The Value of Marketing Crowdsourced New Products as Such: Evidence from two Randomized Field Experiments

To complement their in-house, designer-driven efforts, companies are increasingly experimenting with crowdsourcing initiatives in which they invite their user communities to generate new product ideas. Although innovation scholars have begun to analyze the objective promise of crowd sourcing, the current research is unique in pointing out that merely marketing the source of design to customers might bring about an incremental increase [in product sales. The findings from two randomized field experiments reveal that labeling crowd sourced 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%. Two controlled follow-up studies reveal that the effect observed in two distinct consumer goods domains: (food and electronics) can be attributed to a quality inference: consumers perceive "customer-ideated" products to be based on ideas that address their needs more effectively, and the corresponding design mode is considered superior in generating promising new products.

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