This new year let’s talk crowdfunding.
In addition to traditional fundraising approaches organizations are embracing alternative models, such as crowd funding and direct donation. These models tap into the “power of the crowd” by leveraging individual donations to achieve a funding target. This new year many of you might be thinking of launching a crowdfunding campaign. We have been involved with several traditional and crowdfunding campaigns in outreach, planning, and strategy capacities. Below we will provide five tips for reality check before you launch a crowdfunding campaign, based on our experience. We hope this checklist will help you decide if crowdfunding is right for you, and when is the right time.
1. Crowdfunding compliments a traditional fundraising campaign
Crowdfunding taps into “the power of the crowd” and leverages the reach and sharability of the internet. However we recommend crowdfunding to compliment your traditional fundraising campaign, not replace it.
In additional to being sensible of having a mix of fundraising approaches, most brands are still maturing to online community building and campaigns.
2. Do your research
Researching your target demographic is very essential before you launch the crowdfunding. This will guide your storytelling (below). Elements of a target market research should include demographic/socioeconomic, geographic, psychographic, behavioral and product related understanding.
3. Get your story right
Story is the means by which people can connect with you. If your story is not unique or weak there is a big possibility the campaign will not gain traction. Researching your target audience will hugely guide this step.
Below is the example of strategic community building through storytelling by Mountain Equipment Co-op (MEC). MEC is Canada’s leading specialty retailer of clothing, gear and services for active outdoor lifestyles with 4.3 million members across Canada. Their We Are All Outsiders story (image below) ties all members in a common thread of encouraging and inspiring fellow members to be active outdoors.
4. Know the strength of your community
This point can’t be emphasized enough. A strong and well knit community is needed to make your crowdfunding a success. Communities amplify your story, and do the asking on your behalf. Communities are built over time, they need stories to connect to, space and resources to grow, and support to nourish. Hence know the strength of your community.
A good example of a strong community is Escape Sports. Escape Sports is a local alternative sports shop that is owned by two brothers. The Storey brothers have a passion for and encourage their community to embrace the outdoors. Over time this outdoor community is built through connecting with their story of #EmbraceYXE, providing space and resources for growth (e.g. stand up paddleboarding (SUP) lessons, paddleboards and related equipment for sale and rent, SUP fundraisers for mental health awareness), and support (e.g. paddleboard equipment repair and maintenance) to nourish. The screenshot below from Escape Sports’s Facebook shows how strong their community is.
One practical tip: If you’re unsure of the strength of your community, first verify strength by running a mini (awareness) campaign and measure it.
5. Know there is donor fatigue
As in traditional fundraising campaigns, crowdfunding campaigns can suffer from donor fatigue. Often times we attempt to re-target and sometimes this might expose the vulnerability of donor fatigue in our community. This issue can be addressed by running crowdfunding campaigns less often as annually or longer.