Crowdsourcing = Marketing or Innovation?

When companies tap into the crowd in the right way, they can reap lots of benefits. They are primarily focused on innovation and marketing and while many believe (myself included) that the “proper” form of crowdsourcing leans towards the innovation benefits, we do see lots of initiatives that are more about marketing than innovation.

I recently wrote a post on LEGO Cuusoo. This is an initiative that I like a lot and I also argued that this is more about innovation than marketing.

This spurred a good discussion with Klaus-Peter Speidel on the intersection of innovation and marketing in the context of crowdsourcing. We have some disagreeements although I don’t think we are too far from each other.

Here you get our discussion. Feel free to chip in with your views:

Speidel: Don’t agree with Stefan’s viewpoint on this. It (LEGO Cuusoo) is definitely more of a marketing than a co-creation platform. The numbers speak gor themselves: 6 ideas implemented in two years? But 10,000 votes minimum to make Lego even take a look? This ratio definitely sounds like a marketing more than co-creation platform ratio to me. We are far from what the web-based players Quirky and Threadless do. And both also produce physical items and ship them. 
Even Dell’s ideastorms implemented 200+ ideas in the first two years. Nicely done as it is, Cuusoo is mainly marketing in disguise of crowdsourcing.

Lindegaard: LEGO has always been pretty critical on the products to launch and having this in mind then I think this is just as much about innovation as marketing. A more pure marketing play in my view would be My Starbucks Idea – they definitely got people talking, but the idea implementation rate is very little. On ratio, we also need to look at the number of ideas submitted on which LEGO is not really that high as far as I can see.

Speidel: Hello Stefan, I have a follow-up question on this: I just went to see the My Starbuck Ideas site. It talks about 277 ideas implemented. This seems quite a lot to me. Why is it that you consider it a marketing initiative – and more so than Lego Cuusoo?

Lindegaard: Yes, Starbucks got lots of ideas implemented. But it is actually a very, very little fraction of all of their submissions. They just got a tremendous high volume which makes their initiative an even more successful marketing machine with a smaller innovation component. I think many companies envy the engagement Starbucks have with their customers on this initiative.

Speidel: What makes Lego Cuusoo look so marketing orientated to me is the fact that you need 10,000 people to like your suggestion for Lego even to take a look at it. This is insane compared to the 100/200 at Quirky, Threadless, etc. – where it’s also about developping products/improvements directly affecting the customer.

Lindegaard: Lego Cuusoo is definitely also a marketing play (although also with a fairly strong innovation element to it), but you are of course right that the need for 10,000 “votes” makes it look more like marketing than innovation. However, Lego also has internal processes to consider and manage and this is just much more difficult than Quirky or Threadless and thus I think it is difficult to compare on this.

Interesting discussion. Are you OK with me turning this into another blog post? Others might want to chip into our discussion 

Speidel: Yes, of course. My guess is that Lego did the maths behind Lego Factory and Lego By Me and figured it wasn’t profitable. So to make sure they wouldn’t have the same problems with Cuusoo, they set the mark extremely high. It would be interesting to see some research on who launched what and when and why they changed it the way they did…

As a closing remark, I think companies should use crowdsourcing for the purposes that suit them the best. They should also understand that there is always more than one type of benefit, when crowdsourcing is embraced properly. You can win in many ways at the same time.

It is, however, critical to have a main main focus on either innovation or marketing, because if you try to do both equally good, you are likely going to be doing both half-heartedly.

Please share your views and perspectives…

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  Stefan Lindegaard is an author, speaker and strategic advisor who focus on the topics of open innovation, social media and intrapreneurship.