Setting Up a Crowdsourcing Effort? Read This First.

August 22, 2013 Editor 0

Since Jeff Howe first coined the term in a 2006 Wired article, “crowdsourcing” has garnered extensive media buzz and investment dollars. It has earned praise from those who view it as a digital version of the industrial revolution, criticism from some who fear it will cheapen or commoditize their craft and skepticism from those who don’t fully understand the mechanics. Frankly, all of these viewpoints have merit.

I’ve spent the better part of a decade in crowdsourcing — five years as CEO of uTest, an angel investor in crowdsourced CAD firm, GrabCAD — and have consulted for several crowd-driven firms and reviewed dozens of crowd-based business plans for VCs. During that experience, I’ve developed my own views and insights into what makes crowdsourcing work best. And of course, our uTest experience has honed those views. And so, as we celebrate uTest’s 5th birthday, we felt it was a good opportunity to reflect on some of those hard-earned crowdsourcing lessons:

1. Find the right fit: Whether you’re considering launching a crowdsourcing business or finding a way to implement crowdsourcing into your existing organization, it’s critically important to consider the best way to structure your crowd to achieve the best results. There are various factors that must be examined: Is your crowd performing on-site vs. remote work? Will your crowd compete in single-winner contests vs. multi-winner projects? Are the projects one-off contests or recurring in nature? What incentives can be put in place to ensure engagement and success from the community?

In my experience, spaces that enable multiple winners to perform remote work on a recurring basis are a better fit for building high-growth, sustainable crowdsourcing businesses. Going remote eliminates geographic restrictions, thus opening up the community to anyone with internet access. But why is it important that the community work on a recurring basis? And why should there be multiple winners? Let me put it this way: Imagine recruiting and training a team at your own company for a long-term engagement. Now imagine telling them that only one of them would get paid. Do you think this would help with retention? Do you think your clients would be happy with a new team for every project? Probably not.

2. Crowdsourcing is not enough: Tell a prospect or potential customer that you’re a crowdsourcing company and — if you’re lucky — you might capture their interest (or perhaps just a polite “ah, cool”). Most of the time, this is the point at which they tune you out. Why? Because your prospective customers don’t care how you do something; they care about what you’re doing and, more importantly, how it will benefit them.

So never lose sight of what matters to your customers — it’s about what crowdsourcing enables them to achieve. In our case, our crowd enables customers to test their web and mobile apps under real world conditions (devices, OSes, browsers, languages), just like their end users will experience. In short, no one will write you a check for being a crowdsourcing company (well, maybe some VCs will) — they care about how it enables them to solve their problems.

3. Engaging a community: Treat the crowd as customers. Appreciate them. Understand that you have two sets of “customers” — your clients and your community. You must provide service above and beyond to both sets of constituents. Properly training and communicating is one thing (and a necessary step). But proactively delighting your community is as important as delighting your customers. Proactively providing our community of testers with opportunities to grow — including networking events, free training, games, awards and career advice — is vital to the overall nurturing of the community.

4. Incentivizing a community: Members of a community care primarily about three forms of currency: money, reputation and increasing their skill set (usually in that order). If you want the best workers in your space to join your community and stay, you must create a path for their growth in these areas. Higher pay is important but what about enabling them to share their knowledge with the rest of the community as a mentor? The one thing you cannot afford is for your valuable members to outgrow you — which happens to a shockingly high percentage of crowdsourcing firms. That doesn’t mean stifling their growth, it means empowering them in their professional journey and growing with them.

5. Supply follows demand: While vetting, building and serving a vibrant community is critically important, these things cannot be done instead of building an effective demand generation engine — whether through sales, marketing and/or reseller strategy. At uTest, we like to remind ourselves that, sometimes, the best thing we can do to create opportunities for our tester community is to win our next big customer.

Ultimately, this balance between creating new effectiveness or efficiencies for customers while celebrating and improving the lives of your community is the only way to create lasting, defensible value for all stakeholders. It’s harder than most entrepreneurs think, but for those who crack the code in their space, the rewards are great.

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Categories: HBR, Insights

Tags: Business, Community service