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Designing for Crowdfunding Co-creation

How to Leverage the Potential of Backers for Product Development

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Abstract

Crowdfunding is now established as a valid alternative to conventional methods of financing for startups. Unfortunately, to date, research has not investigated how backers can be encouraged to support entrepreneurs beyond funding. The aim of this study is to design and evaluate certain design elements for reward-based crowdfunding platforms that can engage backers in co-creational activities for product development. The study uses a design science research (DSR) approach and the theoretical concept of psychological ownership to inform a new design and then experimentally test that design. The results suggest that the derived artifacts positively influence co-creational activities in crowdfunding and that feelings of psychological ownership play an important mediating role. The contribution of this research is threefold. First, this paper extends crowdfunding’s application potential from merely a method of financing to a method of value creation with customers for product development. Second, the study advances DSR by applying a new DSR approach that shows whether a design performs as hypothesized by theory. Third, this research allows the exploration of backers’ individual behavior as opposed to their collective behavior.

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Fig. 1

Adapted from Kuechler and Vaishnavi (2008)

Fig. 2

Adapted from Niehaves and Ortbach (2016)

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Notes

  1. In the following we will refer to backers mostly as potential customers since in reward-based crowdfunding most supporters are potential buyers of the product.

  2. Pre-selling refers to a process where users/backers can acquire the rights for a certain product or the rights associated with a certain product (i.e., the product itself or the rewards discussed earlier) even before it has been produced.

  3. These product reviews can be provided by early users who test the product before others or by special communities who, due to their thematic interest, report and review certain new products.

  4. This was done to account for users who are likely to skip textual information and focus more on visual cues such as ratings.

  5. https://artofthekickstart.com/crowdfunding-demographics-understand-kickstarter-and-indiegogo-backers/.

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Authors and Affiliations

  1. Information Systems, University of Kassel, Pfannkuchstraße 1, 34121, Kassel, Germany

    Nikolaus Lipusch, Dominik Dellermann & Jan Marco Leimeister

  2. Corporate Entrepreneurship and Digitalization in Family Businesses, University of Witten/Herdecke, Alfred-Herrhausenstr. 50, 58448, Witten, Germany

    Ulrich Bretschneider

  3. Institute of Information Management, University of St. Gallen, Müller-Friedberg-Strasse 8, 9000, St. Gallen, Switzerland

    Philipp Ebel & Jan Marco Leimeister

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  1. Nikolaus Lipusch
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  2. Dominik Dellermann
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  3. Ulrich Bretschneider
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  4. Philipp Ebel
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  5. Jan Marco Leimeister
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Correspondence to Philipp Ebel.

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Accepted after three revisions by Oliver Hinz.

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Lipusch, N., Dellermann, D., Bretschneider, U. et al. Designing for Crowdfunding Co-creation. Bus Inf Syst Eng 62, 483–499 (2020). https://doi.org/10.1007/s12599-019-00628-w

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