEs) in non-industrial domains. Our manuscript addresses this gap by detailing how entrepreneurs reconfigure their value propositions—via product differentiation, service bundling, and training—in a traditional product-based sector, thereby modeling circularity and resilience in their evolving business strategies.

Emerging requirements and user-driven innovation. Huikkola et al. [16] note increasing attention to requirement analysis in smart product–service systems, emphasizing the need for systems to adapt to new user demands and feedback during the delivery phase. This often involves big data analytics and real-time customer input.

In contrast, many service sectors still lack systematic mechanisms for capturing such requirements, especially where customers are unfamiliar with high-quality or differentiated products, as is the case with Darjeeling tea in our study. By fostering customer awareness through education, the entrepreneurs in our cases create feedback loops that simulate structured requirement elicitation, thus achieving similar innovation outcomes without high-tech infrastructures.

Industrial and cyber–physical system applications. Servitization logic has become increasingly relevant in industrial contexts, especially with the advent of cyber–physical systems (CPSs). Chuang and Chen [7] and Flores-García et al. [12] explore how CPS integration strengthens inter-actor collaboration, reuse, and system modularity.

However, while CPSs are transforming large-scale manufacturing, the applicability of these principles in micro or service contexts remains unclear. Our study contributes to this discussion by showing how modular learning and service layering—applied through localized training programs—can parallel the modular design principles of CPSs, enabling flexible and responsive service evolution even in low-tech domains.

Collaborative consumption and shared value creation. Collaborative consumption, examined by Dalenogare et al. [17] and Wang et al. [18], represents a new phase in servitization where products and services are co-used, co-managed, or co-developed. These models emphasize shared ownership, user empowerment, and community-based innovation.

While the concept is often associated with tech platforms like Uber or Airbnb, its translation into more traditional settings remains under-researched. In our study, tea entrepreneurs foster collaborative knowledge ecosystems through initiatives like the Chaya School of Tea. These serve as community-based innovation platforms where participants co-develop blends, co-train new entrepreneurs, and co-discover market preferences, thus realizing collaborative consumption through education and co-creation.

Artificial intelligence and advanced analytics. Nicoletti and Appolloni [19] and Walk et al. [20] describe how AI, especially in the form of computer vision, supports sustainability by analyzing product usage, predicting wear, and optimizing delivery. These technologies underpin Servitization 5.0, where hyper-personalized, self-correcting systems become feasible.

However, a gap persists regarding the practical adoption of AI-enabled tools in resource-constrained settings. While our study does not utilize AI technologies per se, it addresses the same goals—optimization, prediction, and personalization—through human-centered strategies, such as a sensory-based tea evaluation, experience sharing, and structured blending workshops. This provides a low-tech pathway toward outcomes that mirror AI benefits.

Platforms, governance, and ecosystem evolution. Recent work by Johnson et al. [21], Jovanovic et al. [22], and Yan et al. [23] emphasizes the co-evolution of platform architecture, services, and governance as essential to sustaining complex servitized ecosystems. These studies point to the necessity of adaptive frameworks, continuous innovation, and governance mechanisms to manage evolving actor roles.

Our research parallels this platform logic through community-based governance of learning platforms, where seasoned entrepreneurs mentor newer entrants, set quality norms, and share market intelligence. Such self-organized governance mimics digital platform dynamics, offering a tangible model for grassroots ecosystem co-evolution.

DevServOps and continuous service feedback. The DevServOps model introduced by Dakkak et al. [24,25] highlights how service functions bridge development and operations in modern software engineering. It positions services not merely as delivery endpoints but as feedback loops that continuously inform upstream development.

Although DevServOps is typically applied in digital domains, our case study illustrates how training-based feedback systems play a similar role. As entrepreneurs refine their business based on training inputs and customer reactions, service delivery and product development become tightly interwoven—reminiscent of DevServOps dynamics. Summing up, the key characteristics of servitization in successful companies, as we could identify in the literature, are summarized in

Table 1. Key summary characteristics of servitization in successful companies.

Characteristic	Integration of Services with Core Products	Emphasis on Customer-Centric Solutions	Development of Ecosystems	Harnessing Technology for Superior Service Delivery
Description	Companies have successfully integrated services directly into their core product offerings, enabling seamless and cohesive customer experiences.	Servitization represents a strategic shift from product-focused models to approaches that prioritize the needs and preferences of the customer.	Organizations have built service ecosystems that offer a wide array of interconnected solutions. By bundling services in this way, they streamline the customer journey and foster loyalty by providing a convenient, one-stop experience.	Technological innovation is central to modern servitization, with data integration, platform technologies, and mobile apps reshaping how companies deliver and personalize services. These disruptive changes drive greater efficiency, adaptability, and continuous value creation.
Company example:	Salesforce	Rolls-Royce	Booking.com	Salesforce

Source: elaborated by the authors.

.

Several ontological and epistemological gaps persist in the current literature.

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Ontological Gaps: Servitization research remains biased toward manufacturing contexts. Studies by Vidickienė et al. [29], Albors-Garrigos et al. [30], and Sumyle et al. [31] reveal a lack of understanding regarding servitization in non-manufacturing sectors such as agriculture, retail, and hospitality. There is also insufficient attention to multi-actor ecosystems, including customers, suppliers, and educators, despite their pivotal roles in value creation.

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Epistemological Gaps: The role of user co-production is under-theorized. Buics et al. [32] and Raddats et al. [33] call for a deeper analysis of how customers shape service evolution. Similarly, the poor integration of emerging technologies (e.g., AI, IoT, and AR/VR) into general servitization theory weakens its explanatory power across sectors. Finally, there is a lack of empirical research into the barriers to servitization adoption, especially the financial, knowledge-based, or structural hurdles faced by small enterprises.

This paper addresses these gaps by exploring servitization in a service-based, non-industrial context: the tea sector. Through multiple case studies, we show how entrepreneurs employ training, user co-creation, market segmentation, and knowledge dissemination to transition from product-selling to value-added, customer-centric service models.

Based on the findings of our literature review, we argue that the traditional, generic definition of servitization fails to reflect the full complexity of servitization within service contexts. Drawing on a comprehensive analysis of theoretical frameworks, user participation, process improvements, technological integration, and responsiveness to evolving customer needs, as outlined in existing studies, we propose the following definition of servitization of services:

Servitization of services refers to the strategic transformation where organizations go beyond their traditional service offerings to introduce new, complementary services that are distinctly different yet closely related to their core operations. This approach focuses on creating enhanced value by addressing broader ecosystem needs, fostering customer empowerment, and driving industry-wide improvements.

By validating this definition through empirical data, our study extends servitization theory into new domains, thus offering a holistic, multi-actor, and inclusive perspective on how service ecosystems evolve in the digital and post-digital age.

3. Materials and Methods

3.1. Methodological Approach Grounding

The review of attributes affecting servitization suggests that it is methodologically sound to apply qualitative research methods, such as case studies, which allow for an in-depth exploration at the micro level. This approach makes it possible to identify the specific success factors driving rural viability through servitization and to explain how and why they contribute to resolving rural sustainability challenges with a user-centric approach by adding services. The analysis should first be conducted from a micro-level perspective, focusing on individual cases, and later expanded to a more generalized macro-level perspective, addressing broader rural development implications concerning servitization.

This research adopts a qualitative, multiple case study approach to explore the evolutionary trajectory of customer-centric innovations through the lens of servitization in service firms. Given the empirical novelty of the topic and the theoretical gaps identified in the literature—particularly in non-manufacturing sectors—this methodology is well-suited to capturing the complexity and contextual nuances of service-based business transformation.

As noted by Yin [34], the case study method is particularly appropriate when certain criteria are met:

(a) The primary research objective is to explain a phenomenon by addressing “how” and “why” questions;

(b) There is no possibility of manipulating the behavior of the subjects under study;

(c) Contextual factors play a significant role in the research;

(d) The relationship between the phenomenon under investigation and its context is unclear.

In this study, the aim is to explain how a particular project has contributed to addressing a specific issue of servitization at the micro level and why it has emerged as a decisive factor in enhancing the viability of the rural settlement where it was implemented. The study does not involve experimental manipulation, as all projects under investigation have already been implemented and their outcomes are observable. Contextual analysis is particularly important in this research, as it helps explain the determinants of project success and assess the transferability of such initiatives to other rural areas.

The multiple case study method was chosen to investigate manifestations of farming servitization in India, as the research problem and research questions remain empirically novel and theoretically undefined. Many experts in scientific methodology emphasize the appropriateness of this method when analyzing unexplored and original research problems, as case studies enable an in-depth assessment of the investigated phenomenon and the development of new theoretical assumptions regarding the phenomenon under examination [35]. A review of previous studies has revealed that the relationship between servitization and rural viability factors has not yet been adequately examined using qualitative methods; this gap in research justifies the chosen approach.

3.2. Justification for Sector Selection

This scientific study presents seven purposively selected cases from the non-manufacturing tea sector. The tea sector was purposefully selected as the focal context for several reasons. First, it represents a service-intensive industry that is undergoing significant transformation, especially at the intersection of product differentiation and value-added services. While traditionally focused on commodity trading, the sector is increasingly incorporating customer engagement, brand-building, sensory experiences, and knowledge-based services (e.g., tea education, personalized blends, and curated gifting). These emerging practices closely align with the principles of servitization.

Second, the sector offers a hybrid model, blending tangible product delivery (tea as a commodity) with intangible services (customization, consultation, and training), making it a fertile ground for studying the shift from product-centric to service-centric innovation. Despite these dynamics, the tea sector remains underexplored in the servitization literature, especially in the context of emerging economies like India and Nepal.

3.3. Case Selection Criteria

To align with the research objectives, purposive sampling was employed to select seven entrepreneurial cases that exemplify the transition toward service-oriented value creation within the tea industry. Purposive sampling is employed when cases are chosen based on a clearly defined objective rather than randomly selected merely because they exhibit certain characteristics of the phenomenon under investigation [36,37].

The selection was guided by the following criteria:

• Direct involvement in tea-related services, such as blending, packaging, vending, or training;
• Experience with structured training (specifically the Golden Tusk workshop), enabling a consistent reference point for intervention impact;
• Variation in scale, geography, and market orientation (e.g., B2B vs. B2C, urban vs. rural, and traditional vs. innovative practices);
• Demonstrated shift in business model—either in product positioning, customer interaction, or value proposition—indicative of servitization.

This diversity in profiles allowed for rich, comparative insights while maintaining a coherent thematic focus. The cases were drawn from both India and Nepal, reflecting regional similarities in market dynamics, cultural context, and entrepreneurial challenges. The case study driving questions are as follows:

• What was the motivation to enter the tea business, and what challenges were faced initially?
• How the knowledge and expertise in had been acquired of tea tasting, blending, and procurement?
• What specific changes have been implemented in business after attending the Golden Tusk training?
• How have these changes impacted the business in terms of product quality, customer satisfaction, and financial growth?
• What differences have been observed in tea pricing, sourcing, and quality before and after training?
• How different market preferences are catered? Have any new products or blends been introduced based on this understanding?
• What are the plans for business expansion, innovation, or improving consistency in product quality?

3.4. Data Collection and Analysis

Primary data were collected through semi-structured interviews with entrepreneurs who had participated in the Golden Tusk training program. Interviews were conducted telephonically between May and July 2024, lasting 40 to 60 min each. The open-ended format encouraged participants to share detailed narratives about their business evolution, challenges, and learning outcomes.

3.5. Limitations of the Study

While the use of telephone interviews enabled broad geographic coverage and timely access to participants, we acknowledge that this method may limit the depth and contextual richness typically afforded by in-person or longitudinal fieldwork. The 40–60 min duration, while sufficient for capturing key experiential insights, may not fully capture the complexity of business transformations. This limitation suggests the need for future studies to incorporate extended or multi-phase interviews, direct observations, or embedded case study methods to deepen the understanding of servitization dynamics in service firms. The data were analyzed thematically using an inductive coding process. To enhance analytical clarity and consistency, ChatGPT(GPT-3.5) was used as a text-mining and thematic sorting tool, drawing on its established applications in academic research. ChatGPT was used in an assistive capacity for thematic sorting based on researcher-defined queries. It helped accelerate the initial coding by organizing textual data into thematic clusters. Final coding decisions and thematic interpretations were conducted by the authors to ensure accuracy, contextual sensitivity, and alignment with established qualitative research standards.

This process led to the identification of nine core themes relevant to servitization, which are discussed in the Results section. The use of ChatGPT for the thematic analysis was guided by its growing recognition as a practical tool for exploratory text mining in qualitative research. It should be highlighted here that the use of ChatGPT as a text-mining tool for academic research is already well-established [38,39,40,41]. To ensure reliability, the interview transcripts were pre-processed and segmented to maintain contextual clarity. The AI tool was used not as a replacement for human analysis but as a complementary aid to assist in pattern recognition and the clustering of recurring themes. The emergent themes were then manually reviewed, cross-validated, and refined by the researchers to confirm coherence with the raw data and alignment with the research objectives. This hybrid approach allowed us to benefit from the efficiency of AI while maintaining interpretive depth and methodological transparency.

4. Results

4.1. Contextual Background for the Multiple Case Study

The expert, Samya Roy, one of the authors, embarked on his professional journey as an automobile engineer with an MBA, eager to make his mark in the corporate world. His career began in the marketing department of an earth-moving equipment manufacturing firm, where he showcased his skills and expertise. Alongside him, his wife Pratika, a post-graduate in social work, was making strides in the corporate HR department of the same company. Despite their demanding careers, they found fulfillment in their work and each other’s company.

Their lives took a turn when the nature of Samya’s job demanded frequent transfers across different locations in India. Initially, the prospect of new experiences and challenges excited them both. However, as time went on and they welcomed a child into their lives, they began to realize the toll that constant relocation was taking on their family.

Their daughter’s well-being became a primary concern as they witnessed her struggle to adjust to new schools and make new friends with each move. The stress of uprooting her life every few years began to affect her mental health, prompting Samya and Pratika to reevaluate their priorities.

It was during one of these transitions that they found themselves transferred to Siliguri, a trading town in West Bengal, offering a semblance of stability and a higher quality of life. However, the looming uncertainty of further transfers lingered in the back of their minds, threatening to disrupt their newfound sense of peace.

Faced with this dilemma, Samya and Pratika started exploring alternative paths that would allow them to build a stable life in Siliguri. They considered various options, including starting their own business, as a means to take control of their future and create a more permanent home for their family.

Siliguri’s vibrant trade scene, particularly its thriving tea industry, caught their attention. Samya’s company developed a small excavator that is suitable for making irrigation channels in the tea gardens. Samya was entrusted with the responsibility to develop the market for this product and also to develop the product suiting the requirements of the users. This gave an opportunity to Samya to visit several gardens and learn the nuances of tea processing.

As Samya delved deeper into the tea industry while developing the market for the excavator, he found himself captivated by the intricate process of tea making. From the meticulous plucking of leaves to the precise art of processing and packaging, each step fascinated him. He immersed himself in conversations with tea garden managers, agronomists, and pluckers, eager to learn more about this centuries-old tradition.

Samya envisioned a business centered around tea. Recognizing the diverse range of flavors and qualities that tea offers, he saw an opportunity to carve out a niche in this market.

Pratika, drawing from her experience in social work and corporate HR, provided invaluable support and encouragement as they contemplated leaping into entrepreneurship. Together, they weighed the risks and rewards of starting their own business, recognizing the challenges ahead but also the opportunity to pursue their passion and create a better future for their family.

With determination and optimism, Samya and Pratika set out on a new chapter of their lives, driven by the desire to build a thriving business that would not only provide for their family but also contribute to the local community. Their journey was about more than just financial success; it was about finding purpose and fulfillment in the pursuit of their dreams.

Initially, Pratika formed a company named VPS dealing with the wholesale operation of tea and sourcing teas from the local market. Samya continued to work for his company while simultaneously immersing himself in the intricacies of tea production and sales. He was helping Pratika in sourcing teas. Their division of labor allowed them to balance the risks associated with starting a new business while ensuring a steady income stream. But, it was not smooth. There were a lot of hurdles, which are followed in the next part of the story.

VPS was dealing with CTC tea. CTC tea is mainly consumed with milk in India and CTC tea lacks significant distinctiveness in practical terms. As people drink tea with milk and milk can be of different types—cow, buffalo and goat with different fat levels—and there is a concept of compatible tea. Not all teas pair well with every type of milk or brewing time, but this is not a significant differentiator, and it does not vary much from customer to customer; instead, it varies more by region. There are a few tea gardens that produce exceptional CTC tea costing around Rs 700 per Kg in a few batches, but about 90% of CTC tea is sold at Rs 200–300 per Kg. The market share of CTC tea in India is about 90 percent and 10 percent is orthodox. The CTC tea is basically a commodity where price is the main differentiator, and anybody can come into the business. Samya and Pratika realized that this was not their cup of tea. Samya wanted to be in the orthodox tea where the knowledge of tea is of prime importance to make a successful repacked trader. They closed VFS.

They formed a separate company, Golden Tusk, focusing on Darjeeling orthodox tea. The market for Darjeeling tea is niche [42,43], it is mostly consumed without milk and sugar, and it offers enormous health benefits alongside a flavorsome experience. After the COVID era, they noticed a surge in inquiries for wholesale business. New tea enthusiasts were entering the tea business with full vigor [44,45]. Most inquiries were for low-cost teas intended for sale in rural markets and tea stalls.

It is evident that when one cannot judge the quality of a product, the safest option is to choose the cheapest one. For example, if you buy an expensive diamond, there is a risk of being cheated, but there is little chance of that with artificial diamonds since the price is much lower. They observed that many tea enthusiasts approached tea as a mere commodity, visiting wholesalers to find the cheapest products. Sellers often offered inferior quality teas, which buyers consumed, remaining unaware of the actual taste of leaf tea.

As sellers of Darjeeling tea, their biggest challenge was expanding their reach beyond West Bengal. Most of their buyers were selling CTC Chai, and the palate for Darjeeling tea was not developed across India, except in a few regions. To their surprise, they discovered that much of India was unaware that Darjeeling produces only orthodox teas, not CTC! In contrast, products labelled as “Darjeeling CTC” were even being sold on e-commerce platforms, deceiving customers.

To overcome this challenge, Golden Tusk adopted a different strategy. They minimized telephonic discussions with customers and, for new inquiries, invited them for face-to-face meetings at their office. Strategically, they made customers wait for a while and served Darjeeling tea in the meantime. Once the customers tasted the high-quality Darjeeling tea, they appreciated it. This strategy turned out to be highly effective.

This marked the beginning of their journey to sell quality teas. They successfully made buyers understand that tea is not a commodity and that its price depends on product differentiation. Some tea enthusiasts began to take small risks by investing in good-quality teas in small quantities as sample trials. A few became interested in quality tea for brand building, particularly those in the repackaging segment.

They also observed that many tea businesses were shutting down within a couple of years due to reasons such as

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Being stuck with unsold stock;

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A lack of repeat orders;

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Falling victim to fake marketing funnels;

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Mismatched blends for their target markets;

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Profit-eroding business systems.

The root cause of these failures was an inadequate knowledge of tea. Many lacked proper tea-tasting skills or had only learned from the internet. However, tea tasting cannot be learned online alone—it requires a physical experience to engage all the senses. During tea tasting, apart from the tongue, all other sensory organs play a crucial role. The eyes judge the leaf quality, infusion, and color of the cup; the nose detects the aroma; the tongue discerns taste; and the skin feels the texture of the leaves. Proper tea tasting concludes with noting any physical changes, such as mild sweating, an energizing effect, or drowsiness.

This realization led them to educate buyers on the nuances of the tea business, and Golden Tusk began its journey of empowering tea entrepreneurs by imparting skills for tea tasting. They partnered with Mr. Rittik Chatterjee, a veteran of the tea industry with over two decades of experience across India and abroad, working with numerous established brands and blends. Together, they launched the Chaya School of Tea, aiming to transform tea entrepreneurs. So far, they have conducted six workshops covering 53 participants.

They started training tea enthusiasts in innovative business ideas, such as tea processing, franchising, café management, retailing, drop shipping, repackaging, wholesaling, rural market penetration, gifting, exporting, and more. These trainings are conducted through week-long hands-on workshops, including visits to tea gardens and factories. Participants from across India and abroad have attended the workshops, with tremendous success so far.

4.2. Multiple Case Study

To gather the necessary data for a deeper analysis, seven individual cases were examined in detail. A summary of the key characteristics and contextual features of these cases is presented in

Table 2. Overview of the core features across case Studies.

Case Name	Location	Business Type	Initial Challenge	Golden Tusk Impact	Post-Training Outcome
Nikita	Nepal	Family-owned tea garden, factory, and packaging	Low product quality due to a lack of tea tasting expertise	Learned tea tasting and blending, expanded to specialty teas	New export markets, new product lines, 25% sales increase
Rahul	Jodhpur, India	Green tea blending for retail	Overpaying for raw materials, low online sales	Improved procurement, blending, and pricing strategy	Better quality, 50% revenue growth, expanded local sales
Swaraj	India	CTC tea packer for re-packers	Limited innovation capacity	Gained insights into regional preferences	Customized blends, improved sales
Vegan Tea	India	Loose and blended CTC and herbal teas	Quality control and customer complaints	Improved quality, launched new blends, better procurement	30% sales growth, geographic expansion, own packaging line
Kashi	Vellore, India	Blending, packaging, and vending	Overpaying for poor quality tea, inefficient inventory	Learned procurement, blending, and inventory optimization	20% sales growth, fewer complaints, new brands, vending expansion
Gaurav	Nepal	Family tea packaging and blending	Informal knowledge, limited theoretical foundation	Improved tea terminology and communication	New blend launched, expanded B2B and B2C markets
Dhruvajyoti	Mumbai, India	Vending machines and tea blending	No industry knowledge, weak sourcing capability	Learned tasting, blending, and procurement techniques	Developed vending model, improved product consistency

Source: elaborated by the authors.

, providing an overview of the diverse profiles and developments observed across the sample.

Building on the summary provided above, the following section presents a more detailed account of each case. These in-depth descriptions offer insights into the specific challenges, interventions, and outcomes experienced by the individual participants. By exploring each case separately, we aim to capture the unique pathways through which servitization unfolded in diverse business contexts.

4.2.1. Nikita Case

Nikita manages a family-owned tea business that includes a small tea garden with an on-site processing facility in Ilam, Nepal, as well as a packaging unit in Kathmandu. Initially, the business focused exclusively on producing black orthodox tea, which was sold domestically at Rs. 200–300 per kilogram, with no involvement in export markets. The company employed a tea maker who handled both production and tasting, but due to limited expertise in tea evaluation, the product quality was inconsistent and poorly received in the market. Having previously worked at a bank in Kathmandu, Nikita found little personal fulfillment in her role and eventually decided to join the family business. She developed a keen interest in tea cultivation and production, gradually involving herself in tasting sessions alongside the in-house tea maker. Over time, she identified significant knowledge gaps—both in her own understanding and in her father’s—particularly regarding processing and quality assessment. After discovering the Golden Tusk workshop on Facebook, she enrolled in the program to strengthen her skills.

During her interview, Nikita explained that the training provided her with a comprehensive foundation in tea business operations, including leaf quality assessment, seasonal variations (flushes), and their suitability for specialty tea production. She also gained valuable hands-on experience in tasting and blending techniques, though she acknowledged that mastering the craft is a continuous learning journey. Following the training, Nikita initially continued to collaborate with the tea maker but gradually gained the confidence to evaluate tea quality independently. This enhanced capability allowed her to diversify the product portfolio to include specialty teas such as Oolong and White tea. The response was immediate—a visiting French buyer placed an order on the spot, and a sample consignment was subsequently shipped to the Czech Republic. Currently, Nikita has set a production target of 4000–5000 kg of specialty tea per season. She also introduced a new packaging format: boxes containing 25 sachets priced at Rs. 200–250 each. With each sachet holding 2 g of tea, the effective price per kilogram ranges from Rs. 4000 to Rs. 5000, significantly higher than conventional offerings. Notably, while the raw material costs for specialty teas are higher, overall production expenses are lower than those for traditional orthodox tea, resulting in increased profitability. Additionally, the training helped her enhance the quality of blended teas produced at the Kathmandu facility. Whereas the business previously struggled with customer complaints, these have ceased in recent months, and sales have grown by 25%—all without increasing the price point.

4.2.2. Rahul Case

Rahul, a young graduate from Jodhpur, identified a notable shift in consumer preferences during the COVID-19 pandemic, as more people began turning to green tea for its perceived health benefits. Recognizing this emerging trend, he decided to enter the tea blending sector with a specific focus on green tea production. At the outset, Rahul had no formal background in tea blending and relied on basic knowledge acquired from traders and wholesalers. Despite launching his business two years ago, he faced challenges in gaining meaningful traction—particularly in the competitive online retail market. In search of structured guidance, he discovered the Golden Tusk workshop through social media and enrolled in the program one year ago. The training proved transformative. Rahul gained essential insights into blending techniques, quality assessment, and pricing strategies. He realized that he had been significantly overpaying for raw tea, previously sourcing it at Rs. 1200 per kilogram, when the fair market price was closer to Rs. 600. Post-training, he revised his procurement approach, securing better-quality tea at Rs. 650–900 per kilogram and sharpening his negotiation skills to engage more confidently with suppliers. These changes led to a marked improvement in product quality, which in turn boosted customer loyalty and market demand. By passing on procurement savings to customers through lower prices, Rahul made his products more competitive. As a result, his revenue increased by approximately 50%.

To support growth, Rahul employs email marketing to introduce new blends to his customer base and relies on word-of-mouth referrals to expand his reach. In addition to online sales, he has begun targeting the local market, with current monthly sales ranging between 30 and 40 kg.

4.2.3. Swaraj Case

Mr. Swaraj Chakraborty is an experienced CTC tea packer who primarily supplies blended teas to re-packers. While his business has traditionally focused on established product lines—leaving limited room for innovation—he was able to apply valuable insights gained from the Golden Tusk training, particularly regarding regional taste preferences and liquor quality. By leveraging this new knowledge, he customized tea blends to better suit specific market demands. This targeted approach led to a noticeable improvement in sales performance, demonstrating the impact of even modest innovation within a well-established operation.

4.2.4. Vegan Case

Founded in 2021, Vegan Tea entered the market with limited industry experience, initially supplying both loose and blended teas to re-packers. From the outset, the company faced challenges related to quality control and customer satisfaction. In search of targeted guidance, they explored several training programs, but found options like those offered by NITM unsuitable for the long-term demands of running a tea business. Their participation in the Golden Tusk workshop proved to be a turning point. The training significantly improved both customer satisfaction and operational efficiency. Prior to the program, the company frequently received complaints from re-packers about inconsistent product quality. After the training, their blends stabilized, leading to a 30% increase in sales. This growth also enabled a modest price adjustment, with their CTC tea now retailing at Rs. 285 per kilogram. Following the workshop, Vegan Tea launched five new CTC blends and introduced a new line of 12 herbal tea blends. They also implemented structured blending sheets to ensure consistency across batches. Additionally, they optimized their procurement strategy, reducing input costs by 20%. Armed with a stronger understanding of regional taste preferences, the company successfully expanded its distribution network to Rajasthan, Uttar Pradesh, Gujarat, and South India, previously untapped markets. To further strengthen brand control and value addition, they also initiated in-house packaging operations for their leaf tea products.

4.2.5. Kashi Case

Mr. Kashi comes from a family with over a century of experience in Bidi manufacturing and is also involved in real estate and hospitality ventures in Vellore. In 2015, he expanded into the tea industry by launching his own brand, focusing on blending and packaging. Alongside supplying vendors, he also began operating tea vending outlets across South India.

Initially, Kashi lacked formal knowledge in tea procurement and tasting. He relied heavily on private traders and frequently overpaid for substandard tea. This changed after he attended the Golden Tusk workshop, where he acquired practical skills in tea sourcing, processing, blending, and understanding regional taste preferences. Post-training, he began sourcing tea directly from private auctions, gaining the confidence to assess quality and negotiate prices effectively. Previously, he had been paying Rs. 300 per kilogram for tea valued at only Rs. 150. He now purchases higher-quality tea at Rs. 195–200 per kilogram, resulting in significantly improved blends. In addition to refining his sourcing strategy, Kashi overhauled his inventory management practices. He shifted from large, biannual bulk purchases to smaller, monthly procurements. This ensured fresher inventory, minimized moisture absorption, and reduced capital lock-up. These changes led to a 20% increase in sales and a noticeable drop in customer complaints.

Looking ahead, he is developing market-segmented product lines and has ambitious plans to expand his retail presence by launching 100 new tea vending outlets.

4.2.6. Gaurav Case

Gaurav is part of his family’s long-standing tea packaging and blending business in Nepal, which has been in operation for over 90 years. His expertise in tea was largely developed through informal, experience-based learning passed down from senior family members. While this practical knowledge served as a solid foundation, Gaurav recognized the value of structured, theoretical training to strengthen his professional capabilities. This realization led him to attend the Golden Tusk workshop. The training provided him with a deeper understanding of tea nomenclature and classification, enabling him to communicate more effectively with industry stakeholders and partners.

After completing the program, Gaurav introduced a new tea blend to the market, which was well received. His business has since expanded its reach, now catering to both the B2B and B2C segments, thereby broadening its customer base and market presence.

4.2.7. Dhruvajyoti Case

Dhruvajyoti, a young entrepreneur from Mumbai, brings a decade of experience in operations management at Café Coffee Day. Drawing on this background, he developed and patented an innovative tea vending machine in collaboration with students from IIT Mumbai. Unlike conventional machines that use instant tea powder, his design brews authentic tea, aiming to elevate tea consumption in corporate settings. Despite his strong business acumen, Dhruvajyoti had no prior experience in the tea industry. Early efforts to learn from tea traders proved inconsistent and insufficient. Seeking a more reliable foundation, he enrolled in the Golden Tusk workshop, where he gained essential skills in tea tasting, blending, and procurement. The training empowered him to visit tea gardens and engage more confidently with corporate tea suppliers. He learned to assess quality and pricing with greater precision, skills that now enable him to differentiate between teas priced at Rs. 200/kg and Rs. 400/kg, a distinction he previously struggled to make. Today, his business model follows a structured value chain: sourcing tea through auctions, blending it in-house, and supplying his vending machines installed in corporate offices. This approach ensures consistency, enhances customer satisfaction, and strengthens his competitive edge in the growing market for premium tea experiences.

4.3. Results from the Multiple Case Study

A total of nine themes were identified as relevant to the objectives of this research (see

Table 3. Key themes identified from the case studies.

Theme No.	Theme Title	Description
1	Lack of Initial Knowledge and Expertise	Many participants began with limited or no formal understanding of tea tasting, blending, or procurement.
2	Impact of Structured Training	Training significantly improved participants’ skills, leading to enhanced decision-making and product quality.
3	Improved Product Quality and Innovation	Post-training, participants introduced new blends and specialty teas, improving market differentiation.
4	Cost Optimization and Efficient Procurement	Better sourcing strategies led to reduced input costs and improved negotiation with suppliers.
5	Customer-Centric Focus	An enhanced focus on product quality and taste preferences led to increased customer satisfaction and loyalty.
6	Regional and Market-Specific Strategies	Knowledge of regional preferences enabled tailored blending and market segmentation.
7	Adoption of Modern Business Practices	Participants adopted practices like inventory optimization and structured blending for operational gains.
8	Improved Financial Performance	Many cases reported measurable sales and revenue growth following the training.
9	Long-Term Planning and Vision	Participants developed strategic goals, including brand expansion and scaling operations.

Source: elaborated by the authors.

).

A brief explanation of each theme is provided below. This thematic analysis demonstrates how structured training programs, such as the Golden Tusk workshop, help address critical knowledge gaps, enhance business operations, and support the growth of tea entrepreneurs. Many participants, like Nikita, Rahul, Vegan, and Kashi, initially lacked formal training in tea tasting, blending, or procurement. Their understanding was either limited to experience-based knowledge or entirely absent, leading to quality issues, inefficient procurement, and unsatisfactory market responses. The training helped participants understand tea characteristics (e.g., flushes and regional preferences), improve their tea-tasting and blending skills, and adopt effective business practices. This knowledge translated into better product quality, reduced costs, and higher sales. Post-training, participants enhanced their product quality and introduced innovative products. For instance, Nikita began producing specialty teas like Oolong and White tea, and Vegan developed 12 new blends in the herbal tea segment. Training enabled participants to explore new product lines, adapt to market demands, and differentiate themselves from competitors. Participants like Rahul, Kashi, and Vegan realized that they were overpaying for tea before acquiring the skills to evaluate tea quality and negotiate prices effectively. Training empowered participants to assess tea quality and procure it more economically. This reduced their input costs and improved margins, which in turn allowed some to offer competitive pricing to customers. Several participants emphasized improved customer satisfaction and loyalty post-training. For instance, Vegan reduced customer complaints, and Kashi received positive feedback on the improved blends. The training highlighted the importance of understanding regional preferences for tea blends. Participants like Swaraj and Vegan adopted this knowledge to create blends tailored to specific regions, boosting their sales. The participants were able to successfully segment the market post-training, resulting in increased sales and market expansion. Participants integrated modern practices such as monthly inventory management (Kashi), tea vending machines (Dhruvajyoti), and data-driven blending sheets (Vegan). These practices helped reduce inefficiencies, minimize wastage, and increase profitability. Nearly all participants reported increased sales and profitability post-training. For example, Rahul’s revenue increased by 50%, and Vegan’s sales grew by 30%. Several participants demonstrated a renewed focus on long-term goals, such as Nikita’s production targets for specialty tea and Kashi’s plans for 100 vending outlets. Training inspired participants to set ambitious business goals, laying the foundation for sustainable growth and diversification.

4.4. Results from the Intervention of Golden Tusk on the Studied Businesses

According to Samya, one of the authors, said, “As on date, we are enjoying 84% repeat buyers, considering even gifting business. Considering re-packers and the HoReCa (hotel, restaurant, and café/catering) industry, it is satisfactory growth in volume sales of Darjeeling teas, which is a clear indication of a growth in the market share of our customers and it indicates that the end users have stared consuming good teas”.

He further added: “Success stories of re-packers and the HoReCa industry started provoking nearby entrepreneurs; the numbers of our buyers have increased 36% compared to last year, 2023. As an effect, our Darjeeling tea sales volume has grown 44% than last year. With the increasing demand of exclusive teas in HoReCa, our buying of early first-flush teas and other premium teas has been increased. This year, our total first flush Darjeeling collection was of 540 kg, of which 722 kg have been sold in 9 months and the total Darjeeling tea collection was 1870 kg, including all seasons. Our next year target is to collect 1.5 T of first flush and a total of 3.5 T of Darjeeling teas. With the increasing sales of premium teas, our average selling price of Darjeeling tea has become 1280/per kg, which is about 300% higher than what it was”.

5. Discussion

This study set out to examine how service firms—specifically in the tea sector—undergo business transformation through servitization. The thematic analysis identified nine key themes that shed light on this process: initial knowledge gaps, the role of structured training, innovation in products and processes, cost optimization, customer-centric approaches, regional targeting, modern business practices, financial growth, and long-term planning. These themes reflect a progression from conventional, product-led operations to more dynamic, customer-centric models of service delivery.

The findings strongly support existing servitization theory that describes the shift from product-oriented logic to service-dominant logic [26,27,46]. Specifically, themes related to product innovation, customized blending, and customer feedback align with customer-centric servitization pathways identified in the literature [16,33]. Likewise, cost optimization, training, and inventory management reflect operational adaptations discussed in performance-focused servitization studies [12].

However, this study contributes new insights by applying these frameworks to a non-manufacturing sector—the tea industry—where servitization takes shape not through technology integration alone but also through knowledge empowerment, entrepreneurial training, and community collaboration. These findings extend the conceptual reach of servitization by illustrating how service firms themselves can evolve via the introduction of complementary service offerings, such as workshops, taste education, and localized product development, elements rarely examined in the existing literature. The proposed definition of servitization of services, which emphasizes ecosystem responsiveness, customer empowerment, and industry-wide improvement, directly reflects the observed shifts in business models. Rather than incremental product extensions, participants engaged in strategic transformation through service-led differentiation and value creation. This evolution challenges traditional servitization boundaries and underscores the need for broader, more flexible theoretical models capable of capturing diverse service contexts.

Summing up, this study contributes new knowledge to the servitization literature in three key ways. First, it explores servitization within a non-manufacturing, service-oriented sector (tea entrepreneurship), which remains underrepresented in the current research. Most existing studies focus on product-based industries or manufacturing firms; in contrast, our study addresses how service firms themselves transform by embedding complementary services, education, and value-added offerings into their models.

Second, we investigate structured training as a servitization enabler, demonstrating how knowledge transfer and skill development catalyze shifts toward customer-centric innovation. To our knowledge, this is one of the few empirical studies linking capacity-building interventions with tangible outcomes in business model evolution through servitization.

Third, we propose an updated definition of “servitization of services” that extends beyond traditional views of service enhancement. While existing definitions emphasize the shift from products to services or the integration of services into product offerings, our definition centers on service firms themselves transforming through the addition of distinct yet related services. It also incorporates ecosystem value creation, user empowerment, and long-term capacity building, concepts that are not sufficiently captured in earlier servitization frameworks.

This expanded definition reflects the multi-actor, iterative, and community-based dynamics observed in our case studies and offers a conceptual foundation for future research in service-driven sectors undergoing transformation. Future research should examine servitization in the tea sector at a broader scale, involving a larger and more diverse sample of entrepreneurs to better understand its impact across different market segments. Longitudinal studies would be valuable in evaluating the sustainability and long-term outcomes of servitization strategies. Additionally, comparative analyses between product-centric and service-integrated tea businesses could offer meaningful insights into the most effective models for achieving growth and market differentiation.

6. Conclusions

This study explored the evolution of customer-centric innovations in the tea sector through the lens of servitization using a multiple case study approach. The findings identified nine key themes illustrating how structured training programs, such as the Golden Tusk workshop, enable tea entrepreneurs to adopt service-led strategies and evolve their business models toward more customer-responsive, value-added offerings.

This study contributes to the servitization literature by extending the concept into a non-manufacturing, service-driven sector. It highlights the role of training-based interventions in driving business transformation, an area that was previously underexplored. The proposed definition of servitization of services broadens existing frameworks by incorporating customer empowerment, ecosystem-level impact, and strategic service diversification within traditionally product-oriented businesses.

From a practical perspective, the findings provide actionable insights for entrepreneurs, trainers, and business support organizations. The results demonstrate how capacity-building initiatives can enhance product quality, market segmentation, and operational efficiency. They also offer guidance on how small service firms can embed complementary services to improve customer retention, expand market reach, and differentiate themselves in competitive sectors.

Despite its contributions, this study has several limitations. The analysis is based on a relatively small number of purposively selected cases, which may limit the generalizability of the findings to the broader tea industry or other service sectors. Additionally, the reliance on telephone interviews, while practical, may not have captured the full depth and nuance of participants’ experiences. Finally, the use of AI-assisted text analysis, though helpful for initial thematic coding, warrants further methodological validation in future qualitative research.