9 Steps to a Successful Crowdfunding Campaign
Depending on the crowdfunding platform, between 69 and 89% of campaigns fail to reach their targets. According to Krowdster, 90% of crowdfunding success is owed to a carefully planned and executed plan of action on your part, whereas the traffic from the platform accounts for merely the remaining 10%. So the question is: how do you set about it?
1. Work on a Strong Kick-Off
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We tend to follow the crowd. The fact that someone is already backing the campaign, signals that it must be worthwhile and we are more likely to back it ourselves. That is the power of social proof, often used in fundraising efforts.
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The very first phase of a crowdfunding campaign is commonly referred to as the ‘Soft Launch’ and it takes place the first week before the official launch itself. It is reserved exclusively for your host comity and first supporters, usually your friends and relatives, who are supposed to help you reach at least 30% of the target goal. Why them, poor souls, you may ask?
Well, such a strong head start will have a psychological influence on your future backers, as it creates a sense of ease and comfort for those who are considering whether or not to contribute. For this reason, prior to the official launch of the campaign, it is of utmost importance to establish a social media presence and target groups and forums where you might find the future customers of your product.
2. Create a Buzz on Social Media
Utilizing the power of different social media platforms for crowdfunding has word-of-mouth quality, as it allows you to spread information across multiple networks in a matter of minutes.To have maximum impact, social media needs to be navigated and managed with care and purpose, so it is essential to first choose the platforms and devise individual strategies accordingly.
- Where do I have the most followers?
- Where can I get most shares and conversions from my prospects?
- On which platform can I find most influencers in my community?
- Which platform am I most comfortable with?
Facebook and Twitter are the most commonly used ones, however, the growing popularity of Instagram is something to consider. You can also go for LinkedIn, for campaigns that aim at a more professional audience.
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Start by answering the following questions:
When it comes to Twitter, creating a unique, short and catchy hashtag that you would use in all of your social media posts will allow you to organize them all into one topic page. This way you can centralize your conversions and people can easily inform themselves about your campaign. Furthermore, encourage your donors to use the same hashtag and you will receive valuable feedback.
Facebook, on the other hand, should serve as an ideal platform to create a campaign-specific page that will gather all of your supporters, and be a place where they can exchange views and news. Don’t forget to take advantage of Facebook page insights, as this handy feature enables you to track performance based on likes, reach, engagement (comments, shares) and demographics.
3. Be or Do Different
The majority of your success is going to be due to the product itself, so make something people are willing to pay good money to see, own and/or use. Take the example of the instabeat.me crowdfunding campaign.
Hind Hobeika, the one standing behind its stellar success, has ensured that the product she has designed fills a hole in the market. She has added novelty features to swimmer’s goggles that has enabled them to track heart rate, caloric burn, and number of laps.
To pride yourself on an equally fruitful crowdfunding campaign one day, you’ll have to do your homework before launching a prototype and look for a solution to an existing problem.
4. Choose You Platform
There’s a plethora of crowdfunding platforms, and the type of your project is what will influence your final choice. If you’re supporting a nonprofit or social cause, Crowdrise, Rockethub and Causes are among the most popular ones.
[su_quote cite=”Angel.Me” class=”right”]We want to contribute to create a new generation of entrepreneurs and angels by providing a platform that connects inspiring projects with a new class of angels that can change the way great ideas get realized.[/su_quote]
For those who are looking to start a business or find those who would be willing to invest in a million-dollar project, AngelList should be their one crowdfunding stop. When starting an equity based crowdfunding campaign and raising funds by offering shares to angel investors, the Angel.Me platform will help you connect with creative and like-minded entrepreneurs.
Finally, if you’re just an independent artist and wishes to show the world their unique creative project, Kickstarter and IndieGogo can be a safe way to go.
5. Set SMART Goals
Setting a funding goal might be one of the trickiest parts of establishing a campaign. If you go for Kickstarter, it’s all or nothing – if you don’t meet (or hopefully exceed) your funding goal, you won’t be able to keep the money.
On the other hand, you can opt for IndieGogo and keep what you get, regardless of the final outcome, but bear two things in mind: aiming too low might not be worth the overall cost of the campaign, whereas aiming too high can be quite stressful. Hobeika in her case decided on a sum large enough to cover the first round of production.
6. Tell a Story
In order to reach out to people, concentrate on giving others something truly valuable – prove that your product is something they have always needed, something that has been the missing piece of the puzzle all this time.
To achieve this, you can tell your story in the form of a video, since 52% of consumers claim watching product videos makes them more confident in their purchase. It’s an easy way of conveying a grand plan, it’s craft focused, and more importantly – has a transparent message. Visual representation in combination with an audio message can easily be used to explain the features of your product, with a close-up image and video of the product in action.
7. It All Depends on You
The success of any crowdfunding campaign equals the amount of work you put into it. Namely, before launching a campaign, you have to spend a certain amount of time testing it.
For instance, Hobeika emphasizes that it is crucial to define the community you are targeting and get the right press coverage. What’s more, she herself was proactive – as soon as she realized she couldn’t do it on her own, she hired a professional to connect with bloggers, social media, as well as coaches and swimmers who helped spread the news among her target community. Once experts took part of the campaign into their own hands, success was guaranteed.
8. Keep Your Campaign Going
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It’s incredibly important to have a strong start and finish. Nevertheless, the mid-campaign strategy should not be so easily disregarded either. By simply replying to people’s comments, keeping your page updated and sending thank you emails, you can keep your campaign on the crowdfunding map.
Whether you will decide to offer discounts, add accessories and add-ons for upselling, ensure that you price them strategically and emphasize that it is a limited offer (that is, a unique opportunity to enjoy the perks of the campaign). Referral contest are considered to be a smart move about 30 days into the campaign, or when you reach around 60% of the total funding goal, since there is already a contributor base to be activated and engaged.
9. It’s Not All about the Money
Yes, a crowdfunding campaign is a gateway to much needed capital, but you have to look beyond what is on the surface and check out the comments section, where you can find some valuable feedback from your backers. They might point out certain shortcomings a product might have and give input on how it can be upgraded.
Just be careful – at times, their input might not directly influence the product in question, but give you inspiration for the next one in line. Make sure you know which suggestions to implement and which to save for future project – don’t fail to solve one problem while trying to suit everyone’s needs.
It is also possible to build long-lasting relationships, not only with your customers, but with business partners as well. A tactically-executed crowdfunding campaign can bring many retailers and distributors to the product.
In the end…
Make sure you do an overall analysis of the campaign to see which methods worked best for your campaign and which ones drove the most contributions. Utilize them one more time for the final push.
Don’t forget to include final countdown updates on the timeline and send one or two days’ notice to your audience just as a reminder.
Good luck and may the odds be ever in your favor!
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