Businesses Turning to Crowdsourcing to Better Understand Customers

Posted by jartese on Oct 29, 2013 12:14:08 PM

One challenge that businesses have faced throughout history is finding innovative solutions to problems presented by customers.  In the simplest terms, nearly every business exists to solve problems for customers.  Businesses ranging from restaurants and hair salons to high-tech giants like Google are successful when they meet the needs and desires of their customers.  Continually developing, testing and implementing potential solutions can be an enormous drain on resources.   Many organizations have turned to crowdsourcing, which is the process of seeking the input or assistance of a large number of individuals to develop solutions.  These individuals may work for the company, but quite often, they are volunteers.

There are certain situations that crowdsourcing works particularly well for.  If a fashion company, for instance, is considering options for a new clothing line, they could show samples to a large number of people and quickly find the characteristics that consumers are likely to appreciate.  Restaurant chains quite often use similar methods to test new menu items.  Another use for crowdsourcing is finding solutions to complex problems.  A major issue for pharmaceutical companies is finding the appropriate configurations of protein molecules.  Researchers from the University of Washington developed a game that encourages large numbers of people to create protein configurations.  I think configurations that meet certain criteria are sent to the laboratory for further research.  The idea is that when enough people are attempting to solve a problem, the odds are good that at least one of them will come up with a workable solution.

There are various traditional methods of crowdsourcing.  Businesses have used focus groups to evaluate new products for many years.  Using a focus group, companies can quickly get opinions from a large number of people regarding new products.  Another method for getting a large number of people to work on business problems is to have a contest.  Even a small reward can be a powerful incentive.  Competition can also be a motivation; many people are willing to work hard simply for the satisfaction of outperforming other people.

In recent years, social media has become extremely popular method for crowdsourcing.  Businesses can easily get feedback from hundreds or thousands of people simply by posting messages on Facebook, Twitter or other social media platforms.  This can be an extremely cost-effective way to gauge public opinion.  Political campaigns routinely use this method to determine what issues voters are likely to respond to; this information is invaluable and can influence everything from talking points and advertising to party platforms.  In the 2012 presidential election, the Obama and Romney campaigns spent more than $50 million on online campaigning, much of which revolved around social media.

No matter what the industry, businesses succeed by effectively serving customers and other stakeholders.  Crowdsourcing can be an inexpensive and useful method to find out what customers need and want and how best to meet those needs.  Receiving the feedback, opinions and assistance of a large group of individuals, in return for a relatively small investment makes crowdsourcing a trend that will likely continue long into the future.  Businesses that take advantage of this opportunity will likely be more successful than those that do not.

Topics: Innovation Insights

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