The Fortune 500 Crowdsources Innovation , And Gets Innovative In-House

A food company wants to tell its market about its products. It wants customers to know how flexible its products can be and it wants to prove that they can use them to do more than bake bread or make basic cakes. It could turn to an advertising agency, run some focus groups or conduct some surveys. It could hire some chefs, give them some of its products and create a recipe book based on what they produce.

But the company takes a different approach.

It turns to crowdsourcing.

It runs a cooking competition open to the public in which the only rule is that participants must  use one of its products as an ingredient. The winner will receive a cash prize and the recipes made by the entrants will be shared.

Today, that sounds like a standard marketing practice. Participants would upload videos of themselves cooking to a dedicated YouTube channel. Viewers could vote for the best and anyone could browse a website and find the recipes they want to make.

But the year was 1949 and the first Pillsbury Bake-Off was taking place a long time before social media allowed for easy audience participation and content sharing. It’s taken place almost every year since then.

Crowdsourcing isn’t new but it has won a whole new lease of life. The ease with which members of the public can now interact with brands and with each other, share content and participate in a company’s work has opened a whole new opportunity for marketers. They’ve been quick to make use of it.

A timeline created by Yannig Roth, a Research Fellow at eYeka, a company that specializes in crowdsourcing, starts in 2004 with a lone “Dream Car Art Contest” by Toyota. By June 2014, it had identified nearly 60 crowdsourced projects from major brands in the first half of the year alone.

The timeline focuses largely on competitions. Participants usually have to submit a video or a design but crowdsourcing can be much broader and much more varied. We looked at how Fortune 500 companies have been using crowdsourcing recently and noticed some clear patterns.

Projects can be fairly easily divided into distinct categories — and each category tends to be dominated by a particular industry.

Tech Firms Crowdsource Solutions

Tech companies are using crowdsourcing for brainstorming. They want innovation and they’re willing to look outside the company’s walls to find it.

General Electric has used crowdsourcing several times, including to solve specific engineering problems.

In 2013, the company was looking for a way to reduce the weight of its engine brackets. It turned to GrabCAD, an online design and engineering community, and offered a $7,000 reward for the design that reduced the most weight while still being able to support the engine. The contest produced more than 1,000 entries. The winner was a young engineer from Indonesia who managed to cut the bracket’s weight by 84 percent.

When GE wanted to find an algorithm to optimize flight paths and reduce delays, it used the same approach on Kaggle,  a community of data scientists. The winner of that contest won $50,000.

And the company did it again when it wanted to improve its range of air conditioners, although this time, it gave back to the community as well. For this project, GE partnered with Quirky, a start-up that crowdsources designs and creates the best. At the end of the contest, GE opened some of its patents to inventors to build on.

Other companies with technological problems have used similar strategies. Pharmaceuticals firm Merck also turned to Kaggle to solve a very particular problem. The company was looking for the best statistical methods of predicting the biological activities of molecules associated with the side-effects of drugs. The contest ran for 60 days and delivered a $22,000 prize to George Dahl of the University of Toronto who used neural networks and deep learning algorithms to solve the problem.

Companies using sites like Kaggle and GrabCAD are appealing to a particular audience to solve technical problems. They might be mining a crowd but it’s a crowd of scientists, engineers and designers.

Upload Your Videos!

Firms whose industries are less technical might also use crowds to find innovation but they’re doing it in a slightly different way. When Pepsi wanted to find a new flavor for its Lays brand of potato chips, it didn’t use a specialized crowdsourcing platform to motivate food scientists to mix flavorings. It turned to its Facebook followers — and offered $1 million reward for the best idea.

The company has also crowdsourced innovation to find a name for its Liptons milk tea. For Doritos, it even encouraged people to create and submit their own Super Bowl commercial. It’s as though Pepsi had skipped the advertising firm completely and decided to mine good marketing ideas from the public.

Although an extreme example (few crowdsourced creative ideas are shown to an audience the size of the Super Bowl), the approach taken by Doritos is a particularly common  form of crowdsourcing, particularly for firms in the retail sector.

While technology companies appeal to scientists, retail firms in the Fortune 500 are turning to everyone in their search for creativity and audience participation.

Again and again, we found examples of big brands inviting members of the audience to upload videos, photos or designs connected to their products.

Like Pepsi, Ford has turned to the crowd to produce its marketing creative. To promote the Ford Fiesta, the company announced that it would recruit 100 “socially-connected” consumers to produce a year’s worth of advertising material for the car. They’d need to create video clips that can be shared online, used in digital ads and even adapted for magazines and newspapers.

In effect, the company was appealing to two different crowds at the same time: the 100 consumers who have the skills to create the ads; and the social media audiences of those consumers who might be willing to buy the products.

More common though, is the practice that fills Yannig Roth’s timeline: companies simply asking the public to share their photographs or video footage.

HP’s “You on You” campaign promoted its Artist Edition laptops by inviting customers to upload videos of themselves taken with the computer’s Web cam or to remix their own commercial with stock images from Getty. The only rule was that participants weren’t allowed to show their faces.

Johnson and Johnson’s “Wacky ways to wake up” wanted videos showing the ways in which a girl might wake up her best friend in the morning. The videos, which would be used to promote the company’s Clean and Clear beauty product, were voted on at the company’s Facebook page.

And Coca Cola has used uploaded videos to create campaigns for Dannon yogurt, Diet Coke. Dr. Pepper, Evian, Glaceau, Minute Maid and Sprite.

All the campaigns follow a similar pattern: a marketing company produces a plan to build engagement for a product that’s recognizable and used by the public. Users can upload their images or videos and other users can usually vote on them.

Crowdsource Your Staff

A few companies are taking slightly different approaches. In addition to crowdsourcing from the public some very large firms are crowdsourcing from among their own employees — people with a good understanding of the company’s culture and needs.

IBM has been running “jams” since 2001, bringing together staff from around the world to solve problems and create innovation. The 2006 Innovation JamTM took place online with more than 150,000 employees in 104 countries. The result was the launch of ten new IBM business with seed investments of $100 million.

In 2009, AT&T opened The Innovation Pipeline (TIP), an innovation and collaboration tool intended to bring together staff working in different areas of the company. Membership has now passed 100,000 and more than 1,600 ideas have been suggested, rated and reviewed. One of those ideas is Geocast, a platform that improves the abilities of first responders to deal with natural disasters.

Whether businesses are sourcing ideas from the public or from their employees, whether they’re mining the expertise of select audiences to solve problems or  engaging with everyone to push a brand, crowdsourcing is now established among the Fortune 500 with clear patterns to follow and tools available to make the project easy to manage.

Occasionally though, a company will look to break the mold. Union Pacific  turned to the public to suggest a route for a steam engine to take during its “Great Excursion Adventure.” Caltex, a South African oil brand owned by Chevron, used social media to keep a celebrity driving from Johannesburg to Cape Town. The public decided what the celebrity listened to, packed, and ate. And Walmart is said to have been considering crowdsourcing delivery by persuading its customers to take orders to their neighbors.

Crowdsourcing innovation might now be common and established. But even without turning to the public, crowdsourcing itself is still innovating.

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