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So you’re thinking of crowdfunding your next launch because you’ve seen it be successful for other products or “competitors”, but how do you know if crowdfunding is right for you? It is not going to work for everyone and after working with more than four dozen campaigners, I can tell you it definitely doesn’t work if you aren’t willing to put your maximum effort into it. So here are five things to think about before making that decision to green light your crowdfunding project.
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Why are you crowdfunding? There are good and bad reasons for crowdfunding and despite how easy people make it seem, crowdfunding isn’t for everyone. Consider the two extremes. If it is your “last option” you can probably spend your money and time better through another tactic that will get you more positive results for the time and money you have to spend to do crowdfunding right. If you have nothing to lose, then you may be wasting time and money that you can be spending more efficiently. Alternatively, we often hear that people are doing it for marketing or PR. What a horrible idea. The media has become extremely wary around crowdfunded projects and unless you can show them a solid proof of product, that brand awareness campaign will backfire. There are much better ways to get attention, especially if your product is already ready to go. When it comes down to it, crowdfunding takes more time and energy than it seems. If your product falls under the traditional need and understanding and you have the money, time and plan to execute crowdfunding in its full potential, then dive right in.
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Will it make or break your brand/company/product? Is crowdfunding a last resort for you? Then it is a horrible idea to put in your last bits of hope and funding you have to run a campaign. In this world of digital media and easy access to online advertising, it may be better to just offer the product on your website and double down on ad strategy and media relations, independent of a crowdfunding campaign
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Do you have the resources to do it properly? Despite what campaigners may think. The best campaigns had a solid budget for campaign management, online and digital marketing, influencer campaigns and media campaigns. Not only do you need money to execute this properly but you need to be able to invest time into managing and monitoring the process. Have you considered the resources you’ll need to execute a successful campaign? Our suggestion is to write it all out and measure the time it will take before you decide to move forward.
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What do you want the outcome to be? Are you going to be that $15 Million campaign? Probably not. While 78% of campaigns exceed their crowdfunding goal, the average campaign raises about $7000 (remember this is an average). The goal of raising funds in crowdfunding is to know how much you’ll raise before you even begin. Email lists and pre-marketing are a huge component to that understanding. So if you do want your campaign to reach six figures, you should have a well-curated list of emails, begin media outreach at least three weeks before your campaign and have a digital marketing plan in place as well.
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Will you be okay if you fail? Most campaigns fail. Not sure that you wanted to hear that, but that’s good to know going in because it sets a precedent for making sure you make all the right moves. On Kickstarter, 56% of campaigns fail. On Indiegogo the percentage is higher, however, they have launched services to help campaigners reach their goals. Create some realistic goals for your campaign. While no one wants to fail, you should determine if failing is an option that won’t scar you too badly.
If you’re still not sure and you want to get some expert insight on if crowdfunding is right for your specific project, feel free to contact us at info@thesilvertelegram.com and we will be happy to provide insights and thoughts around your campaign.
Good luck!