Disrupting the business model: Tapping into the crowdsourcing community

Crowdsourcing business models have exploded over the past few years. Of all the new models that have been born out of the age of internet connectedness, crowdsourcing is right up there as one of the most disruptive.

If there is demand out there in the market, the wisdom of crowdsourcing tells us that it can most likely be fulfilled more efficiently or effectively by tapping into large networks of people online.

We’ve already seen all manner of industries disrupted by crowdsourcing; from graphic design (99 Designs, Crowdspring, Designcrowd – thanks @adrobbins) to music promotion (Sellaband), customer service (Get Satisfaction) to football team management (MyFootballClub), market intelligence (Chaordix) to medical treatment (CureTogether).

What makes crowdsourcing so disruptive to existing industry is the fact that – by its nature – it always undercuts or entirely bypasses a previously relied on/established part of the tried and tested equation.

Sometimes this is incredibly welcome. Ushahidi provides a humanitarian software platform which allows anyone to contribute information making it possible to collect, map and visualise critical trends data that helps to focus humanitarian aid efforts.

This is crowdsourcing at its finest; harnessing the power of masses of eyes and ears on the ground through technology in a way that literally wouldn’t have been possible as little as ten years ago. FixMyTransport aims to address transport issues according to demand and essentially crowdsources disgruntled passengers to lobby for their particular issue. A great idea, even if it offers no guarantees to do anything with those efforts.

Other industries and professionals haven’t been quite so welcoming of the crowdsourcing phenomenon. Designers, doctors, management teams, copywriters, journalists, software testers and investors, amongst others, have been undermined by the economics of crowdsourcing.

Demand is often dependent on price and subject to promises of effectiveness, industries where this equation is more than occasionally called into question by buyers are usually more open to attack from crowdsourcing models than others. Even farmers need to start watching their backs if MyFarm is anything to go by (ok, MyFarm doesn’t really look likely to represent a threat to the more conventional model any time soon…)

But what about businesses that do not have crowdsourcing at the core of their business model? Should they be getting in on the action? Well they are already… in their droves.

Companies from Starbucks to LG, Mountain Dew to BMW, IBM to Lego have all built successful crowdsourcing initiatives into their businesses’ wider research and development programmes, all of which have been specifically designed to sift the nuggets of gold from vast numbers of consumer insights.

The current age of social media connectedness of course makes these types of initiatives even easier to facilitate so it’s incredibly fitting that one of Facebook’s greatest strategic moves was to begin the crowdsourcing of the translation of its pages by its global community of users back in 2008.

Of course there are detractors. Steve Jobs famously relied on his and his team’s instincts for what consumers really wanted, ignoring the option of focus groups and the like. His philosophy was in the tradition of Henry Ford who famously stated ‘if I had asked people what they wanted, they would have said faster horses’.

Clearly it comes back to price and effectiveness. If either or, even better, both can be significantly improved through outsourcing to a large group of digitally connected people then there is almost certainly an opportunity to crowdsource. It’s disruptive and means people and companies on the wrong side of the equation getting a raw deal but at the end of the day it’s simple economics.

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Adrian Goodsell is Head of Digital at Steak. Steak, part of the Dentsu Network, is a full-service, international digital marketing agency specialising in paid search marketing, search engine optimisation, social media, affiliate management, display advertising and digital design. Steak’s UK clients include Virgin Holidays, Debenhams, Swiftcover.com and Dixons Retail. Steak is a previous winner of the coveted Media Agency of the Year Award at the Interactive Marketing and Advertising Awards and has offices in London, New York and Melbourne.