Crowding as a means of consumer engagement and social benefit for established organisations

Abstract

Crowdfunded projects utilise internet platforms and crowd participation for several purposes, namely: pooling finance; assisting with product development and promotion; and marketing of new business initiatives. Contributors are in turn offered financial rewards, products, equity, the satisfaction of participation and a sense of community. Crowdfunding began as a means of financing projects deemed unworthy by the established financial sector. Almost notorious for favouring underdogs, crowdfunding continues to grow and is soon likely to be a contender in mainstream finance. The rise in crowdfunding’s prominence begs the question: Could a large corporation also participate? Large corporations choosing to utilise crowdfunding could stand to benefit from the medium’s ability to create highly engaged consumers, develop brand communities, shape offerings, amongst other benefits. The mobilisation of corporations to engage in projects with societal worth would be of general benefit to society. Crowdfunding may provide the means by which such projects may be undertaken and provide the impetus and finance for such undertakings. Pivotal to the formulation of a successful crowdfunding proposal is an understanding of the contributor’s motives, attitudes and beliefs acting to drive participation. Some work has already described motivational drivers, but there appears to be a lack of research into contributor’s attitudes, specifically regarding attitudes towards project initiators. This study aims to establish how contributors may respond to projects initiated by a large corporation as opposed to smaller project initiators. The research will examine contributor’s attitudes towards crowdfunding project initiators, where the project initiator is a large corporate, or where there is an element of social benefit. The research will make use of an online quasi-experiment featuring a fictitious crowdfunding project as its methodology. This study draws upon extent crowdsourcing and crowdfunding literature to describe the newly emerged contributor/investor/crowdfunder. Consumer-identity theory, cognitive evaluation theory, prosumption literature, and the Theory of Planned Behaviour, are used to paint a picture of the motivational drivers and address the impact of identity upon contributor intention in a crowdfunding context. This study addresses a knowledge gap in that no extant literature appears to address contributors’ attitudes towards large project initiators within the crowdfunding context.