Why the world's top brands use crowdsourced innovation

A headshot of Judy Garvey

by Judy Garvey

Two blue cartoon people standing next to each other holding up a yellow lightbulb in between them above their heads.

As U.S. companies are spending over $460 billion a year on research and development, it's clear that innovation is a huge industry.

What the biggest brands are starting to learn is that, through the dedication of their clientele, they can learn what they should be doing next. Crowdsourced innovation is allowing brands to increase their market share in a way that's aligned with what customers want.

Feedback from comment cards and surveys is one of the oldest tricks in the book when it comes to learning from your audience. If you're involved with a local community, you can build loyalty by providing what customers are clamoring for. Taking your project directly to the public yields insight into your products that your in-house staff is too afraid to say.

Related Read: Why the innovation process should be collaborative

If you're looking to make a big change in your way of doing business, consider crowdsourced innovation. Here are 4 reasons that it works.

1. Save Money

Since you won't be spending tens of thousands on focus groups and test marketing, you'll be able to devote more money to build better products. One of the ways that you can do this is through making mistakes.

When you ask for public input through crowdsourced innovation, you can listen to what the public asks for and even follow through. If you end up with a horrendous looking prototype that doesn't adhere to your basic requirements, show that to the public. They'll know that you listen to their feedback, even when they're wrong, and will show dedication to you in kind.

By crowdsourcing your innovation, you won't be paying academics to perform hours of research to find out what your customers are thinking. They will bring it to you for free.

In order to ensure engagement from your customers, offer a small incentive, prize package, or a discount. This small concession will yield huge results and connect consumers to your company in an organic way.

2. Save Time

Setting up research and development teams costs both money and time. By crowdsourcing your research, you can get feedback immediately. Rather than spending months trying to guess what customers want, you could find out in a matter of hours.

Once you've determined what they're looking for, you know which projects to fast track. You can get prototypes and samples out to the customers who've spent the most time engaging with your crowdsourced innovation campaign. They will appreciate that you noticed their commitment and will remain engaged.

You can use this relationship as a feedback cycle for perfecting the release of your new products and services.

If you're in the food product industry, this can be a little trickier. You'll need to balance out with FDA regulations to ensure that you're protecting customer health and keeping them informed.

With other industries or for creating apps, this is a great way to build loyalty and save time in performing arduous research.

3. Think Differently

In order to think about things in a new way, you can't be constrained to the limitations of knowing what works and what doesn't. Sometimes the craziest idea, like a computer in your pocket, can become quickly normalized. A comprehensive awareness of what could go wrong can hinder the creative process.

There could be people who are using your products in a way that you never even realized. When Play-doh was invented, it was intended to be a wallpaper cleaner. It turns out that it was much better suited to build strange sculptures and to be accidentally eaten by your toddler when your back is turned.

Check out our Innovation & Crowdsourcing page for more.

You could be part of a large demographic shift that you would never have predicted. No one would have guessed that big clunky vinyl records would be sustained by people who were born long after they had been popularly produced. It turns out that if producers had listened to consumers, they might have noticed a hankering for that warm scratchy sound.

No matter what product you're creating, you're sure to be creating something that has more than one reason for existing. By listening to the crowd, you could learn something new about the product you think that you know so well.

4. Create Buzz and Hype

People love to be part of an exclusive club. If you can find a way to offer your most dedicated customers first crack at your latest products, you can build hype through exclusivity.

Try advertising on social media. Use the new products and test marketing as an opportunity to increase your profile. Require that potential customers like, comment, or even post a photo of a receipt of purchase of an earlier product.

People will start hearing the buzzing and need to know what they're missing out on.

Create viral videos, take some photos of your new products that obscure them a little. Use a little bit of mystique to engage with your customers' passion.

Get your customers to spread the word. For every customer who refers a certain amount of people to your site, you could offer them access to something exclusive.

Use crowdsourced innovation to find out more about your customers. Find out who their favorite musicians are, their favorite sports teams, and what movies they like. This can create opportunities for cross-promotional products and experiences.

By hitching your wagon to something your customers love, you can improve your profile and cement their brand loyalty.

Read Next: How you can drive engagement by aligning brand purpose with customer passion

If you haven't had the opportunity to discover what your customer base looks like, crowdsourced innovation is the perfect chance to get to know them. By sharing information about who they are and what they love about your products and services, you'll be able to get cater to your most important clients. An invigorated base will become evangelized and start spreading the word about what you do.

If you want to know more examples of customer co-creation, check out our guide to innovating and co-creating with your customers.

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