There are many options when it comes to funding your startup, and one of them has been getting a lot of buzz in recent years - crowdfunding. Crowdfunding is the collection of funds through small contributions from many different people in order to finance a particular project and it has become increasingly popular among businesses, thanks to the growing number of crowdfunding platforms.
Crowdfunding helps you avoid common fundraising obstacles and allows you to appeal directly to your target audience, gain access to new networks, secure capital without taking on debt, enjoy a straightforward way of processing and tracking funds, and build a base of customers who feel they have a stake in your business's success.
With that said, only less than a third of crowdfunding campaigns end up reaching their goal. The truth is, simply placing your new product on one of these platforms isn’t enough – if you want to succeed, your campaign must be carefully planned and executed.
Read on to discover what you need in order to win at crowdfunding:
Have a Clear Plan
To give your campaign its best shot at success, start planning your campaign at least 2 months in advance to help you to project your financial needs and use the capital effectively to prevent excess and waste. Consider the following to help you develop a solid strategy:
What are your crowdfunding goals?
A clear target is necessary to know where to aim.
How much money do you need to fulfill your project?
Use this crowdfunding budget tool to calculate costs, promotional expenses, rewards, etc.
How long should your campaign run?
A duration of 30-45 days is recommended to allow you to focus your efforts and build a sense of urgency amongst your audience.
What platform is right for your goals?
Depending on the project, different platforms will have different advantages and disadvantages. Go here for a complete list of options.
What rewards will you offer backers (people who donate to your campaign)?
Rewards encourage people to contribute to your campaign. Think what your audience wants and list at least 5-8 potential rewards you could offer.
Write Your Story
To encourage people to contribute to your cause, you need to tell your story in an authentic way that will generate an emotional connection. Answer the following questions to form a compelling narrative:
What is broken with the world today?
How does your project help “fix” what is broken?
Why does your project matter?
Discuss the impact of your product and the people who will benefit from it.
What are your credentials to make it happen?
Why should people trust you?
How will the project unfold once you get the money?
Lay out a clear, specific timeline for what backers can expect.
Where will the money be spent?
Let people know you’ve thought things through and have a workable plan, so they can trust you to use funds wisely.
Determine what videos and images you will use to convey your story.
Crowdfunding campaigns with videos raise 4 times more funds than campaigns without one.
For your crowdfunding campaign to be successful, you must reach out to as many potential backers as possible. Spread the word and get people as excited as you are about your project using the following tactics:
Embed a campaign widget/banner on your website.
Set up a landing page to build your email list.
Visits to campaign pages originating from emails have a 30% higher conversion rate.
Create a “Coming Soon” page on your selected crowdfunding site.
Reach out to your existing community.
Tapping into your existing network can help create the initial buzz around your project.
Update all your social media profiles (e.g., Twitter, Facebook, Instagram) to include a link to your campaign.
Create content to post on social media.
Use a calendar to organize your post publishing schedule.
Post to Facebook 1-2 times and Tweet 10-15 times every day to increase engagement and drive traffic to your campaign.
Write a press release.
Reach out to relevant media outlets, sites, and journalists to cover your campaign.
Boost your campaign’s exposure.
Send an email to relevant contacts in your database.
Keep your messages personal, showcasing your project’s unique features and rewards.
Post interesting and shareable updates.
Keep backers engaged and inform them of your progress by posting text-only updates or including images, videos, and sound clips.
Communicate with backers one-on-one.
Check your messages and comments regularly and respond to any questions to earn backers’ trust.
Use Google Analytics to track how many visits to the project page are converting into pledges and Bitly to track the activity surrounding your project views and shares. This data will help you know what’s working and what’s not.
A great product is only half the work. Strategically marketing it and supporting it with quality content is what builds a successful crowdfunding campaign that will get you to your fundraising goal.
Need help creating your crowdfunding campaign? Contact us for more useful advice!
Thought this was helpful? Check out 7 Tips for Building an Engaged Instagram Community or How to Foster Brand Loyalty Through Marketing for more business tips.