Purpose: Despite the fact that user participation (UP) has been highlighted as an important aspect in innovation, previous findings on its relationship with service innovation performance (SIP) are inconsistent. This study aims to investigate the relationships among UP, knowledge management capability (KMC) and SIP, especially in the digital age, inspired by the theories of knowledge-based and absorptive capacity.

Design/methodology/approach: Based on a sample of 252 Chinese e-commerce enterprises, this study adopts a hierarchical regression analysis and bootstrap method to test the theoretical framework and research hypotheses.

Findings: UP and KMC have positive effects on SIP, respectively. KMC plays a mediating role in the effect of UP on SIP. Furthermore, the intermediary role of KMC varies in different sub-paths between UP and SIP.

Originality/value: First, this study provides some explanations for inconsistent arguments on the relationship between UP and service innovation. Second, with the consideration of specific dimensions of UP and SIP, the mediation role of KMC varies in different sub-paths has been recognized, which provides a deeper understanding of the relationship between UP and SIP. Third, this study opens the discussion about how to realize SIP more effectively in the digital age, advancing theoretical and practical developments on service innovation.