Previously we had presented crowdfunding as a valuable financing tool and we even showed some examples of projects that achieved success through crowdfunding, which is what crowdfunding is all about.
In this note, Gregorio Delgado advances on the subject and shows us how, in addition to providing financing, crowdfunding can be an excellent marketing tool.
Crowdfunding Takes Off, But Can It Take Off For You?
Crowdfunding is fundamentally an excellent marketing tool
The application of technology allows us to do things that were unthinkable until recently.
Crowdfunding is a field of high interest and, with still modest figures,it is taking off with force.
The search for a large number of small monetary contributions, in different modalities, to finance a project, is offering solutions in the most diverse cases. Internet and social networks make it possible.
Perhaps you are considering the use of this tool for your project. I hope to give you some ideas that will help you, and alert you to some difficulties.
What Can We Do With Crowdfunding?
Financing the development of a game, a technological gadget, or covering the costs of a lawsuit against a politician: crowdfunding is being applied more and more to successfully raise funds. Even is already a word in common use. I don’t think it will be long before the RAE accepts it.
In 2014 in Spain, an approximate amount equivalent to 50% of the financing provided by ENISA was obtained through crowdfunding. I leave it up to you to assess whether this amount is important or irrelevant. Yes, it is true, whatever your answer, that they were very important amounts for those who got them.
We find different modalities.Perhaps the simplest is the reward, in which for a contribution the participant receives some kind of gift or the product that the promoter intends to develop, under advantageous conditions.
Other more complex ones are crowdlending in which patrons lend money that will be returned under certain conditions or equity in which a stake in the property of the company that organizes it is received.
One of the great theoretical advantages of crowdfunding is that it allows you to do experiments with soda. You test a concept to see if you like it, without even having to create a company, since the legal framework is provided by the crowdfunding platform; If it turns out great, and if not, then on to something else.
This is a false perception that those who approach this tool for the first time can receive. Of course, you could play the flute and your happy idea invention get the endorsement of thousands of buyers, but this is not going to happen to you.
Crowdfunding, A Powerful Marketing Tool
I personally think that crowdfunding is fundamentally an excellent marketing tool.
And raised like this it is difficult for us to fail with it. Even large corporations use it to carry out market studies that help them validate the potential success of a product before launching it on a massive scale.
Although more than a marketing tool itself, we could also see it as an integrating tool, which serves as the basis for designing a broad marketing campaign in which we must use many different resources.
Things never work alone, money does not come out of anywhere, and the principles of marketing, or business, apply as in any other action.
If you have 1 million friends and you ask for 10,000 euros, you won’t have a big problem, but if you have 1,000 friends and you need 100,000 euros, things get complicated.
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5 Basic Aspects For The Success Of Your Crowdfunding Campaign
1.- You have to be clear about who the product you want to develop is for. If you don’t do strategic marketing well, you’re going to crash.
2.- Building trust, as in any sale, is essential. Therefore, the support that can be seen behind the project, the successes already achieved, solvency, both financial and professional, or the quality of the content you use are key.
3.- You need to connect with a sufficient number of people and generate the desire to buy. and this you have to achieve by your own means. The crowdfunding platform is not going to bring you, buyers. The buyers will have to bring you.
The numbers of visits given by the platforms are not their own visits, but visits brought to them by the projects; they are not there for you. You have to get yours.
4.- So the previous part before starting the crowdfunding is what will mark the success. Before opening crowdfunding, you already have to have enough buyers to guarantee its success. Otherwise, you will be seriously disappointed.
5.- The previous points are summarized in that you need resources proportional to what you want to achieve. That is money and hours of work applied to promote your project.
In any case, if you use crowdfunding as a marketing campaign, success is practically guaranteed, whether or not you get the amount you set as your goal.
Analyzing the most popular campaigns, it can be concluded that their preparation was carried out in great detail, with a significant prior investment. Hence, the first days sometimes see high sales figures or strong investments.
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Crowdfunding is an excellent tool that is taking off with interesting growth figures, but like any tool, it does not work magic, rather its results are proportional to the effort and investment made.
Would you add any additional keys to success in crowdfunding? Please, leave us your comments below and share the note on your social networks.