In the e-commerce space, crowdfunding was initially just a tool to help entrepreneurs measure and, ideally, grow some enthusiasm around their goods and/or services. However, today, crowdfunding campaigns have become a reliable method for generating enough capital to launch and sustainably scale digital brands.
Not only are billions of dollars generated via crowdfunding in North America yearly, but the percentage of money raised through crowdfunding continues to grow steadily. With a track record like that, it’s hard to deny that a crowdfunding campaign can be a worthwhile area of focus for generating sales — if you can convert shoppers into buyers.
Let’s discuss why conversion is an important metric to consider and how you can grow it to make your e-commerce crowdfunding campaigns more successful.
Why Focus on Crowdfunding Sales Conversion Rates?
Getting traffic to your website or crowdfunding platform should be your campaign’s goal.
However, getting all the visitors in the world who don’t actually purchase anything will inflate your metrics in an unsustainable way (bad news for investors) and waste your resources without generating any cash flow (bad news for your bottom line).
We believe conversion rate is one of the most important signals online business owners should look at when it comes to crowdfunding campaigns, whether launching a new business or product line or making a big push to scale up sales.
While the conversion rate you should aim for is highly dependent on your audience, industry, offering, and typical conversation amount — the average e-commerce conversion rate hovers between 2% and 4% in 2023.
7 Tips for Maximizing Your Crowdfunding Conversion Rates
Conversion rates need a boost?
Check out the following tips to improve the performance of your crowdfunding campaigns.
Consider your target market
Your target audience really matters regarding how well crowdfunding can work for you.
Research shows that people aged 24 to 35 are more likely to participate in crowdfunding initiatives than those younger or older. Do your best to connect with potential supporters in this age group regarding marketing and creating your campaign; your conversion rate will likely be better for it.
Invest in email marketing
Regarding how you market your crowdfunding campaign, email marketing is a hugely powerful tool for conversions. Some sources indicate that a donation occurs more than half of the time a crowdfunding campaign is shared via email!
And even if your campaign emails aren’t pulling in those kinds of conversions, you can still rest assured that the reward will be worth the spend by generating new sales, referrals, and repeat shoppers. After all, the ROI of email marketing is $36 for every $1 spent — better than any of the other widely-used marketing channels out there.
This ROI makes it critical that your marketing emails are well-written, well-designed, and personalized using customer information. We’ll talk about how to create great content in the next section, but as for collecting customer data and setting up a great system for sending off customized marketing emails — that’s something your crowdfunding platform should help you with.
With the self-hosted solution from IgnitionDeck, you can enjoy personalizable emails, a built-in customer relationship management (CRM) tool for handling customer data, and a Mailchimp integration to simplify email marketing administration.
Cater to your audience
As mentioned above, creating email and other marketing content that speaks to your audience is key to conversions.
To produce content that works the best for the most consumers, we like to break down the typical audience into four types of sales prospects:
- Spontaneous: These folks are probably in a hurry and make decisions fast — cater to them with concise language that explains how you can solve their problem.
- Methodical: This consumer category is all about considering the options. To lead them to convert on your campaign, create expert-level content that builds trust and naturally guides them toward your solution.
- Humanistic: In this area, potential buyers are guided by their human relationships. Appeal to them with case studies and stories of how other real people benefited from your offering.
- Logical: Logical shoppers are, not surprisingly, very focused on the facts. Crowdfunding campaign copy should lean into the stats and proof to help you win conversions from this type of shopper.
Once you know your audience, you can apply an AI-powered content creation platform such as Chat by Copy.ai to create quality content that converts quickly.
To deepen your knowledge on content strategy and become an even better business marketer, read A Crash Course in Content Marketing for Crowdfunding & E-Commerce.
Don’t shy away from getting personal
Most of the risk associated with supporting a crowdfunding campaign isn’t about the business or product itself — it’s all about the creator.
Where most creators place all the attention on the product itself, it’s crucial to humanize yourself (and your team, more on that next) in your campaign content.
Where to start with personal details? Here are some areas to consider:
- The basics: name, general background, age group, passions, maybe a picture
- Education: schooling, certifications, etc.
- Past successes: sales to date, successful projects, other businesses, happy investors, etc.
Highlight your awesome team
Sure, it’s somewhat about you — but it’s not only about you.
Compared to solo campaigns, crowdfunding campaigns that feature the details of the teams behind them raise a whopping 38% more money!
If you have a team, show them off as part of your crowdfunding campaigns. And if you’re a one-person business, it may be worth considering building a team or at least finding a few investors or other professionals in your category willing to be featured in your campaign.
Offer on-site chat support
Consumer insight firm J.D. Power found that 42% of customers want to use chat versus any other channel when communicating with brands.
Unlike other, more conventional support communication channels, Chat provides a pathway to near-immediate solutions. And despite how high-tech it may seem, the barrier to entry is quite low: select one of the many chat solutions on the market (choose from live chat to fully automated bot to anywhere in between) and typically just adjust a few lines of code on your website to get up and running.
The beauty of using a third-party solution for this application is that you enjoy the new capability while the vendor manages all the building, maintenance, and scaling.
Apply social proof
Social proof includes elements, such as reviews, that shoppers often look for before purchasing. The psychology behind this is that people think they can recreate another shopper’s positive situation by acquiring the same product or service they used.
Even if you don’t think you have, chances are you’ve relied on social proof at some point. Many of us have ultimately purchased after reading several positive reviews or seeing a video featuring a product we’d debated for a while. Social proof is a recognized approach to earning customer confidence and spurring conversions.
Social proof comes in many forms from which to choose:
- Customer reviews
- Celebrity/influencer endorsements
- Number of shares, likes, or other forms of social currency
- “Stamp of approval” from a category expert
If you want to incorporate this powerful conversion factor into your crowdfunding campaign, build it using highly-customizable White Label Crowdfunding Software that highlights your amazing backers and makes prospects want to follow in their footsteps.
Continue Your Crowdfunding Sales Learning
Whether you’re building new or continuing to scale in your business, there is much to learn about e-commerce and crowdfunding.
With a combination of e-commerce knowledge resources and unique, personalizable crowdfunding products built to help crowdfunders excel on their terms, you’ll be well on your way to expanding conversions and overall business success.