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How To Use Social Media For Crowdfunding

20 January 2021 | 1 comments | Posted by Luke Fitzpatrick in Industry Experts

getting funding via social media

Starting a business can be a daunting undertaking due to all the hoops and hurdles you have to jump through to get things going in the first place. Raising capital is in itself is a challenge that dissuades most people from ever taking up entrepreneurship. This is a shame because it is a potentially rewarding undertaking not just through profits, but also the learning experience and the networking you undergo when running a business.

But now, the process of startup financing has been democratized, thanks to the advent of crowdfunding. With the power of the Internet, your ideas can be the fuel they need to become a reality through funds contributed by people on the Internet who are interested in what you are trying to achieve. While crowdfunding in itself is innovative, it is the presence of social media that takes it to the next level.

Combining the convenience of crowdfunding with the power of social media takes a bit of know-how to pull off, and here are some of the things you need to take note of before starting a campaign.

The benefits of crowdfunding

The most noticeable advantage with crowdfunding is how much faster and easier it is than traditional fundraising at raising capital. It is also less demanding than applying for a loan and looking for investors physically, compared to setting up a crowdfunding campaign online. As long as you understand your customers and your business idea is something people will find appealing, you can make it work.

You also get to gauge interest through crowdfunding because being funded online doubles as social proof because investors are the general public. This can then potentially turn into more traction as many backers can lead to more publicity and media attention, which can then attract more backers to fund your campaign.

Tech blogger Antoine Bechara says,

"You can set up rewards and stretch goals to both entice people to fund your campaign, as well as show gratitude and sincerity by giving the people what they want."

You can also promote brainstorming and feedback through your crowdfunding page, potentially making the business even better right there in the funding phase.

Crowdfunding can be a frightening tightrope act because you have to balance the publicity and media hype you want to project with being able to deliver on your promises. Nevertheless, compared to doing things the old fashioned way, crowdfunding is a more efficient way of funding a business through public interest and useful online marketing.

Using social media for your crowdfunding campaign

Another good thing with crowdfunding is being able to use social media to promote your campaign. However, it is more than just sharing a link to your campaign page and expecting people to immediately give you their money because that's not how it works. You have to convince them that funding your campaign is a good and worthy idea. That is where social media comes in for this endeavour.

Social media can be a force multiplier for your crowdfunding campaign if you consistently do things right and continuously try new ways to bring more value to people. Only by giving what the people want, would they consider contributing and investing in return.

Many ideas turned into actual projects that bore fruit through crowdfunding because they were ideas that people were genuinely interested in supporting. Many successful campaigns had used varied ways of getting their messages across and were successful in obtaining funds necessary to execute their project, and proceeded from there.

Choosing a social media platform for your campaign

Before the campaign is launched, you have to decide which social media platform you will primarily use to promote your campaign. While you may be able to shotgun it and post it on every social media platform that exists, that takes a lot of time and effort.

The big two are Twitter and Facebook, where the vast majority of people on the Internet are. However, they are not the only social media platforms available for promoting your crowdfunding campaign. Other social media platforms can be just as good for promoting your campaign, as long as you promote your particular niche. The use of Twitter or Facebook, however, remains an advantage.

With Facebook, you can tell your story and create a community among your followers. You can also have targeted ads on it, which can help spread the word regarding your campaign. Meanwhile, Twitter is better for quick updates and leveraging hashtags to make your tweets easier to search for as interest grows.

Instagram is great if you take a lot of photographs related to your business. Pinterest is for users who like to organize their pins and boards related to their interests. You should be in there if your company has a lot to do with one of the more popular topics. Every successful campaign requires a good video, therefore consider YouTube. It is the go-to platform for videos, making it good for vlogs and other videos related to your business.

Then there's Reddit, which has subreddits for specific niches, which is great for targeted promotion. Do take note that Reddit has a fairly strict policy against accounts made solely for self-promotion, so you need to be a frequent contributor in that subreddit or have someone with an account do it for you.

How to promote your campaign on social media

Promotion in social media undergoes three phases. The first phase is word spread by immediate family and friends. The second phase is word of mouth spread by friends of friends. The third phase is by the general public and media. If you can eventually cross through all three and see a definite increase in people who engage with your promotion, then you should be doing well.

You cannot, however, rely on the product or business alone to sell itself. It is not just all about marketing and self-promotion, but more about telling your story. You must be able to touch the hearts of those you wish to get money/funds from, by telling them what led you to this point. The story must be told with honesty and thoughtfulness, making the audience understand and value both your struggles and successes. It must be a story your audience will appreciate & relate to that can elicit an emotional response.

After telling your story and laying the foundation for the narrative of your crowdfunding campaign, you must then pitch your business idea. While your story may draw people in, it is the pitch that will convince them to give you the funds for your business. They are investing their trust in you in the hope that something good will come to fruition later on.

Both storytelling and pitching are essential steps for using social media to promote your crowdfunding campaign. You can make use of social media ads to draw people in and regular content to hold their attention. Different ad types can help you show the best of what you have and additional content types to keep them interested.

Gathering feedback and results to improve your campaign's content

Taking feedback from the audience can be somewhat intimidating because you are unsure of what they have to say or how they will say it. Negative comments may affect your disposition. Also, the sheer volume of feedback you will be getting once you have a fair number of followers on social media can be hard to keep track of, especially when you are still busy trying to get your business up and running.

Being able to get the feel of what people think regarding your content and your efforts, and their suggestions on how to improve your campaign can be beneficial. Generally, their engagement should already tell you how interested they may be in what you do.

There are also analytics and metrics you can consult to see if your social media marketing efforts for your crowdfunding campaign is doing any good. You can get down to the nitty-gritty details like what kind of ads perform best, what type of content people engage with the most, and so on. Seeing those statistics in real-time, lets you adjust accordingly to get more out of your campaign.

Summing up

Social media is not a magic bullet for crowdfunding campaigns because there is still a lot of work to be done to help you raise funds for your business. However, if your idea and pitch are indeed good, and you can connect with your audience. Social media can help make your campaign more visible and potentially earn more contributions from those who believe in what you are trying to accomplish.

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