They say that a little knowledge is a dangerous thing. In the case of crowd funding, perhaps a little knowledge is not so much dangerous, but it can waste time as well as being rather disheartening when a campaign is commenced with the owner not going in with their eyes open, and then not achieving the desired outcome. But knowledge is power. Understanding your crowd, how to motivate and communicate with them, as well as understanding what crowd funding is all about can make the difference between success and disappointment.
Firstly, it is important to understand what crowd funding actually is, and the mechanics of how it actually works to truly appreciate the roles of the platform and the owner of the campaign. A common misconception is that the platform raises the funds, and that the campaign owner need simply post a campaign and then sit back and watch the money roll in. The platform provides a foundation on which the campaign is hosted, and which simplifies the pledging and payment process, as well as allowing the campaign to be easily shared. Some even provide a structure and coaching to campaign owners’ campaigns. It is up to the campaign owner to then find the initial supporters and to get the early momentum behind the campaign. Only once the campaign has sufficient momentum (usually around 20 – 25%) will the activity, promotion and marketing of the platform actually kick in.
Shooting an arrow aimlessly into the air is unlikely to yield any great prize. The same can be said for crowd funding. It is essential to identify your crowd – to whom is it that you need to promote and appeal? Understanding what motivates them and how you engage with them are paramount to gaining their support (are they motivated by the outcome of your campaign e.g. to save a species of turtle, or are they motivated by getting their hands on a cool, highly sought after reward?). And it’s not just what inducements you need, but how many people do you need to appeal to in order to achieve your target. Working on the basis of just 10% of those in your networks will actually pledge, and given that the average pledge is $50, you will need to work out what will need to be the optimal size of your crowd before you begin to promote your campaign.
The advent of the Internet has made everyone a potential broadcaster. In one sense, this is a good thing, giving everyone a voice, but in another sense, it has created a noise on the ‘web that can be a challenge to cut through. Facebook, Twitter, LinkedIn and the like are all great social media tools but using them effectively to build and audience prior to starting a campaign, then using them efficiently during the life of a campaign can be a challenge. Drafting an effective communications plan before your campaign is exposed to the crowd can be tricky – how do you blend social media, with traditional media and get all of the channels leveraging off each other?
The wheel has already been invented, so it is a matter of finding what has worked well for others who have worn a path over the ground you plan to tread. When it comes to writing a campaign description, rewards, and a campaign video, it is unlikely that you will not be able to find someone who has already run a successful campaign in the same sector. These previous campaigns make for a perfect temple that any astute campaign owner can then meld to suit their own needs.
When the sun sets on any campaign, one of two results will have been achieved, success or unsuccessful. Either way, there are a number of activities and actions that should be undertaken. How do you best thank people, or utilize the information your gathered along the way? How do you go delivering the rewards, and what is the best way to communicate any changes to your plans and schedules? And if you are going to have another go and either raise more funds or have a second attempt to raise the funds you missed out on, what is the best plan for starting again and re-engaging?
There are many questions raised in this blog piece. The answers are found in some of the great seminars, workshops and online courses like this one by successful crowd funding marketer, Eli Regalado. There are informative blogs dedicated to crowd funding that speak from a position of experience, knowledge and authority such as the iPledg Blog. And there are excellent websites at the core of the industry like www.crowdsourcing.org which provide infographics, statistics and case studies of the latest successful crowd funding initiatives.
Use the resources, gather the information, and use the experience of those who have successfully walked before you, and you will be well on the way to achieving your crowd funding goals.