The elements of a successful crowdfunding campaign are often so intangible, that they often go unnoticed. The highest dollar raised campaigns on rewards-based crowdfunding are what we like to call, “unicorns,” because they are increasingly rare. The odds are that you simply will not raise millions of dollars without an air-tight plan and world-class execution by a professional agency that can get you the exposure necessary for that level of success.
Before I explain the three elements I want you to consider your product or service and think about what you would spend to acquire a customer. Then identify the average lifetime value of that customer (the total amount that they spend with you over time). If launching your crowdfunding campaign will be a way to get those first customers, then understand that the cost of acquisition of your first customers / clients is going to be roughly 5x that of a company with an established base in traditional advertising / marketing. That number is based on our experience in the industry. A successful crowdfunding campaign comes in at nearly half of that total cost because of the inherent viral nature of the internet and crowdfunding campaigns in general.
1. LOWER YOUR GOAL
I see campaign owners with $250,000 goals all the time. What they don’t seem to understand is that you will not hit that goal unless you’re coming in with at least 40% of the money raised on day one from friends and family. If you’re aiming to raise $250,000, you want to consider a $25,000 goal and then hit it as fast as possible and then raise beyond that goal. What happens is that a psychological trigger of “joining the party” and “fear of missing out” incentivizes more people to make more pledges and contributions.
2. EARLY BIRD SPECIALS
Encourage your early contributors with steep discounts through early bird specials. Set limits to the amount of perks or rewards at that level and let it sell out. It creates a scarcity model which is essentially economics 101 and will drive up the cost of your perk / reward prices and perceived value.
3. PRE RAISE 20-40% OF YOUR POSTED CAMPAIGN GOAL
By pre-raising 20 – 40% of your posted goal, you’re ensuring that others will believe that you will have a successful campaign, thus increasing confidence in your campaign. Oftentimes, you need to spend upwards of 60+ days before the launch of the campaign to pre raise the necessary amount of money from friends, family, colleagues and your online networks.
If all else fails, we’re here to help. Just shoot us a message or call us and we’ll help you on your way to crowdfunding success.