[This article was originally published on Social Media Week Global blog]
Like everything, there is no secret recipe for a successful crowdfunding campaign. From our previous posts it should be clear that there are lots of options, motivations, possibilities and tools behind every single crowdfunding project and similarly there is no single approach to creating a successful campaign. However, we have used our experience and analysis of crowdfunding to come up with a bit of general advice that should be useful to anyone wishing to start a crowdfunding campaign.
1. Clarify objectives, targets and time frame
It might sound obvious but it is important to clarify early on exactly what it is that you are seeking to achieve and share it amongst the team tasked with delivering the project. This is an important step because it should encourage you to come to an agreed position and also help bound the scope of your aims. It should make you realistic, and consider if this is a single project or perhaps a multiple project process, making the targets more manageable. As they say, eat the elephant bite by bite.
If you are planning on selling equity, establish how much and what value it is, and get the right legal advice before proceeding.
Give yourselves a time frame, this is crucial: it will help to manage the resources you will need to allocate to the project and to factor in that cost if necessary. It’s also a call to action. Don’t be afraid to review your schedule, you may need to revise the date as you establish what needs to be put in place before starting.
2. Choose the right crowdfunding platform
As we’ve seen in the latest post, choosing the right crowdfunding platform is a very important step in the process. You will almost certainly use one of the many turnkey solutions rather than trying to set it up by yourself. As ‘turnkey’ solutions they make the process more straightforward and have the typical functionality you need to operate a successful campaign. As a result this should lower the cost of the campaign by comparison to doing it yourself on a bespoke self-built platform. Also they will have passing traffic on their suite that will often fall outside of your own contacts and this ability to reach beyond one’s immediate audience is a key aspect of running a successful campaign. But each platform has a specific value proposition and you must choose from amongst this diversity a platform for the one that is correct for your campaign. It’s useful to articulate your decision making factors to ensure you have given this the necessary thought.
Of course the onus on delivering the campaign is very much on the project holder. These platforms offer a transactional service but the project holder must do the outreach and campaigning.
3. Choose the right rewards
Considering what rewards you should offer in a campaign is often the most difficult part. It can be challenging as it would be good to have a portfolio of rewards that are diverse and are of varying value in order to attract the widest spectrum of contributors and investors. Expectations of return can be extremely diverse, particularly in a networked world, therefore you should seek to accommodate that diversity of reward by including tangible and intangible returns. You should keep in mind that what you might like may not be what others like. Given that you should always seek to tap into the long tail of investors, you should imagine that people who at present know nothing about you or your project may well turn into funders. You absolutely want your initial contacts to want to reach out to their contacts, and those contacts to theirs and so on. We may not know or have any awareness of exactly where all of our funders will come from, so a reward’s value is both in the specific return to the investor but also in the value as an item to be shared further. By this we mean: would an investor want to tell the world about the reward they have just bought?
Another key element of operating in the online environment is the idea of lowering barriers to entry. You must be able to allow a diversity of funders to step in with opportunities for even very small donations being possible. Aggregation of small amounts into a largest overall total is fundamental to the offer of crowdfunding. Additionally every investment is an opportunity to celebrate and communicate, so lots of excuses to keep those communications lively and regular is important for momentum.
Different organisations will have different scope for generating rewards. Product developers can, and usually do, offer different versions of the product at optimum prices, ahead of normal availability and value added services in combinations that constitute a variety of reward packages. Some circumstances and organisations may have less tangible things to offer. Diversity and exclusivity are two fundamental elements. If an organisation finds it hard to identify tangible rewards, as it might perhaps be a third sector service provider, then creativity is important at arriving at a reward package. It is legitimate to consider approaching third parties to provide rewards for a given project. They benefit from the exposure and association with the project and may well have social media communities and relationship capital that can also be leveraged for a project. Collaboration is a key aspect of the networked environment, and it should be taken into account for every project.
4. Pitch and communication strategy
Having a well thought-through pitch is essential. Potential investors need to understand what they are involved with and why they should care. Being able to communicate and reiterate those key messages throughout the campaign is fundamental. Likewise, it’s important to identify the key words in the story we are telling as these will be valuable in identifying an audience as we reach out to online communities.
Passion is important – why should others care if you don’t? We can’t emphasise enough that you are reliant on your contacts reaching out to theirs and so on for this to succeed. If you simply appeal to your usual contacts and don’t find ways of making them reach out further then you are not using the power of social media and networked communities and you are not tapping into the “long tail”.
To do this the story in the pitch must be easy to tell and be worth telling. There are many approaches to developing compelling stories. One of them is Chip and Dan Heath‘s approach in Made to Stick: Why Some Ideas Survive and Others Die. They offer the SUCCESS model for developing quality content:
Simple – Find the core of any idea
Unexpected – Grab people’s attention by surprising them
Concrete – Make sure an idea can be grasped and remembered
Credible – Give an idea believability
Emotional – Help people see the values and importance
Stories – Empower people to use an idea through narrative
It’s worth trying it out on people outside of our immediate circle for an objective view.
5. Video and other media
A video to promote a project is very valuable. In a rich media world people are readily attuned to rich visual prompts. We will get only limited attention time so video can convey more in a short space of time: one will say more in terms of message in a short video that in a written pitch. It can be more engaging and can introduce quirkiness or humour and other elements that can make a campaign more attractive. If you are going to make one, then you need to ask yourself if and how you can make it. It doesn’t have to be Oscar quality, however, depending on the circumstances, professional video can be very slick. In any case, you should carefully consider the commitments associated with creating one: technical skills and equipment, time, participants, etc.
Video is a fundamental and very engaging communication method, but it’s wrong to rely only on that alone. There are still a lot of people out there who aren’t able to watch videos all the time, especially on the workplace, or on the go. Therefore it’s important to consider also other engaging pitch formats, such as a funny and short slide presentation, or a podcast, and to never underestimate the value of a simple and clear text. You should always keep in mind that the audience is very diverse. It’s good to keep it short and simple, and at the same time to provide enough material for those who will want to know more (link to more information, more resources, etc).
6. Audience & Channels
Whilst we emphasise the need to reach beyond the initial immediate audience, you will always have to target an audience to begin with. This audience may be part of your existing relationship capital and contact groups, but it may also be that you are seeking to make contact with a group you have not had extensive contact with before. Nevertheless the viral reach of social media is a key component in the success of crowdfunding and if an organisation is not already social and does not have a social media asset base to draw on then it may be useful to spend time and effort establishing that before entering a crowdfunding campaign.
Whatever audience you are seeking to reach you need to ensure you can identify them and their behaviours, particularly in a social media context. Do they use it and if so what channels? How can you find more contacts? Key words identified in the pitch development might help here. Fish where there are fish as they say, so you need to make sure your choice of channels matches where your initial audience is likely to be. It’s crucial that you evidence your thinking, do some research, and don’t just assume.
7. Resources, Responsibilities and Action
Any project will require time, effort and resource to make it a success. It is down to you. You will be generating momentum for your campaign, populating it with compelling content and messages, and sustaining that throughout the project.
The communication aspect will have several facets. Original content created by you and used to generate interest and engagement; content that reflects and comments on the progress of the project; and content generated in the transactions and conversations that develop through the course of the campaign. You can plan to resource the latter two in terms of time and effort but it is difficult to predict what the content will be. But the first element – original content – you can and should plan for as it will be important priming material to kick start a campaign, and extra ammunition you might need to sustain the communications.
You should not underestimate the demands made by this process. Planning is important and will pay off in the long run. It’s worth surveying your organisation for content that can be re-purposed to keep up a rich and compelling stream of material that will both develop the relationship with investors and be items that could be shared by them and so extend the reach of the campaign.
You should think about what you have that you can already use and how you might produce it in the course of the campaign: fact sheets, newsletters or archives that you can draw on, for example. You could set up alerts and monitoring to trawl for material on line that you could use. It’s important to establish who will actually do the publishing and engagement with the community, and if there is an optimum time when your key audience might be open to communications, and what channels are they likely to use. A style of engagement is designed to bind people in and engage them in a relationship, so listening is a key part of one’s behaviour. In a communication plan everybody should pay attention to the following behaviours and approaches:
• Engage – Listen, nurture, converse, respond
• Give funders privileged access to information
• Promote – Don’t assume that people know
• Keep updating – keep the campaign alive
• Honour your promises – sounds obvious but not doing it will kill a relationship
• Be naturally social – don’t talk only about the project, share other thoughts, join other conversations, be social for the sake of being social
• Say thank you! – it’s common sense and common courtesy
We keep emphasising that a crowdfunding campaign takes effort and so before starting any project you should ensure you have the right people to help and that you consider their skills and their needs.
It’s important to set some monitoring targets. Each crowdfunding platform will be able to give some insight to traffic and activity but there are many other monitoring tools you could use, many of which are free. Setting targets will help to keep engaged and indicate progress. They will act as indicators of when you are doing well in order that you reinforce this and keep your enthusiasm. Just as importantly they can act as alerts for when things are not going so well and you can take the necessary action to adjust and respond.
To précis the long post above, these are the main steps to a successful crowdfunding campaign, which should be applicable to any project.
– Have a strategy. You need a plan
– Set an achievable target
– Select your project carefully. It must be realistic & achievable
– Identify your target audience/s
– Select your platform carefully; choose the right model for your project
– Develop your rewards. More is better, be creative. What assets can you draw on?
– Create a powerful pitch. Stories, passion and multiple media
– Select your channels. They vary.
– Develop a publishing plan: content, channels, timing. What resources can you draw on, where does your content come from, what can you repurpose, when?
– Define the resources required; Who will do this, and when. What existing skills can you draw on internal and external?
– Set a time frame; even if the platform is open time give yourself one
– Monitor: to gauge progress, to identify where you are successful/less successful
– Be Social Media ready
– Check how Social Media ready your audience is
– Be Human = Be Social
Most importantly, don’t just ‘go do it’!