CrowdSPRING

CrowdSPRING is an online commercial platform based on providing creative services such as logos creation, business cards, graphic and Web site design, marketing services, etc. The company puts on relations the so-called “buyers” (clients that want creative services) and “creatives” (designers, illustrators, writers, or photographers that produce these services). CrowdSPRING also provides community tools, such as public profiles with feedback, ratings and stats, private messaging, portfolios, and community forums on its Website. Moreover, it offers legal protection for buyers and sellers, it protects both sides against intellectual property issues by offering completely free, customized written legal agreements for every transaction.

The concept of this company is the following: Buyers who need a creative service simply post what they need, when they need it and how much they want to pay. Once posted, several thousands of creatives from around the world will submit actual work for the buyer to review, without bids or proposals. As the submissions come in, buyers are able to review, sort, rate, provide feedback and collaborate with creatives until they find the “the best one.” Normally all the procedures take 20 days, which includes an average of 11 days of bidding and selecting and 9 days to finish the project.
CrowdSPRING creates minimum prices, sharing statistics to help the buyer set the price or increase the rapidity of response. Its infrastructure builds the underlying project management infrastructure which includes file upload, project specifications and communications, including private or public comments, and ratings.

Customers (“buyers”) get more and more interested in this site for several reasons:
- They can have creative services with small budgets for projects (beginning from $250 for a company logo)
- They often have a big choice of designs
- Besides, they often get a fast and high-qualified “breakthrough” design
- If there are less 25 entries (proposed services), customers are refunded
- There is the possibility to launch a project made to order
- The site offers the protection of property rights
- They have the opportunity to provide feedback and ratings
- They get the opportunity to find a talented creative for long-term work outside CrowdSPRING
- Different coupons, promotions and discounts offered by the site

Suppliers (“creatives”) resort to this site for many reasons such as:
- They come up with the designs, including revisions, for clients, with the chance of getting paid.
- The possibility to work on interesting projects
- This site allows the creatives to find and to enlarge their potential clients due to the Internet
- A chance to find a job for young employees who have no portfolios, no experience, no contacts
- The possibility to create profile and portfolio on the site
- A chance for people to show their talent for design
- This site gives the opportunities to showcase their work to many potential clients
- Besides, CrowdSPRING provides opportunities to interact with other Creatives

But on the other hand the suppliers face some risks and problems why CrowdSPRING is much criticized for:
- Competition – as every time offering the product there are other designers (about 80), so the competition is rather harsh
- Risk to spend much time and to earn nothing - The creatives are reasonably protected (the client’s money is in an escrow account, security features prevent stealing ideas, etc.).

CrowdSPRING acts as the intermediary in the transaction and places the bounty in escrow. This helps the designer feel confident they will get paid. Crowdspring offers a money-back guarantee for buyers if they don’t get at least 25 entries.

Their source revenue model is very simple, they get 15% commission on the awards offered by buyers. Despite a short-term existence, CrowdSPRING won different awards such as WIRED Magazine’s Small Biz 2008 competition, Business.com’s best people solution competition, the Illinois Technology Association’s Newcomer award in 2009, Webby Award, and a Stevie Award for Best Product/Service. Due to these awards, they got a large sum of money.

There are some concepts that form the basis of CrowdSPRING activity.
First of all, CrowdSPRING is crowdsourcing site. It offers an online environment for people to collaborate and contribute new creative ideas. It sets up challenges with prizes to see what the crowd comes up with.
Besides, it applies “Spec” concept that suggests doing any work on a speculative basis, without a prior agreement that the suppliers will be paid for their work.

The CrowdSPRING model is innovative not only because it differs in remarkable ways from the traditional model to buying and selling creative services, but also because there was introduced a new approach such as:
- Build strong community to work more successfully together
- Education (they spend much time collaborating, educating and learning in the forums, they wrote some guides for starting-up the business)
- Money back guarantee
- Legal agreements
- Respect for Intellectual Property
- Pro project (to keep the confidentiality of big companies’ during all the projects)
- Enforce communication after posting the project (via RSS, sending emails, posting public and private messages)
- Reputation system (two-way reputation system that encourages rating buyers and creatives)

Their marketing strategy is well-thought:
- They participate in worthy charities and non-profits with graphic design needs.
- They wrote several guides to help buyers around the world (“ 10 Logo Design Tips for Buyers”, “10 Tips For Buyers To Effectively Manage Design Projects”, e-book to help designers create legal agreements for their projects).
- CrowdSPRING uses old-fashioned word-of-mouth marketing that comes with a new-technology twist (in their work they use Twitter, Facebook, Craigslist, etc)
- They customize the buyers by coupons, discounts and promotions

CrowdSPRING has several competitors using the same concept.


One of them is BootB. This is also an online platform that helps to find the best marketing concepts and strategies, graphic design solutions or ideas for advertising campaigns by addressing the unlimited number of creative talents from all over the world.

Another example is Denook. It is also an on-line community of designers from around the world that create the project ideas: logo, website, apparel, stationary, etc.

The concept used in CrowdSPRING was also applied in other industries.

One of the examples is Threadless, an on-line community-based tee shirt company. The members of the Threadless community submit t-shirt designs online. the designs are then put to a public vote. A small percentage of submitted designs are selected for printing and sold through an on-line store. Creators of the winning designs receive a prize of cash and store credit.

Another good example is iStockphoto, an online, royalty free, international microstock photography provider operating with the micropayment business model. Images cost between 1 and 20 credits, depending on size. This site claims to be "internet’s original member-generated image and design community."
The online photo library contains over 4 million images, illustrations, video tapes, Flash-clips, etc, contributed by over 50,000 photographers.

This business model seems so tempting and advantageous that can be applied in many other industries such as electronic products, software ideas, fashion, music production, architecture, technology, etc.

This site has many possibilities for growth and for revenue increase. First of all, it is necessary to point out that CrowdSPRING uses already brokerage model taking the fees for each transaction. Moreover, it applies the infomediary model using customer loyalty program by providing coupons and discounts.
In their business it could apply advertising model through banner ads, or adverstising via RSS feeds. Besides, it can take a little fee for user registration.

There are other ways of developing the site. They can introduce new and more complex services such as audio, video, copywriting, animation, photos, flash-clips, digital services, etc. They could invent some Freemium services such as having access to some important database, more creative services, etc. Besides, they could provide other advantages for the clients in order to attract more customers.

We saw above that they wrote some guides for starting-up the business and some tips for leading business activity. To my mind, it would be good idea to keep on writing such kind of training aids and to start selling them widely or to place them on-line and to take the fee for acceding them. The managers could also give some training programs for all volunteers in order to share their experience, especially taking into consideration the success of this business. Keeping on developing the partnership with non-profit organizations and taking part in charity seems also very interesting.