With sites like Kickstarter and Indiegogo establishing a reputable presence, the idea of crowdfunding to establish or revive a business is becoming more accepted. Until recently, it was a little taboo to consider crowdfunding a business endeavor, but now it’s a method that even Hollywood is using! Earlier this week, the producers of Veronica Mars staring Kristen Bell were proud to announce that they achieved their goal of at least $2 million raised within a single day on Kickstarter. Thanks to the funds raised, Veronica Mars will begin filming this summer with a release in 2014.
Crowdfunding and the Future of Marketing
While Kickstarter is known for helping entrepreneurs, it’s also helped established businesses as well. Thomas Steinemann relied on crowdfunding to raise $1.57 million to help save the oldest Swedish watch-making company. Since there are perks for investors and the brand creates loyal fans, crowdfunding has the potential to be a win-win scenario for everyone.
But as popular as sites like Kickstarter and Indiegogo are, crowdfunding doesn’t just magically raise money. Brands must make the case on these platforms that their business is worthy of the funds being raised – and this is where crowdfunding becomes a powerful marketing tool. Instead of simply trying to raise funds, focus on showcasing your brand and why it’s worthy enough for people to invest their money in. If you make the case effectively, you’ll not only crowd-source the funds, you’ll strengthen the reputation of your brand. This is content marketing at its finest.
Tips for Crowdfunding
Since sites like Kickstarter allow you to market the case for your crowdfunding project through both video and written content, you have endless opportunity to establish a good name for your brand. To make your crowdfunding endeavor a successful marketing one as well, consider:
- Incentivizing the pitch. Of course you’re going to showcase your business in the best light possible. Everyone does that. What sets you apart? It’s the incentive that you offer the donor to give in the first place. Sites like Kickstarter are a two-way-street. People give to the project and the project gives back perks such as free samples, coupon codes, or memberships. The more that you incentivize the pitch, the more people will be likely to donate and remember your brand.
- Building the buzz. If people like the idea of your business or what it represents, they’ll gladly share it with your friends. Furthermore, strong incentives will have people talking about your brand anyways. While incentivizing the pitch is a good way to encourage donations and build a loyal base, it also builds the buzz around your crowdfunding effort.
- Managing the results. Proper management of the funds after the crowdfunding ends will signal to consumers how strong your business and its leadership are. Wisely using the donations to build, grow, or revitalize your brand will create loyal customers out of your donors. Also remember to stay true to the incentives you provided during the pitch. If you promised a free product for every $100 donation, then fulfill that promise as quickly, professionally, and effectively as possible. Staying true to your word as a company tells consumers that your brand is a brand to be trusted and do business with.
Have you ever used crowdfunding to begin your startup or revitalize your struggling business? If so, we’d love to hear your story below!
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