As you’re planning for a crowdfunding campaign, it’s important to know what to expect. A big part of setting expectations for yourself and your team is knowing what crowdfunding success metrics are important and how they should be defined. If you have a good idea of what success metrics should look like, it’s much easier to evaluate your crowdfunding campaign and course-correct where needed so that you achieve the highest levels of success.
Each crowdfunding campaign has three phases: prelaunch, a live campaign, and post-campaign. Dividing success metrics into these three phases as well makes it easier to know when and where to focus your energy in order to have a highly-successful crowdfunding project.
Part 1 – Success Metrics During Prelaunch
The prelaunch phase of your project should be focused on getting everything ready to go live. However, note that this involves much more than just getting your campaign page ready.
One of the most important parts of prelaunch is collecting valuable leads. Having a set of email addresses prior to launch gives you a pool of people who are likely to back your project on the first day, giving it an initial boost. The number of email leads you need varies according to your project, but can be calculated using the formula (funding goal x 30%) / (conversion rate x price of product). As long as your conversion rate is accurate, you should reach 30% of your goal with an email list of that size
One way to boost your crowdfunding campaign’s performance from the beginning is to have funding lined up from friends and family. We like to see our clients have as much of their funding goal as possible met by their personal contacts. Having this ready to go as soon as you launch your project is a great way to ensure you have enough momentum early on.
The pre-launch time period should also be used to garner press hits in time for launch. We find that media outlets are typically hesitant to cover Kickstarter or Indiegogo projects before they launch, which is okay – after all, coverage is more important when you actually have a campaign page to drive traffic to. However, if you can get at least one goodembargoed press hit ready to go for launch day, you’re in good shape.
Part 2 – Success Metrics During the Crowdfunding Campaign
As I’ve already mentioned, percentage funded at the beginning is important. Some crowdfunders say you need 25-30% of your funding at the end of the first 48 hours for your project to be a success. In my experience, there is no “magic number.” I’ve seen projects hit 30% quickly and then stall out, and I’ve seen successful projects that start out slowly. With that being said, hitting that 25-30% goal quickly never hurts, and getting more than that is even better.
Conversion rates during the campaign are an important way to measure success. Track and analyze conversions rates for the campaign page and for Facebook ads. A good baseline conversion rate is typically around 5-10%, but rather than focusing on specific numbers here, look at the general trend: are your conversion rates going up or down? Try to keep them trending upward, or keep them stable at the very least. This can involve significant A/B testing – if you notice conversion rates going down, switch things up on the page or in the ads and see what happens!
Be sure you’re paying attention to cost per click and cost per acquisition for Facebook ads as well. Keep in mind how much your product costs versus how much you’re spending on Facebook ads. If your cost per acquisition for ads is more than how much you’re bringing in from product sales, you’ll have a serious problem on your hands.
Part 3 – Success Metrics Post-Project
Once your campaign is over, you’ll likely shift to InDemand on Indiegogo or some other method of accepting pre-orders. However, your success metrics and key performance indicators will stay about the same as during the campaign, even if your numbers shift. You should still pay attention to total sales, conversion rates of both site visits and ads, and cost per click and cost per acquisition for ads.
Knowing what metrics to measure is clearly important for a successful crowdfunding campaign, but it’s also important to note that there are no ideal numbers that fit all campaigns. Crowdfunding can be highly unpredictable, so just because you aren’t reaching the numbers we’ve laid out here, doesn’t mean your project is doomed to be a failure. Finding ways to keep conversion rates up and costs down is most important, and what we focus on with all our clients.