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Case Study

The AI paradox: Will generative AI enhance or destroy the business model of 99designs.com? (Cartoon case)

By Stefan Michel

4 pages

October 2024

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Reference: IMD-7-2505

99designs.com is a global platform connecting freelance designers with potential clients. The case study examines the potential impact of generative AI on 99designs’ business model. The platform uses a crowdsourcing approach that invites designers to compete for projects with only the winning designer getting paid. This model offers clients a variety of design options at a fixed fee, fostering creativity and competition among designers. The authors of the book “Real Impact Strategy” used the competition model at 99designs to design their book cover. The authors appreciated the interactive and collaborative nature of the process, which allowed them to incorporate feedback from potential readers into their final decision. However, the use of 99designs sparked criticism from traditional designers and colleagues regarding potential exploitation of designers and claims that genAI tools could have done the job instead. This criticism highlights the growing influence of genAI as proponents claim it can produce high-quality designs quickly and at low cost. Generative AI poses both opportunities and threats to 99designs. It can enhance the platform by increasing the quantity and quality of design submissions, making design services more accessible and affordable. Conversely, it threatens to devalue human creativity, reduce the demand for freelance designers, and undermine the platform’s business model by enabling clients to generate designs without professional assistance. The case ultimately raises questions about the future role of generative AI in the creative industries. In the teaching note, but not in the case itself, the authors conclude that 99designs.com provides publishers, and in this case, the co-authors, many benefits beyond designing the cover. It involves them in a learning process as well as helps them to create awareness and interest for the book through the cover survey.

Learning Objective

Identify the relevant value constellation for 99designs.com as a platform connecting clients with freelancers.
Analyze the features that 99designs.com provides.
Connect those features with the benefits for clients and for freelancers.
Evaluate the multiple benefits that 99designs.com offers to clients beyond the simple creation of a design.
Discuss the AI paradox that 99designs.com is facing, i.e. whether Generative AI is a strategic threat or an opportunity for the platform.

Keywords

Strategy, Business to Business, Digital, Disruption, Generative Artificial Intelligence, Business Model, Design, Publishing, Platform

Settings

World/global, Switzerland
Manufacturing, Graphic Design
2021

Type

Published Sources

Available Languages

English

Related material

Teaching note

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