Crowdfunding: engaging consumers
Julie Feeney who raised €23,000 for her album ‘Clocks’ on fundit.ie
By Stuart McLaughlin, Chief Executive, Business to Arts
In recent times I have read and heard much discussion between marketers around the subject of participation and conversation or, more specifically, authentic participation and conversation between brands and their consumers. Each day we see this play out on-line with attempts to kickstart dialogue on Facebook and Twitter with mixed success depending on a wide range of factors many of which, if we are honest, we are only beginning to grasp an appreciation of.
The reality of course is that we don’t fully understand consumer behaviour in the online environment. As soon as we think we are approaching some insight, they are likely to have moved on. To some extent ‘twas ever thus’, but now the pace has quickened, the shifts in behaviour are greater and the value in pre-empting or responding quickly to change has risen considerably (the risks also).
Perhaps to experts in the field these comments seem basic, but after 18 months of being involved with Fund it, Ireland’s home-grown crowdfunding website, the value of these principles has been realised in a very true and tangible way.
Fundit.ie went live in March 2011 presenting a new way for creative people to fund their projects by realising the value of their networks; offering an opportunity for consumers and audiences to participate in the creation of new work which might otherwise never find its way onto their screen, stage, paper or iphone.
After 14 months live, €800,000 has been pledged to 300 creative projects on fundit.ie by over 14,000 people – staggering statistics considering the economic backdrop and, we feel, a great demonstration of the DIY culture that exists among much of Ireland’s creative talent.
The fundamental principles behind a successful Fund it campaign are no different to any sales cycle: indentify your market, establish what they want and the appropriate price points; communicate clearly and consistently; deliver great service; and build a relationship that creates a platform for repeat sales.
But there are some important differences that I believe have underpinned the success of many creative projects on the Fund it platform and these lay in the absolute authenticity of conversation and participation that is possible outside of the confines of a traditional brand.
Where a mobile operator or drinks company might have to stimulate or prompt a dialogue with their consumers, often around topics that are designed to activate sponsorship relationships, a Fund it project creator is most likely to have a network of supporters or fans who are invested in their idea or project on an emotional level and welcome the chance to engage in a conversation about the next album, performance or film in a way that might not previously have been possible.
For artists this can be extremely valuable; the connection between them and their fans has always been a valuable lever in creating a relationship. With Fund it this principle can apply on a smaller scale. By creating the opportunity for fans to participate in the creation of work via a pledge, we find consistently that they will pay more for this opportunity.
A personal experience to make the point – when Julie Feeney released her second album I dutifully went to HMV on release day and purchased a copy for €15. With her third album Julie raised over €23k through a Fund it campaign, and I paid €100 for the opportunity to be part of the creation of the album, because this was more exciting for me as a fan of Julie’s music. This dynamic is played out time and again on the site, with the average pledge around €50.
Recently too, in a small way, we have begun to observe brands and project creators think about how they might make the dynamics of the consumer relationship on Fund it work to their mutual advantage. Most recently we have seen the people behind Go Car pledge to and promote a project around creating a ‘Cycling in Dublin’ newspaper, with an obvious link between the demographic for both.
Brands have also supported projects in their communities, such as Murphy’s backing the ‘Tosca in the Park’ project as part of the Cork Midsummer Festival. For a low cost it gave an opportunity for the brand to assert its support of the Festival, make a positive contribution to the local economy, and be credited with making a project a reality in a very tangible way.
Taking all of this into account, what of the future? One year in consumers surprise us every day with their actions, and the engagement in the site has been a joy to observe. The pressure switches to project creators to come up with exciting fundable ideas, to build their supporter networks for the projects and products and, most importantly, to deliver on their promises.
So while the ability to test, to adapt, and to respond has quickened, it is fascinating to observe that many of the basic marketing principles remain the same and, more importantly, it is inspiring to realise that for a great creative idea there is a market waiting to engage in the most authentic way.
This article first appeared in Marketing.ie Volume 23 No. 6 July 2012
