You’ve probably heard the term “crowdsourcing”, but perhaps you were not entirely sure of its meaning. When a startup business launches a Kickstarter campaign, is it taking advantage of crowdsourcing? What about when an aspiring filmmaker makes a spec commercial and enters it in a contest? Is Wikipedia an example of crowdsourcing? Keep reading to understand just what crowdsourcing is and how it can help you grow your small business.

What Is Crowdsourcing?

The term “crowdsourcing”, which only entered the English language in 2006, refers to the process of gaining ideas, content or services through reaching out to large groups of people. Crowdsourcing typically occurs online, with members of online communities providing the needed resources, sometimes anonymously. Crowdsourcing takes the place of traditional suppliers, suppliers or employees in supplying these needed resources.

Closely related to crowdsourcing, but separate from it, is the process of crowdfunding, in which a person or organization seeks financial resources from a community, sometimes in exchange for stated benefits in place of actual profits.

How Your Small Business Can Use Crowdsourcing for Innovation

Access to Creative Freelancers

As a small startup business, you’re probably in need of graphic designers, marketing writers and video professionals with social media experience. But let’s face it: you’re a small startup, and you can’t afford to hire a full creative staff.

That’s where crowdsourcing comes in as a cost-effective way to connect to the global talent pool of creative freelancers. Whether you check out the low-end help available on Fiverr or seek out seasoned professionals on crowdsourcing graphic design marketplaces such as 99Designs, stepping into this new business model lets you find the talent you need at the right price.

Similar crowdsourcing aggregators exist for virtually every creative skill, so you can find someone to design your website, write a marketing email, or create that 30-second video for your Instagram and Facebook pages without breaking the bank or taking on long-term commitments.

Innovative Problem-Solving and Brainstorming

Turning to the global audience to bounce around ideas, brainstorm and seek solutions to clearly defined problems is increasing in popularity in many fields. This extension of enterprise and communication took a grand leap forward in 2012 when grass-roots, crowdsourced efforts exploded in response to Hurricane Sandy. Social media got to work, and local churches distributed supplies efficiently and served tens of thousands of meals using of crowdsourcing. Whether you reach out to your targeted audience for solutions directly or use an open innovation platform such as Innocentive, crowdsourcing your problem-solving sessions opens your process to ideas that your small staff might never produce.

Other Benefits Your Small Business Reaps from Crowdsourcing

Improved Customer Engagement

Drawing your customers into your decision-making processes increases their engagement with and loyalty to your brand. Consider sending out surveys to engage customers and potential customers, interact with them and learn what problems your business can help them solve. Another customer engagement crowdsourcing tactic that has proven itself useful is the contest.

Doritos engendered massive social media interest and customer involvement with its Crash the SuperBowl contest, a crowdsourcing effort that challenged customers to make the best commercial for the big game while drawing in millions of potential customers to vote on their favourite entries. Similarly, BMW’s crowdsourcing of design ideas for two of its 2025 models helps the company learn what its consumers want.

Access to Data

Before the era of crowdsourcing and social media, consumers might have felt awkward or nervous about sharing the kind of personal information you need to make informed business decisions, but all that has changed. Data galore are available through social media and other venues. Crowdsourcing the information you need allows you to crunch numbers and even build your marketplace before you launch your products.

Reduced Costs

Reducing the number of employees on your payroll lowers your overall costs in terms of wages and benefits. Crowdsourcing gives you the opportunity to bring in workers seasonally, as your work ebbs and flows. You also reap the benefits of other cost savings, such as office supplies, printing costs, and other office expenses associated with the tasks you’re crowdsourcing. In addition, keeping the number of employees to a minimum allows you to save on your physical space, which reduces costs for rental, office furniture and utilities.

Reduced Environmental Footprint

Your organization’s environment footprint becomes greatly reduced when you start crowdsourcing. Crowdsourced workers are likely to work out of their own locations, keeping commuting to a minimum, thereby reducing your carbon footprint. Fewer employees also use less office supplies, such as paper, and petroleum-based products, such as toner and plastics, resulting in conservation of natural resources.

As crowdsourcing continues to grow, it can help you grow your company if you use it strategically and incorporate it wisely into your overall business plan.

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