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What IFAs can learn from Arvind Kejriwal

In a nutshell

Politicians love saying that their actions are always guided by what the public wants, and nothing else. In the rare occasions that they actually do this, people love it. Iceland re-drafted chunks of its Constitution based on thousands of inputs that poured in from citizens through facebook, twitter and youtube. The Greek PM conducted a referendum, asking the public what he should do in the bail out negotiations with the EU. Closer home, Arvind Kejriwal won many hearts when he went to Delhi's public asking them whether he should form a minority Government with outside support when the elections threw up a hung house result. These are politicians who didn't just say they understand the "pulse" of the people - they went out, asked the people, and their decisions were guided by what the people said. Kejriwal's landslide victory in the next elections is widely credited to AAP's Delhi Dialogues initiative - where the public of Delhi effectively determined what went into the party's manifesto, and which has now been embraced by the Delhi Government as a "to do" list with a task force set up to execute it. Opinions are sharply divided on Kejriwal's brand of politics, and this column does not seek to either endorse or condemn it - but there is a lot we can learn for our business from at least one aspect of Kejriwal's brand of politics.

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Welcome to the world of crowdsourcing

Just like politicians claim to be guided by the voice of the public, marketers also love saying that they listen to the voice of the consumer. Those who actually do, have great success stories to boast about. Its no longer enough to think you understand the "pulse" of what the consumer wants - the trend that's catching on is to actually involve consumers in deciding the products you create, the communication message you put out, even the packaging of the products you sell. Welcome to the world of crowdsourcing.

Crowd-sourcing is a mash up of the words crowd and outsourcing, a concept to indicate that instead of a just a group of individuals doing all the work, you get the community or the crowd engaged to do some component of the work and help take decisions. Why does crowdsourcing work? Quite simply because when you involve your customers in new product innovation, when they tell you what to do and you do it, their sense of ownership is vastly higher. The buzz that is created in the process of asking consumers does more for the new product than advertising would ever do. People love getting involved, people love feeling empowered. Crowdsourcing taps into this feeling, which is why it is becoming part of mainstream marketing strategy.

Going back to Kejriwal, Delhi Dialogues was a hit because the people of Delhi were asked to get involved in setting the agenda for the party, if it came to power. People believed in the sincerity of the proposition (at least at that time), felt empowered by the process, and voted in large numbers for THEIR agenda to get actioned. The key is to transfer ownership of the idea from one person/company/party to the crowd, the people. That's the power of crowdsourcing.

Crowdsourcing goes far beyond surveys

In surveys, you ask a set of questions that you come up with, and seek responses only on those. In crowdsourcing, you open up the thinking aspect completely - no pre-defined questions with multiple choice answers - involvement of consumers is total, with no predefined notions that you are testing. It is especially useful for product development where you get direct input from consumers who become a part of the process. The company gets a different perspective that it might not have considered. With direct involvement from consumers, the company can find out which of the proposed ideas would not work in the market and weed out bad products that will not do well with consumers. It leads to increased interest in the product even before the launch because the brand awareness for the product has already been created prior to launch.

There are two ways that crowd-sourcing is often structured; it is either through competitions or by collaboration. In a competition, the company engages the consumer by competing with others in the crowd to submit their ideas towards the product. In collaboration, the crowd is engaged to contribute towards the product and share their expertise and knowledge with others as a community goodwill gesture.

Marketing examples of crowdsourcing

In 2009, premium ice cream maker Ben & Jerry's used the competition route to choose a new product and reinforce the company's commitment to fair trade practices. The company organized a "do the world a flavor" contest where consumers were given the opportunity to create a new flavour of ice cream by choosing from a variety of ice-cream bases, adding chunks of goodies such as brownies or donuts and delicious swirls of flavours like ginger or chocolate fudge. Consumers named their flavour and were even given the option of uploading their own packaging design. Participants could then share their creation via social media. The company received over 100,000 entries and the winning flavour was a caramel ice-cream with praline almond cluster and caramel swirls. The new ice cream, named Fairly Nuts, exceeded marketing goals on reaching the market. Not only did the company have a new winning flavour, but it also impressed customers with its dedication to fair trade.

Crowd-sourcing can really be successful when it is so creative and engaging for the customers that it goes viral. A buzz is created around the campaign and this in turn generates "free advertising" for the company. For the campaign to be successful, customers need to feel their opinions matter. In 2012, American beer brand Samuel Adams gave fans the opportunity to create a new draft beer through a Facebook crowd-sourcing campaign called "Crowd Craft Project". Through a facebook app, customers voted for preferences on six brew factors - yeast, hops, malt, clarity, body and colour - and the project drew over 5000 responses. The new brew created based on customer preferences was named B'Austin Ale.

Crowd-sourcing can also be successful when it appeals to the volunteering nature of consumers and gives consumers a sense of co-creation and responsibility. In India, three Goan entreprenaeus started a website called Foodlets where people can discover good food and connect with foodies. People posts and share pictures of food from restaurant menus, share their experiences about a particular dish. The restaurant owners can also upload pictures of their dishes or they can use the site's premium feature to get a professional profile and photographer to photograph their dishes. The site now gives tourists as well as locals the opportunity to find over1000 dishes from some of the best restaurants in Goa.

Radio stations routinely use crowd-sourcing to report on traffic reporting. Listeners can call a number or log on to the website or send a text message to post on traffic jams in the city and thus help out other listeners of the radio channel. News channels and journalists often get tips and news from viewers, by appealing to the society service spirit of viewers.

Where is the buzz?

So what lies behind a successful crowd-sourcing campaign? The campaign has to be creative and engage the customers in order to create a buzz. It has to be well-organized to handle the numbers and if it is conducted online, technology issues like servers crashes from too much traffic need to be deterred. Instead of the product or company in the spotlight, the buzz is created by the competition/collaboration and that is the focus for the consumers. However, the buzz generated ultimately makes the organizer company and product shine through "free advertising". The buzz that is created, and the feeling of ownership of the new product or idea among the crowd are strong enough factors that usually enable the new product to become very successful. Beyond the product itself, it does a world of good to the brand itself.

How can IFAs leverage crowdsourcing?

A great example of an IFA who fantastically leveraged crowdsourcing was the world record setting effort of Pramod Saraf, Swan Finance, Indore (Indian IFA smashes world record!). There are many great things that Pramod did to pull off his spectacular achievement, but one of the most important elements was his effort to get every school in Indore to buy into a proposition that it will be contributing towards Indore setting a world record - a dream that Indore will now find a prominent place in the Guinness Book of World Records. When 170 schools signed up to try and create a world record together, they made history - together. The brand rub-off for Swan Finance, needless to add, has been nothing short of spectacular.

Its difficult for IFAs to pull off such a large feat - which is what makes Pramod's achievement really special. But, there is nothing to stop you from leveraging crowdsourcing in your own locality, in the community you live in. Here's just one thought: let say there are 25 housing societies in your locality, each of which has a managing committee made up of active members of each society. Put in an idea that your locality/community should aspire to create a record of being the first in the city to have 100% smart investors. It's a bit like a recognition for 100% literacy and so on. Get the managing committees involved in defining what constitutes a smart investor. Offer inputs to aid their decision, but be careful to allow the criteria to be finally decided by them, not you.

Some examples you can suggest include:

  1. Every family must have signed up for either a retirement plan or a child plan, or

  2. Every family must have at least one live SIP

You may, instead of looking at "smart investor" as the goal, decide to consider "secure families" as the goal, which may perhaps appeal more. You would then keep criteria like every family must have a term plan or other life insurance policy for at least one member, every family must have a health insurance policy for at least one member.

Based on what the managing committees finally decide as the definition of what constitutes a "smart investor" or whether they opt to target a milestone called "100% secure families", take up the entire publicity of the campaign, ensuring that all the material you prepare stresses on the collective goal of making your locality the first in the city to achieve a 100% smart investor/ 100% secure families record. Get local media involved, get active on social media. If somebody knows the local corporator/MLA, well get him/her into the loop to ensure appropriate recognition from the city authorities.

If you get the initial messaging right and you ensure publicity for the initiative, you will most likely find the managing committees themselves taking up the responsibility of driving the target in their respective societies. Don't put any conditions that all investments/transactions must be made only through you - that will kill the whole idea. Instead, be very visible and active to ensure that you land up facilitating most of it. Go on overdrive with education sessions, explaining the need for everyone to become a smart investor or the need for securing the family and simple ways of getting there.

A month long effort in this direction will do a great deal of good for all the families in your locality, great publicity for your locality when you achieve your milestone, and of course huge visibility for your business that you can leverage in the months and years ahead. Get the people to "own" the target, and check out for yourself the power of crowdsourcing.

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All content in Marketing Wiz is created by Wealth Forum and should not be construed as views of Kotak MF.



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