Originally published on MarketingLand
How crowdsourcing inventory helps companies cut costs associated with product design while keeping customers engaged.
As retail increasingly moves online and into mobile experiences, consumers are presented with ever-increasing purchasing choices, including fully customizable products that can be ordered on a whim.
Today’s consumers have become accustomed to increasingly accurate recommendations as they shop, and tomorrow’s consumers will expect increasing levels of personalization and customization for the products they buy. And not just because people want to buy things unique and specific them, but because the underlying personalized digital experiences will become increasingly commoditized.
To get ahead of this trend, attract new customers and keep current customers engaged, marketers can incorporate a radical new approach that crowdsources product designs and enables customers the opportunity to create and invent. It also guarantees a product will sell and dramatically reduces the risks and costs associated with internal product design.
Crowdsourcing initiatives
According to the Journal of Marketing Research, companies are increasingly experimenting with crowdsourcing initiatives in which they invite their user communities to generate new product ideas.
The findings from two randomized field experiments reveal that labeling crowdsourced new products as such — that is, marketing the product as “customer-ideated” at the point of purchase versus not mentioning the specific source of design — increased the product’s actual market performance by up to 20 percent. Here is the experiment abstract (The report is behind a paywall):
These projects are created by everyday people around the world who dreamed of something, were able to find others who believed in their projects and were willing to pitch in to bring them into existence. Without “backers” who donate, projects wouldn’t get off the ground.
Myriad consumer brands have democratized product creation and have familiarized consumers with the idea that they can be a part of the product-creation process:
This shift is a radical disruption for retailers and consumer goods manufacturers, particularly given the complexities of establishing supply chains, procurement processes and sale strategies. Some retailers, like Zara, have succeeded in manufacturing a product and getting it on store shelves within eight weeks, enabling them to stay ahead of fashion trends, where other apparel retailers plan months or quarters out and may miss out on the latest trends.
For retailers that are agile and able to simplify their supply chain, here’s how marketers can get involved:
The world of retail is rapidly changing: Customers have diverse, shifting tastes, and brands that continue to guess what customers need (or want) will fall by the wayside in favor of brands that empower customers to take ownership of the product creation process.
Modern retailers seeking to move into customized products must simplify their supply chains and become more agile with the product creation process; those that succeed in crowdsourcing their inventory are not only more likely to achieve financial success and positive brand perception, but they can also cut the costs associated with product design and development.
Rohit Gupta - Director of Digital Strategy
Rohit Gupta leads the North America consumer and media digital strategy practice within Wipro Digital. Prior to Wipro Digital, he has held various leadership positions within the retail industry driving digital transformations through customer centric solutions for eCommerce and in-store experiences. He holds an MBA from Cornell and mentors various start-ups within the Bay Area.
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© 2021 Wipro Limited |
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