Crowdsourcing – Definition

Cite this article as:"Crowdsourcing – Definition," in The Business Professor, updated September 15, 2019, last accessed December 4, 2020, https://thebusinessprofessor.com/lesson/crowdsourcing-definition/.

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Crowdsourcing Definition

Crowdsourcing refers to the obtaining of work, data, or public opinion from a large group of persons who deliver or submit their information via social media platforms, the internet or any other related means. Most crowdsourcing employees primarily work as paid freelancers, while a significant number are typical volunteers performing small tasks on seldom basis. A good example of volunteers in crowdsourcing are persons who provide public reviews about a restaurant, or a hotel for the benefit of others who had thought about going there. These individuals in this case usually work with real-time GPS apps like Google, or top review sites like Glassdoor.

A Little More on What is Crowdsourcing

Crowdsourcing makes life easier for businesses as it allows them search for top talents and willing volunteers in any part of the world with access to the internet. Businesses usually engage in this activity to pick out top skills and persons with experience for certain tasks, or simply to get people’s opinion about their products or about their proposed models. Crowdsourcing is attractive to businesses, as it eliminates the high cost of hiring an in-house team member to complete specific tasks, which they may, for may not be familiar with. This process is usually carried out by taking an enormous project and splitting it into different portions for people to work on separately. An example would be a from in need of a website for their brand. Instead of just hiring an traditional employee to work on the establishment of the website, the design, the exposure, content, marketing, sales and other aspects, the business can just choose to crowdsource professionals along the globe who are certified experts in different fields of such project. Thus, they get to hire a writer, a designer, and SEO, a salesperson, a marketer, and even a market researcher. Of course the latter process is cheaper and faster.

Crowdsourcing helps businesses save more money on specific projects. This shouldn’t however be confused with crowdfunding, which serves as a way to secure capital financing for specific projects. While traditional financing method requires you to pass through intermediaries to get financed, crowdfunding gives you straight access to persons who are willing to fund your projects. Crowdsourcing on the other hand, gives you direct access to a large network of professionals that are willing to take your ideas and turn them into reality.

Crowdsourcing can be implemented in any job type, no matter the complexity. There are different experts that are available for hire on contract terms, and no matter what field you’re interested in, there’s always someone out there for you. Website Designers and Virtual Assistants are examples of crowdsourced projects, while something like Lyft is an example of a crowdsourced transport system. Also, a platform like ClickBank is an example of a crowdsourced marketing channel.

As we stated earlier, crowdsourcing can relate to volunteering and persons involved don’t always get paid for their services. An example would be the public opinion which a firm gets on their existing services in form of survey reports. Also, if a business wants to release a new product, they might choose to ask for public opinion, so they can get a glimpse of how the product will affect different demographics. Beta testing of apps is also an example of crowdsourcing.

Crowdsourcing can also be used by big businesses to determine how different professional fits their business needs. For instance, if a business needs a logo designer, it might request for samples from different designers and pick the one which fits their model the most. Of course, they will need to pay for the samples, but the cost will be minute compared to the price of the completed project.

Pros of Crowdsourcing

Crowdsourcing has different advantages to the small and large business alike. This system helps firms to cut down cost, increase the speed of project completion, and gives companies the opportunity to work with top-notch professionals. If an employee will require a minimum of a month to complete a project, it wouldn’t take up to 2 days for the same project to be completed when crowdsourced to different professionals. An example of such condition would be the illustration of a brand’s website given above. Also, if a firm needs jobs on seldom basis, like graphic or logo design, or creation and updating of business plans on paper, they can opt for crowdsourcing rather than hiring a full-time employee who will rarely be busy.

Crowdsourcing and Crowdfunding: The Difference

Crowdsourcing is used by businesses to get professionals and also seek public opinions in future products and services. Crowdfunding on the other hand focuses particularly on getting money or funds for an individual, a business, or a charity without seeking out loans. The latter is quite similar to fundraising, except that you’re not giving the donor anything in return.

Reference for “Crowdsourcing”

https://en.wikipedia.org/wiki/Crowdsourcing

https://crowdsourcingweek.com/what-is-crowdsourcing/

https://www.investopedia.com › Investing › Financial Analysis

https://www.businessnewsdaily.com/4025-what-is-crowdsourcing.html

https://www.thebalancecareers.com › … › Work-at-Home Basics

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