1) Donation-based crowdfunding
Much like the definition of donation, people give a campaign, company, or person money for nothing in return. Usually, individuals will give money out of support for the business’s growth and do not expect anything back.
In this case, the money pledged by backers is considered a loan and must be repaid with interest by a specific deadline.
This is the most common form of crowdfunding where donors receive something in return for their donations. Generally, rewards vary by size of the donation, which provides an incentive for higher contributions.
There are not many crowdfunding campaigns that allow backers to own portions of the company they are supporting. Equity-based crowdfunding enables small businesses and startups to give away an amount of their business in exchange for funding. This type of donation is considered a type of investment where participants will receive shares in the company depending on how much money they contribute.
At the moment, there are currently four powerhouses in the online crowdfunding platform landscape: Kickstarter, GoFundMe, LendingClub, and Indiegogo. Before we look at some tips for creating a successful crowdfunding campaign. We need to understand each platform so that there are no barriers to launching a campaign.
Kickstarter is a rewards-based donation platform that has helped companies raise money since 2009 and has raised over $5 billion for more than 182,000 projects. The platform does not allow equity crowdfunding and has a list of prohibited items. GoFundMe is a donation-based crowdfunding company that is famously used for more charitable initiatives. Nevertheless, businesses can also take advantage of the platform. Thirdly, LendingClub is a debt-based crowdfunding site based on P2P lending.
The platform offers up to $40,000 in personal loans and up to $500,000 in small business funding. Finally, Indiegogo is another reward-based platform, but it provides two kinds of funding; fixed and flexible. Fixed funding allows companies to set a goal for a certain amount of money. If they do not reach their target, all funds are returned to donors. Flexible funding allows a company can keep any amount of monetary support whether they hit their goal or not.
Crowdfunding Tips For a Successful Campaign
There are quite a few stages to any crowdfunding campaign. If you carry out all the steps correctly and effectively, then your campaign will have significantly higher chances of success. The stages include research, pre-launch, funding, and post-launch.
1) Do your research
Research is the first stage of any crowdfunding campaign; it is crucial in determining the project’s success. The main objective of the research is to help you understand the value of your product as well as its demand on the market. Research also helps you explore the strategies that your competitors have used and successfully implemented. You should compare your company’s development to other similar products in addition to evaluating the benefits, target audience, and positioning of each during the research stage.
1a) Learn if the audience is interested
Regardless of what type of company you have, the first task should be to ensure that you have a good product-market fit. Rather than solely focus on the opinions of loved ones. You need to get a more objective idea of your product’s potential by getting market validation from potential backers. You can use analytics tools that are designed to figure this out. Using those techniques, you can learn if your audience is interested in your product and whether they will buy and test the product at the price provided. There are tools out there to help determine the add-to-cart-to-purchase ratio and the correlation between behavior and purchases. Some can also forecast through accurate market projection, consumer behavior, and the percentage of people returning to a Kickstarter campaign.
1b) Get early subscribers
Through research and analytics tools, you can already shape your audience and obtain ambassadors for your products. Using insightful analytics. You can see how well your product performs based on industry averages and can make the respective changes to product features and pricing to make it more attractive to potential backers, Proper research is an affordable method of gathering qualitative evidence on the product’s potential and finding the right market and the right price for the market.
2) Research similar campaigns
Another way to know whether a campaign will do well is to see how similar campaigns have performed. You can analyze your competition’s performance by analyzing their funding curves through trackers like Biggercake. This is only available for Kickstarter and Backertracker. Not only will this help you see whether your product will get backed but it also helps determine which platforms work best for your product.
It is important to remember to gain insight from recent data from recent campaigns since old campaigns that may have been successful in the past may not be successful at the moment. It is also possible during the research process that you will come across many similar products and competitors. Rather than getting discouraged, you can figure out how to improve your product and make it stand out by taking into account other companies’ experiences, users’ feedback, and other factors.
3) Examine similar products
It is common to come across similar products in the market as you plan to launch your own. Another way to increase the chances of your product’s success is to examine similar products on Amazon and other e-commerce websites during your research process. You should pay close attention to the number of reviews the other products have received. It’s also important to read the comments and reviews to understand better what features consumers like, what did not work well, and what needs to be improved.
4) Identify PR and marketing strategies that have worked
Research not only involves understanding what products already exist in the market; it also includes evaluating how successful crowdfunding campaigns were able to use effective PR and marketing strategies to reach their target audience. By simply typing in a competitor’s name into any search engine, you can see how your PR efforts allowed them to gain the appropriate media attention for their product.
You can also examine the advertisements your competitors have used to see what consumers are interested in, whether it is more visual or text-based.
5) Read past success stories and case studies
Since a crowdfunding campaign relies on consumers, to run a successful campaign. You should also pay attention to past success stories and case studies from other campaigns. This allows you to learn the best practices from the best campaigns to apply them to your own.
6) Brainstorm for potential targeting options
In addition to having a great product, you need to find suitable targeting options to reach the right audience. It is worth sitting down and figuring out keywords and techniques that are somewhat related to your product, so your efforts do not go to waste.
Launching a crowdfunding campaign is no longer just as easy as submitting a product, sitting back, and watching the money roll in. For this reason, preparation for a campaign launch can begin months before the actual launch date. Through thorough practice and proper research, you can get your audience excited about the launch before the campaign even goes live. The pre-launch stage is an essential step because it helps campaigners test the market, find the right niche, and collect large numbers of potential backers.
1) Create a landing page
In digital marketing, a landing page is a standalone web page created specifically for a marketing or advertising campaign. It is designed to convert visitors into leads. It is different from other pages on the company’s website because it generally has a form that allows companies to capture a visitor’s information exchange for the desired offer.
To look more professional and be considered an established business. You need to create a creative and user-friendly landing page. This will encourage potential backers to invest their money in the business. Several tools exist that help companies with little or no experience to creating landing pages and websites that will attract even the least tech-savvy website visitors.
2) Integrate with analytics and other functions
Most web pages and landing page tools now have built-in tools to help companies integrate their performance through analytics. By doing so, you can easily track your results and have a concise place to check your progress throughout this stage and further on.
You should also add tools on your landing page to help with your email marketing efforts and turn casual readers into subscribers, you can use tools that make it easy for you to customize and embed forms on your website and use unique platforms with many variations to remind your visitors to subscribe and back your project.
3) Use appropriate visuals and provide valuable information
Once the landing page has been created, it is now time to pique backers’ interest in the product. You need to have high-quality visuals and provide valuable information. This way, consumers know exactly what they are putting their money into and why they should choose this product over others.
You should also capture your product in settings where it was designed to be used. This way, you can help your target audience identify themselves with their product through their pictures. Since we have quite short attention spans these days, you should emphasize your product’s unique selling points through photos. High-quality images make a product more visually attractive and much more likely to get noticed. You should make it possible for potential backers to learn about a product merely by looking at the photos. This means that you should reflect on the key features of a product and show them in the best light.
A note about disorganized content
You should remember not to overload your page with disorganized content. If people were to find themselves on a confusing page. They would opt to go somewhere else rather than struggle to find important information among your chaos.
Additionally, the way you describe their product through text should provide value to consumers and help them to understand why it is necessary to back the product, Creating newsworthy content can be stressful, especially with so many other responsibilities that you’re likely to have when launching your business, product, or service. This is exactly why PR agencies like Pressfarm exist… To help brands to create newsworthy content that will help you gain media coverage for their project.
Pressfarm’s PR experts and writers create everything from press releases to personalized pitches and guest posts. This is in addition to other content that can gain traction for your crowdfunding campaign. The Pressfarm team also designs creative press kits that can create a memorable impression for your company, both in the media and among your target audiences. All of Pressfarm’s PR packages include access to their PR database of over 1 million journalists and media professionals across different industries
The PR professionals at Pressfarm also develop curated media lists, personalized to fit the niche and stage of growth of each startup, Combined with the comprehensive PR database, these lists help companies connect with the right media contacts to help them reach their target audiences, finally, the experts at Pressfarm help increase online visibility by helping companies feature in relevant search results on various search engines through their knowledge of the digital PR landscape and SEO.
4) Use email marketing
Once you’ve created a media list of your target media professionals. You should employ email marketing to get the word out there about your product. Email marketing is not necessarily a way to connect with media professionals. Nevertheless, it is an effective way to get their attention.
The company’s email should provide all the necessary information about the company founder. How and why the product was created, its benefits, and a clear call to action. You should think of sending emails as a way to develop mutually beneficial relationships with media professionals and their audiences. If you decide to use this strategy, you need to understand that you should not write the email to benefit yourself. Rather, you should also offer the media professional some value. Journalists do not like feeling like a means to an end. For this reason, you need to find creative ways to convince them to write about you.
If you plan to use email marketing to email your current and potential backers through subscription newsletters, you need to remember that consistency is critical, you should plan your emails simultaneously every week, you can also drop hints of what you’ll be covering next time to get your subscribers excited about the next email.
5) Drive traffic to the landing page
Now that you’ve created a landing page and developed some content for this page. You need to find ways to drive traffic towards it. You can do this by using social media ads, lead generation ads, or creating conversions to drive relevant traffic.
Along with that, you should also create at least 2-3 different versions of your landing page. Since you are still in the experimenting phase, this allows them to test which landing page works better with their backers. At the end of this experiment, you can choose the one which generates the best results.
Since crowdfunding is all about being able to gain a large audience to back a project, you should also organize a referral program. This way, backers will have more of an incentive to refer their friends and earn rewards from the campaign. Referral programs are a great way to drive traffic to a landing page. Because it rewards participants with tangible gifts that will motivate them to participate in the project.
6) Social media to reach audiences
Social media has become an easy way for people to communicate with people all over the world. Messenger marketing or chatbots have also become a way for companies to communicate with their audience in a more straightforward way. Tools like ManyChat have given companies an easier way to communicate because of their easy-to-use user interface and flow building. Many messenger marketing platforms are now doing a great job of constantly developing and enhancing functionality and usability. They also allow companies to schedule a broadcast for their segmented audience whenever they wish.
Influencer marketing has also become a way for companies to get the word out there about their business. Even so, it needs to be done effectively. If you plan to use social media and other video platform influencers. You need to pay attention to how engaging the target influencer’s posts are. Evaluating the number of comments that each post receives can be an excellent way to assess their engagement rate. Along with finding the right influencer, you need to choose the right social media channel to promote your product. In this case, you need to consider the price of the product and how you plan on promoting it.
According to professionals, products that are cheaper in price tend to work well on platforms like Instagram. In contrast, expensive ones tend to work better on video platforms like YouTube. With its plethora of influencers doing product reviews and unboxings for a living.
When it comes time to communicating with the influencer, you need to create a clear understanding of what kind of content you expect. Just remember to do this in a way that doesn’t hinder the influencer’s creativity. After all, influencers don’t like feeling stifled.
It is essential to only launch the campaign when there is a high-quality, functional landing page. Otherwise, the project will not gain the visibility it deserves. It is important to note that different crowdfunding platforms take varying lengths of time to approve projects, so you need to plan for this. For example, Kickstarter generally takes about three days to approve a campaign, while Indiegogo typically approves them instantly.
1) Launch Kickbooster campaign as a supplement
Along with the original crowdfunding campaign. You should also launch a Kick booster campaign. As an affiliate marketing platform for Kickstarter and Indiegogo campaigns. Kick booster helps creators manage their affiliate marketing programs separate from the original campaign but in an integrated platform.
2) Submit the project to backer communities
Along with Kickstarter and Indiegogo campaigns, crowdfunding promotion services significantly contribute to a company’s fundraising efforts. You can generate more traction for your project by submitting your project to product listing and newsletter services.
Some of the services include Product Hunt, Backer kit, Gadget Flow, and many more. Platforms like Product Hunt allow users to share and discover new products. It is a platform that unites many inventors, early adopters, and gadget-aficionados to significantly raise awareness for a product and generate leads to conversions.
Tracking the results
Result tracking is essential when you’re choosing relevant strategies for your Kickstarter campaign. This is because it helps you understand what you should focus on more.
1) Track campaign page results
Two tools used to track conversions easily and other metrics are analytics found through crowdfunding sites like Indiegogo or Kickstarter and Google Analytics, Regardless of which platform you decide to use. You will always be able to access your analytics through the native dashboard of the platform. Google Analytics is one of the most reliable choices when dealing with conversions and user behavior.
When measuring analytics, you need to keep an eye out for a few factors: age & gender, bounce rate, conversation rate, and funding per visitor. By finding the most relevant age and gender of real visitors and customers, you can target your ads more precisely and find influencers with relevant audiences, Secondly, you can keep an eye out for the bounce rate to see why people click out rather than stay on your page. If the percentage rate is relatively high, then you know that there is something wrong with your page’s content, design, or even your product price. Conversion rate is the metric that you need to pay the most attention to because it shows the percentage of sessions that have resulted in a transaction. You can also see the amount of funding that each visitor provides for your product.
Creating a successful crowdfunding campaign is not just a one-time thing. On the contrary, it is a long process of constantly trying to understand what works and what does not, depending on the avenue and the audience, however, by seeking insight into the different parts of the campaign, you can develop a clear path of what needs to be done at every stage to have a successful crowdfunding campaign. With so many campaigns out there, running a successful campaign is about more than just having a great product and vision. It also involves understanding the demographics of target audiences and providing a solution to consumers’ wants and needs. Whether on your own or with the help of PR professionals, you can apply what you have learned to get the funding you deserve and transform an idea into reality.