ALL FOR THE MONEY? THE LIMITS OF MONETARY REWARDS IN INNOVATION CONTESTS WITH USERS

Practitioners increasingly use innovation contests to harness the knowledge of external crowds for internal innovation purposes in exchange for prize money. While some innovation contests have the objective to attract professional experts from distant fields to obtain technical solutions, other innovation contests primarily target customers or users in order to generate new product and service ideas. Hence, external crowds differ substantially across, but also within, innovation contests in terms of personal needs in the innovation domain. Drawing upon the private-collective model of innovation, we argue that participants’ “userness” in terms of personal needs gives rise to non-monetary reward expectations and collectively oriented participation as opposed to the private pursuit of monetary rewards emphasised in innovation contests. Hence, the effectiveness of monetary rewards in innovation contests is bound to certain participants and behaviours. In particular, participants weigh non-monetary rewards mor...