Presented by: FAWAD AHMED Master degree student Process System Engineering School of Chemical Tech CROWDSOURCING: COSTUMERS AS CREATORS

Introduction Commercial examples Challenges Conclusion References Discussion Content

”user-centered innovation”. Utilizing unpaid or low-paid crowd to: ▫ design products ▫ create content ▫ tackle corporate R&D problems value creation process is changing from ▫ from linear to networked ▫ from top-down to bottom-up ▫ from centralized to decentralized ▫ from closed to open Crowdsourcing - Introduction

According to Thomas Kohler 2, crowdsourcing-based business models consist of three elements 1.Open business model share ideas and technologies with others 2.Leverage technology exploit social networks, peer to peer tech, and mobile connectivity to invite users in value creation activities 3.Transfer value-creating activities crowd members co-create platforms with provider or other groups Crowdsourcing - Introduction

MIT publication shown two examples of risks management which are similar to crowdsourcing concept Threadless ▫ Chicago-based T-shirt maker Muji ▫ Japanese specialty furniture retailer Crowdsourcing - Examples

Online contest for T-shirt design Designs posted on website and scored by audience 4-6 highest rated designs in production ▫ Only after pre-orders by costumers to save money loss Winners get cash and prizes Threadless

Real motivation for crowd ▫ Own work in public ▫ Name on T-shirt label For designers, it's a creative outlet. For customers, it's a wider range of choices. For company, ▫ doesn't have to hire a design staff ▫ Production of only pre-order designs Threadless

Uses community members for new ideas Asks members to pre-evaluate design Professional designers develop highest-rated ideas or designs Run production after pre-order of 300 items by costumers. Endorsed it’s costumers top items on website Muji

Crowd-driven business model is difficult to deploy Some unsuccessful firms; ▫ Crowdspirit – communities designed products - Admits that business model was wrong ▫ Genius Crowd – helped individuals to bring ideas into market (5000 users) - Admits to reevaluate business model Crowdsourcing-Challenges

Sharing sensitive information with crowd, advantageous for competitors Do not create radical innovation, it requires insight knowledge about processes, products and company’s values Crowd may suggest existing ideas, no guarantee of plagiarism free ideas Professionals struggle to compete unknown low budget idea suppliers Crowdsourcing-Challenges

Crowdsourcing is different from traditional outsourcing, because of undefined individuals or groups Social crowd can be deploy at different stages of product development Crowd can be engage to solve problems People can be motivated by desire to learn, winning prize and setting reputation among peers Cost can be concern due to uncertain result Crowdsourcing-Conclusion

1. consumers-as-creatorshttp:// consumers-as-creators 2.Kohler, T 2015, 'Crowdsourcing-Based Business Models: HOW TO CREATE AND CAPTURE VALUE', California Management Review, 57, 4, pp , Business Source Complete, EBSCOhost, viewed 31 March Agafonovas, A, & Alonderienė, R 2013, 'VALUE CREATION IN INNOVATIONS CROWDSOURCING. EXAMPLE OF CREATIVE AGENCIES', Organizations & Markets In Emerging Economies, 4, 1, pp , Business Source Complete, EBSCOhost, viewed 31 March References

Discussion