Market research with the aid of a smartphone application – a case study

Abstract

We discuss using the presumed ‘wisdom of the crowd’ to reduce the bullwhip effect in supply chains by enhancing the accuracy of demand forecast. Our case study describes a joint project of a leading European technology company (We chose RAGD as a pseudonym for the company throughout the study.) and the University of Kassel on a smartphone application for end customers to gather early information for this producer’s forecast. Our results confirm the ‘wisdom of the crowd’ hypothesis: A group of experts, in our case technicians who install and maintain RAGD-products, is capable of anticipating market fluctuations six weeks in advance. This only holds true if the ‘crowd’ of technicians is large enough. Our business climate index outperforms the company forecast in the first six months, when on average 22 technicians took part per week. We discuss successes and limitations of the cooperation and provide recommendations for similar projects.