At the Le Web conference in Paris today, Jeremiah Owyang unveiled Crowd Companies, a “brand council that provides peer to peer knowledge, expert education from third parties and access to an innovation network of startups”. Formerly with social consulting and research firm Altimeter Group, Jeremiah has essentially launched a social network for enterprise business innovation, with an immediate focus on developing collaborative economy business models.
Brand consulting has traditionally been a specialist industry based on premium priced enterprise engagements for delivery of proprietary customized solutions. Social media impacts this scarcity model by bringing voices of domain expertise into the open. Industry leaders and management now openly share business intelligence and experience on blogs and the media, in part for their own personal or organizational brand development. The resultant exposure of expert voices has created a pool of expertise, much of it untapped because many of these voices still have day jobs.
The flip side of brand consulting is its lucrative customer base, the Fortune 500 companies. The sharing economy has created new disruptive business models that many traditional brand consulting concerns, like ad agencies, have a hard time grappling with because they extend beyond their brand marketing expertise into startup strategy and technology. Enterprises now need to rethink brand strategies, but the old consulting model of embedding young McKinsey associates to learn about their business isn’t cost effective when seasoned industry experts who have led innovation can teach or implement new strategies far more quickly. Instead, enterprises need an easier path to developing innovation that forces their management to step outside the bounds of their corporate culture to see what others are doing. This is a major challenge for those within the confines of a complex org chart. For example, retailers need to see how Patagonia developed its Common Threads program to help consumers resell and recycle Patagonia goods online, and start thinking about how they might take similar steps that may run counter to their traditional transaction focused business models.
Social networks have become marketplaces. Many of the new expert voices want to monetize or transact; they’ve set up consulting firms and startups, or are seeking projects and ventures that will benefit or enhance their work. Fortune 500 companies hold the purse strings, and this is where Crowd Companies focuses its business model. Crowd Companies facilitates the sharing of business innovation concepts and research between the innovators and the doers, and in effect acts as a business information and advisory marketplace. That marketplace takes shape in the form of Crowd Companies’ “Brand Council”, a consortium of companies made credible by the inclusion of many Fortune 100 firms. Like any marketplace, the business model takes a portion of proceeds in the form of membership fees.
The sharing economy is more closely associated with the physical objects we share, like Zipcars and Airbnb apartments. The sharing of information is already being done at the social media level, where ideas are broadcast via blogs and Twitter. Jeremiah asks the question: “What role do companies play if people get what they need from each other?”. The next phase of sharing needs to involve these companies so they can build products and services that fundamentally address the new needs of consumers, and to sustain relevancy in their lives.
My final thought: This is something LinkedIn should be doing. Through its Brand Council, Crowd Companies provides an application layer across a social network database to create business opportunities.