Crowdsourcing: Let Your Customers Do The Work

What is used by the US Navy to refine tactics, carried out by more women than men, and increased 30% between 2014 and 2015 for major brands?

… Crowdsourcing, which includes platforms such as 99 designs and crowdfunding sites like Kickstarter and Indiegogo.

From Outsourcing to Crowdsourcing

There was a time when if you wanted something done affordably and efficiently you would outsource it to somebody else. However, it was beyond your capabilities. Call centres to India, cheap labor in China, it is a crux of capitalist society. Outsourcing is of course still common place in many areas of business. But as is the nature of the internet and technology, a new concept is quickly rising in popularity. It’s called Crowdsourcing and everyone seems to be doing it.

Crowdsourcing Definition

But what does it mean? The truth is despite the new-fangled term. Crowdsourcing still follows the basic principles of outsourcing. I.e. contracting jobs out to third parties. However with the wide reach of the internet it functions in a new limitless environment. The internet has an ability to improve our communication. This brings with it much more focus on creativity. Also, the outsourcing of ideas themselves, rather than presenting a rigid set of instructions for a set few to follow.

So in short crowdsourcing is enlisting the services of a number of disparate people, from the online community.

The Wisdom Of The Crowd

Proponents of the practise believe that its key benefit is in the phenomenon of collective intelligence. This occurs when a project is opened up to a broad and diverse range of people (which the internet enables), who can collectively accomplish more than any one person or predefined team. If pitted against each other in a competition setting. The end result might also be better than choosing one individual or group from the beginning. Everyone is striving to be the best.

Imagine for a moment it’s 1991 and a small business is looking to launch a new marketing campaign. They would have to rely on employees within the company or a local marketing firm to generate ideas. Also, get the campaign off the ground. Today that company could turn to a crowdsourcing platform and tap in to great minds all over the world. They could even put them in competition against each other for even better results.

Whether a specific task needs completing, a problem needs solving or ideas need generating, the so called wisdom of the crowd will always outperform that of a single expert or grouping. China based crowdsourcing agency Zhubajie facilitates over 8 million people alone. Before the internet who had access to 8 million people?

Yet despite its ties to modern day web platforms, crowdsourcing has actually been around in the offline world for many years too. Did you know that in 1901 the designing of the Australian national flag was crowdsourced via a competition of 30,000 designers? Those Aussies also turned to the crowd to design the Sydney Opera House in 1956. It is one of the 20th century’s most famous and distinctive buildings. The internet has just made the process more efficient and versatile.

In the modern day some uses of crowdsourcing are a little unsettling. The US Navy for example has allowed teenage gamers access to video games based on their strategies, to work out which would be most effective in real life. Perhaps 80s classic War Games wasn’t just a movie!?

Crowdsourcing Examples

In theory you can crowdsource virtually anything you would traditionally outsource. Crowdsourced projects however typically fall in to one of the following categories:

Crowd Voting. Using the crowd to vote on which idea to go with or how to proceed with a project, including anything from the name of a product to which article appears on the front page of a website. (Crowd voting is integral on community driven sites like Reddit).

Crowd Competition. Just like the Aussie flag and Opera House, a crowd competition is used to find the best of the best, whether that be a product design or a trailer for a movie.

Crowd Collaboration. Using the collective intelligence of the crowd to outsource skills, ideas and problem solving. Startups commonly use crowdsourcing to fill the roles needed to develop the business or even brainstorm the initial idea.

Crowdfunding. Using the reach of the internet to generate funding for a project or cause, by accepting donations from individuals through platforms like Kickstarter and Indiegogo. This is common for startups that have a seemingly popular and innovative idea but can’t secure funding in the traditional way. It is often future customers that pledge their money.

To Crowdsource of Not to Crowdsource

Having access to an entire globe of skilled workers is one thing. It increases the available options and maximizes creativity, but what other reasons are there to utilize crowdsourcing?

Firstly you are not responsible for accommodating remote workers. So a company’s intangible assets and overhead costs are reduced compared to doing the work in-house. Likewise the amount it costs to crowdsource is often cheaper than doing it in-house, because the global market drives down rates. The 99 Designs graphic design marketplace which allows you to crowdsource design work, will typically work out cheaper than approaching a singular design company.

Other benefits are not necessarily to do with money. Crowdsourcing can often double as a marketing effort, as online buzz about a project can go viral. Using crowdfunding websites like Kickstarter or Go Fund Me UK is also a great way to connect with customers and build anticipation. They are part of the project, funded it and are passionate about promoting it.

This doesn’t mean there aren’t downsides. If you choose the wrong platform or haphazardly launch a crowdsourcing project, you run the risk of getting poor quality and unreliable results. There is no guarantee or contract that states the project must be completed to a certain standard or at all. And not everyone from the crowd will be an expert (depending on the type of project you launch).

There is also a lack of confidentiality on commercial crowdsourcing sites. If you have a you are developing a top secret product that you don’t want the competition to discover, crowdsourcing is simply not an option because it requires you to open everything up to the world.

The Big Players

While crowdsourcing is common among small businesses and the startup scene, corporate giants like Microsoft, Samsung, Google and Apple, have all used it to help bolster their creative endeavours and product development. Windows 10 for example was tested by the public and third party developers via the Windows Insider Program. Their feedback directly influenced the development of the operating system and the features found in the public release.

In 2013 Google was so impressed with the Waze app which gathers real time traffic and road news from users – the crowd. They acquired it for $1 billion!

Overall there was a 30% increase in crowdsourcing among major brands in 2015, with the likes of Johnson & Johnson upping their use of the method by 186%.

There’s no sign of it slowing down.

Women Leading The Charge

When you think of new technology and the internet, you tend to imagine the male dominated hub of Silicon Valley and icons like Steve Jobs or Bill Gates. Yet the data suggests it is women leading the charge in crowdsourcing, at least in terms of those doing crowdsourcing jobs. Over 60% of such workers are female.

What’s not a surprise is the tech savy millennial generation are the majority overall demographic. There are 70% of crowd workers falling in to the age group. Most crowd workers tend to already be employed and are using the opportunity to make extra cash as a side activity. Those that do it full time are likely already full time freelancers, using crowdsourcing platforms as another avenue to find work.

What adopters of crowdsourcing are beginning to recognize is that it’s an invaluable method of reaching their target audience, a focus group that’s intimately tied to the development process. In a way, the consumers are becoming the producers and/or financers. This is very clear on Kickstarter and Indiegogo, where the success of a products often determined by weather the public will pay money upfront.

The big take away however is that it works. 92% of web based crowdsourced projects have been successful!

Top Platforms

99 Designs: Crowdsource your design project from a large pool of skilled individuals and qualified professionals.

Design Crowd: Another leading graphic design marketplace.

Kickstarter: Leading crowdfunding platform allowing users to pledge money for perks or a copy of the finished product.

Amazon Mechanical Turks: Crowdsource technical tasks that cannot be automated without humans.

Chaordix: Creative Problem Solving, Design Thinking, and Systematic Creativity, from the crowd.  Used by brands like Lego, HTC and American Airlines.

Fiverr: Leading freelancer site, built on the simple concept of $5 per task.

Indiegogo: Crowdfunding UK style, allowing you to set a funding goal that if not met refunds the donors.

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