Crowdfunding your new product or idea sure beats dipping into your own pocket, and it's probably significantly less stressful than asking family members to invest. But ask anyone who has ever done a Kickstarter or Indiegogo campaign and they'll tell you it's no walk in the park.
Only about 44 percent of Kickstarter projects meet their goal and Indiegogo's success rate is even lower. Many crowdfunding campaigns fail because there are too many similar products being promoted, lack of public awareness, and insufficient information about the project that causes backer doubt.
Don't let that scare you away. Despite crowdfunding's journey into oversaturation in multiple markets, companies and individuals are winning funding, as well as publicity buzz. After reviewing dozens of glowing campaigns, it seems success boils down to these three things:
1. Planning Ahead
Popbasic, a women's fashion brand in San Francisco, reached its goal of $20,000 in less than five hours. In fact, it has made more than 300 percent of its initial goal and still has a couple weeks to go.
This windfall seemed to happen very quickly for the company, but that is not the case. It planned the campaign six months in advance, constantly engaging their mailing list of over 30,000 women who knew about the silk blouse the company would be rolling out. In fact, the fans even helped choose the print and decide on design features. Popbasic's audience was emotionally invested in this Kickstarter long before the page ever went up!
The campaign didn't come without roadblocks. "It was tough to keep the momentum of the initial excitement of the campaign," says Madeline Veenstra, Popbasic's Co-Founder. It didn't affect them getting funded; however, as you plan for your own campaign, think about life after the launch. Maybe plan a special surprise in the middle of the campaign--an event or new incredible reason to back you. This way, you can continue the buzz around your product through the duration of the campaign.
2. Constantly Engaging the Audience
Comedian Ben Rosenfeld kept his audience engaged on and offstage during the Kickstarter campaign for his new illustrated coffee table book, Russian Optimism. "Before I made my Kickstarter public, I put together a spreadsheet of blogs, sub-Reddits and Facebook groups to pitch," he says. "Once I launched the campaign, I just made sure to do a little every day. I'd also make sure to do the stage version of the book every night when I performed and mentioned the website for the book after each show."
Ben exceeded his goal, but reminds us that between Kickstarter and Amazon Payment fees, a sizable percentage will be deducted from the funds. Also, international shipping fees to backers are expensive--so plan accordingly and adjust your funding goals.
3. Gaining National Exposure
"Most of our donations came from articles written about us and our products," says Etai Granit, Founder and CEO of BitBite, a wearable technology that helps monitor eating habits. The company gained national media exposure surrounding the evergreen topic of losing weight and improving personal nutrition. They were featured in Yahoo!, CNet, and CNBC to name a few and within 48 hours of launching their product, they had $20,000 in donations.
BitBite didn't have a physical product that people could hold in their hands, so they had to work harder to convince their backers that the product was worth waiting for. Because of the strong design factor displayed in their Indiegogo page, they were able to generate credibility.
If you are launching a crowdfunding campaign for a product, go above and beyond to show your audience all of its features as if they had it in their hands. Have a strong video that clearly shows the product and how to interact with it. Make sure your materials lay out the technology and its functionalities in a way that is comprehensive, but easy to understand.
You cannot be overprepared for a crowdfunding campaign. Better to push your launch to a later date than to do it when you're less than 100% ready. Once your materials are the best they can be, you have planned your media campaign to the endth degree, and you have the manpower to answer backer questions immediately, it's time to pull the trigger. Good luck!