When it comes to getting your idea from your brain to hundreds (or thousands!) of wrists, there’s nothing quite like crowd funding to make your dream a reality. Yet even with the low barrier to entry that crowd funding provides, there are still important considerations to keep in mind to ensure your project isn’t one of the 60% that doesn’t reach their goal. Here are 3 pitfalls to avoid and some of the best ways to do so.
1. Rushing to Launch
This is the most common mistake I see crowdfunders make. As soon as they have prototypes in hand, they take some photos, put up their copy, and start their campaign. Without taking the time to build any interest in their project before they launch!
Any crowdfounding platform is simply that, a platform. One that hosts your project and handles payments. You should not rely on it to be a discovery channel. You need to put the work in yourself to generate interest in your project, the competition to be seen on Kickstarter or Indiegogo is just too high for it to happen naturally.
The best way to launch successfully is to promote your project on blogs and forums, your own social media channels and with an email subscriber list. You should be using your list as a gauge for when to launch. you can expect between 10% and 20% of subscribers to pledge so you need to calculate how many pledges you need to reach your goal then launch when your list is at least 5 times that number.
2. All What and How, No ‘Why’
The most important lesson you’ll ever learn in marketing is this one from Simon Sinek. Seriously, watch that video right now if you haven’t already, I’ll wait…
You can buy a watch on the internet from an established brand like Seiko or Citizen for $50. You need to stand out for people to engage with your brand and trust that you’ll deliver. The ‘what’ you’re selling and ‘how’ you’re making it is important but to really stand out you need a compelling and engaging ‘why’ you’re doing it. The ‘why’ is what hooks people into your brand and concept and it’s what sells your passion for the project. Crowdfunding is just as much about selling passion as it is selling a product.
Communicating that ‘why’ clearly should be your primary goal in writing your campaign copy. the ‘why’ is what your brand stands for, what you’re trying to accomplish and what inspires you to create your project. Start with that and you’ll win the crowd, turning customers into evangelists.
3. Poor Budgeting
Most people are aware that crowdfunding is not a get rich quick scheme but what many don’t realise is how tight margins can be. For most projects you can expect some degree of cost overruns and unexpected expenses. Even with great budgeting your profits will likely be tied in your unsold stock meaning you need to account for a post campaign sales strategy. This article has some great examples and advice on what to expect when running a campaign.
These are 3 pretty basic pitfalls that are easily managed by good planning and research. A quote from a recent startup convention I attended has stuck with me as it applies to crowdfunding even more so than more traditional startups – “Successful startups throw thinking at problems instead of money” – Thinking and planning are your greatest assets as a crowdfunding startup, you have to be creative when you don’t have money! All the best for your campaign, if you would like to discuss crowdfunding strategies with the author please email [email protected]