Only 22.4% of crowdfunding campaigns hit their goal. Why? There are many factors that come into play, but based on our studies there are four common reasons why a crowdfunding campaign will fail:
- Failing To Build up Momentum Before Your Launch
- Focusing on the Wrong Positioning
- Pricing the Product Incorrectly
- No Follow-Up Communications With Backers
#1 Failing To Build up Momentum Before Your Launch
The first 48 hours of your crowdfunding campaign is crucial. If you don’t hit at least 30% of your funding goal within the second day, there is a high chance your campaign will fail. Make sure to have a bulletproof omnichannel advertising plan. Optimize your advertising during pre-launch and test various audiences, copy, and media types in order to find the winning formula that converts.
#2 Focusing on the Wrong Positioning
Backers will pledge if they understand the value of your product. Many great products fail when their value isn’t properly communicated,or the founder is focused on narrow use cases only. Ask yourself what problem it solves, and highlight more of these.
#3 Pricing the Product Incorrectly
People look into crowdfunding to score an upcoming product at a big discount. Price your product fairly and don’t be too worried about losing some of your margins – this is your way of thanking your earliest backers.
#4 No Follow-Up Communications With Backers
Perhaps the most important step is to keep backers updated. Campaigns that update followers regularly raise 126% more than campaigns with no updates. Rainfactory offers a Backer Update service wherein our team will compose an update every week in-campaign, and every four weeks after, per best practices.
Each campaign is unique and we have launched several million dollar campaigns to jumpstart remarkable products. If you’re interested in deep diving on what makes a successful campaign, download our FREE CROWDFUNDING HANDBOOK.
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