Definition and Benefits of Crowdsourcing

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Crowdsourcing projects seek knowledge and services from a group of people, often from an online community, in order to improve decision-making and strategy. Discover how the wisdom of crowds can help with branding and problem-solving.

 

What Exactly Is Crowdsourcing?

Crowdsourcing is a method of gathering information, goods, or services from a large group of people. Crowdsourcing examples include online product and service reviews and real-time traffic app updates. Crowdsourcing can be used by entrepreneurs to gather feedback on new products and business models. Polling can be used by brands and influencers to engage their social media followers.

Crowdsourcing has long been a popular way to obtain information and goods. The British government offered a large cash reward in the 1700s to anyone who could develop an effective tool for measuring longitude at sea. The internet changed crowdsourcing even more. Jeff Howe investigates how people gain inspiration from others through crowdsourcing platforms such as social media and online review sites in "The Rise of Crowdsourcing," a 2006 Wired article.

 

3 Types of Crowdsourcing

Crowdsourcing can take several forms, including:

1. Crowdfunding: Crowdfunding, which is a combination of "crowdsourcing" and "funding," is a method of raising capital for a cause or business venture by asking a large number of people to make small donations on a crowdfunding website. Crowdfunding platforms are used by individuals, small businesses, startups, and nonprofits alike.

2. Open source: Open source is created by individuals for the benefit of a community. Copyright holders license open-source software and allow users to change, use, and distribute the software and its source code to anyone. Companies can adapt open-source algorithms to advance micro-tasking projects.

3. Outsourcing: Crowdsourcing entails communicating with an unspecified group, such as all social media followers, whereas outsourcing entails delegating a minor task or study to a formal party, such as a consultant.

 

Examples of Crowdsourcing

Crowdsourcing could be used by a company undergoing a rebranding to find an artist to create a new graphic design identity for the company. Stakeholders could solicit graphic design submissions or hold an online visual design contest. As a form of engagement, stakeholders may also release the plans on social media.

Another example of crowdsourcing is the online encyclopedia Wikipedia. To keep the information up to date, the public can edit and contribute content (which may go through a review process).

 

Advantages of Crowdsourcing

Crowdsourcing can provide numerous advantages to a business. Among the benefits are:

1. Access: Crowdsourcing can provide you with more immediate and broad access to your audience's thoughts. Coming up with ideas in an office with a few peers is not the same as asking a crowd of thousands what they think. Crowdsourcing allows businesses to hear directly from their customers.

2. Costs: Consultants can be costly. Crowdsourcing is a low-cost way to assess the health of your business model.

3. Visibility: Crowdsourcing can result in higher engagement rates, which can lead to viral content. Crowdsourcing can help your company's online visibility and brand recognition.

 

Disadvantages of Crowdsourcing

Crowdsourcing has several disadvantages, including:

1. Few professional opinions: While crowdsourcing provides companies with the public's opinions, the ideas from respondents may be scattered or difficult to quantify. Setting up a clear feedback form aids in streamlining these efforts, but consultants will typically have a clear data analysis system in place.

2. Lack of confidentiality: When you ask a question or express a concern in front of an audience, you expose yourself to a large group of people without masking your needs. While transparency can be a good thing, it can also expose your flaws.

3. Failure: While crowdsourcing is typically a low-cost endeavor, it is possible for crowdsourcing efforts to fail. When dealing with time-sensitive issues, this can be difficult.

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