At its most basic, crowdfunding is the generation of small amounts of money by many people through websites like Kickstarter and Indiegogo to fund a new product, project, or business.
With the internet, fundraisers can get support from people all over the world for their product ideas. Thanks to platforms like Kickstarter (as well as social media platforms), it’s never been easier to fund your project.
But this only changed recently. Ten years ago, it was pretty hard for entrepreneurs and start-ups to launch their projects. If you didn’t have a rich family member or a huge savings account, you were pretty much out of luck. But that’s changed with the rise of the internet.
Nowadays, just about anyone can get their project funded if it’s good enough. The only thing that really matters is if your market thinks your product has value. If it’ll improve their lives in some way, odds are that they’ll back it.
But there’s one caveat — the packaging needs to be cute. You don’t walk into a store and pick the toy with the drab packaging, do you? To run an effective crowdfunding campaign, you’ll need all the bells and whistles.
Before that, though, there’s one thing you need to ask yourself.
Should I Crowdfund My Product Idea?
As of this very moment, 141,590 projects have been successfully backed on Kickstarter. Another 251,633 projects couldn’t reach their goal and 54,744 of those projects received 0 dollars in funding. That’s right, not even their friends and family donated.
I don’t want that for you. But for you to succeed, you need to make sure you have the right kind of product in mind. Choosing the right product to crowdfund is essential for success — it’s arguably the most important part of your entire crowdfunding campaign.
Luckily for you, you can crowdfund just about anything if you do your homework and have the resources to support it. Remember the infamous potato salad?
One thing you can’t do is use Kickstarter to back your company. That’s not what it’s made for. Instead, you can use it to successfully launch your first product, and then you can use that success to expand.
Another thing you shouldn’t do is try to appeal to too many groups of people. Make your product something that you would use. It’s fine if your target market is small as long as your product is something they actually want. Just be wary of trying to cater to too many groups of people.
But the biggest thing to consider is something I already mentioned. You need to be able to support your campaign. If you prematurely launch a crowdfunding campaign but aren’t able to make a killer video to promote it, you won’t like the result.
Or worse, what if you can’t fulfill all the rewards you promise your backers? Your campaign will be dead in the water and people will remember. You won’t get a second chance. So be prepared and do your homework.
Tips for Building Your First Crowdfunding Campaign
Develop an inspirational story
While you want your product to stand on its own, an inspirational story can push it over the top. Crowdfunding platforms like Kickstarter and Indiegogo shine a light on the creator of the product — people want to know who you are and how your product came to be.
If your project is simple, you don’t need to go over the top with your page. But answering a few questions can help potential backers feel like they know you. This will make them more likely to believe in your product and invest.
Try and answer these key questions on your project page.
- Who are you?
Let people know more about you. They want to know who’s behind the project. If you’ve done other similar work, show them.
- What are you making?
Give people more information about the project. The more detail you give, the more people will get behind your vision. This is where you should include your prototypes and photos.
- Why are you making it?
Share the history of the project and let people know how the idea came to be. Has anyone else helped you along the way? What led you to make it? These are the things people want to know.
- What’s your plan?
Laying out a specific plan of action will help you build confidence. Break down the steps in your plan, including project dates, estimated shipment times, and any other valuable information.
- Do you have a budget?
Tell people where their money is going so they can trust you to use it wisely.
- Why do you want to make this?
This is where you let your passion seep through! Passion projects are always more successful than money-driven ones. People want to know you care.
Create an epic video
Your crowdfunding video is arguably the most important part of your campaign. It’s your chance to not only highlight the project, but to show off your personality and passion. And don’t worry, it doesn’t have to be a big budget film. In fact, some of the best campaigns have videos with a very DIY feel to them.
To save you time and money, write your video script ahead of time. Know well in advance what you want to say and consider creating a storyboard. Without one, you might end up going over budget and spending a lot of time doing reshoots.
And like I said, your video doesn’t have to break the bank. If you have professional videographers at your disposal, then that definitely gives you an edge up. But most of us don’t, so try hitting up local universities. Odds are you’ll find a student who’d help you out for cheap to build their portfolio.
Check out this campaign video for some inspiration — it’s a very DIY video that supported a hugely successful campaign.
Take professional photos of your product
You’ll also want to take some high-quality photos of your product for promotional purposes. Don’t skimp out here, you want your photos to be eye-catching. If you don’t know any photographers willing to help out, again, hit up your local schools.
You’re going to be using these photos on your social media, website, and campaign page, so make sure you have a few different perspectives to choose from.
Make a website
While you don’t need your own dedicated website, it certainly helps you look more legitimate. A well-designed website lets your backers know that you’re serious about the product. It’s also a great step for building customer loyalty, and if you’re planning to launch future products, can help retain customers.
At the very least, you need a single landing page with basic information about your company and product. If you’re launching future products, consider creating a mailing list to let your backers know when those will launch too.
Have a realistic goal
Don’t just go into this blind. Do some research into what you can expect from the market and estimate how many products you’ll sell. Set realistic goals and most importantly, ensure you can meet them.
Meeting your funding goal is only the first step. If you aren’t able to manufacture and deliver the goods in time, your backers will lose faith in you. That’ll be the nail in the coffin for your brand and you’ll have trouble funding future products.
Promote, promote, promote
While high traffic crowdfunding sites like Kickstarter and Indiegogo have a steady stream of regular traffic looking for new campaigns to back, you’ll want to do your part to attract your specific customer. The first and most obvious step is to use social media to let people know about the campaign.
You should also reach out to media outlets and industry bloggers who cover your type of product. It’s the best way to get your campaign in front of the people you want to see it.
And don’t underestimate the power of your immediate social circle. Get your family and friends to share (and donate) to your campaign. That’s some guaranteed free press and donations.
Figure out your rewards
Your rewards are the second most important part of your entire campaign and are crucial if you want to see any success. Your backers want to receive something for their contributions — if you only offer one reward (the product itself) you’ll be missing out on a lot of donations.
Don’t hesitate to set your reward levels high. You might not receive any backers in that category, and that’s ok. But there’s always the chance that you will. And the same could be said about setting low rewards. Some people can’t afford to pitch in very much, but every dollar counts. Plus, they might share that they backed your campaign on social media — free press!
Types of Rewards
The types of rewards you offer depend on your campaign. Use the following categories to come up with your own rewards!
A common reward for low tier donations is to offer some type of recognition. Give the backer a shout-out on Twitter or include their name in the credits. Video and board game campaigns sometimes offer to name a character after the backer. Use your creativity!
If you’re selling something, it makes sense to offer it as a reward. You can offer your product in bundles or include merch with your logo on it. Some campaigns have offered more customizability as a reward.
Maybe you could include some experiences. Fly your backers out to have dinner with the CEO or contribute to your project in some way. Give them an inside look into the creative process. The options are endless.
Give your backers the opportunity to become VIP. This is usually a top-tier reward and can include anything from early access to products or experiences to advance screenings.
Crowdfunding is one of the best ways to introduce your product to the world. It allows you to judge consumer interest and fund your production run without a traditional loan. But that’s essentially what it is — a loan. Make sure you’ve done your research and can deliver on your promises.
The majority of campaigns fail. Hopefully, these tips can help you build a successful crowdfunding campaign.
If you’re still in the product development phase, Cad Crowd can help. We’re home to many top-tier industrial designers as well as patent services. Considering contacting us for a free quote and advice!