Chris Myers: Small Business, Startups and the Wisdom of Crowds
My fascination with the concept of crowdsourcing started back in 2004, as it did for many who read James Surowiecki’s brilliant book “The Wisdom of Crowds.” The idea that the collective wisdom of a large group could prove superior to the expertise of individuals is powerful. It has been proven out to a great degree by experiments both large and small. However, for the longest time I wondered about the commercial aspects of collective wisdom. There’s no doubt that crowdsourcing has plenty of technical applications, from prediction markets to market intelligence. While there is certainly immense value to be found in those applications, I was more interested in how it would impact the small business economy. Fortunately, in the years since I was first introduced to the concept, countless solutions have emerged that can help small businesses and startups leverage the crowd to solve problems they face on a daily basis and punch well above their weight in the market.
Look to the crowd for content. For a small enterprise, developing and running comprehensive marketing campaign can be a gargantuan task. Business owners are so busy trying to keep up with day-to-day operations that the idea of sitting down to draft content or test out new ideas seems laughable. Fortunately, busy entrepreneurs can look to existing and prospective customers to help create content and share it socially. Crowdsourcing articles, social media and video can help small business owners cultivate a rich and diverse library of meaningful content related to their business, while also getting their customers to engage personally with the brand. This very blog is a great example of the power of crowdsourced content with a collection of guest contributors. When your customers engage in the creation of content, they can become more personally connected than you could ever achieve with traditional marketing.
Build loyalty with peer-to-peer support. It’s incredibly important for small businesses and startups to offer amazing, personalized customer support in order to stay relevant in today’s highly competitive market. However, just as with marketing, it can be difficult for entrepreneurs to devote enough time dealing with customer questions and concerns when they’re busy trying to keep their heads above water. Again, with the advent of crowdsourcing, small business owners can look to their existing customer base for the solution. By creating a robust forum (using free tools such as WordPress’s Codex solution) where existing customers can help each other overcome challenges and answer questions, you can deliver a fantastic service experience while instilling a strong sense of loyalty in your base. It’s a process that has already been adopted by large companies like Apple to great acclaim.
Look to the crowd for diverse funding options. Securing funding from traditional lenders can be a difficult and trying process. However, by crowdsourcing the search for funding, small businesses and startups can access the capital that works for them quicker and easier than ever before. Crowdsourced funding has the luxury of offering a greater variety of solutions to meet the needs of individual borrowers, due in part to less stringent regulatory standards. For people looking to raise money for charitable causes or are appealing to the crowd’s altruistic side there is GoFundMe, which allows people to pledge donations of any size. For entrepreneurs looking to simultaneously validate a concept and fund early development there are solutions like Kickstarter and Indiegogo. Finally, for individuals and companies looking for debt financing there are companies like Kabbage, LendingClub and Dealstruck. All of these providers offer solutions that would not have been possible fifteen years ago and still seem wildly out of reach for traditional financial institutions. Put simply, since the crowd funders aren’t hampered by tradition, they have more opportunities to offer a solution that works for those seeking capital.
It’s certainly an exciting day and age for small businesses and startups. Never before have entrepreneurs been able to leverage technology, their customers and each other so effectively to accomplish so much with so little. The wisdom and resourcefulness of the crowd has the potential to dramatically change the way that small businesses and startups operate worldwide. By taking advantage of technology and the wisdom of the crowd, small businesses and startups have the opportunity to level the playing field, competing on par with their larger counterparts more aggressively than ever before.
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