By Evan Varsamis, entrepreneur, founder/CEO at Gadget Flow, investor and marketing advisor at Qrator Ltd.
The number of crowdfunding campaigns has been increasing with great momentum throughout the past few years. In 2015, these campaigns generated $34 billion, and there are no signs of slowing. If you ask me, it's a platform that is here to stay -- one my company has had great success with.
Because of this growth, however, it has become even more difficult to make sure that a campaign stands out from the many others. There are a number of factors and scenarios you have to consider to ensure its success. Although running a crowdfunding campaign might seem like an easy way to jumpstart your entrepreneurial dream, you can lose it all if you don't do it right.
Recently, I worked with the team at Arora Project to analyze 10,000 backers across $10 million raised in the crowdfunding world. From our research and observations, we identified several metrics you need to consider in order to run a successful crowdfunding campaign.
We found that the average pledge amount that people prefer backing for crowdfunding campaigns is $403.18. What does that imply? People are willing to back that amount if they find your campaign to have substantial value. If possible, center your pledge rewards in the $200 to $450 range. This will give you a higher chance of exceeding your funding goal.
Pew Research Center also found that large donations are not uncommon, with 21 percent contributing $51-$100 and another 14% giving $101-500 to a single campaign -- though the vast majority (49 percent) contributed a lower amount, between $11 and $50.
The key focus here is demonstrating the value to your backer or contributor community. Get creative with your reward tiers. What version or mixture of your tiers hits the sweet spot of value, price point and creativity?
Next comes the ratio of male-to-female backers. Male backers far outnumber the female backers for crowdfunding campaigns, 85% to 15%. So, it would be wise to cater some of your campaign to men. This does not imply at all that products catered to the female population will not do well; this simply implies that there is a large community of male backers in the crowdfunding world.
And, though Pew Research Center shows a male-to-female ratio that's nearly level, it also gives insight into the largest age groups of supporters, citing that 30 percent are between 18-29 and 27 percent are between 30-49. While your description should function to include every type of backer, creating a story that resonates with your product's demographic and that of campaign supporters might work in your favor.
Furthermore, while people might be more involved in mobile browsing today, when it comes to backing crowdfunding campaigns, desktop browsers are favored at 62 percent. So, while you should make your campaign work across devices, you can focus on making videos and images -- as well as your entire campaign presentation -- more prominent for desktop users. Also, around 55 percent of mobile users have iOS devices and 45 percent use the Android operating system. It's a pretty close race, but if you are planning to launch a mobile app campaign or work on one related to your project or product, you might see a slight advantage if you release an iOS app first.
Though 65 percent of your audience will come from the U.S., you should never underestimate the remaining 35 percent. For most people who back your project from different parts of the globe, the primary concern is shipping. If that's not addressed with a proper fulfillment service, you may lose the 35 percent of potential backers. Global shipping is crucial for crowdfunding campaigns and the more you consider it in your campaign, the more successful your campaign can be.
The range of daily, unique visitors varies vastly from campaign to campaign, given the resources, market reception and overall paid effort put into traffic generation. The range seen over some of Arora Project's highly funded campaigns was between 3,200 and 15,330 visitors. Full disclosure: 15,000 unique visitors is a high number that usually implies there is a good reception of your campaign. Anywhere between 5,000 and 8,000 daily, unique visitors is standard for successful campaigns.
To keep this traffic influx steady throughout the duration of the campaign, there need to be daily efforts, ranging from sending email campaigns, public relations initiatives, influencer marketing, social media ads, organic outreach and more. Suffice to say, every single day of your campaign is important. You need to post regular updates, reply to comments and keep your page up to date with current information. Failing to do so will result in a drop of unique visitors which might just drive away potential backers.
Nevertheless, in fewer than 20 years, crowdfunding has changed the landscape of fundraising, overtaking many traditional methods. As this platform continues to increase in the number of campaigns and backers, success depends on strategic planning in order to be noticed among the crowd.
Evan Varsamis is an entrepreneur, founder/CEO at Gadget Flow, investor and marketing advisor at Qrator Ltd.