Big money is waiting to be spent. That’s what a glance at Kickstarter stats promise. But it also hints that it won’t be easy.
By the time this blog post was written, more than 92,000 projects were successfully funded on Kickstarter with $1.67B. Sounds like a quick buck for every entrepreneur out there? Not really. Only 37% of the projects reached their raising goals.
What Differentiates a Failed Campaign from a Successful One?
Crowdfunding needs a crowd. Friends and family are a good starting point but they won’t get you far. The campaigners need to make a big fuss on social to get people aware of their product and enthusiastic about it.
Reaching a wider crowd beyond the close friends goes through influencers. Influencer marketing is a key factor for getting more people interested in a campaign. For the campaigners, influencers are like a whole new nodes of friends-and-family – 100x bigger of their own.
Influencers love to announce new cool, sometimes crazy, projects and take part of their future success. A tweet from an influencer about a hip product on Kickstarter is an opportunity for everybody to join a buzzing conversation that’s about to start.
And then a snowball might start rolling.
Those who like the campaign will most likely share it with others. Whether it’s because they want to push the campaign to reach its goal or just to brag a little and show how awesome they are. May the reason for social sharing be, they amplify the campaign visibility. And each and every tweet leads to more bucks in the campaigner’s pocket.
How Much is a Twitter Mention Worth?
And here’s the Proof.
Intuition can only go so far, and we are great believers that data-driven decisions are key to doing smarter marketing. So, we decided to put our money where our mouth is, and prove there is a direct correlation between Money ($$ Raised) and Twitter Shares.
In many cases the ROI of Social Media can only be quantified as “Your Mother“, but here we felt there’s a good chance to measure a ROI that a supermarket actually accepts. The research was conducted by taking 10 recent campaigns, measuring the social mentions velocity and comparing to the amount raised so far. One can argue we are only proving correlation and not causation, but even so we’ve definitely managed to raise the confidence our point is true.
Here, take a look at the graph:
As you can see in the graph, there’s a linear correlation: f(x) = 14.295x + 29190 between the volume of Twitter shares a Kickstarter campaign got, and the amount of money they raised in the campaign. This means that each twitter mention equals to $14 and 2.95¢. If you’re interested in more details on how we conducted the research feel free to reach out or take a look at our open Google Doc.
Unknown Seller Offers Non-Existing Product
Just like any other product, people are not likely to buy something at first sight. Their decision cycle is long. It starts with being aware of the product; then considering their need for it; evaluating the product or seller reputation; and then, maybe, they will become buyers.
Now consider this cycle with an unknown seller and just a promise of product. That’s the headache of a crowdfunding campaigner.
Influencers disrupt the cycle. They overcome the trust and awareness barriers and get people straight into the product consideration.
That’s why crowdfunding campaigners aim for more social shares and even get those who already backed the campaign to promote it.
By now we all know that crowdfunding goals are often overachieved. Those success stories are the new funding fairy tales of today’s entrepreneurship.
The secret of these cases is the ongoing social amplification. The campaigners know that to raise high volume of funding they need to put a lot of efforts on new promoters for the campaign. And it works. This effort has a definite amount of money attached to it.
Resources: Keyword Trackers of the Kickstarter Campaigns
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