Why Crowdfunding is Marketing & Not Financing

Kickstarter campaigns and crowdfunding have made a lot of headlines this year. Successful (and often record breaking) campaigns for projects like The Lizzie Bennet Diaries web series and the Veronica Mars, Zach Braff and Spike Lee movies brought this concept more into mainstream news and awareness than ever before. In fact, there was significant controversy around the last three projects from people who viewed them as Hollywood co-opting the indie world of crowdfunding.  However, brands like Honda and DC Entertainment have a presence on crowdfunding platform Indiegogo without raising eyebrows. If we can recognize this strategy is more about building and engaging audience than about raising money, then bigger players don’t take away from these opportunities but add to the potential audience that can be reached. This issue of From Search to Screen reframes crowdfunding as marketing and uses this perspective to help screen media creators get the most from this tactic (and I’m not just talking bucks).

Marketing vs Financing

Let’s start with a couple of basic definitions. Google defines marketing as “the action or business of promoting and selling products or services, including market research and advertising” and financing as “provid[ing] funding for (a person or enterprise).” When you look at the things you can do with and around a crowdfunding platform and whether they fall more into one definition or another, a clear pattern emerges:

Crowdfunding Action	Marketing?	Financing?
Asking your fans, followers, friends and family about what kinds of rewards to include in your campaign.	X
Doing in depth research into potential niche audience(s)	X
Setting up a page and populating with content about project, its summary, hook, story to date, rationale for why this will get made, and why it would appeal to your identified niche(s), etc.	X
Telling your core fans and potential niche community fans about your campaign page to build relationships and interest in project	X
Targeted ad buys to niche communities to attract further attention	X
Press releases tailored to each specific audience and giving each a unique reason to visit (both niche and general/local press)	X
Providing strong rewards that reflect your current and potential fans to get them to donate/pre-buy/invest	X	X
Updating and evolving content and rewards on page once it becomes clear what people are responding to the most	X
Getting donations/pre-sales/investment	X	X
Collecting data and information about donors and responding with messages of personal thanks and engagement	X
Ongoing regular communication via email and social media to further leverage personal communities and investors to date	X
Reaching and celebrating reaching financing goals including closing financing (by providing additional content, communications, and press releases)	X	X
Post campaign survey of donors to capture further data, audience intelligence and insight for future promotion and campaigns	X
Creating merchandise for reward fulfillment and also offering it for sale after the campaign ends	X	X
Post campaign content rollout to crowdfunding page with additional updates, peeks behind-the-scenes, etc	X

In fact, the “crowdfunding as financing” part of the equation becomes simply one of the many side benefits from “crowdfunding as marketing” when reframed in this way. If you have been strategic, proactive and squeezed everything you can out of this as a marketing tool (which is a heck of a lot of hard work) then the financing part comes much more easily and successfully.  This is a perspective that is gaining traction, and can be seen in some very recent articles in both Forbes and AdWeek.  It is a one that can help screen media creators shift their thinking and become more strategic in working crowdfunding into an overall marketing strategy. To get the most out of it, it is also important to understand what are the best practices in this space (although as can be seen from the recent set of articles in the Film Collaborative blog there is no magic formula that works each and every time).

Marketing Best Practices for Crowdfunding

If Kickstarter, Indiegogo and their compatriots are really just opportunities for marketing what does this mean for your project? Well, the heavy lifting still needs to be done by the core creative team, there is no getting around that in the digital indie world. Marketing is more and more your responsibility and offers you a chance to own your own audience and success or failure (which is really just another opportunity to learn). Here are some of the best practices you can employ to get the most out of your crowdfunding campaign:

• Know your audience(s) before, during and after your campaign. There is invaluable market intelligence available which can be used whether or not you raise the money you are hoping for.

• Gather, watch and respond to the data, both qualitative and quantitative. Keep an eye on the data generated and ask, listen and respond to your audience along the way. This is a perfect, authentic opportunity to engage people and help them feel ownership of your project and success (especially the superfans).

• Keep it simple. Your messaging needs to be clear, your calls to action visible, and your goals realistic. Don’t ask for more than your audience can give or risk losing them. The easier you can make it for them the better your chance of success.

• Just one part of the promotional cycle. Understand this is just another chance to engage and communicate with your potential audience and an excuse to do so well before you even go into production. You need to build a core audience ahead of time, keep them engaged throughout your crowdfunding campaign and then continue to bring them along for the ride as you move through production and bring your story to market. And don’t forget, crowdfunding milestones and successes are great fodder for conventional publicity and media coverage.

• The Internet never forgets. Remember your crowdfunding page can potentially live online forever, so incorporate it into your communication and engagement strategy even after your campaign has closed, just like you would with any other social network. This is a practice that is rarely used and so represents a significant advantage if you do it well.

A Final Thought…

I’d like to leave you with this thought, recently quoted by one of my favourite compatriots Sheri Candler, and credited to Thomas A. Edison:

“Opportunity is missed by most people because it is dressed in overalls and looks like work.”

This may become my new mantra, as it sums up so many of the struggles of my students, clients and collaborators. It is true. There have never been more opportunities for content creators because of the direct connection to audience offered by the digital world. However, you are being asked to work harder than ever before. Crowdfunding is a strategy that demands much and should be only undertaken with a strong strategy in place and enough resources (both time and money) to implement your vision. In the end, if you have done it right, you may not only raise the money, but also build a valuable community for your brand and future projects. And this is the true measure of success for new digital business models.