What is crowdsourcing in marketing and how does it work?

By Indeed Editorial Team

Published 19 May 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Connecting with an audience and encouraging them to be part of a brand is an integral part of a businesses marketing strategy. Crowdsourcing is one effective way that marketers and researchers can utilise both internal and external resources to benefit the business. By sourcing innovations and insights from a wider community, it's possible to spread awareness, encourage sales and inspire customer loyalty. In this article, we look at what crowdsourcing is, how it works and some examples of this marketing activity in action.

What is crowdsourcing?

In answer to the question 'What is crowdsourcing', it's a marketing strategy and promotional tool businesses use to collect public opinion and insights. This information informs various product or service development activities and ongoing advertising for existing products and services. You can also use internal crowdsourcing in large-scale companies, bringing in fresh ideas and new concepts.

Crowdsourcing is a component of broader marketing plans. They typically carry this activity out in an earlier research stage, gathering public opinion to guide further research, connecting with the audience and encouraging buy-in from involved participants. Using crowdsourcing may be a marketing tool for rebranding or repositioning existing products, strengthening existing customers' connection to the brand.

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Crowdsourcing vs crowdfunding

Crowdsourcing is a specific marketing activity used to seek information and innovation. Crowdfunding is the act of seeking money to support business activities. Many crowdfunding platforms exist online to help companies and individuals in their work. While crowdsourcing and crowdfunding are two different practices, there can be some crossover. For example, early adopters or people who have bought in can affect development and change based on data gathering and polling.

Crowdsourcing in marketing

Crowdsourcing is a marketing tool for several purposes. Businesses utilise the data gathered from crowdsourcing to inform business decisions, back up existing concepts and aid in selecting campaigns and branding activities. Crowdsourcing examples include:

Product suggestions

Product suggestions involve directly asking a target audience of consumers for their input on a product. These suggestions could include changes to an existing product, a new product in the same line or a new colour or style of marketing activities. Product suggestion crowdsourcing supports businesses to design and promote a new product and encourage consumer participation, raising awareness and creating a sense of buy-in.

For example, a famous crisps brand may choose to rename one of its flavours for a particular campaign. Crisp fans might enter a competition, where they can submit an online form with their funniest suggestions for the flavour name. The top five submissions receive crowdsourcing for a second time through a public poll. This strategy raises awareness, encourages the audience to take part and offers a tangible outcome for the work put in.

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Content creation

Crowdsourced content is increasingly common for brands and businesses that want to connect to their audience personally. This type of crowdsourcing feeds directly into marketing, providing resources for the business to use while giving a feeling of participation to their audience. Contributors could provide slogans, images, audio or video for content creation, which boosts awareness and improves brand loyalty.

For example, a business that creates cameras for extreme sports could host a contest where customers can submit their own extreme videos using their product. After review, they used the top five of the best videos in the following social media advert for the brand. Participants get to take an active part in their favourite brand, while the business benefits from high-quality content that connects to audiences on a personal level.

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How does crowdsourcing work?

As a marketing process, crowdsourcing requires specific circumstances to be effective to businesses. For example, connecting with the same audience where products are selling is an effective way to gauge how their target market may react to a product change or new service. The basic conditions for crowdsourcing are:

Clearly defined concepts

Crowdsourcing that's muddy or confusing for the audience is less likely to deliver precise results. It's essential to have a clear idea of the product, concept or campaign to achieve helpful feedback. A clear definition can allow for better clarity in response and make it easier to adapt the specific concept to make better use of suggestions and ideas.

Information collection

The collection and collation of data are important in the crowdsourcing process. By defining requirements for participation, the gathering and combining of data and information is easier and more effective for practical use. For example, an online poll with defined questions or a simple form may be preferable to an open discussion for information collection purposes.

Diversity

Diversity in crowdsourcing can provide access to a broad reach of different opinions and insights that may not be available otherwise. By reaching out to a broad audience with a wide net, crowdsourcing can prove successful in capturing the different opinions and ideas of a wide range of different people. This diversity is helpful to enact change in ways that benefit the wider audience rather than a small section of the total audience of a product.

Qualified submissions

Qualifying participants is as vital in crowdsourcing as it's in making sales. Utilising participants that have the knowledge and experience to provide qualified information is invaluable. If the purpose of crowdsourcing is for a highly specific purpose, using motivated, qualified individuals can help to support this practice.

Selection

All ideas and data submitted during crowdsourcing can be further condensed and examined in-house. These extra checks allow marketing professionals to identify powerful ideas, themes and concepts, which inform changes and other campaign activity. Selection is a vital part of crowdfunding as the component that puts the gathered data into functional use.

Examples of crowdsourcing

Crowdsourcing can take a range of different forms depending on the business requirements. For example, crowdsourcing for a specific publicly available product, such as a food item, may be entirely different from crowdsourcing for a brand. Some examples of crowdsourcing include:

Public idea submissions

Public submissions for crowdsourcing are one of the most common marketing activities. These campaigns aim to encourage consumers to connect with the brand by getting involved, whether that's drawing their own design, providing feedback on a product or taking part in a poll. For example, having an 'ideas' page on a website where customers can submit their thoughts on new products.

Internal ideas generation

Internal ideas generation crowdsourcing is a common tool used in large-scale or international businesses. In these cases, crowdsourcing functions as a tool for internal marketing to gauge opinion and gain ideas for different in house processes, practices and implementations that work well. For example, a multinational company could crowdsource ideas from their employees on the best solution for providing snacks in the offices.

Competitions and campaigns

Competitions and campaigns are an effective form of crowdsourcing. As a more active and time-sensitive solution to gain opinion and information, these marketing activities focus on gaining data over a shorter space of time. For example, a contest to name a new flavour of ice cream would take place in the spring season instead of indefinitely.

Benefits of crowdsourcing

When used as part of a wider marketing strategy, there are many benefits to crowdsourcing. For example, crowdsourcing with an existing product audience or fan base can be an excellent way to connect with customers and improve awareness in one. Here are a few of the benefits crowdsourcing can provide:

Quality data collection

Analytics is a crucial component in measuring the success of marketing activities. Crowdsourcing can provide important data for future marketing plans and strategies. A company can collate anything from demographics to buying habits and other information.

Audience engagement

Engaging with customers and providing a 'human' element can help to improve brand loyalty and personal connection with consumers. If customers feel like they can make a difference, they're more likely to think about that product or service. Engagement can also directly contribute to increased sales and repeat custom alongside other marketing activities.

Sales generation

Generating new sales is the key priority for most businesses. Publicity through crowdsourcing, particularly with campaigns and competitions, can be an effective way to bring in new audiences. Public crowdsourcing can also help differentiate a business from its competition, improving customer opinion overall.

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Innovation and fresh ideas

One of the significant benefits of crowdsourcing is access to fresh ideas. The diversity of crowdsourcing from a wider audience can bring unexpected ideas or entirely new innovations. This process can be an effective way to track and get ahead of trends, allowing businesses to stay ahead of the curve in the products they offer and the changes they make.

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