Research reveals that 90 percent of crowdsourcing flops

low-hanging-fruitIt’s tempting to think that crowdsourcing has nothing but upside to it.  After all, the social cost is largely outsourced to the participants, with you just having to select the winners.

Alas, that isn’t always the case.  I wrote earlier this year about the management costs involved, especially as participants grow to critical mass.

Unfortunately, that particular problem is not something that most crowdsourcing sponsors have to worry about.  A recent study found that under 10 percent of projects attract a decent level of participation.

The reality of crowdsourcing

The research saw the performance of some 23,809 organizations that had accessed crowdsourcing software to solicit new ideas from external sources.

The results were far from flattering, with just 1 percent of those organizations obtaining even one suggestion per day, with around 90 percent receiving less than 30 suggests per year, and half attracting barely any level of participation at all.

In other words, for the vast majority of organizations, crowdsourcing has been an unmitigated flop.  It underlines that just because social tools have made it much easier to solicit engagement from external parties, that is certainly no guarantee that such engagement will be forthcoming.

The authors suggest that many organizations have been blinded by the potential of crowdsourcing to provide ‘cheap innovation’, and have subsequently failed to invest in appropriate management of their projects to attract participation and ensure the best ideas are worked on.

How to achieve crowdsourcing success

This was reflected in the performance of those at the higher end of the spectrum, who nearly all invested substantially in their projects, both in terms of time and resources.  This involvement was particularly pronounced in the early stages.

The study found that this attention typically came in two forms.  Proactive attention was valuable in the sense that organizations contributed ideas themselves in order to get feedback from the crowd.  This helps to warm the crowd up by giving them an easier way of participating, with the hope that they will then progress to suggesting ideas of their own.

Reactive attention then sees the organization respond to suggestions promptly from the crowd.  This can take many forms, from reporting on the implementation of ideas all the way through to saying thank you for suggestions.  This attention is particularly valuable for new users who perhaps feel less emboldened than their more established peers.

Unfortunately, the study found that most organizations do the opposite of what is recommended, and only devote attention to the project once it’s proven itself.

It’s all about relationships

There is a temptation when it comes to crowdsourcing to regard it as an impersonal process.  Alas, the study found that the true value comes not from the collected wisdom of the crowd, but from the relationships that are born out of the engagement.

The cultivation of these relationships takes as much time and effort as you would expend on any valuable relationship, but it’s a level of effort that few organizations appear willing to commit.

It’s important, therefore, not to regard crowdsourcing as innovation on the cheap, and to ensure that you have the right level of resources to build and cultivate those relationships before you embark down that road.  This is especially so as a slow start is often difficult to recover from.

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4 thoughts on “Research reveals that 90 percent of crowdsourcing flops

  1. Goodness. I kind of imagined that the number would be reasonably high, but no way did I imagine it would be quite that high. That's shocking.

  2. And lets face it, this is just basing success on ideas submitted. If we based it on ideas actually implemented I reckon the success rate would be tiny.

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