Hopefully you’ve read my crowdfunding overview. If not, you definitely should. It should give you a good insight into how crowdfunding works and what solutions work best for musicians.
Now I’m going to look at setting up and running a campaign.
The average pledge on crowdfunding campaigns is $70 and on average you will get about 7-10% of your mailing list to pledge. So if you have set up your perks right then you should look at the size of your mailing list. Realistically only about 7-10% of your mailing list will back your campaign so by multiplying the number of people on you list by $70 and divide by 15(approx 7%) you will have a good idea of what you can look to raise.
With Facebook and twitter you should be looking at a much lower percentage. Between 0.5% and 1% of your fans, but remember they are far less reliable. I would always lean on the side of caution and set your target lower than you think you can get. This way you can budget for the lower number and if you get more then all the better. In basic terms I would estimate that for every 1,000 likes/follows you will raise about $2500 at most.
If your fans are not engaged, of if you have previously acquired fans on Fiverr or some other dodgy service then I would not rely on any sales.
Some of the most successful campaigns were set up with a very low target in relation to their fans and as a result, end up raising a lot more than there target. In the case of Amanda Palmer, she raised 12x more than her target. She had raise more than her target before, but by setting it lower, she was able to create hype around her success and generate even more money.
Don’t set your budget based purely on how much money you need. Look at what you can realistically raise and if your mailing list is too small to guarantee the amount you need then you should look to either raise the difference elsewhere or accept that crowdfunding isn’t right for you.
A successful campaign takes a lot of work and if you set unrealistic targets then you will be setting yourself up to fail. Do you really want to invest your time and resources in something that is likely to fail? Surely you could focus your resources on generating more fans in other ways.
Having the right perks at the right price points is vital to creating a successful campaign. Get this wrong and you could end up leaving thousands of dollars on the table. There a few things to consider here; who are your audience and how much are they willing to spend?
There seems to be a trend with crowdfunding across all industries with a certain percentage of people willing to spend a little more than others and some who are willing to pay a lot more.
Lets look at the different segments:
This is usually someone who isn’t quite a fan but is somewhat aware of you. They are sitting on the fence and not willing to invest much money into your campaign. These people are often overlooked as they don’t offer much value singularly but collectively they are great, as there are a lot of them. Spend: $1-$5
This is someone who follows you but not attentively. They have bought your music before or have shared your posts with friends. They are engaged and willing to put their hand in their pocket, if for no other reason than to support you. This is an equally large group and one of great value as they tend to generate a huge amount more money than the casual shopper. Spend: $10-$20
These are the guys who are waiting outside your shows when the doors open. They have bought your music before, have your t-shirt and know your lyrics. These guys are your bread and butter. They will generate more money than your normal fans, not just today but into the future. Treat them well and give the more than they expect. Spend: $50-$125
These are the fans that will fly to see you on tour in another country. They will bring their friends and convince them to buy your t-shirts. They comment under all your videos and share all your blog posts. They are willing to spend on rarities. For them it is about the unique experience. You won’t have many of these in the early days but as you get bigger and start touring more, they will start to pop out of the woodwork. Spend: $200 – $400
You should always cater for the person who has more money that sense! You may not get them to pledge on your campaign but it is still worth creating an over-the-top perk just in case. If nothing else it will make your fans laugh when they read through your perks. How crazy can you get? Check out Nine Inch Nails drummer Jose Freese’s perks. Spend: $1,000+
There are a few things to consider when setting up your perks. Having too many options can cause people to be overwhelmed and put them off. I would suggest covering one perk for each of the five fan types and then maybe adding an additional one in some, but not all of the fan types.
You can also offer early funder options where you offer a limited amount at a lower rate to boost initial sales. Limits are great when creating experience-based perks. You may want to offer a night out with the band, but you can’t offer them to every one, so you limit it to 5 people and charge a little more.
Headlines are important and choosing the right one for your campaign could make a huge impact to its success. If your headline is nondescript or dull then people won’t click on it. If you can make it intriguing then you will not only get more of your fans to view your campaign, but you will get a few outsiders, who may very well decide to buy one of your cheaper perks.
A great way to structure your title is to give it a name and then follow that with a short description.
Our Campaign: You Can Be Part Of Something Awesome
Project X: New Electro Swing Album from Band Y
The other advantage of doing this is it will make it a lot easier for people to search for your campaign.
Try and stay clear of creating clickbate, where your title suggests something other then what your offering or if so far fetched that people click away once they realise. This may work for Buzzfeed and Upworthy, but they make money from page views so they don’t care if someone only spends 2 seconds on their website.
Where your title is used to attract people to your campaign, it’s your description that does the hard sell.
Don’t be afraid to sound like a sales person here. This is a sales page and its job is to sell your product. It shouldn’t be all about you and what you are doing, although this may be a big part of what you are selling but for a potential pledger you need to make it about them.
You should take about how your project will benefit them, not how it will benefit you. Only your closest friends and family care about your needs, everyone else is motivated by their own.
Why do they need to pledge? What’s in it for them?
One of my favourite pointers on how to be more compelling with your description is Simon Sinek’s Ted Talk – How great leaders inspire action is a great place to start when it comes to convincing people to buy into what you are doing.
Another great resource for writing a great sales page is David Frey’s 12 Step Sales Letter, whose steps are as follows:
You really need to spend some time on this. Even if it takes you two weeks and 10 edits to get it right. Even professional copywriters don’t get it right on the first attempt. They will always go through a few edits before they are happy.
When you’re happy with what you have, get someone else to read it and ruthlessly tear it apart. Then go back and rewrite it.
Finally get someone to proof read it. It’s very easy to miss typos when you’ve spent a lot of time working on something. Having someone put some fresh eyes on it will make sure there will be as few mistakes as possible.
You really can’t beat video to tell your story. But only when it’s done right. A badly produced video will have a negative effect. There is nothing saying you can’t shoot a hand held single take video on your iPhone, but you need to make sure it is first and foremost engaging.
Write your script based on the description you wrote. Use Simon Sinek’s Why? How? What? technique to make it more convincing.
A few other things to consider are:
All your hard work is done and you’re ready to hit publish and put your feet up while the money starts to roll in.
I’m sorry to disappoint you but this is where the hard work starts.
In order to generate traction you need to get the word out there.
You’re very first step is to send an email to your mailing list and post to your website. It is really important that you generate sales right off the bat as the number of backers you have when someone comes to your page will play a roll in their decision. As stated in step 6 of the sales letter nothing shows social proof more than a campaign that already has a ton of backers.
Once you’re given your mailing list a chance to generate sales you should then go to social media. Post to your Facebook page and then do the same on Twitter and other social networking sites. Share videos and images from your campaign and get creative.
Bloggers who write about similar artists to you have readers who will likely dig your music. So getting them to promote your campaign will help you reach your goal.
To find these blogs you should go to Hype Machine and search for similar artists. You can also Google search “Blog Search” and you will find other sites that will allow you do similar. You will get much better results if you search smaller bands over bigger bands. So start with local bands and then move on to smaller bands in other territories.
Be human and don’t spam people. This is not a time for a bulk mailing 30 blogs. If you want people to help you then go charm them. Take the time to read their blog and send them a personalised email that references specific posts and how it relates to your campaign.
Similar to the blog outreach you should look to approach your local media outlets. Local Radio and newspapers are always looking for local stories to share with their audience. Don’t put all your effort reaching out to national media as they won’t have the same objectives.
You should also look to other bands who have a similar following to yours. Don’t view other bands as your competition, view them as an opportunity to help each other reach more people. Get in contact with them and tell them what your are doing, ask them for help and, when they ask you to return the favour, make sure you do.
You really can’t beat an old school hustle to sell yourself. It’s much harder for someone to say no when you pitch to them in person or over the phone. So make sure all your friends and family understand how important this is to you and how much work you have put into it. This is where most campaigns generate the bulk of their funding.
Once your campaign has started to show a bit of traction it’s time to consider some advertising. For most cost effective advertising you should probably turn to Facebook. Your main target audience should be your current fans, people who already like your page. This way you’re only showing ads to people who are interested in your music and might back you.
After you receive some likes and comments on your posts you should boost them to reach more people. You will see the little blue boost button under your post. This is one of Facebook’s many forms of advertising and it can be very effective. It will cost you between $5 and $50 and will generate a few hundred to 1,000 targeted clicks.
One of the best features that crowdfunding sites have is a section where you can post updates to both your backers and to potential backers.
This allows you to keep your campaign fresh and even if the only people who see your update are those who have already pledged it will generate more opportunities for them to share your campaign with their friends.