Crowdsourcing can help SMEs expand

Many of the prominent examples of businesses using crowdsourcing are large multinationals. Toy giant Lego, for example, encourages its vast fan base to pitch new product ideas through an online platform, while Procter & Gamble has used external “innovation tournaments” to find new ways of cutting corporate energy waste. But Allan Szymczyk, co-founder of London-based drinks business Agora, believes SMEs can learn just as much by tapping into the wisdom of crowds.

Every decision at Agora, from product design to marketing strategy, is voted for by an online community through a system of “likes”. Founded by Szymczyk and Jan Verwijs, Agora uses Facebook, Twitter and LinkedIn to drive interest in decisions, and the community recently decided on Agora’s first product – raspberry and mint-flavoured water.

“Of course it’s much easier for Lego to generate new ideas,” Szymczyk says. “Its exposure is immense, and it has an enormous customer base to draw on.” But having a smaller crowd can also be an advantage, he argues. Lego’s system requires a project to have the support of 10,000 users before the company looks into it, but Agora’s threshold is considerably lower. “It means any one individual can have a greater impact on the business, and that motivates people to be more engaged,” Szymczyk says.

Equally important, however, is making sure that contributors have the right incentives. “It can be difficult to get the right people to spend time on these decisions – it’s something that any enterprise using crowdsourcing needs to think about.” Designing a label, he says, seems to be well outside the area of competence of many of Agora’s users, and a few of the suggestions reflected this.

At Agora, the incentives for contributors are both monetary and non-monetary. “People like to feel part of something they believe in, like with Wikipedia.” Agora’s users also get to vote on the distribution of profits, with the payouts related to the success of a user’s past submissions.

If the system is structured well, Szymczyk says, the results can be impressive. “Another upside is that we save on publicity and marketing – there’s already an interested group that has been involved in the development of the product.”

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