my starbucks idea and the value of business crowdsourcing
TRANSCRIPT
-
7/30/2019 My Starbucks Idea and the Value of Business Crowdsourcing
1/13
MY STARBUCKS IDEA AND THE VALUEOF BUSINESS CROWDSOURCINGBY MIKE SCHOULTZ 7 CO MM EN TS
inShare
My Starbucks Idea
Within five years, if youre in the same business you are in now, youre going
to be out of business.
- Peter Drucker
The My Starbucks Idea website, where Starbucks does its business crowdsourcing, has been
actively engaging customers for over 3 years now. It encourages customers to submit ideas for
better products, improving the customer experience, and defining new community involvement,
among other categories. Clearly, Starbucks has seen and believes what Peter Drucker has to say
about business adaptability.
Customers can submit, view, and discuss submitted ideas along with employees from various
Starbucks departments Idea Partners. The company regularly polls its customers for their
favorite products and has a leaderboard to track which customers are the most active in
submitting ideas, comments, and poll participation.
http://www.digitalsparkmarketing.com/innovation/my-starbucks-idea/#commentshttp://www.digitalsparkmarketing.com/wp-content/uploads/2012/04/MY_STARBUCKS_IDEA.pnghttp://www.digitalsparkmarketing.com/innovation/my-starbucks-idea/#comments -
7/30/2019 My Starbucks Idea and the Value of Business Crowdsourcing
2/13
The site is at once a crowdsourcing tool, a market research method that brings customer priorities
to light, an on-line community, and an effective internet marketing tool.
Why is Starbucks business crowdsourcing so effective?
because they have combined the concepts of change, experimentation, social media, customer
engagement and market research and made the results key components of their dominant brand.
Have you given My Starbucks Idea a try? What did you think?
Lots of ideas here that can be easily replicated which ones do you feel could benefit your
business? How could you improve the My Starbucks Idea concept for your business
More related reading from Digital Spark Marketings blog library:
The Story of Two Roads
Are You Aware of These Surprising Facts on Innovation?
Do You Practice These Habits of the Highly Creative
Digital Spark Marketing is skillful in creative marketing and customer service/experience
design. Call us today for a free consultation we do our homework prior to meeting!
For more reading on creative marketing, click here.
http://www.digitalsparkmarketing.com/innovation/my-starbucks-idea/www.digitalsparkmarketing.comhttp://www.digitalsparkmarketing.com/2012/05/20/the-story-of-two-roads/http://www.digitalsparkmarketing.com/2012/05/14/are-you-aware-of-these-surprising-facts-on-innovation/http://www.digitalsparkmarketing.com/2012/04/22/do-you-practice-these-habits-of-the-highly-creative/http://www.digitalsparkmarketing.com/services/creative-marketing/http://www.digitalsparkmarketing.com/innovation/my-starbucks-idea/www.digitalsparkmarketing.comhttp://www.digitalsparkmarketing.com/2012/05/20/the-story-of-two-roads/http://www.digitalsparkmarketing.com/2012/05/14/are-you-aware-of-these-surprising-facts-on-innovation/http://www.digitalsparkmarketing.com/2012/04/22/do-you-practice-these-habits-of-the-highly-creative/http://www.digitalsparkmarketing.com/services/creative-marketing/ -
7/30/2019 My Starbucks Idea and the Value of Business Crowdsourcing
3/13
Crowdsourcing Risk and Reward How to Evaluate
Options for Success
25
inShare
To be upfront about where we stand, yes we are great supporters of tapping into the wisdom of
the crowd for many pursuits for citizen engagement, open innovation, or crowdfunding. That
said, we realize that its important to be aware of the fact that there are risks to consider. This
article is a response to the concerns raised by people we meet along an organizations path of
considering crowdsourcing to fulfill a particular need for their organization or their constituents.3 COMMENTS AND 0 REACTIONS
IN:STRATEGIES
To start, its important to get a few definitions out of the way in case you are new to the topic. For those withexperience with these concepts, please bear with us.
What is Crowdsourcing?
Crowdsourcing is one of those concepts that have competing definitions. On one hand, crowdsourcing is an
engagement method whereby organizations (such as cities, brands and entrepreneurs) seek input from
http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#disqus_threadhttp://www.innovationmanagement.se/category/innovation-levers/innovation-strategies/http://www.innovationmanagement.se/category/innovation-levers/innovation-strategies/http://www.printfriendly.com/print?url=http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#disqus_threadhttp://www.innovationmanagement.se/category/innovation-levers/innovation-strategies/ -
7/30/2019 My Starbucks Idea and the Value of Business Crowdsourcing
4/13
communities of people. These communities can be open or closed, homogenous or diverse. Participants are
invited to contribute ideas, solutions, or support in an open process whereby the elements of creativity,
competition and campaigning are reinforced through social media to come up with more powerful ideas or
solutions than could be obtained through other means. Ideation is also used to as a term to describe this
concept or process. Citizen engagement, open innovation and ideation are terms that are also used.
Crowdsourcing can also be defined as the division of labour by a distributed, multi-dimensional workforce,
(sometimes paid sometimes volunteer), motivated to accomplish a set of tasks that combined together to
achieve an overall goal or solve a problem. This motivation can be financial, reputation building, or part of
being a good citizen of a particular community (ie. computer programmer).
In a Bloomberg Businessweek article, Crowdsourcing: Consumers as Creators, Paul Boutin writes:
Crowdsourcing is a subset of what Eric von Hippel calls user-centered innovation, in which manufacturersrely on customers not just to define their needs, but to define the products or enhancements to meet them. But
unlike the bottom-up, ad-hoc communities that develop open-source software or better windsurfing gear,
crowdsourced work is managed and owned by a single company that sells the results.
To paraphrase von Hippel, it relies on would-be customers willingness to hand over their ideas to the company,
either cheaply or for free, in order to see them go into production for the benefit of themselves and other
customers.
Risk and perspective
Risk, always, is viewed from two perspectives: those running a crowdsourcing initiative, and those participating
in one. While this article is written for those thinking of running a crowdsourcing initiative, we thought we
should address the fact that risk is also something participants think of as well.
Participant risk
The risks participants should be aware of include:
Privacy Make sure your information is secure and used by the intended party only. This includes
personal and financial information. Checking to make sure the site you are visiting has SSL certificates active,
does not redirect you to unknown URLs (web addresses), and is not asking for information that you dont feel
comfortable giving.
-
7/30/2019 My Starbucks Idea and the Value of Business Crowdsourcing
5/13
Reputation Make sure you are dealing with authentic and transparent organizations. You wouldnt
want to be involved with an organization that is up to no good away from the Internet; so being aware of who
is running an online engagement makes sense.
Intellectual Property If you participate in a crowdsourcing or open innovation initiative, make
sure the ideas or comments you contribute are your own and not taken from someone else that might be upset
you were passing them off as yours. Ideas are open for everyone to contribute but some sites allow you to
contribute product ideas that might have a financial reward associated to them and misrepresentation can get
you into trouble.
Organizer risk
As someone who is looking at using crowdsourcing, the first thing to keep in mind is that whether you are a
brand, a city, or other organization your crowd is already talking about you. A quick search of social media
properties and traditional forums will give you the sense that for good or bad, people are talking about you
behind your back. The risk of providing a place for this conversation to happen where you can monitor and
benefit from it outweighs the risk of not doing so.
Understanding Crowdsourcing risks
Most social and business practices arent risk-free, and neither is crowdsourcing. It can be a useful tool that can
be used by individuals, citizens, or any organization or company in any industry. However, before diving into a
crowdsourcing initiative, you should evaluate and address certain risks to protect your brand and the integrity
of your organization. As with all endeavours, risk is measured on the Risk Reward continuum that is inherentfor each organization.
Evaluating risk tolerance
Successfully engaging the crowd means opening up your doors to new people, perspectives, ideas, and solutions
to problems and other things they want to share with your organization. To start, ask yourself a few simple
questions to help you set the strategy:
Question 1:What am I trying to achieve with this initiative and what is the reward?
Question 2: Is the crowd I am trying to attract external (open) or internal (closed)?
Question 3: Am I able to trust a vendor to take care of this risk or does my organization prefer to
manage it directly?
-
7/30/2019 My Starbucks Idea and the Value of Business Crowdsourcing
6/13
For many organizations, crowdsourcing may seem too risky. This perceived risk can often get in the way of open
innovation and crowdsourcing. In the article 2 Ways to Reduce Open Innovation Risk: Convert the Naysayers
and Bring on the Seasoned Veterans,Jackie Hutter, IPStrategist, writes:
In order to be successful (and not only have a single chance to try Open Innovation), one must be able to
navigate the corporate politics that would stop the process, as well being able to minimize the risk associated
with going outside for new product ideas. I think I have a solution to each of these concerns.
The Risks
As we discussed, crowdsourcing risks should be looked at with perspective in mind. The following table lists
risk to all parties for two types of crowdsourcing initiatives.
The first type of crowdsourcing is that focused on open innovation the aspect that is the most commonly used
in industry and is the basis for the first instances of using the crowd to complete tasks and come up with
solutions to problems that are technical in nature. The second type focuses on using this methodology for
engaging citizens whether it be a city, a province or state or country to not only solve problems, but also
gauge support and refine solutions for a particular community based challenge. This could be policies,
programs, etc.
Table: The risks of Crowdsourcing
Crowdsourcingfor OpenInnovation Crowdsourcingfor CitizenEngagement
Reduced internal capacity for
innovation
Lack of resources for proper
management of campaign
Gamification by special interest
groups or individuals
Gamification by special interest
groups or individuals trying to rig
the voting
Controversy over IP ownership
after idea is submitted
Confusion by the crowd caused by
lack of clarity in campaign
Confusion by the crowd caused
by lack of clarity in campaign
Participation is low due to lack ofawareness of the engagement
initiative
Originality of idea (relates to
ownership mentioned above)
Distrust among community caused
by past experiences lack of follow-
through by those running the
http://www.innovationmanagement.se/author/jackie/http://www.innovationmanagement.se/author/jackie/http://www.innovationmanagement.se/author/jackie/http://www.innovationmanagement.se/author/jackie/ -
7/30/2019 My Starbucks Idea and the Value of Business Crowdsourcing
7/13
campaign in the past.
Campaign for innovation is not
set-up to allow the organization to
respond in a timely manner
Low participation due to lack of
awareness of open innovation
initiative
The crowd stops participating due
to the perception the organization
is non-responsive to their input
Risk: Crowdsourcing does not solve your organizations problem
Some of the biggest companies in the world rely on crowdsourcing. Starbucks, Nokia, Dell, IBM, Netflix and
many, many more organizations have successfully used crowdsourcing in a number of ways. Some of the
greatest innovations at these organizations have come from the ideas brought forward by the crowd. However,
in order for crowdsourcing to work, the crowd needs to know what you expect from them and the project needs
to be very focused. Your organizations culture plays a major role in the success of crowdsourcing. In a New
York Times article by Steve Lohr, The Crowd is Wise (When its Focused), Lohr wrote about the importance of
corporate culture:
Opening the corporate doors to ideas and inspiration from the collective crowd holds great potential, but there
are pitfalls, warns Henry Chesbrough, executive director of the Center for Open Innovation at the University of
California, Berkeley. To succeed, Mr. Chesbrough said, a company must have a culture open to outside ideas
and a system for vetting and acting on them.
In business, its not how many ideas you have, he observed. What matters is how many ideas you translate
into products and services.
Risk: The crowd doesnt have the answer
Many organizations dont feel that the ideas offered by the crowd will actually solve the problem at hand or lead
to innovation suitable for investment. The solution to your problem isnt always going to be found within the
walls of your organization. Organizations are expected to do more with less, and that often means fewer
-
7/30/2019 My Starbucks Idea and the Value of Business Crowdsourcing
8/13
employees. In the article 2 Ways to Reduce Open Innovation Risk: Convert the Naysayers and Bring on the
Seasoned Veterans, Hutter writes:
Because of this extreme downsizing, however, the experienced coaches and seasoned players are not on the
usual playing fields; that is, they are not in the corporations where they learned their crafts (on someone elses
dime). Moreover, many of thempresumably the best and most entrepreneurial of themare not sitting on the
sidelines after being cut from the corporate teams for which they have been playing for many years.
Risk: Failure to participate
Some people worry that crowdsourcing is that shiny new thing that everyone wants to be part of at the
beginning, and the hype will die down a few campaigns in. Crowdsourcing isnt new. The term itself has been
around for six years or so, but organizations had been using various forms of crowdsourcing before then. Look
at the longevity of crowdsourcing projects like My Starbucks Idea, Dells Ideastorm and Nokias IdeasProject.
These projects continue to receive widespread support from their crowds and they have all been around (and
producing results) for many years. One of the things each of these organizations does well is communicate with
their crowd. These groups promote ideas that have become a reality and the crowd that they are listening and
that their ideas do have value. Simple tasks such as commenting on ideas and getting in on the conversation
help to build deeper relationships. These relationships help build loyal crowd members, who in turn get
involved in more projects and share projects with their own crowds.
Risk: Crowdsourcing takes too much time
People worry that projects will take too much time to complete if crowdsourcing introduced to the process
because of the large number of people involved and the number of submissions received. In many
organizations, they think that it will just be easier to limit participation to a team in the company or the
company as a whole because there are fewer ideas to deal with and decisions can be made faster. However, just
because you can move through a process faster, doesnt mean the solution is going to be the best one. There are
two ways to address the time issue:
Different projects require different response times
Create contest type projects that have time deadlines attached to them.
In addition to these options, youll also want to develop a plan for handling submissions so that they are all
reviewed in a timely manner. If needed, set deadlines and work backwards to figure out which activities you
need to complete and when. This will help you stay organized and keep the crowdsourcing project on track.
-
7/30/2019 My Starbucks Idea and the Value of Business Crowdsourcing
9/13
For time-sensitive projects, crowdsourcing can be used to bring large groups of people and information
together in a short period of time. Using social media to leverage your crowdsourcing project allows you to cast
a wide net, reaching your crowd to solve a problem/find an answer.
Crowdsourcing focuses on small asks, where people often have an easier time of relating to the project or
getting their head around it in order to support it to the level they wish. Reaching a wider range of people
through crowdsourcing and social media often means that projects can be funded on time.
Risk: Idea theft
Another thing organizations often worry about is idea theft. Ideas are only ideas until they are executed.
Sometimes an organization may not have the resources to execute the ideas. While some companies will modify
ideas to put their own spin on them in order to make them a reality.
Risk: Maintaining privacy
Many of the crowdsourcing platforms use technical security measures such as SSL certificates when they
develop their platforms to protect the privacy of those that participate in the campaigns run by our clients.
Because platforms often closely integrate with clients websites, making sure they are developed properly in
order protect privacy is taken seriously from the start.
Risk: Gaming the system
There are many ways to try and prevent gaming of the system but there it can be a balancing act. Restricting
access to people you know (ie. log in to access a campaign) is one option, but the problem with this is that you
risk narrow your crowd, which isnt not always desired for the campaign you are running. The crowd also does a
fairly good job of preventing people from trying to gain the system by reporting abuse, etc. Any platform that
you would consider should have security features in place that prevent gaming of the voting functionality, for
example, to ensure integrity of the system around voting and ranking.
Crowdsourcing best practices
There are a number of crowdsourcing best practices, whether for open innovation or citizen engagement that
should be considered as a way to reduce risk for your organization. Since these endeavours require
commitment to execute successfully, there are a few questions youll want to answer and research youll want to
do as a starting point.
-
7/30/2019 My Starbucks Idea and the Value of Business Crowdsourcing
10/13
In conclusion, asking whether crowdsourcing is right for you after evaluating the risks and benefits is the
natural question. You need to think about the main objective and ask if crowdsourcing is right for your
organization. Here are some questions youll want to give some thought to:
Is your organization culturally open to input from outside there is no sense going down the
crowdsourcing or open innovation path if your team is closed minded or will feel threatened?
Do you have the resources to investigate the ideas and innovation that come from the crowdsourcing
process?
Does the presence, or not, of a reward for the winning idea change things? What is the risk associated
with this?
Do you want to use internal development resources to create something from scatch or use an existing
platform? If you choose to use a platform that exists, have you considered the criteria you might use to evaluate
crowdsourcing platforms to make sure they contain the functionality you require?
Crowdsourcing risks shouldnt get in the way of enabling open innovation or citizen engagement at your
organization. Using your crowd to solve problems is a great way to make your crowd feel included and
empowered, helping boost brand loyalty. Crowdsourcing risks cannot go ignored, as wrong turns can have a
negative impact on the success of your crowdsourcing or crowdfunding project.
By Paul Dombowsky
[1]Lohr, Steve New York Times 07/19/2007
http://www.nytimes.com/2009/07/19/technology/internet/19unboxed.html/
[2]Hutter, 2 Ways to Reduce Open Innovation http://ipassetmaximizerblog.com/?p=1092
[3]Boutin, Paul BloombergBusinessweek Crowdsourcing: Consumers as Creators
http://www.businessweek.com/innovate/content/jul2006/id20060713_755844.htm
[4]Jackie Hutter,IP Strategist 2 Ways to Reduce Open Innovation Risk: Convert the Naysayers and Bring on
the Seasoned Veterans http://ipassetmaximizerblog.com/?p=1092
http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#_ftnref1http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#_ftnref1http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#_ftnref2http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#_ftnref2http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#_ftnref1http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#_ftnref1http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#_ftnref3http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#_ftnref3http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#_ftnref1http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#_ftnref2http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#_ftnref1http://www.innovationmanagement.se/2012/06/11/crowdsourcing-risk-and-reward-how-to-evaluate-options-for-success/#_ftnref3 -
7/30/2019 My Starbucks Idea and the Value of Business Crowdsourcing
11/13
About the author
Paul Dombowsky is the founder and CEO ofIdeavibes and the charity crowdfunding
initiative Fundchange. Paul started Ideavibes after over fifteen years in marketing roles at various technology or
related firms. His expertise with web marketing, social media, and marketing automation, as well as keen
interest in how social networks are now influencing all aspects of product development and marketing, laid the
foundation for building a lean web app company. Paul developed a particular interest in open innovation and
crowdsourcing through his work with TELUS Communications and his experience supporting various non-
profits since graduating from Acadia University in 1990. Ideavibes as a company, and the platform, have been
built though Pauls intent on collaborating with the best and brightest from all aspects of business, government,
and the non-profit sector.
http://www.ideavibes.com/https://www.fundchange.com/engine/fundchange/https://www.fundchange.com/engine/fundchange/http://www.ideavibes.com/https://www.fundchange.com/engine/fundchange/ -
7/30/2019 My Starbucks Idea and the Value of Business Crowdsourcing
12/13
CROWDSOURCE WHEN TIMES
ARE GOOD
Posted by Neil
Lets talk crowdsourcing for a minute. In very generic terms, crowdsourcing describes work or funding thats gathered
from a network of connected online participants. Think Wikipedia or Kickstarter.
When applied specifically to marketing, crowdsourcing can evolve in any number of ways. It has the power to turn
traditional product development and marketing concept development methods on their heads. Crowdsourcing lets
consumers and aspiring ideators assume the role of the R&D expert. It even empowers brand fans to develop a
products identity and marketing message. Crowdsourcing is a dynamic tactic for tapping into the strength of the
masses.
While generally used for consumer goods and rolled out to younger demographics, crowdsourcing is being leveraged
by more emerging businesses and enterprises to tackle marketplace challenges. Organizations riding the wave of
crowdsourcing are seeing shortened product and strategy development cycles, while spending less on traditional
R&D and marketing resources.
As case studies are analyzed and best practices continue to develop, Trellist has discovered a common
misconceptionthat crowdsourced ideas are a last resort, culled only when theres a problem the insiders cant
solve. Because we believe in the vast potential of crowdsourcing, we think its best used in the best of times.
Rather than falling into the trap of reactive crowdsourcing, consider crowdsourced ideas as key elements of your
overall communications and marketing strategy. Unleash crowdsourcing challenges when youre experiencing
unprecedented sales or growth. Let crowdsourcing follow your brand or products aggressive growth arc and soon
-
7/30/2019 My Starbucks Idea and the Value of Business Crowdsourcing
13/13
youll see a bump in your social clout. After all, crowdsourcing participants are social influencers with large networks.
The more ownership theyre extended in a crowdsourced action, the more likely theyll be to rapidly spread the good
word about what youre up to.
For a practical example of proactive crowdsourcing, take a look at Starbucks. Theyve created a crowdsourced
community appropriately named My Starbucks Idea. To date, Starbucks has collected 85,184 product ideas and
30,776 experience ideas. Over 500 have been put into action. My Starbucks Idea is a caffeine-fueled think tank
where like-minded members submit their thoughts, gain points for participating and use their status to influence
others. By involving the crowd, the Starbucks brand grows even stronger and is positioned for long-term success.
My Starbucks Idea is just one of many examples of enterprise crowdsourcing at work. Major players like General
Electric, Amazon, EBay, Xerox and Panasonic are all experiencing success through crowdsourcing.
Before jumping into the crowdsourcing pool, remember that consumers are savvier than ever these days. Theyre
aware and theyre seriously connected. They know the difference between the spirit of collaboration and the scent of
desperation. Whether youre trying to increase general brand engagement or fine tune a product or service offering,
involve the crowd early, often and under sunny skies for ideal participation and results.
In the end, knowing when to launch a crowdsourced action is only part of the success equation. Knowing what to ask
your crowd for is just as important. Ill discuss that in my next blog post.