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Crowdfunding Best Practices

The Key Marketing Costs For Your Crowdfunding Budget

Explore the different marketing channels you can use to promote your crowdfunding campaign and the associated costs you'll need to factor in your budget.
The Key Marketing Costs For Your Crowdfunding Budget
Jules

By Jules

 

April 20, 2020

Crowdfunding success depends largely on creating a good campaign budget and sticking to it. While this involves many different costs, one of the most important things you’ll need to budget for is marketing. That’s because your campaign won’t go anywhere if people don’t know about it.

But, this doesn’t mean you should just throw your money at any marketing opportunity that arises. You need to be strategic. Here, we’ll talk you through how to manage crowdfunding marketing and what you need to factor into your budget in order to effectively promote crowdfunding.

How Much Does It Cost to Run a Crowdfunding Campaign?

Before we discuss marketing budgets, you need to have a good overview of the total costs that come with running a crowdfunding campaign so that you understand what it takes to promote a crowdfunding campaign. Crowdfunding not only brings in money but also enables innovators to build their brand, engage with their target audience, and develop their ideas. But, to ensure your campaign runs smoothly, it’s important to have a complete crowdfunding budget. Below are a few major costs you’ll need to budget for in your crowdfunding campaign:

  • Marketing - Strategic crowdfunding marketing is essential for the success of your campaign. This will require a budget for effective advertising and promotional materials.
  • Product designs - If you’re manufacturing a product, you’ll need to budget for design and production costs. Ask for reviews and check the reputations of local companies, or reach out to people on LinkedIn and Quora. The cost of this will vary greatly depending on the nature of your products and company.
  • Platform fees - Each platform will charge you for running your campaign. This will usually be a percentage (usually 5%) of your campaign funds. There is also an additional percentage for payment processing fees.
  • Fulfillment - Many campaigns fail because they forget to budget for fulfillment at the end of their campaign. Make sure to think about where your backers are likely to be and figure out the size of shipments you’ll be sending out. Then, use a service like Easyship’s shipping rate calculator to estimate how much your shipping will cost.

What Marketing Channels Can I Use for My Campaign (and How Much Do They Cost)?

If you’re worried about how to advertise a crowdfunding campaign, there are a plethora of crowdfunding marketing channels you can leverage. However, you should be aware that your choice of marketing channels will be tied directly to your crowdfunding marketing budget. If you don’t have a big budget, certain avenues won’t be open to you. Here are a few marketing channels you can consider to promote your crowdfunding campaign:

Crowdfunding Platforms

Most people prefer to run their crowdfunding campaigns on established crowdfunding platforms like Indiegogo and Kickstarter, and it's certainly helpful to promote crowdfunding this way. Obviously, despite reaching a wider audience, you will have to pay platform fees and payment processing fees. For Indiegogo’s fixed funding campaigns, you’ll pay a 5% platform fee and a 3%-5% payment processing fee. For flexible funding campaigns, you’ll pay a 5% platform fee if your campaign is successful or 9% if it’s unsuccessful, as well as a 3%-5% processing fee. On Kickstarter, you’ll have to pay a 5% fee to use the platform, and then a 3%-5% fee for payment processing.

Landing Pages and Blogs

Landing pages are a routine part of setting up an effective crowdfunding marketing campaign. The more targeted your landing pages are, the more effective they will be. If you choose to create a blog to run alongside your campaign, don’t forget to factor in the costs of website and graphic designers, domain hosting, and content creators. However, you will be exempted from third-party platform fees on a crowdfunding platform. The cost of this will vary greatly depending on what services you choose. Here are a few examples with average costs:

  • Website hosting: $3-$30/month
  • Domain registration: $10-$15/year
  • Website design: $1,000-$50,000
  • SEO for website: $2,000-$10,000
  • Content creation: $60-$300/page
  • Photography and video: $10,000-$15,000

Social Media Channels

The key to strategically using social media in your crowdfunding marketing is tailoring your content to fit the specific social media platform and target market. Paid advertising and paying for post-boosting are effective, regardless of your platform of choice. Your crowdfunding marketing budget should consider these costs, and you can expect to pay around 10% of your fundraising goal.

Email marketing

Crowdfunding email marketing is increasingly becoming an excellent crowdfunding promotion strategy and should be factored into your crowdfunding marketing budget. Sending important messages to those in your email lists is a sure way of getting to potential backers and customers. You’ll need to pay to use a good email marketing program, but costs for these can vary. For example, Mailchimp has several pricing plans that range between $0-$299/month depending on what functionality you need.

Other effective crowdfunding marketing channels you may need to factor into your budget include backer gifts, forums, events and parties, and using marketing agencies.

You should continue to promote your crowdfunding campaign until you meet or surpass the fundraising goal, so plan to continue crowdfunding marketing throughout your campaign. And, it’s even better if you can keep that momentum going post-campaign. For example, delivering a branded post-purchasing experience will keep your brand and campaign in your backers’ minds and could set you up for future success. If you use Easyship, for instance, you’ll be able to deliver more crowdfunding marketing by creating branded tracking pages and packing slips that remind backers of your brand when they unbox your package.

How Do You Market a Crowdfunding Campaign?

Crowdfunding marketing is essential for the success of your crowdfunding campaign. Crowdfunding, in itself, is a marketing strategy for raising money and increasing awareness of your products. However, promoting your campaign and convincing people to contribute a small amount to generate the required capital in a short time comes down to effectively marketing your campaign.

8 Tips for Marketing a Crowdfunding Campaign to Success

To successfully execute a crowdfunding marketing strategy, your crowdfunding platform marketing strategy should do the following:

  1. Establish a reputation – Most successful crowdfunding campaigns have founders with experience. Establishing a good reputation automatically satisfies the much-required social proof aspect on a crowdfunding platform. For new innovators, you could partner with individuals with an established reputation for a quick crowdfunding marketing boost.
  2. Make your idea worth sharing – Your crowdfunding idea should not only be exciting but also worth sharing. Backers should willingly share your project with their peers.
  3. Make your campaign viral – An easy way to make your project viral is to make it appealing to your target market. There's nothing like organic crowdfunding marketing for campaign success.
  4. Market your project months before launching – You can reach out to influencers, established social media pages, and journalists about your product before launching it in the market. With a good pitch, they will feature your idea ahead of the campaign launch, which will create the awareness and momentum you need for a successful campaign.
  5. Prompt people to share and promote your campaign – Part of your crowdfunding marketing should involve asking your target market and backers to share your campaign on social media platforms for a wider reach.
  6. Use the right Crowdfunding platform – Selecting the right platform is probably the most challenging part, but it can really help your crowdfunding marketing efforts. Kickstarter, for instance, has specific requirements and varying fees; Indiegogo has looser regulations. An effective crowdfunding platform marketing strategy depends on the platform that you choose.
  7. Improve your landing pages for a better response – Landing pages have a significant effect and you need a good one to make an impression on backers and interested customers. As such, its design should immediately capture the attention of browsers, making them want to find more about your products.
  8. Set achievable expectations – Setting realistic expectations is also essential for a successful crowdfunding marketing strategy. Delayed projects will frustrate your backers and possibly harm your hard-earned reputation. Try and mitigate this by communicating early and often.

5 Successful Crowdfunding Marketing Strategies

As mentioned, crowdfunding has been a blessing for many brands. Some successful businesses that have had fantastic crowdfunding marketing strategies include:

  1. Pebble E-Paper Watch – This incredible smartwatch raised $3.3 million in just five days on Kickstarter! They built a great website and generated buzz ahead of their campaign launch.
  2. Pono Music - Pono Music raised $6 million in one month for its music device. The brand also developed an operational PonoPlayer shortly after. The key to their success? Creator Neil Young (yes, that one) reached out to friends like Kings of Leon, Metallica, Elton John, and Patti Smith to get their signatures on limited-edition players that backers could get their hands on.
  3. Opena - This bottle opener-iPhone case combo raised $283,000 with its campaign; its initial goal was $150,000. How did they do it? They used a Facebook page to generate buzz and Facebook ads to reach more potential backers.
  4. Tile - This Bluetooth tracking device had an initial goal of $200,000; they raised over $2.6 million. The reason? They did some serious public relations work six weeks ahead of the campaign.
  5. Bo & Yana - The campaign for these interactive toy robots that teach children to code began with a goal of $250,000, but raised more than $1.4 million by creating special limited-edition robot outfits that early backers could get.

Once you Find Crowdfunding Success, Use Easyship to Fulfill Your Campaign

With the increasing use of crowdfunding as a source of investment for startups, innovators should understand how to execute a good crowdfunding marketing strategy for their campaign. They should also be aware of the marketing costs of running a successful crowdfunding campaign. There are many benefits to using crowdfunding, but identifying the costs and developing a successful crowdfunding platform marketing strategy is crucial for success.

You should also try to partner with companies that are well-versed in crowdfunding to promote your crowdfunding campaign. Easyship, for instance, is the exclusive shipping partner for Indiegogo and can help you fulfill your crowdfunding campaign. Easyship has worked with many crowdfunding success stories including Waverly Labs, Keyboardio, and Tropicfeel. We provide more than 250 affordable courier solutions with accurate estimated delivery times that help you avoid additional charges and enable you to ship your successful crowdfunded projects with ease.