This is a guest blog written by Michael Ibberson, a writer based out of Toronto, Ontario. He covers the most up to date news and information in regards to crowdfunding for the CrowdClan blog.
It goes without saying that crowdfunding offers an amazing opportunity for innovators, entrepreneurs, and artists to raise funds for a project online. With that said, crowdfunding is by no means free money; in order to be successful, a lot of work must go into the campaign. For those interested in crowdfunding but have no idea where to begin, this is the post for you!
Every project must first identify a primary demographic. This involves extensive research in terms of consumer interests, behaviour, and history. Furthermore, it requires an objective point of view: How does your project compare to others similar in nature and concept? You must define a target market narrowly but not exclusively, otherwise you leave little room for error. To help sway funders in a chosen demographic, pinpoint those in the industry who hold the most influence and bring them to your side. It’s also important for you to be revered as an expert as this will help improve your project’s marketability.
When approaching an audience, find the angle that accentuates all of your project’s unique features. Highlighting these elements will dazzle viewers. As well, always stay open to suggestions; your audience may offer insights on what the market lacks, which is information you can use to your advantage. This is why your project model must be as flexible as it is concrete.
On the notion of flexibility, consider teaming-up with other professionals when working within a particularly difficult market. While assembling an A-team may impress your followers, as a group, you’ll also find a reduced workload, diversified thought process, and an expanded market reach, helping to prevent exclusivity, as mentioned before.
With all of these details ironed out, take your knowledge of the market and apply it to each crowdfunding portal. With your project in mind, consider things like security, usability, reputation, statistics, financial tools (debit/credit/PayPal), user fees, as well as the portal’s model (all-or-nothing vs. all-or-something). Finding the portal right for your campaign is just as essential as finding the proper audience.
Setting Goals and Picking Perks
In order to set a realistic financial goal, calculate the fundamental costs of your project. This includes the hourly wages of consultants, designers, writers, or marketers brought on board for the campaign. You should even budget minor costs like web-hosting and travel. Every dollar counts when setting a goal.
One of the largest expenses for a campaign is the cost of manufacturing and distributing perks. Many successful projects use a multi-tiered system in which they assign various perks to different contribution levels. In such a system, always favour perks that reflect the project rather than those that are generic (i.e. a game expansion vs. a branded mug). Although creativity is an asset, you need to watch your expenses. Rewards cannot become your biggest obligation. So when creating a goal, carefully estimate both the manufacturing cost as well as the quantity of perks you expect to move during the campaign.
On top of your original goal, setting stretch goals may help you to make the most out of a single campaign. Projects often turn to stretch goals in the last few days, anticipating the myriad unknowns still to come. To do so effectively, however, projects need to introduce new incentives that attract or re-attract backers for the final push. Keep in mind that if you choose to pursue stretch goals, youwill be responsible for shipping more incentives.
The last thing you should do before launching a campaign is obtain the appropriate patents, copyrights, and trademarks. Safe crowdfunding involves protecting your ideas. When approaching the crowd, the idea of losing an invention to a competitor is a very real concern. Avoid this trouble by filing the proper paperwork early on.
How to Promote
The way you deliver your project’s story could have a huge impact on its success. Use emotion and logic to show people your campaign’s merit. Most people find it easiest to evoke strong feelings through video, as one can tell a story with words as well as with images and music. Using all of the artistic tools at your disposal, highlight the big idea — your ambitions, goals, and intentions.
Stay transparent in your promotion, but also practice persuasion. Everything mentioned in the video must serve a purpose. You may need to revise this part of the project several times before getting it right. Thankfully, film equipment does not cost what it used to. Try not to skimp out when budgeting the video, but remember that you are not running a feature film.
When it comes to promoting your project, build profiles on every social media portal and engage with as many users as possible. After building traction, start to approach popular social mediaists and ask them to review your project. Simultaneously, create a blog of your own. Target posts that are sharable, interesting, and, above all else, valuable. Whenever possible, fit time into your busy schedule to unplug and appear at meet-ups in person. Essentially, you should adamantly spread-the-word until the very last minute of your campaign, using every means to connect with backers from all over the world.