According to Gartner, a global research and advisory firm headquartered in the United States, crowdsourcing is due to increase to 75 percent by 2020.147 Its predictions even suggested that consumer goods companies using crowdsourcing would see a distinct 1 percent increase in their revenue compared to those that did not. Crowdsourcing applications involve the processes of attracting the desired participants, stimulate relevant contributions, and select winning ideas or solutions.148 Companies use online communities to help them solve problems and develop new consumer-created products and ideas. This type of crowdsourcing is a great way to interact with customers.

It enables a business to turn customers into loyal brand advocates and to reward them for the ideas that they contribute. These initiatives aim to encourage the most qualified and creative individuals to offer their ideas and to improve projects and products. There is an increasing trend toward using crowdsourcing as a research and development tool, and consumer goods companies are actively seeking consumer engagement. It is the development of technology that is making this approach more popular and workable. Crowdsourcing is not a cheap alternative;

it takes investment to be able to scan and evaluate the ideas that are being generated. Some companies, such as the American personal care company Kimberly-Clark, invite parents to submit ideas related to childcare products. The company then develops some of the ideas and provide funds to create prototypes.149 If, in the end, the company does not want the product, they will help the parents find a manufacturing partner. Another example comes from Madison Electric, which manufactures products for the professional electrician. They rebranded in 2010 and used crowdsourcing as an integral part of the process—the company developed new products based on the ideas and opinions of electricians who responded to the crowdsourcing. The inventors of the new products could choose to sell their idea to the company, earn royalties on sales, or license their ideas to the company. Since 2010, every one of the company’s new product launches has been derived from crowdsourced ideas. Thus, the company can be assured that they are developing and marketing products that their professional market needs and will buy.

Madison Electric discovered it was vital to quickly evaluate ideas and respond to the contributors.

Do you think it is right to use ideas from customers with little or no reward? How would you go about ensuring that a crowdfunded project attracted a high and consistent level of participation?

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