The rule of the 4 C of crowdfunding is one of the 20 golden rules of crowdfunding. In short, they are Community, Costs, Communication and Collaboration. Let’s analyse them one by one:
Crowdfunding is incredibly difficult without an existing community prior to the launch of the campaign. And it’s not just about quantity, but also quality.
What do we mean by quality? Mainly it’s engagement: comments, shares, discussions in forums, open and click rates of emails and conversations happening without the main creators of the project being involved.
And why is having a community prior to launch so important? It all goes back to the 30-90-100 rules. We’ll need a good push from our circles to get us over the magical 30% that will be crucial for our success.
Without an accurate cost analysis, crowdfunding is virtually a mission impossible.
The first and most important costs are the fixed costs of the project itself. You should aim to answer: What is the minimum amount of money that will make the idea a reality? Having an accurate estimate can be key for its success (see the 30-90-100 and the Power of 100 rule). Having a target that’s too high could demotivate our potential backers, that would see the objective as too difficult to reach.
On the other hand, being short on this estimation could be disastrous in the post-campaign. It wouldn’t be the first time that a creator can’t deliver the rewards even achieving 100% of the target of the campaign.
Por otra parte quedarse corto en la estimación puede generar un desastre en la poscampaña ya que podría darse el caso de que no se pudiese realizar el proyecto o entregar las recompensas, aunque se hubiese alcanzado el 100% del objetivo de la campaña.
The other group of costs that are key to have under control are the variable costs of the rewards. How much does each reward cost? Have you considered shipping? Did you include VAT and other taxes in your calculation?
Perhaps the most important C of crowdfunding. Without effective communication, an otherwise perfectly designed crowdfunding campaign will not be successful.
A tool that will facilitate enormously any other communication effort is a well-crafted elevator pitch. You’ll be able to use it in the description area of your campaign, in the video and across all other communications. It must be catchy, easily understandable, short (under 30 seconds), and (most important of all) addressing our target audience.
The communication during a crowdfunding campaign must be frequent and engaging. Your backers will want to hear the progress of the campaign and if you give constant value, they’ll want to share your updates with their friends and followers.
To be effective, you’ll have to plan this carefully with a content calendar. Prepare press releases, create unique hashtags, plan any posts on social media… all those are important steps for a successful campaign. The first week is crucial, so think about how you’ll engage with your audience on the early stages of your campaign.
Finally the fourth C of crowdfunding is collaboration. Both crowdfunding and its ‘parent’ crowdsourcing are collaborative methods by definition. Your backers must feel part of the project being funded. Ideally, you want to frame the campaign as not only something that will allow the creator to make their ideas to reality but also something that will be built will the help of all of the backers.
Participation in the development of the product, gain access to special editions, get recognition, get the product at a better price… the options are multiple. When you consider your backers as co-producers, your campaign will have a deeper effect on everyone.
How can we meet the rule of the 4 C of crowdfunding?
- Work on having a community to tap on.
- Control the campaign costs.
- Communicate, communicate and communicate.
- Frame your backers as collaborators.
Wrapping it up
Community, Costs, Communication and Collaboration are key for a successful crowdfunding campaign. If you need help in building the strategy around the 4 C of crowdfunding, please don’t hesitate to contact me.