New Academic Study Confirms Success of Crowdsourcing Ideas from Customers

By | February 6, 2012

New academic research carried out at the Carnegie Mellon University (CMU), based in Pittsburgh, USA, suggests that crowdsourcing can yield high value product ideas from consumer groups. 

In Chapter 19 of Getting Results from Crowds on Using Distributed Innovation Platforms we explore how idea management platforms can be used by brands to connect with consumer communities.  The theoretical win-win is that companies are able to not only engage customers and help nourish brand loyalty, but also get some great ideas which can be put into practice. Leading organizations which have executed this successfully include Starbucks with and Dell with IdeaStorm.

The researchers at CMU acknowledge that there has been some criticism of idea management platforms directed at consumers.  They cite three reasons why crowdsourcing initiatives are sometimes regarded as not being cost effective; firstly that ideas submitted by consumers are too niche to make an impact, secondly that many of the ideas are often unrealistic and simply not feasible and thirdly that slow responses from the organizations involved leads to actually disengaging otherwise loyal customers.

However the study suggests that by having the right policies and practices in place, then more valuable ideas can be produced.  These ‘policies’ include allowing peer voting on ideas, ensuring a quick response from the organization to new ideas submitted and also giving contributors indicators of the potential cost of any idea, so they can assess if an idea has a realistic chance of implementation. The research team also advocates rewarding those whose ideas are implemented rather than those who simply contribute.

Perhaps most interestingly the researchers concluded that as a platform matures the volume of ideas may reduce, but the quality of ideas improves. They put this down to communities of consumers become more aware of the crowdsourcing process and the less valuable contributors dropping out of the platform.

Kannan Srinivasan, a Professor at the Tepper School of Business at CMU, said

 “individuals learn about their abilities to come up with high-potential ideas as well as the cost structure of a firm through peer voting and the firm’s response to contributed ideas, and individuals whose ideas do not earn the favor of their peers or the backing of the firm drop out of the process while contributors of high-potential ideas remain active.”

If it’s true that greater awareness of crowdsourcing amongst consumer groups leads to more valuable contributions, then going forward major brands may reap the collective benefits.   As using an idea management platform becomes a standard way to communicate with and engage consumers, better practices and more effective contribution from users will inevitably emerge.  Likewise there will be better community management from businesses. This ensures more value for organization and the crowd, a positive step as crowdsourcing matures and enters the mainstream.

What do you think?  Do idea management platforms engaging the views of customers produce good ideas?  As the practice becomes more common will the quality of ideas get better?

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