Crowdsourcing is more than just asking your Facebook friends for restaurant recommendations or polling your Instagram followers to vote on their favorite outfit. It’s also a helpful business tool to accelerate innovation.
The term—a portmanteau of “crowd” and “outsourcing”—was coined in 2006 by author and business journalist Jeff Howe. Today, organizations use crowdsourcing in many contexts and across an array of industries, from studying lunar images as part of the Moon Zoo crowdsourcing project to conceptualizing new ideas for home goods as part of Ikea’s Co-Create program.
Today, crowdsourcing is a vital part of the business innovation process, giving companies access to a volunteer global workforce of internet users. Learn more about how to find winning ideas through a crowdsourcing campaign.
Free Guide: How to Find a Profitable Product to Sell Online
Excited about starting a business, but not sure where to start? This free, comprehensive guide will teach you how to find great, newly trending products with high sales potential.
What is crowdsourcing?
Crowdsourcing occurs when businesses tap into the general public for ideas, feedback, opinions, and services around a shared goal or question. Businesses can use modern crowdsourcing to gather ideas from a large group of people via social media, smartphone apps, or dedicated crowdsourcing platforms.
From a business perspective, a successful crowdsourcing campaign leverages collective intelligence for problem solving and idea generation. By drawing on a vast pool of people from diverse backgrounds and experiences, companies can discover innovative ideas and robust solutions by using external knowledge that transcends their boardrooms and offices.
Crowdsourcing allows for open innovation and collaborative efforts in many forms, from a basic social media poll to contests involving prize money. These efforts can offer a useful data point too. Active participation can mean you’ve struck a chord with your audience or found an enthusiastic base.
Types of crowdsourcing
Although the right form of crowdsourcing may vary depending on your business needs, the most common forms include:
-
Idea crowdsourcing. Idea crowdsourcing involves asking an audience for thoughts and insights around a particular subject area, including new ideas for products or a marketing campaign.
-
Task crowdsourcing. Task crowdsourcing calls on a group of people to divide and conquer a particular task, such as website development.
-
Feedback crowdsourcing. Use feedback crowdsourcing to gather opinions from consumers about products and services, essentially conducting market research to solve problems and drive innovation.
-
Design crowdsourcing. Design crowdsourcing taps into groups of people to provide graphic design expertise or work on company logos, products, and packaging.
-
Contest crowdsourcing. Contest crowdsourcing encourages active participation through financial incentives, offering prize money for the best ideas and most innovative solutions.
-
Crowdfunding. Individuals and organizations can also use crowdsourcing to raise money for a particular effort or cause. People often raise capital by using crowdfunding sites like Kickstarter and Indiegogo.
-
Crowdsourced testing. Your organization can use crowdsourcing to test new apps, letting you collect real-time feedback and data from beta users ahead of a formal launch.
Examples of crowdsourcing
Many companies use crowdsourcing to improve their products and services. Some successful crowdsourcing examples include:
1. perfectwhitetee
Jen Menchasca and Lisa Hickey are the founders of perfectwhitetee, an apparel brand. Crowdsourcing has helped inform what types of products they include in their line of high-quality basics. According to Menchasca, the co-founders regularly pick the brains of their team, friends, and sales representatives to hear what items they’d like to see in future collections.
For Hickey, the nature of operating a direct-to-consumer (DTC) clothing line lends itself to crowdsourcing solutions and feedback in reviews and comments. “We love having that consumer that can tell us [what’s working] right away,” Hickey says on an episode of the Shopify Masters podcast. “We can put something on the website and find out, ‘Hey, this is a hit. Look, they’re loving this sweatshirt or they’re loving this fit and they’re leaving reviews and comments.’”
2. Minted New York
Marcus Milione grew his apparel brand, Minted New York, by sharing his journey online and sourcing feedback from his audience. He primarily uses TikTok to share his story, behind-the-scenes looks at his business, and requests for feedback.
One such instance of feedback crowdsourcing was particularly successful when Marcus shared a prototype for a tote bag with a rigid strap. “I wore it in a video and got tons of comments about wanting [the strap] to be adjustable. It was something I hadn’t even thought about,” Marcus says on an episode of the Shopify Masters podcast. He was able to iterate on the product and make it that much more covetable to his audience.
3. Taaluma Totes
At Taaluma Totes, crowdsourcing plays a central role in how the socially responsible travel bag company operates. Customers help source fabrics and raw materials during their travels around the world. Taluuma Totes then uses these materials on its bags, allowing shoppers to essentially serve as business partners.
“In the beginning, it was just the two of us finding fabrics around the world, and now that’s expanded to anyone who’s traveling and wants to help us source fabric,” Taaluma Totes co-founder Alley DuFour says on an episode of the Shopify Masters podcast. “Any traveler can go out there and find fabric to send us and we’ll put their line of backpacks on our website as well.”
Pros and cons of crowdsourcing
Although there are many advantages of crowdsourcing, there are also a few downsides to consider. Here are some key benefits and drawbacks:
Pros
-
Builds community. One of the primary advantages of crowdsourcing is encouraging groups of people to unite around solving a problem or working toward a common goal.
-
Time and cost savings. Splitting tasks among a group of people can make a project more efficient and cheaper.
-
Provides diverse perspectives. Outsourcing feedback and ideas to the general public opens your business to a wide range of viewpoints from people with different backgrounds and experiences.
-
Solves customer problems. Crowdsourcing can help identify unexpected solutions to your business problems by taking the issue outside company walls.
-
Leads to better customer data. Including target audiences in crowdsourcing may help your business build stronger customer engagement down the road and thus better venues to gather data and build loyalty.
Cons
-
Lack of confidentiality. Crowdsourcing usually is a public endeavor, potentially making it difficult to keep certain ideas or feedback confidential, especially if they’re shared on an online forum or social media platform.
-
Less control. Opening up feedback and ideas to the public means that a business owner may have limited control over the responses and how the crowdsourcing effort is perceived publicly.
-
Inconsistent results. A crowdsourcing venture may yield skewed results depending on the audience demographic, which could degrade or alter the intended result.
Crowdsourcing FAQ
What is an example of crowdsourcing?
There are several successful crowdsourcing examples among some of the most prominent companies in the world. Crowdsourcing is common on traffic apps like Waze, for example, which asks users to submit and corroborate reports of road accidents or traffic congestion to provide the most accurate real-time conditions.
What are crowdsourcing ideas?
Crowdsourcing comes in many formats and there are several ways to approach it. You can email your customer base seeking new product ideas or ask them to fill out a poll voting on their favorite packaging. Alternatively, you could launch a rewards contest to gather ideas for a new product or design a new logo, with the winning idea taking home the prize.
How do I start crowdsourcing?
Crowdsourcing can be as simple as using your company’s social media accounts to ask for feedback on products or organizing a small in-person event to bounce ideas off friends and professional contacts. More complex projects may involve different levels of crowdsourcing that tap into an array of audiences.
