This document discusses how industrial B2B firms can combine digital marketing, social media, and crowdsourcing to facilitate innovation and value co-creation. It proposes a model where firms use social media to improve awareness of idea challenges and use crowdsourcing to solicit new ideas and solutions from customers and end users. While some large B2B firms have begun using social media for marketing, the document finds they have not fully utilized it for innovation or crowdsourcing from external groups due to concerns about purchasing processes, intellectual property, product complexity, and lack of resources. However, as social media use increases over time, especially among younger workers, the document suggests crowdsourcing potential for B2B firms will grow.

1. FACILITATING INNOVATIONS AND VALUE
CO-CREATION IN INDUSTRIAL B2B FIRMS
BY COMBINING DIGITAL MARKETING,
SOCIAL MEDIA AND CROWDSOURCING
Henri Simula, Aarne Töllinen & Heikki Karjaluoto

2. MOTIVATION
There are already many cases which have demonstrated the power
of social media and crowdsourcing separately (e.g. Li and Bernhoff
2008; Howe 2008; Parent et al. 2011).
The purpose of our paper is to examine how
industrial business-to-business (B2B) firms could
interact with their products’ end-users via social
media in order to receive new ideas, feedback and
solutions to improve their innovation process.

3. MOTIVATION
”Beyond advertising on Facebook or Twitter,
companies are using social networks to build teams
that solve problems faster, share information better
among their employees and partners, bring customer
ideas for new product designs to market earlier,
and redesign all kinds of corporate software in
Facebook's easy-to-learn style.”
USA Today, Cover Story, May 17, 2012

4. THE INITIAL IDEA
SOCIAL MEDIA
FIRM Customer
X Y
CROWDSOURCING

5. THE INITIAL IDEA EXTENDED
SOCIAL MEDIA
FIRM Customer End User
X Y Z
CROWDSOURCING

6. PROPOSED MODEL
Social
Media
applicaDons
(Blogs,
Discussion
forums,
TwiIer,
Facebook,
LinkedIn,
YouTube)
and
viral
markeDng
to
improve
awareness
of
idea
challenges
Manufacturer
B2B
SALES
&
B2B
CUSTOMER
MARKETING
Crowdsourcing
new
ideas
B2B
and
soluDons END
USER
R&D (B2C
CUSTOMER)
SERVICE
&
MAINTENANCE

7. SOCIAL MEDIA
• Marketing communications in the digital world is about
creating presence, relationships and mutual value
• Ideally the digital communication is two-way, personalized
dialogue with each customer, which can potentially be a
source for innovations too
• Social media provides a way to share ideas, content, thoughts
and relationships online i.e. people are connecting, interacting
and sharing online with each other.
• The two key characteristics of social media are user generated
content and customer interaction
Scott 2010; Halligan & Shah 2010; van Zyl 2009; Riegner 2007;
Wertime & Fenwick, 2008; Rowley 2004

8. SOCIAL MEDIA
• In a B2B context, social media is much more than mainstream
applications such as Facebook, LinkedIn, Twitter or YouTube.
• E.g. instant messenger applications, modern intranets and
interactive digital selling tools can be social in a nature.
• Also social Customer Relationship Management (CRM) can be
considered as a social media application.
Acker et al. 2011

9. SOCIAL MEDIA & B2B
• Tools enable fast and personalized communication with
customers
• Can enhance corporate credibility and deepen the customer
relationship.
• B2B companies can use it to both attract new customers and
cultivate existing relationships.
• Provides a new tool for an organization to create a unique
brand identity and to differentiate itself from its competitors.
• Tools make it easy for a B2B company to stay connected with
its partners, distributors and manufacturers.
Kho 2008; Weber 2009; Michaelidou et al. 2011

10. SOCIAL MEDIA & B2B
• B2B companies have been quite slow to adopt SM in their
marketing communications
• There is a significant gap between the potential and the
actual use of social media in B2B business.
• Academic research is quite limited in the field of social media
use in the B2B sector. (Most likely this about to change…)
Michaelidou et al. 2011; Jussila et al. 2011

11. CROWDSOURCING
“Crowdsourcing is thus a powerful resource
for innovators. ... A world of people and
organizations is available to assist you, if
you have the commitment and care to
engage them properly.” (Chesbrough 2011)

12. CONCEPTUAL MESS
… also peer production, collaborative systems, community
systems, collective intelligence, crowd wisdom, customer
empowerment & mass collaboration…

13. CROWDSOURCING
“Simply defined, crowdsourcing represents the act of a company or
institution taking a function once performed by employees and
outsourcing it to an undefined (and generally large) network of people in
the form of an open call. This can take the form of peer-production (when
the job is performed collaboratively), but is also often undertaken by sole
individuals. The crucial prerequisite is the use of the open call format and
the large network of potential laborers.”
Howe, 2006

14. CROWDSOURCING
“Crowdsourcing is a type of participative online activity in which an
individual, an institution, a non-profit organization, or company proposes
to a group of individuals of varying knowledge, heterogeneity, and
number, via a flexible open call, the voluntary undertaking of a task. The
undertaking of the task, of variable complexity and modularity, and in
which the crowd should participate bringing their work, money,
knowledge and/or experience, always entails mutual benefit. The user
will receive the satisfaction of a given type of need, be it economic, social
recognition, self-esteem, or the development of individual skills, while the
crowdsourcer will obtain and utilize to their advantage that what the user
has brought to the venture, whose form will depend on the type of activity
undertaken.”
Estellés-Arolas &
González-Ladrón-de-Guevara, 2012

15. CASE EXAMPLES…

28. EMPIRIA
• Cross-industry research project’s workshops
• Survey data from industrial firms (n=145)
• Interviews with three large industrial B2B firms;
global manufacturers with products that are visible
and observable to potential end-users; (# of
employees varied from 10,000 to 30,000, revenue
from €1.5 billion to €5 billion.)

29. FINDINGS
• Social media tools were used, but not to their full potential.
• Social media was also seen mainly as being for marketing
purposes, rather than for evoking ideas or for innovation co-
creation among people outside the organization.
• Companies had published YouTube videos for marketing
purposes, some firms participated in LinkedIn group
discussions and some level of Facebook and Twitter presence
had been established.
• However, no external crowdsourcing was established in
practice in these firms.

30. BARRIERS
• Industrial purchasing processes (IPPs)
• Intellectual property rights (IPRs) in general created some
worries.
• Products are complex and require technical know-how and are
governed by several strict standards and legislation.
• “A layman, does not have a sufficiently deep knowledge of that
product.”
• People in organizations are already busy and there are no
resources to conduct crowdsourcing
• A global idea competitions would provide too many ideas. (?)
• Fear of leaking ideas to competitors.

31. FUTURE POTENTIAL
• Setting up crowdsourcing seems to be more a question of
company culture than of technical implementation.
• Actual end- users would become more ‘computer savvy’ in the
future, and perhaps the field workforce would be using more
social media when the next generation came into the
workplace.
• In general it is likely to assume that both social media use and
crowdsourcing in the B2B sector will grow in the future
• More research is needed… J

32. THANK YOU
henri.simula@aalto.fi
Twitter @HenriSimula