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Indiegogo Launches a Crowdsourcing Business For Big Businesses (computerworld.com)
Lucas123 writes: Indiegogo announced at CES today that is now has a crowdfunding site exclusively for big businesses, which often have hundreds of internal R&D projects or ideas that never see the light of day and could benefit from getting public exposure online. Companies such as Google, Anheuser-Busch, GE and Hasbro have already run crowdsourcing campaigns on a pilot of the new site in order to raise money for projects, garner customer ideas, or validate pre-retail products. In July, GE ran a campaign to prove market demand for a countertop nugget ice-making machine for the home. GE offered the Opal icemaker for $399 to early buyers on Indiegogo, with a future retail price of $499. GE's Opal icemaker project raised $2.64 million total from 6,177 contributions by the end of the 30-day Indiegogo campaign. The campaign also garnered 510,000 page views and 15,000 Facebook shares. Natarajan Venkatakrishnan, head of R&D for GE Appliances, said crowdsourcing allows development and marketing to be conducted at a fraction of the cost of a traditional R&D project. "If it flops, no worries. Upfront costs were some 20 times less than a traditional product rollout, which can cost tens of millions of dollars," Venkatakrishnan said. "If we're going to fail, we want to fail fast."
I don't see this as a way to get cheaper products. And that's fine - there's nothing wrong with putting up extra cash for something you REALLY want. Think of it as being an early-early adopter. It's up to you and I to decide if we want something that badly to put in the money for it. The alternative of the standard model where the corporation does market research, and tries to figure out what consumers want and will pay for, does the research/design/etc, and then offers it for sale, means that you're not likely to see anything too outside the box. When the corporation is assuming 100% of the risk, why shouldn't they go with the "safe" option?
On the other hand, with this model, they can offer something a little more cutting edge, because if nobody is interested, it'll become apparent quickly. Also, you won't be running into the common Kickstarter problem of people who overpromise their ability to deliver because they have no idea of what the real costs are going to be, or how to budget, etc.