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By: Virna do Brito Lopes, 401903

For this week we had to read three articles in relation to the topics crowdsourcing, crowdfunding and prediction markets. The first article, ‘Which kind of collaboration is right for you?’ by Pisano and Verganti (2008) elaborates on the importance of choosing the right mode of collaboration for your business to successfully develop new technologies. 4 different modes of collaboration are mentioned in the article:

1. The open network with hierarchical governance (‘Innovation mall’), where anyone is free to post a solution but the sponsor makes the final decision.
2. The open network with flat governance (‘Innovation community’), where anyone is free to post a solution, and in which the community together decides the solution.
3. The closed network with hierarchical governance (‘Elite circle’), where the sponsor defines the problem and also decides what the solution will be.
4. The closed network with flat governance (‘Consortium’), where a closed group works on a chosen problem and together decides what the solution will be.

The second article by Malone et al, (2010) proposes a framework for understanding how businesses can gather and utilize collective intelligence. There are a number of ‘building blocks’ that can be combined in various ways to build a collective intelligence system. For constructing one a manager needs to ask the following four questions: 1.What is being done? 2. Who is doing it? 3. Why are they doing it? 4. How is it being done?

The third article ‘Prediction markets: A new tool for strategic decision making.’ By Borison and Hamm (2010) elaborates on the existence of uncertainty when making important strategic decisions in the public and private sector. Making use of prediction markets, next to approaches that are already utilized, can be an outcome for this. They argue that prediction markets, in which individuals can gamble on the outcome of future events for real/or play money, can help businesses minimalize the risks and improve their chances of success.

In relation to the topic ‘crowdfunding’ I chose for the article ‘Crowdfunding: Tapping the right crowd’ by Belleflame et al, (2014). This article provides two modes of crowdfunding. 1. Inviting the crowd to pre-order a product, so that an entrepreneur can gather money for the launch of production. 2. Asking the crowd to advance a fixed amount of money and offer a share of future profits in return. Choosing for option 1 or 2 depends on the initial capital requirement in relation to the market size. Besides this, the existence of uncertainty and information asymmetry in crowdfunding projects are also discussed in this article.

Finally, I searched for two mini-cases related to the topic ‘crowdfunding’. The first one I found was about the pedestal for the Statue of Liberty, which was built thanks to crowdfunding. This project became a success due to a campaign started by Joseph Pulitzer who succeeded in raising $101.091, in five months, from over 160.000 donors.

http://therealdeal.com/wp-content/uploads/2015/07/50.png

The second case I found was about the musician Amanda Palmer, who broke the Kickstarter record for a music project, in 2012, when she raised $1.2 million from over 25.000 fans for the album ‘Theatre Is Evil’.

http://www.granadatheater.com/files/2015/03/tumblr_nhl2siAVha1qzdv4io1_1280-300×170.jpg

References

Belleflame, P., Lambert, T., & Schwienbacher, A. (2014). Crowdfunding: Tapping the right crowd. Journal of Business Venturing, 29(5), 585-609.

Borison, A., & Hamm, G. (2010). Prediction markets: A new tool for strategic decision making. California Management Review, 52(4), 125-141.

Dredge, S. (2015). Amanda Palmer is crowdfunding again, but this time on Patreon. Accessed  at: http://www.theguardian.com/technology/2015/mar/03/amanda-palmer      crowdfunding-patreon-kickstarter-fans

Gaylord, C. (2015). How crowdfunding brought the Statue of Liberty to America. Accessed    at: http://www.csmonitor.com/Technology/2015/0617/How-crowdfunding-brought  the-Statue-of-Liberty-to-America

Malone, T. W., Laubacher, R., & Dellarocas, C. (2010). The collective intelligence genome. IEEE Engineering Management Review, 38(3), 38.

Pisano, G. P., & Verganti, R. (2008). Which kind of collaboration is right for you? Harvard business review, 86(12),

 

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By: Virna do Brito Lopes, 401903

A few days ago I read that One Piece, a Norwegian brand of clothing, is opening a new pop-up store in Amsterdam where people, in the near future, can buy stuff with their social media accounts. This is a concept which allows customers to link various platforms such as: LinkedIn, Facebook, Pinterest, Tumblr and Twitter and pay in-store according to their friend and fan following. In other words, the more followers you have, the more discount you get. For each 500 followers one can earn 1 dollar discount towards a purchase for a maximum of 20 dollars. In order to earn this discount it is required to upload and share an image of one of the stores and use the store’s hashtag.

The business introduced this new payment method last year, called ‘’social currency, when it opened up a branch in Soho, New York, which was very expensive because the rent in that area is really high. Therefore they had to come up with an idea to attract customers and create buzz in order to stimulate the store’s sales’. Moreover the store has always been a pioneer when it comes to social media marketing and gained a lot of its success through this. And so the concept of paying with ‘’social currency’’ emerged.

Quickly after its launch the campaign became a success, attracting 40 million followers and 1.5 milliard readers. The only problem, at that time, was that people had to travel to New York in order to take part in the campaign. But now, after receiving feedback, from multiple customers and potential customers, and suggestions for making it possible to also pay with social currency in other One Piece stores and its webstores, the businesses is working on it.

I personally find this idea really amazing, although I don’t have so many followers, so it isn’t really an option for me. But then again, who does? It seems almost impossible for a normal person like me or you to get more than 2 or 3 dollars’ worth of discount. Or am I wrong? If you had the possibility to pay with social currency, would you?

References

Spilka, S. (2014). Are you Instagram-famous? OnePiece offers discounts for every 500 followers across various platforms. Accessed at:http://www.psfk.com/2014/11/functionalize-3dprinting-circuit-boards.html

Stamkot, S. (2015). Betalen met je socialmedia-account. Accesed at:                http://www.metronieuws.nl/mode/interviews/2015/10/betalen-met-je-socialmedia-account

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In his book, The Presentation of Self in Everyday Life (1959), Erving Goffman argues that people attempt to manage their impression before the people they’re surrounded by, as if one is performing on a stage in front of an audience. His theory distinguishes between two topics, namely ‘’frontstage representation’’ and ‘’backstage representation’’, wherein front stage representation refers to our costumes, the roles we play and how we behave in the presence of others in order to create a positive image of ourselves, so that others like and respect us. In opposite of this, back stage representation refers to how we are when we let our guard down, not preoccupied with how others perceive us.

When Goffman invented this theory it was used to analyse real-life situations, but in today’s society this theory is also applicable for online spaces such as social networks like Facebook. Steve Wheeler (2011), who is an Associate Professor of Learning Technologies at Plymouth University, for instance, asked his students whether they think of Facebook as a backstage or frontstage area. The conclusion was that most of his students thought of Facebook as a backstage area, thus, a place where one let’s his guards down and can be completely him or herself. Honestly, this surprised me. I’m also a Facebook user and in my experience it is more of a frontstage area, because people in my surroundings use it to show happy pictures of themselves and share moments of joy. Off course in some cases people are sad and share their sadness when they lost a loved one or broke up with their boy/girlfriends. But I have the idea that these emotions are always a bit regulated. By this I mean I never see pictures of people crying or post things like ‘’I am so depressed and unhappy about my life right now’’. So, I don’t think you can see Facebook as a backstage area (for a 100%). What do you think of this?

References

Goffman, E. (1959). The Presentation of Self in Everyday Life. New York: Anchor Books.

Wheeler, S. (2011). Back stage front stage. Accessed at: http://stevewheeler.blogspot.nl/2011/05/back-stage-front-stage.html