Sample of participants in crowdsourcing contests.
Nowadays, companies have to increasingly face a lack of internal creative ideas. This has led them to outsource their ideation process through crowdsourcing contests in order to benefit from the creativity of participants on the Internet. Crowdsourcing is a successful outsourcing strategy for companies but includes some limitations that the authors recall in this chapter. Since some authors tend to praise the merits of this new practice, others are suspicious regarding certain aspects of its application. It is in this context that the authors offer a synthetic view on the benefits and risks of creative crowdsourcing. They also offer an analysis of applicable strategies that are commonly used to circumvent major obstacles related to the organization of creative contests and to improve the success of a crowdsourcing campaign. Based on the literature and the results of two qualitative studies, the authors point out the main managerial implications of crowdsourcing initiatives in terms of implementation, benefits, limits and conditions of success.
- conditions of success
Crowdsourcing is defined as “the act of taking a job done by the employees of a company or institution and outsourcing this task to a large and undefined group of Internet users in the form of an open call for contribution” [1, 2]. Crowdsourcing is implemented by companies to meet a variety of needs, ranging from simple or routine tasks (e.g., data collection, proposal of informational content) to creative or ideational such as artistic design [3, 4].
A company is invited to choose among two broad options when it comes to setting up crowdsourcing practices. The first is based on the creation of dedicated platforms allowing them to permanently receive fresh ideas and suggestions (e.g., IdeaStorm of Dell, Cvous, Open Oxylane, MyStarbucks Idea). The second is to use specialized intermediation platforms (e.g., Mechanical Turk for simple crowdsourcing or routine activities; eYeka, Creads ou Studyka for creative crowdsourcing activities; and Innocentive for crowdsourcing of inventive activities) [5, 6, 7].
One of the most popular and promising crowdsourcing initiatives is crowdsourcing contests . Companies are increasingly using crowdsourcing contests in different industries for both problem-solving and decision-making. They may take the form of idea competitions, design competitions, idea contests or innovation and research tournaments .
The increased use of crowdsourcing activities can be explained by the different benefits it provides for companies: the possibility of gathering new ideas to complement those of professionals [10, 11], accelerating innovation , reducing the launch failure rates of new products and services , low cost innovation [14, 15] or strengthening the customer relationship and improving the image of the company [10, 16].
While several researchers recommend the use of crowdsourcing for its multiple benefits [2, 3, 17], others agree on the difficulties encountered in setting up these campaigns. They allude the difficulty of finding potential participants or evaluating the large number of proposals received by the crowd [4, 11, 18]. Similarly, some authors argue about the risk of generating negative feelings, which is essentially linked to the perceived unfairness by participants (i.e., not all participants are equally rewarded at the height of their efforts) (Decoopman and Djelassi, 2009; [3, 19, 20]).
Based on the context provided earlier, this chapter seeks to provide a comprehensive overview on creative crowdsourcing strategies. Prominent authors have different opinions regarding crowdsourcing practices. Some authors tend to praise the merits of this new practice, while others are skeptical regarding certain aspects of its application. It is in this context that the authors offer a synthetic view on the benefits and risks of creative crowdsourcing. This chapter will also offer an analysis of applicable strategies that are commonly used to circumvent major obstacles related to the organization of creative contests, and to improve the success of a crowdsourcing campaign. The chapter is organized as follows. The authors begin with presenting the methodology employed to systematically provide an insightful synthetic framework. Then, based on the literature and the results of two qualitative studies, the authors point out the main managerial implication of crowdsourcing initiatives in terms of implementation, benefits, limits and conditions of success.
2. Research methodology
Using a qualitative approach by interviewing experts and participants in crowdsourcing contests, this chapter seeks to understand the main benefits and limits of this particular outsourcing strategy. The authors also aim to shed light on its conditions of success. Therefore, we collected insights from fifteen semi-structured interviews with participants in crowdsourcing contests (cf. Table 1), and ten interviews with managers in charge of crowdsourcing contests (cf. Table 2). We ensured for information richness through sample diversity . Both, participants and managers, were rigorously selected according to diversity criteria, i.e. age, gender, and profession . Moreover, the authors ensured that participants varied in their amount of experience with crowdsourcing contests and the type of contests they participated in or managed.
|IN05||Paul||Consultant in big data||27||Studyka.com||32’|
|IN09||Jean-Louis||Financial project manager||26||Studyka.com||67’|
|IN13||Nadine||Senior advertising manager||29||Eyeka.com||41′49”|
|Company||Crowdsourcing initiative||Respondent’s position||Interview duration|
|French multinational food-products corporation||Voting for the next version of a product||Product manager||31’|
|Intermediary platform organizing individual creative contests||Creative contests for well-known brands||Responsible marketing||55’|
|French home-improvement and gardening retailer serving thirteen countries||Idea proposal and preference voting from DIY enthusiasts||Responsible for coordinating innovation projects||47’|
|Intermediary platform and French leader of student challenges||Student competitions focused on generating new ideas||Technical department manager||50’|
|Intermediary platform organizing individual creative contests for freelance designers||Creative contests about creating logos, slogans, etc. for companies||Associate director||21’|
|French multinational food-products corporation||Proposal and vote for the products to see shelves||Policy officer||60’|
|Intermediary platform organizing individual creative contests||Example contest: Submitting innovative ideas to reinvent the delivery and installation of kitchens and bathrooms||CEO||48’|
All participants were recruited through three creative contest platforms namely Studyka, eYeka and Creads. The selected platforms were of different types: The first is the French leader of student innovation group challenges. The second platform offers individual challenges asking participants to submit ideas and original content. The last mediation platform is composed of a community of freelance graphic designers. Managers of these platforms were interviewed as well. The latter sample was completed by managers of international companies, which have launched creative contests on a national level.
3. Implementation of crowdsourcing contests
The results of the interviews with expert managers enabled us to identify six steps required to implement a crowdsourcing contest. Indeed, and far from being a simple promotional tool, crowdsourcing is a thoughtful strategy and a process structured around several steps. First (1) step is to define the problem. The question that arises is “
By carefully studying different companies’ approaches toward the organization of crowdsourcing campaigns, the authors have concluded that some companies prefer outsourcing the crowdsourcing procedure to specialized mediating platforms such as eYeka, Studyka or Creads. This is mainly due to a lack of internal resources or expertise “
These mediating platforms position themselves as advisers and support companies by giving companies access to a community and to technical tools
While several experts agree on the benefits of outsourcing crowdsourcing competitions, others, on the contrary, do not share this opinion. They advise companies to be autonomous in the management of their call for contributions. They put forward arguments related to the lack of transparency toward participants “
For instance, a recent contest launched by the French mediating platform “Studyka” (cf. Figure 2) illustrates the main steps described above.
4. When crowdsourcing is profitable for companies
The first part of this chapter shows that organizing a crowdsourcing campaign requires considerable efforts and a careful consideration of the structure and the steps of such competitions. Whether these efforts are favorable or risky has been discussed in the scientific literature. It is a difficult task to provide a clear answer regarding the profitability of creative contests. In this chapter, the authors argue that creative crowdsourcing refers to a double-edged sword, which depends on the company’s investment and involvement to a great extent. To illustrate this assumption, the authors first present the benefits that are commonly cited in the crowdsourcing literature, before addressing the risks that are generally associated with it. While presenting the different benefits and risks, the authors include citations of interviewed managers and participants to face scientific arguments to real-life observations.
4.1. Improving the commercial acceptability of products and services by the market
Even though many crowdsourcing benefits may be cited, previous research discusses the generation of new ideas tailored to the needs and expectations of consumers. It addresses the critical issue of launch failure rates of new products and services  and maximizing their commercial acceptance rate . Crowdsourcing is here perceived as a pre-test of the product before it is launched on the market . In addition, the crowd benefits through its participation from the opportunity to express its needs and to make proposals to improve existing products . Companies can probe the need of the market by having access to customer and prospect preferences, which serve them in a useful way .
As a result, by using the wisdom of the crowd, companies benefit from a broad access to participants’ skills. They thereby circumvent the limits of internal innovation . Using the crowd also allows the company to access consumer ideas and resources if they cannot solve the problem internally . Over the last years, the number of crowdsourcing initiatives, which seek to gather the freshness and diversified ideas and solutions has increased [3, 11].
In this context, Poetz and Shreirer  demonstrated that the crowdsourcing process makes it possible to produce attractive ideas whose score is significantly higher in terms of profit and novelty, and thus allows the company to gather new ideas to complement internal suggestions.
Interviewing experts shows that their sayings are in line with the scientific literature. They are unanimous in considering the need to innovate as one of the biggest priorities of crowdsourcing “
4.2. Mass of proposals at a low cost
Proponents of crowdsourcing consider that the major advantage of this practice lies in its relatively low cost [3, 4, 12]. Crowdsourcing allows the company to access a large pool of individuals around the world  and to reduce the relative cost . Several researchers point out the benefits of integrating non-experts into the innovation process, both in solving scientific problems and in the design of products and services. They offer better and less expensive solutions in comparison with traditional research development programs .
Lebraty  points out that the cost advantage is not always guaranteed because some crowdsourcing initiatives can have counterproductive effects, as the company must manage the risks of dissatisfaction. Similarly, Le Nagard and Reniou  consider that some companies perceive the cost of crowdsourcing as high (human and financial resources).
4.3. Strengthening the customer relationship and the brand image of the company
Another benefit associated with crowdsourcing is of the strengthening of the customer relationship and the brand image of the company . Crowdsourcing allows the company to improve its visibility through accessing a large group of users online .
Experts reveal that crowdsourcing allows firms to be present on the Internet and to speak about the brand, which generates positive word-of-mouth: “
Similarly, managers recognize the positive impact this proximity can have on the company’s results. “
5. When crowdsourcing carries risks for companies
Besides the many benefits of crowdsourcing as an innovation strategy, the scientific literature warns about some side effects or risks that can appear if the campaign is not managed properly. In the following paragraphs, the authors present the main limits of creative contests and confront them to the interviewed managers’ vision.
5.1. Risk of loss of control by the company
Enkel et al.  identified a set of risks that companies must manage when investing in crowdsourcing projects. For these authors, when the company loses control over the crowdsourcing process, it also risks losing control over its long-term innovation strategy. The potential risk of losing control is associated with the potential impact on the image of the company. In this case, participants who do not win become hostile toward the company . They generate negative word-of-mouth by sharing their negative experience online, which can be detrimental to the company’s brand image [33, 34]. Some researchers talk about “crowdslapping” to describe this phenomenon [2, 23].
Participants, who question the credibility of such competitions, often highlight the random and subjective nature of the gain. As a result, they do not feel rewarded for the effort they provide “
5.2. Risk of disclosure of key information
When it comes to discussing the potential risks of crowdsourcing, some researchers do not hold back to stress the risk of losing the confidentiality of certain strategic information. The open and visible nature of crowdsourcing is likely to divulge the company’s strategy to competitors .
This risk makes the company lose the advantage of benefiting from relevant ideas and proposals of the crowd (b). The risk is greater when the company engages in crowdsourcing initiatives to solve complex problems or develop new products. This finding explains why companies prefer to use traditional means of innovation and internal teams in the case of breakthrough innovations .
5.3. Risks related to ethical and legal issues
Consumer empowerment increases the complexity of managing crowdsourcing initiatives for businesses . They face ethical issues related to the management of intellectual property rights. Indeed, some participants claim the total ownership of their ideas. The absence of a clear intellectual property policy can lead to a feeling of unfairness [10, 14]. Intellectual property is considered as a sensitive topic that companies must manage with great care . Researchers insist on the need to clarify the rules related to intellectual property rights [3, 4] and on the use of ideas received by the crowd . As a result, companies need to inform participants upstream on generating new ideas. They have to make clear if they remain owners of their ideas or not .
Another ethical point is what some authors call “free work” or “free exploitation” of participants [14, 37]. If crowdsourcing is based on the voluntary participation of individuals, few proposals are “paid.” In this case, the authors talk about “over-exploitation” . They compare the amount of work provided by the crowd and its real value on the market, with the remunerations paid by the companies. Participants fear being exploited by the company, which results in a feeling of mistrust and skepticism in the way of interacting with brands.
Participants mention the negative effects that crowdsourcing generates when it comes to the exploitation of their ideas “
6. Crowdsourcing success determinants
To avoid any failure of crowdsourcing operations, we asked managers to decide on the possible determinants of success. According to them, the success of a crowdsourcing operation is often attributed by the experts to a good preparation by the company or the mediating platform “It is crucial for the company and the management to focus on preparation and clearly defining the objective of the whole exercise.” According to the managers, if the team is ready and well prepared, it is far easier to explain the objectives and to solve the problem. “
The analysis of expert interviews shows that only a good preparation is not enough. It is pivotal to communicate the message effectively through the right media to encourage consumers to participate. “
As far as the management of the reward system and intellectual property is concerned, professionals insist on the transparency and the clarity of the roles between the company and participants.”
Finally, managers consider that the success of any crowdsourcing initiative depends on the number of participants and the mass of contributions they are capable to submit. “
This chapter provides a synthetic overview on a relatively recent phenomenon from a scientific point of view. While some authors support crowdsourcing initiatives by focusing on the benefits of this practice, other researchers fear that the limits linked to this outsourcing strategy outweigh its benefits. In this chapter, the authors confronted both views and analyzed the conditions of success. The authors conclude that crowdsourcing presents clear benefits and helps circumventing companies’ major internal obstacles.
However, the financial aspects of running a crowdsourcing program need to be studied carefully. Moreover, the company and the concerned professionals should commit themselves fully to this program. Their level of commitment would determine the outcome. Therefore, it is important to engage themselves at every step of the crowdsourcing program. Crowdsourcing should not be considered as a low-cost strategy. This comprehensive approach requires time and investment to yield the benefits discussed in the literature.
Crowdsourcing campaigns, if managed effectively, can reap positive results such as the inclusion of fresh and innovative ideas. It can also maximize the commercial acceptance rate of new products or services. Therefore, the professionals must be very aware of the importance of managing this strategy with great care. The failure of crowdsourcing contests can be detrimental for firms as it influences the company’s innovation strategy over the long term and can strongly affect their brand image.