What is Crowdsourcing? Definition, Benefits, Types, Examples & more

What is Crowdsourcing? Definition, Benefits, Types, Examples & more
What is Crowdsourcing? Definition, Benefits, Types, Examples & more

What is Crowdsourcing? – Crowdsourcing is the collection of data, ideas, research, and content from multiple people. Find out more about the wisdom of crowds and how companies are using it!

What is Crowdsourcing?

Crowdsourcing is a process in which a company involves many people ( crowd ) to perform or generate data, ideas, content, opinions, services, knowledge, and information to achieve certain goals, solve problems, get innovation, or efficiency.

For information, the term crowdsourcing was first coined in 2006 by Wired magazine writer Jeff Howe in his article “The Rise of Crowdsourcing”. This concept builds on a theory sometimes called the “wisdom of crowds”.

When an entity requests certain resources from a group of people to achieve certain goals.

The groups involved will send related data via the internet, websites, social media, and smartphone applications. Often they are referred to as paid freelancers ( freelancers ), but many also do it voluntarily according to the type requested.

Example of crowdsourcing: when you give online testimonials about cafes, restaurants, malls, and so on. You are a productive contributor to the wisdom of crowds because you have provided relevant information needed by the audience.

Crowdsourcing Benefits

The use of the wisdom of crowds allows companies to save time and money in getting any information to launch a project. Come on, understand more about what crowdsourcing is for!

1. Filling a Position that Doesn’t exist in the Company

Companies can leverage crowdsourcing to work with people who have skills that internal teams may not have.

For example, a company needs a group of people with specific skills to run a project, but there is no need to recruit them as permanent employees because they are usually only needed for one project.

2. Operational Cost Efficiency

Companies can rely on crowdsourced workers such as contributors or freelancers to work on projects with fees according to what is done, no need to pay full salaries and other allowance fees.

They can do it remotely, so there is no need to spend additional operational costs either. This is a form of overhead cost efficiency while the tasks are still well done.

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3. Utilizing the Services of Other Groups

There may be a type of project where the company needs a lot of personnel from other cities or even countries, so the company can recruit crowdsourced workers.

In addition, companies can also obtain and use services and various other skills and expertise to complete their projects.

4. Speed ​​Up Work

Crowdsourced workforce groups can certainly speed up work completion, compared to relying on just one internal employee, for example. They can help complete a variety of small tasks in a project or tasks that can be done by a group of people separately.

5. Reduce Risk

The company does not risk its own time, money, or energy to manage permanent employees. With a crowdsourced workforce, companies only focus on results according to predefined terms and conditions.

6. Utilizing the Internet for Productivity

Companies can find people with the skills they are interested in through crowdsourcing sites. Companies can also use the internet to collect, obtain, and share data according to their purpose.

7. More Diversity

The company’s internal team may have run out of ideas or need input from outsiders and professionals. With a crowdsourced workforce, companies can capture and explore capabilities, ideas, values, and other data from an external perspective.

8. Collect Original Ideas

Utilize groups of people with different skills who might generate ideas that would not have been discovered through the approach that the internal team had taken.

9. Marketing and Media Coverage

Building a crowdsourced community of contributors can also get them connected with companies that resonate and build product loyalty, brand visibility, and customer loyalty, and great benefits in terms of marketing.

In addition, crowdsourcing can be a cost-effective and positive source of marketing and media coverage, especially for new services or products.

Disadvantages of Crowdsourcing

It has been explained that there are many benefits of wisdom of crowds for companies or entities that need it, but apparently, there are also disadvantages such as:

  • Lack of company confidentiality/privacy or ownership of an idea.
  • Potential for failing to achieve goals or objectives.

Check the following crowdsourcing drawbacks :

1. Difficult to Control

Companies may have a large crowdsourced workforce that can be difficult to control. There may be miscommunication, differences of opinion, or other work processes that are difficult to control so that they do not meet expectations.

2. Quantity is Higher than Quality

Tasks are outsourced to other groups, but the results may not match the set standards. If a company screens low-quality crowdsourced personnel, there may be a risk like this.

There may also be a misunderstanding in the briefing process so that the tasks completed are not appropriate.

3. Less successful

There is no guarantee that a crowdsourced workforce group including contributors and freelancers can reach the skills companies need. Therefore, you must look for the best resources so that the project results meet expectations.

Crowdsourcing Type

There are at least several types of crowdsourcing, including:

1. Crowd Contest

That is, a company or organization creates a contest to create something, for example, a graphic design for a product logo. The designer who wins with the best design will receive a certain amount of money and other awards.

2. Macrotasking

An entity is looking for a single individual to complete a particular project.

3. Microtasking

An entity is looking for multiple contributors to complete several tasks or small tasks for a large project.

4. Crowdfunding

Crowdfunding is an organization or entity asking for some kind of donation or funds to cover the costs of certain needs.

5. Crowd Voting

Request a vote (votes) to determine the best choice.

There is also crowdsourcing which is obtained for free and benefits the company or organization. For example, contributors write positive reviews, download product photos or experiences using company services on the internet, and share/promote brand products/services voluntarily.

Crowdsourcing Example

Companies need experts or contributors only for certain projects and at certain times. For example, IT personnel for coding, graphic design, freelance writing, talent, and so on.

The company will outsource that task to contributors to avoid the cost of a permanent employee within the company, as it is also not needed all the time.

Companies can look for contributors on various crowdsourcing sites, such as Flickr, Trendwatching, Idea Connection, Top Coder, and so on.

That’s a complete discussion of what crowdsourcing is to help you complete certain jobs to grow your business.