‘How social media relates to crowdfunding’

One afternoon we asked ourselves a question: “How many followers do you need to receive one dollar from your crowd?” To measure the amount of social network support we turned to Kickstarter as it is the most popular and, in many ways transparent.

We took 60 successful music initiatives listed on Kickstarter. Selection fell under the criteria of being affiliated with music and having collected more than $5.000. We then made a spreadsheet with data from Kickstarter, Facebook and Twitter.

We looked at the amount of:

• Followers the bands/projects have;
• Facebook likes there are on their Kickstarter pages;
• Comments about their projects there are on Kickstarter;
• Updates by the project owners/ musicians;

From averaging our Excel spreadsheet numbers, we found that:

• About three Facebook likes on your project’s Kickstarter profile gets you one backer;
• Every Facebook like is worth around $34 dollars of investment;
• Every social media follower brings you about $96;

The numbers above are averages. The deviations (how far are all the numbers from the average) are huge. So unless you plan to set up a hundred different Kickstarter projects at once, you will probably not get the same results. Lies, damn lies, and statistics!

The numbers generate more questions than they give answers. For example: If people like your profile page, do they attract more backers? Or do the backers like the page and then simply attract more likes from their own social networks? Are your social media followers directly involved with backing your project or do they just help spread the word about your project and contribute to your funding in this indirect manner?

So, as you see, the data does not draw a picture, instead, much like Jackson Pollock, it splashes a bunch of paint on the canvas and leaves you baffled in search for meaning.

To fully answer these questions, we analyze: in what way does the project include its followers; quality of the project proposal (usually the video); degree of originality; novelty and so on. These are hard (if not impossible to measure objectively).

We have talked about our finding with Mark Hillen (pictured), an expert in Retail, Social Etrepreneurship and Crowd-backed initiatives. “Crowdfunding is a relatively new phenomenon and there is little hard-data on it”, says Mark. “I expect, that in a few years from now, when researchers and universities start investigating crowdfunding, we will see a lot of interesting results. Similar thing happened in marketing. Today, marketing is an established science, and retailers know exactly how their promotions will affect the sales of a particular item.”

“We do not yet have the same data for crowdfunding,” continues Mark, “eventually, we will know what type of videos, what type of engagement, what type of projects have better success chances for crowdfunding. As for now, much is based on intuition and gut-feeling.” Mark advises crowdfunders to define the potential supporters based on the cause of the Crowdfunding campaign, understand their emotion that can trigger support, know what they want and like and tune the efforts and incentives. And make a clear call to action!

We do not want to give up our search for answers. We are sure that there is a connection between a project’s engagement with social media and its crowdfunding success (or failure), we just do not yet know what it is. Surely, the crowdfunding community is eager to learn about it as well. That is why we we are sharing our spreadsheet with our readers. Feel free to share your thoughts, ideas and findings with us and anyone interested in the topic!