Last week I had great fun presenting at the General Assembly info session as an ex alumni of Jay Oatway’s Digital Marketing Course. At the end, as I was talking to some really interesting start-ups, it struck me that the majority of questions were around how we made our recent Indiegogo crowdfunding campaign such a success. So whilst this is a lot longer than our normal posts, we hope that you will find our top 10 tips for crowdfunding success here in Asia invaluable to setting up your own campaigns….
1. Research your ideal crowdfunding platform but don’t expect it to generate funds for you.
Over 90% of our funding came from our own efforts driving footfall directly to the page (unlike the 30% that you often see quoted on crowdfunding sites). Kickstarter offers potentially much greater support in generating awareness and noise for your campaign as it has a much more effective network of supporters but it also has more restrictions on who can use it (their focus is on UK and the states and they ‘vet’ every project before agreeing to have it on their site). This is vs Indiegogo where anyone can post and you can still get the funds even if you don’t hit your target (at a price) but there is less support to help you raise the cash.
Also it’s worth knowing that a lot of those people active on kickstarter etc are young males, so if you want to attract a different buyer like us you need to think how you will do the work to get them there as even if you get lots of noise it might not be with the group of people you are looking for.
Finally if you are tech savvy there are also ways to simply launch your own site if you are generating most of the interest yourself and just need a platform to take payments or angel investing if that is your preferred route. If you just don’t know where to start, take a look at crowds unite to help you see everything that is out there.
2. Have clear objectives before you start planning and not just financial ones.
For us we wanted to achieve a certain amount of orders to pressure test the manufacturing & generate some initial funds without over stretching ourselves or the factory too early on. This impacted every other decision we made. For your financial target set it based on what you need to kick off your idea but sense check once you have made your perks how many people you need to get to fund it on average and that you can see a way to generate that level of interest.
3. Make sure your perks are aligned to your objectives.
We reviewed a heap of similar campaigns across Kickstarter and Indiegogo and found that often 80% of the pledges delivered 20-30% of the cash ie. Many of the good campaigns resulted in lots of people supporting but at a low level. This left us with some serious heartache about our rewards as what we really wanted was to sell dresses, but these were pretty expensive (>200USD). Therefore after much evaluation our top tips for setting your rewards would be
I) Make sure your perks are aligned to your objectives – for us that meant giving women the chance to get our dresses
II) Make sure there are some cheaper perks in there for people to just show their support
III) Make sure there is something for men and women irrespective of your target – whilst our dresses are for the ladies we targeted our male network with kick ass gift boxes!
IV) Have an early bird deal that gets snapped up and gets some momentum. We launched with a 2 dress bundle and it was amazing to see hundreds of dollars come in within minutes of going live!
V) Think about offering a discount (give people a reason to support you now) but you don’t have to go too deep. Ours were typically between 10-15% and that was enough to make people take the leap of faith.
VI) Have some rewards that are just cash. It doesn’t matter how much these are but again it gives people who buy into your idea a way of supporting you. We called these ‘founders friends’.
VII) Be careful about offering perks that create a whole load of work but are not ‘on brand’. We thought about keyrings, t-shirts etc etc all of which would have created extra work without getting us closer to our objective and would also all cut into our margin.
VIII) Don’t release all perks from the start, have a few exciting bundles to help reenergize the campaign half way through and use these to reignite your PR / social media focus
IX) Remember your shipping… it can cost a fortune to ship internationally and so either work it into the price of the perk or be clear that people have to pay for it additionally (which is not very easy to do on Indiegogo and so we did have to go back to a number of supporters and ask for shipping separately)
X) Finally if you offer discounts and bundles, make sure they all stack up financially for you and for the person who is buying. Its easy to get caught out when you are building deals on deals.
4. When you have your targets and stretch targets and perks laid out, break them down and know how you could deliver every dollar.
We had individual targets for all the team and specific plans on what activities would deliver it at what part of the campaign e.g. trunk shows, early bird deals etc. The more you can target and measure which elements of the campaign can drive sales, the closer you can get to your target. If you don’t plan how to deliver the target any deeper than ‘PR’ or ‘Facebook’ you may come into problems when funding doesn’t come in as quickly as you would like (or get lucky!)
5. Put enough time aside to plan for the entire campaign before launching
We reckon 6-8 weeks minimum is required before you start to make a good campaign. It sounds a lot but you need to 1) set your objectives 2) Work out your rewards 3) set up your payment solutions 4) Develop your network and social media plans 5) Create your PR plan and 6) Ultimately create enough materials not just for ‘launch’ but for your updates throughout your campaign.
I actually haven’t gone into this in too much detail here as we found an MUST READ post by Tim Ferris (author of the 4 hour work week) and Mike Del Ponte called Hacking Kickstarter : How to Raise 100,000$ in 10 days. Whilst these guys are not in Asia the majority of what they have outlined worked for us and gives you everything you need to plan your campaign.
6. Don’t assume longer is better
Depending on the platform you choose you can decide how long you run the campaign for. From our research we realized longer isn’t always better as you have to maintain a huge amount of momentum throughout the campaign and it ends up all consuming. It does give you more time to deliver but if you do manage to hit the target early, we found everyone thought we had finished and we really had to re-energize people with stretch targets and new rewards to get things moving again. In the end we ran the campaign for 24 days and broke it down into weekly chunks with a focus for our activities each week so that we always had new news to go back to the same people with.
7. The video is key
And also unbelievably hard to do! We spent 3 weekends recording, editing and cringing at ourselves until we got to a point that we could use it. Even if you are broke find a way to get it done professionally (ask friends, friends of friends etc etc and trade your wares if you don’t have the cash). Also keep it as short as possible to get maximum viewings (ours was a bit too long) and make sure your key selling points come out in the first 15 -30 seconds in case people switch it off.
8. Don’t over rely on media.
Do the work to pull together press packs and get as much coverage as you can but don’t assume your funding will come from here (depending on the type of product / service / campaign you are running). We spent a long time pulling together our PR packs but in the end decided to focus our efforts on social media primarily as we really wanted a tight target audience and wanted to engage them in a deeper conversation as we knew our perks were pretty costly so it would probably take a lot to convert.
In the end we did get covered by Forbes (thanks Joshua Steimle!) and a few others which was awesome and it did generate some last minute funding but it would have never have been enough to have made the campaign. Feedback from a lot of guys we spoke to was that even sending out 100 media packs to bloggers, papers etc etc would result in only a handful of articles written.
9. Leverage key forms of social media that are relevant to your target
Start a few months before the campaign starts to build you community and your story. It doesn’t matter that you aren’t live yet as it takes people 5 or 6 times of viewing something to act on it. We really used our Blog and Facebook but could have used Twitter and Pinterest much much more than we did. Also remember because of the algorithms only a fraction of people in your networks (approx. 16% on Facebook) see any of your posts.. so don’t worry about posting and reposting several times a day or sharing the same material across different sites.
Our biggest learning for a product like ours was to stay focused on your target audience. Ultimately whichever route you try, do what it takes to talk to the type of people who are going to buy your product rather than just generate ‘likes’ or noise for the sake of it.
10 Finally be realistic.
Understanding the algorithm of the crowdfunding site you use really helps you make the most of its features. For us on Indiegogo, we worked out to improve ourselves up the ranking (and get visible on the front page / features etc) you basically need to
i) Get early momentum and achieve key milestones as quickly as possible – setting realistic targets is critical in this as you need to balance driving towards the money you need but doing it quickly!
ii) Be active. Every comment, update, picture you or your backers post on the site helps increase your visibility and so plan content up front, post it and respond to others daily to get as much noise as you can
For some grounding we found a useful post called what you should know before you Indiegogo . It’s a bit more sober reading but doesn’t need to put you off, just give you a better understanding of the pitfalls so you can make some great choices for your campaign
Finally, (ok so it’s more like 10 1/2 tips but who’s counting!) one of the most surprising things for us was that even though you know what crowdfunding is, most other people don’t. People thought Indiegogo was our website or that we were asking for investment in return for equity and when they did understand they were buying a reward, it was hard for them to get that it wouldn’t be instant. So in the end we made this part of our social media plan, wrote a crowdfunding blog post and leveraged email marketing to explain the concept as well as our offering.
Overall, delivering the crowdfunding campaign has been incredible time for us and whilst it took a lot of hard work it was definitely worth it. We hope this helps if you are thinking of doing one yourself and watch this space in a few weeks to see our learnings for delivery of our rewards through our local manufacturing solution!
Steph & Jess