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Social Media Crowdsourcing
Jordi Paniagua
1
and Pawel Korzynski
2,3
1
Faculty of Economics and Business, Catholic
Universtiy of Valencia San Vicente Mártir,
Valencia, Spain
2
Dept. Human Resources, Kozminski University,
Warszawa, Poland
3
Harvard University, Cambridge, MA, USA
Synonyms
Consumer-generated media;Online social net-
works;Social networking sites;Virtual
outsourcing.
Introduction
Crowdsourcing is the process of outsourcing a
business task or activity to a network of individ-
uals. Crowdsourcing tales place on social media, a
group of Internet-based applications that allow the
creation and exchange of virtual content. Social
media and crowdsourcing are shaping the way
companies interact with consumers and changing
the business landscape.
Key Concepts and Definition of Terms
Social Media
Social media is an ambiguous, evolving concept
that is frequently interchanged with related con-
cepts of Web 2.0,user-generated content, and
consumer-generated media. Social media builds
upon different technologies including blogs, web
pages, networking sites, and forums among others
to allow interaction and communication between
users. However, the nature of social media is
broader concept than a specific technological plat-
form. Kaplan and Haenlein (2010)define social
media “as a group of Internet-based applications
that build on the ideological and technological
foundations of Web 2.0, and that allow the crea-
tion and exchange of user-generated content.”
Obar and Wildman (2015) identify four distinc-
tive traits of social media:
•Web 2.0 Internet-based applications
•User-generated content
•Individuals and groups create user-specific
profiles for a site or app designed and
maintained by a social media service
•Social media connects a user’s profile with
those of other individuals and/or groups
#Springer Science+Business Media LLC 2017
E.G. Carayannis (ed.), Encyclopedia of Creativity, Invention, Innovation and Entrepreneurship,
DOI 10.1007/978-1-4614-6616-1_200009-1
Web 2.0
The term Web 2.0 was coined at the end of the XX
century by DiNucci (1999), but it was popularized
widely in an annual summit held in San Francisco
from 2004 to 2011. Web 2.0 describes the evolu-
tion of web sites from a unicast to a multicast
service. Web 2.0 represents an ideological and
technological foundation of the World Wide
Web, where content is continuously created and
modified by many users in a collaborative manner.
Web 2.0 challenges users with an active interac-
tion as creators of user-generated content. Several
technological innovations have been necessary to
surpass passive viewing of content like Ajax and
JavaScript frameworks.
User-Generated Content
User-generated content (UGC) represents the dif-
ferent manners in which users utilize social media.
UGC describes the variety of media content
uploaded by end users in Web 2.0 Internet-based
applications. According to the Organization for
Economic Cooperation and Development
(OECD 2007), UGC has the following
characteristics:
•Publicly available online
•Creative
•Nonprofessional
UGC includes a large variety of public content
like posts, tweets, blogs, wikis, chats, podcasts,
videos, images, and audios. However, UGC
excludes peer-to-peer or private communications
like email or instant messaging. Commercial con-
tent or replication of existing content does not fit
the general definition of UGC. UGC may be
curated by a system administrator to prevent
unappropriated or copyright content.
The combination of UGC with the ideological
(e.g., digital natives and millennials) and techno-
logical (e.g., mobile applications, coverage, and
bandwidth) foundations of Web 2.0 give rises to
the social media ecosystem.
Building Blocks of Social Media
Kietzmann et al. (2011) establish the seven build-
ing blocks of social media, with implications on
functionality:
1. Identity: The extent to which users reveal
themselves
•Implications: Data privacy controls and
tools for user self-promotion
2. Conversations: The extent to which users are
ordered or form communities
•Implications: Conversation velocity and the
risks of starting and joining
3. Sharing: The extent to which users exchange,
distribute, and receive content
•Implications: Content management system
and social graph
4. Presence: The extent to which users know if
others are available
•Implications: Creating and managing the
reality, intimacy, and immediacy of the
context
5. Relationships: The extent to which users relate
to each other
•Implications: Managing the structural and
flow properties in a network of relationships
6. Reputation: The extent to which users know
the social standing of others and content
•Implications: Monitoring the strength, pas-
sion, sentiment, and reach of users and
brands
7. Groups: The extent to which users are ordered
or form communities
•Implications: Membership rules and
protocols
Social Media Types
The following list describes some of the most
popular social media types:
•General social networking sites
•Corporate social networking sites
•Creativity Works sharing sites (video, photo,
content)
•Personal blogs
•Corporate blogs
•Help/frequently asked questions (FAQ) sites
•Collaborative sites
2 Social Media Crowdsourcing
•Commerce communities
•Podcasts
•News sites
•Educational sites
•Open-source software sites
•Social bookmarking sites
•Academic sharing sites
•Mobile communication apps
Theoretical Background and Open-ended
Issues: Social Media and Business
Performance
One of the main differences between traditional
and social media is the business potential of the
latter. Social media allows firms new business and
marketing opportunities. For example, customers
can be targeted based on their location, prefer-
ences, past experiences, or social circle. Compa-
nies use social media for market research, direct
communications with customers, sales and pro-
motions, or e-commerce.
Paniagua and Sapena (2014) posit that social
media resources (e.g., conversations, identities,
shares) are conveyed into business capabilities
(e.g., customer links, sales abilities, reputation
placement). They identify four channels by
which social media increases business
performance:
1. Social capital: Corporate social performance
depends on the firm’s social capital or the trust-
worthy relations with the society through cor-
porate identity and reputation. Social media
shapes the firm’s brand and reputation, which
determine CSP capabilities through the social
capital channel.
2. Customer’s revealed preferences: Customers
reveal the preferences with conversation, shar-
ing, and presence in social media. Through
social media mining, companies anticipate
demand for products and services. Customer’s
revealed preferences have an effect on finan-
cial performance (like share prices), which
depends on market expectations.
3. Social marketing: Social media is embedded
in today’s marketing strategy. Social media
marketing is multi-cast and involves interac-
tion, conversation, sharing, collaboration, and
engagement. Additionally, firms can tailor
marketing directly to individual customer’s
preferences, tastes, and experiences. Firms
can use social marketing resources (e.g., con-
versations, sharing, presence) which are trans-
formed to increase financial performance
capabilities (e.g., sales).
4. Social corporate networking: Social corpo-
rate networking refers to the interconnection of
professionals and firms staff through social
media. Social corporate networking sites (like
LinkedIn) connect job applicants, staff, stu-
dents, and users on a professional level. The
social ties occur within the company and also
with other firms. Corporate networking is nor-
mally persistent, and users stay connected with
former colleagues. This type of business social
media allows companies to identify better job
candidates and to stay connected with cus-
tomers and former employees. Thus, social
corporate networking increases the firm’s oper-
ational performance (Fig. 1).
Implications for Theory, Policy, and
Practice: Crowdsourcing
Crowdsourcing
Crowdsourcing refers to the process of
outsourcing a business activity to a self-selected
network of undefined individuals. The outsourced
task could have been performed internally by
employees or suppliers, but instead it is executed
individually or collaboratively by a large group of
people. The organization profits from participa-
tive (generally altruistic) services, ideas, or con-
tent. Social media is the usual platform to perform
crowdsourcing. Both parties benefit from
crowdsourcing: the user satisfies needs like social
recognition, self-esteem, or the development of
individual skills (Estellés-Arolas and González-
Ladrón-de-Guevara 2012) and the crowdsourcer
Social Media Crowdsourcing 3
reduced costs, speed, quality, flexibility, scalabil-
ity, and diversity. Crowdsourcing is usually
designed as an open call or as a contest.
Crowdsourcing Types
Palacios et al. (2016) identify five emerging trends
in crowdsourcing:
1. Problem solving: With crowdsourcing, firms
use collective intelligence from different exter-
nal sources to solve internal problems.
Crowdsourcing is an appropriate mechanism
to explore activities in the areas of research
and development, market research, knowledge
management, and customer service.
2. Learning paradigms: Crowdsourcing is
source for the generation of new ideas which
contribute to organizational learning.
Crowdsourcing is normally associated with
nascent and innovative firms. However, it rep-
resents a learning opportunity for firms in
mature markets with a low level of innovation.
3. Open innovation: Open innovation represents
the needs of organization to access new knowl-
edge. Crowdsourcing is used to share, reuse,
recombine, and accumulate knowledge to
achieve external and internal innovation. In
this sense, the crowd is seen as an innovation
partner.
4. New product development: User innovations
can be used to create new products, designs,
and services which satisfy the needs of
customers. The crowd can provide firms with
resources and feedback in the process of creat-
ing new products.
5. Collaborative initiative: Collaborative initia-
tives are an emerging trend in crowdsourcing.
Many start-ups use crowdsourcing as a coordi-
nation and collaboration mechanism. Firms
also seek partnerships or investment through
crowdfunding, where entrepreneurs raise funds
or donations from the crowd. New business
models dedicated to crowdsourcing itself,
with online platforms that enable third parties
to launch and manage collaborative
crowdsourcing initiatives.
Crowdsourcing and Business
Through crowdsourcing, organizations draw
unique resources from the crowd (e.g., knowl-
edge) to build performance-enhancing capabili-
ties (e.g., acquisition, innovation). Prpićet al.
(2015) argue that firms build crowd capital or
organizational resources acquired through
crowdsourcing. Crowd capital increases business
performance in three stages:
1. Constructing a crowd: Crowdsourcing is
rarely a spontaneous event; it is initiated and
curated by the firm. The crowd is selected
depending on the organizational considering
size, specific skills, and external (from people
outside of the organization) or internal mem-
bership (from employees).
Social Media
Crowdsourcing,
Fig. 1 Social media and
business performance
(Paniagua and Sapena
2014)
4 Social Media Crowdsourcing
2. Developing crowd capabilities: Organiza-
tions need to establish how to obtain resources
dispersed in a crowd and align them with its
goals and internal processes. The crowd capa-
bility consists of acquisition and assimilation
capabilities. Acquisition capabilities refer to
determining the type of crowd interaction
required for the acquisition of knowledge and
choosing the best suited platform. Assimilation
capability is the process of in the internal
assimilation of crowd contributions. Organiza-
tions need to institute internal processes to
organize the incoming crowd knowledge.
3. Harnessing crowd capital: An organization
can construct separate or overlapping internal
and external crowds. In addition, crowd capital
can be generated at low cost, with a relatively
low investment. Organizations should consider
the different alternatives to manage efficiently
crowdsourcing initiatives.
Conclusion and Future Directions
With the proliferation of the Internet and mobile
technologies, social media and crowdsourcing
offer a wide range of possibilities for business.
Social media builds on the ideological and tech-
nological foundations of Web 2. 0 and user-
generated content: online collaboration, creativ-
ity, and nonprofessional. Social media enhances
business performance via four channels: social
capital, customers’revealed preferences, social
marketing, and corporate social networking.
Crowdsourcing is embedded in social media and
enables organizations to draw knowledge and
resources from disperse online users.
Crowdsourcing builds crowd capital, which
leads to competitive advantages.
Social media and crowdsourcing present excit-
ing avenues and challenges for research and prac-
tice. The wide range of possibilities challenges
organizations when choosing the right medium.
Additionally, social media and crowdsourcing
require a minimum number of users (or critical
mass) to have an effect on business performance.
These online activities require careful planning,
integration, and corporate alignment.
Cross-References
▶Online Corporate Social Networking
▶Social Networks and Entrepreneurship
▶User-generated Information Systems
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