Celebrities such as James Fancy, Shaquil O’Neill, or Kristen Bell have had successful crowdfunding campaigns. Notorious brands such as Honda, Phillips, Microsoft or Coca-Cola had their own campaigns.
Why famous celebrities and well-established brands launch crowdfunding campaigns when they do not really have to? They have money, fame and loyal following – crowdfunding can’t bring them any more advantages.
The truth is that crowdfunding campaigns offer a number of benefits to the most established brands in the world. You can even say that the benefits offered by crowdfunding will not be found on any other platform. What are they?
Crowdfunding product Validation
The most popular companies and brands use Kickstarter and similar platforms to show the world their new product. Through crowdfunding, companies can validate if their new product/service or just a minimum viable product is relevant to the market. What’s more, they can do it low-cost.
Validation is a simple process through which companies discover if a particular target audience is interested in a product or service. Even for large companies with considerable budgets, it makes no sense to invest in the development of something that no one wants to use at the end of the day. And the easiest way to get a product in front of millions of people and verify customers’ interest is through platforms like Kickstarter and so.
Practically, it’s very simple. If a crowdfunding campaign is successful and rewards are being sold, validation is a success and the company knows that there are people in the world who are interested in the product and are willing to pay for it.
If, on the other hand, the campaign doesn’t take off, there is not enough interest in the product, so at least the company knows that this is not the right way, but it can use the feedback, data, and information to improve the product or change the whole concept.
Katy Perry had a shark costume during her show at the Superbowl. These costumes attracted great attention so Bonobos decided to launch a crowdfunding campaign to see if people would be willing to pay for the costumes.
The campaign was successful and thanks to crowdfunding, Bonobos did it low-cost and with minimal risk.
Creating community and brand ambassadors
Lovebrand is not just a concept, it is the expectation and feeling that makes ordinary people and customers ambassadors and brand lovers. Many companies are using crowdfunding to create community and ambassadors through their own campaign, which they will later use to promote the product.
The crowdfunding community consists of thousands of smaller communities of varying focus, which gives businesses the ability to easily reach a large number of people with one campaign. In addition, the crowdfunding community is loyal to the projects it supports, making it easier for businesses to create communities around their products and campaigns.
The trick is that crowdfunding campaigns allow their supporters to be part of the whole development and influence the life of the product, thus building loyalty between project creators and supporters. Both camps are on a common path where there are certain risks, obstacles, and uncertainties, but the common pursuit of success is stronger. This has supporters much closer to the brand as if they only saw it on television or in a typical advertising campaign.
Dodge created the Dodge Dart project and combined it with the principles of crowdfunding and community building. The aim of the campaign was to sponsor a new car, with people choosing which part of the car they want to sponsor. The concept of the campaign was so appealing to people that they began joining groups and communities that sponsored whole car parts. At the end of the day, Dodge Dart went viral and thanks to thousands of shares, many NGOs were supported through the project.
The Dodge Dart campaign demonstrates how a simple combination of crowdfunding and sharing is able to create a buzz around brands and communities around projects.
You will find two types of weapons in the crowdfunding arsenal: a shotgun and a sniper rifle.
You can use one of these campaigns to target the campaign.
If you want to show the project to a huge number of people, you want to choose a shotgun.
If a project is looking for a specific audience and wants to laser-target people, a sniper is a right choice.
Large companies and established brands belong to the first type of campaign. They are looking for a large exposure to the masses. Crowdfunding is once again the simplest way to meet that goal. Crowdfunding is a home to millions of curious eyes ready to support promising projects and their products. There are not many such places in the world, and the traction that projects can get is not negligible even for world brands or celebrities.
The TLC girl group was preparing their fifth album. But this time the band members decided that 23 years after their debut album they will try something different. They have created a crowdfunding campaign to give their loyal fans the opportunity to take part in making the album.
TLC’s new album was the reward, and at the same time, the fans could give tips for improvement. The goal was not to get finances, that was clear from the beginning of the campaign. The aim was to use crowdfunding as a way to a larger community, new fans, and a completely new channel that would allow fans to work on the album directly with the band. As a result, the campaign was mega-successful and the marketing noise that came naturally during the campaign increased the popularity of the album even more.
It’s not true that only projects with no resources turn to crowdfunding. Unsurprisingly, it is becoming an increasingly common alternative for global brands.
An important factor that combines small and large crowdfunding projects is the community that surrounds all of the crowdfunding platforms. What’s more, this community is so wide and varied any project can fit in it.
Still, the most important part at the end of the day is product quality and style of communication. Even global brands have experienced failures in crowdfunding. What’s special about it is that the failure of a crowdfunding campaign does not have to be fatal.
Hundreds of projects have experienced failure. But then they learned and succeeded with their next venture. And this is a luxury that all projects, big or small, known or unknown, can afford only in crowdfunding.