28 Oct Success and Failure on Kickstarter
The growth of Kickstarter has fueled many entrepreneurs to follow their passions and create unique products without all the constraints that bank loans carry. Kickstarter instantly connects startups to an engaged audience of potential customers who will happily spread the word of their project. Instead of paying back the principal plus interest of a loan, Kickstarter projects require different forms of kickbacks for the money raised, from simple thank you notes to copies of the actual finished products and beyond.
The logistics of Kickstarter seem great, but the unfortunate truth is that only 37% of all Kickstarter projects are successfully funded. We set out to investigate what successful projects have in common in order to glean some insight for entrepreneurs looking to launch their next dream on Kickstarter.
Aspects of Success on Kickstarter
Lesson 1 – Be realistic with your expectations.
Asking for too much money may be seen as a sign that you don’t know what you’re doing. However, don’t sell yourself short; research how much you’ll need to actually make your project a success. Make sure the features you’re offering are on par with similar projects and that the rewards will be enticing to backers.
Lesson 2 – Optimize social sharing assets.
Successful projects receive 250% more social shares than unsuccessful ones, and the majority of this sharing happens on Facebook. If you’re a regular Facebook user, you already know what grabs your attention as you scroll through your newsfeed. A high-quality demonstration video or infographic can set you above the competition. Recognize the short window of time you will have to make your impression, and get right to the best part of your invention. Furthermore, content that resonates on an emotional level performs better. If your category is one of the top five for Twitter shares, make sure you have a wordsmith forge a witty title and tagline for your project.
Median Successful Funding Goals
Lesson 3 – Pick the right category.
Conventional wisdom may be to select a category that most closely matches the scope of your project. This shouldn’t be ignored since miscategorization is a clear sign of unprofessionalism and is unlikely to help your project succeed. However, multiple subcategories may apply, and in this case, it behooves entrepreneurs to select the one that drives the most regular traffic and funding dollars. You may also consider adding a new element to your project so that it better fits the specifications of a more popular category.
The Most Successful Categories on Kickstarter
Lesson 4 – Plan your reward levels to encourage higher donations.
The same way that car manufacturers have a portfolio of vehicles to appeal to the widest possible customer base, so too should your reward levels appeal to the widest possible audience on Kickstarter. A low-end level is necessary because every dollar counts. Considering the median of all successful projects entice just over 200 people to pledge money, you’ll also want higher levels of funding. Successful projects attain a median funding per backer of $73, so make your reward levels north of that figure as attractive as you can.
The Least Successful Categories on Kickstarter
Lesson 5 – Compare yourself with the competition.
Perhaps one of the reasons apps are the least successful category is that this field has become saturated with thousands of functionally equivalent product offerings, many of which are free to download. The takeaway if your project idea falls within one of these least successful metrics is to position your concept and rewards beyond what consumers can already find at physical and online stores. Find a balance between pushing the envelope and being humble with your goals.
Kickstarter Funding by Country
Lesson 6 – Look for new opportunities.
Kickstarter allows you to fund projects anywhere in the world; however, the service has been overwhelmingly more popular in the U.S. than any other country. As any good entrepreneur should have noticed by now, foreign Kickstarter markets have not been fully tapped and are thus ripe with opportunity. You may consider a project that specifically appeals to people of these countries, but recognize you also need to keep the scope broad enough so that people from around the world as well as Americans can recognize its benefits.
Successful Kickstarter projects are shared more on social media, have reward levels appealing to higher donations per backer, and have realistic expectations for their funding goals. These truths may seem obvious, but they are more difficult to achieve in practice. Perhaps the best advice is to steep yourself in Kickstarter culture before throwing your own hat into the ring, which you can achieve by becoming an active member of Kickstarter and related discussion forums online.
The 205,000 Kickstarter projects analyzed for this project were scraped with a web crawler by Web Robots and then merged together to remove duplicate entries. The full data are available for download here. The social media data were collected for 100 active projects from the 15 largest categories using the SpreadsheetBooster plugin for Google Sheets.
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