marketing lessons from crowdfunding - clay hebert at eo ny

Marketing Lessons From Crowdfunding

Clay Hebert Presentation to EO NYC Knickerbocker Hotel Thursday, October 6th, 2016

5 MYTHS ABOUT CROWDFUNDING

MYTH #1 CROWDFUNDING

is new

In 1713, Alexander Pope crowdfunded his

translation of Homer’s Illiad

In 1783, Mozart wanted to perform

three recently composed piano

concertos in a Viennese concert

hall

In 1885, Joseph Pulitzer saved The Statue of Liberty,

keeping it in New York City

MYTH #2 CROWDFUNDING is a small industry

The Rise Of CrowdfundingB

illio

ns o

f $ (U

SD)

0

4.5

9

13.5

18

2010 2011 2012 2013 2014

The Rise Of CrowdfundingB

illio

ns o

f $ (U

SD)

0

10

20

30

40

2010 2011 2012 2013 2014 2015 (est.)

2015 $34B

The Rise of Crowdfunding

64.22%35.78%

MYTH #3 CROWDFUNDING is only for creatives

MYTH #4 CROWDFUNDING

is free money

MYTH #5 You have never

CROWDFUNDED

CROWDFUNDING 101

CROWDFUNDING versus

CROWDSOURCING

THE 5 types of

CROWDFUNDING

1. REWARDS 2. DONATION 3. EQUITY 4. DEBT 5. RECURRING

1. REWARDS 2. DONATION 3. EQUITY 4. DEBT 5. RECURRING

1. REWARDS 2. DONATION 3. EQUITY 4. DEBT 5. RECURRING

1. REWARDS 2. DONATION 3. EQUITY 4. DEBT 5. RECURRING

1. REWARDS 2. DONATION 3. EQUITY 4. DEBT 5. RECURRING

YOURIDEA

IS YOUR IDEA right for

CROWDFUNDING?

A CREATIVEPROJECT

WITH A BEGINNING

AND AN END

IN WHICH SOMETHING NEW GETS MADE AND

SHARED

WITH A TRIBE OF PEOPLE YOU CAN

IDENTIFY

AND BUILD TRUST AND PERMISSION WITH

BEFORE YOU LAUNCH

REASONS TO CROWDFUND

BEYOND FUNDS

VALIDATING YOUR IDEA BUILDING YOUR TRIBE GAINING EXPOSURETESTING PRICING + MARKETING SECURING INVESTMENT

WHAT IS your

“WHY”?

GREAT CROWDFUNDING IS JUST GREAT MARKETING

TACTIC QUESTIONS

TACTIC QUESTIONS:

1. Do Facebook ads work? 2. How much should I spend on SEO?

3. What do you think about retargeting?

PLATFORM QUESTIONS

PLATFORM QUESTIONS:

1. Should I be on Pinterest or Instagram? 2. Do I have to use Snapchat?

3. What’s “the next big platform”?

DON’T COPYTACTICS or

STRATEGIES

TACTICS (EVEN STRATEGIES)

ARE UNIQUE

DON’Trely on

PLATFORMS

PLATFORMS DIE

PLATFORMSCHANGE THEIR RULES

FACEBOOKPAY TO PLAY

TAKEAWAY

LEARN PLATFORMS DEOCDE STRATEGIES

STUDY TACTICS

BUT GREAT MARKETING IS REALLY JUST ABOUT

10 QUESTIONS

THE 10 MAGIC MARKETING QUESTIONS

10 Magic Marketing Questions

The answers to these 10 questions define your marketing strategy

1. WHO specifically are you trying to reach?

If the answer is ‘everyone’, start over.

“The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.” - Peter Drucker

Your Perfect Customer Avatar

‣ Define ONE perfect customer avatar…

‣ helps you attract the right customers for your business.

‣ helps you repel the wrong customers. The wrong customers will be huge pain and cause you lots of headaches and frustration.

‣ helps inform every subsequent aspect of your marketing and your business. It will inform your website, your videos, your copy, your pricing, all of it. You’ll create your marketing as if you’re speaking 1-on-1 to your perfect customer avatar.

Who Are You Trying To Reach?

Your Perfect Customer Avatar

‣ Most importantly…

‣ Your perfect customer avatar becomes your compass, your answer key and your Magic 8-ball, all rolled into one.

‣ It solves all of your “Should I…? questions. Whenever you come across the “Should I…?” questions in your marketing, knowing your perfect customer avatar will help you answer those questions quickly and confidently.

Why Is A Perfect Customer Avatar Important?

Your Perfect Customer Avatar

‣ We’re not just going to focus on the demographics, like age, gender and income level. That’s worth thinking about but it’s the least important piece of this exercise. Demographics are also the easiest to define, and we’re going to go deeper.

‣ We’re going to dig into psychographics, which are even more important.

‣ Demographics are facts. Psychographics are feelings.

‣ We’re going to look into your perfect customer avatar’s habits and consumption, which is one level deeper than surface level demographics and then we’ll go even deeper and really get into their problems, fears hopes and dreams.

Why This Exercise Is Different

Your Perfect Customer Avatar

‣ Very simply, your customer avatar is your one perfect customer.

‣ I like starting by doing an exercise I call “The Single Unit Exercise”. Imagine you only had one unit of the product or service you’re creating.

‣ Who would be the one perfect person in the whole world to get that one unit? Who would be the most excited to get it?

‣ Define your avatar very specifically as one, specific human being.

‣ You’ll be tempted to generalize and speak in demographic ranges (like females, ages 25-40). In a minute, we’ll look at why that’s a common mistake but for now, just stay specific and define your avatar as one, singular clearly defined person.

What Is A Customer Avatar?

Your Perfect Customer Avatar

‣ What is their name?

‣ How old are they?

‣ Are they married, single, dating?

‣ Are they close to their family?

Defining Your Avatar: The Person

‣ Where do they live?

‣ Do they own or rent?

‣ Where do they work? What’s their title?

‣ What is their income?

Your Perfect Customer Avatar

Defining Your Avatar: Their Habits & Consumption

‣ What books, magazines or catalogs do they read?

‣ What are their favorite websites?

‣ Where do they go out to eat?

‣ What TV shows do they watch?

‣ Do they listen to podcasts? Webinars?

‣ What are their hobbies? What do they do in their spare time?

Your Perfect Customer Avatar

Defining Your Avatar: Their Problems, Fears, Hopes + Dreams

‣ Problems: What are they struggling with? What frequently frustrates them?

‣ Fears: What do they worry about? What keeps them up at night? What would they be afraid to tell their spouse? What would they be afraid to admit to themselves?

‣ Hopes: What are their short and medium-term hopes? What would make their month? What would make their year? What hopes do they discuss with their family, friends and spouse?

‣ Dreams: What are their big dreams? What do they dream about when they’re awake? In their perfect life, who are they? What does their day look like? Who do they become?

Your Perfect Customer Avatar

‣ Your job is to be able to think like them (thoughts) and feel like them (feelings).

‣ If you are your perfect customer avatar, that’s fine. It’s fairly common because often people build products and services to “scratch their own itch”, but either way, it’s important to be able to think and feel as if you were them.

‣ When possible, use the words that they use. And if you don’t know those words, go talk to more people who are like your perfect customer. Ask them questions. See what words they use in the context of your product.

Become Your Perfect Customer Avatar

Your Perfect Customer Avatar

‣ There is one mistake that will hold you back from creating your perfect customer avatar. I’ve made this mistake and I’ve seen lots of others make it.

‣ The most common avatar mistake is worrying that by specifically defining your avatar, that you’ll be too niche and alienate lots of other people.

‣ This is understandable, because by doing the hard work of defining your one perfect customer, your brain feels like it’s leaving everyone else out. And our business school and MBA courses teach us to address the largest possible addressable market.

‣ Unfortunately, this mistake is crippling to businesses large and small. It’s completely the wrong strategy. Let’s look at Kittyo’s customer avatar to see why specific is best.

The Most Common Avatar Mistake

Your Perfect Customer Avatar

Example: Kittyo’s Customer AvatarJessica is a 29-year old woman who rents a 1BR apartment in the Upper West Side of Manhattan with her boyfriend, Will. She was recently promoted to Senior Account Director at the marketing firm she works at, which brings her annual salary to $97,000. They live with her Persian cat, Sansa, who despite being a cat, is one of the consistent things that makes Jessica happy everyday.

Jessica reads Monocle and Real+Simple magazines and has her apartment decorated with Crate & Barrel and West Elm. Her favorite websites are Instagram, Twitter, Refinery29 and BuzzFeed. She’s hooked on Game of Thrones and loves the comedy of Amy Schumer. Her favorite podcasts are The Nerdist and Radiolab. In her spare time, she goes to drinks with her girlfriends and co-workers and tries new restaurants with her boyfriend. They also have a monthly date night at The Comedy Cellar.

She gets frustrated with her clients at work and wonders if she made the right choice sticking with one firm since college or if she should have job-hopped a bit more. Her 2-year relationship is solid but she wonders how serious her boyfriend is about a longer-term commitment and they rarely ever talk about whether they’ll have kids. She daydreams about making VP, traveling to Europe and Southeast Asia and then settling down, getting married and having 2 kids.

Your Perfect Customer Avatar

Kittyo’s Results?‣ Because Kittyo focused

specifically on marketing to one specific avatar…

‣ Their marketing was compelling and consistent. They raised $271,154 from 2,425 backers, many of which were nothing like their avatar.

Your Perfect Customer Avatar

Lesson: DEFINE YOUR

IDEAL CUSTOMER(LIKE KITTYO)

TAKEAWAY

BUILD YOUR PERFECT

CUSTOMER AVATAR

FIND your

SUBTRIBES

FoodiesFood

bloggers

iPad app early

adoptersCooking

show fans

Fans of specific chefs

Lesson: DEFINE YOUR

SUB-TRIBES (LIKE PANNA)

TAKEAWAY

FILL OUT YOUR SUB-TRIBE

VENN DIAGRAM

2. WHAT story are you telling?

Or what story are you living? Or what story are you spreading?

THE ALARM CLOCK

TEST

PLAY WITH YOUR CAT, EVEN WHEN YOU’RE

NOT HOME

YOU DESERVE A BETTER WATER

PITCHER

Lesson: TELL A SIMPLE STORY

YOUR CUSTOMER ALREADY BELIEVES

TAKEAWAY

WHAT IS YOUR ALARM CLOCK

TEST?

3. DOES that story resonate with the worldview these people already have?

What do they already believe? What do they already want?

Lesson: REDEFINE WHAT YOU

REALLY SELL

TAKEAWAY

WHAT IS YOUR “FLOWER”?

WHAT IS YOUR “SUPER MARIO”?

4. WHERE is the fear that prevents action?

Why might they say no? What are the fears that would prevent them from saying yes?

5. WHEN do you expect people to take action?

If the answer is 'now', what keeps people from saying, 'later'? It’s always safer for them to act later.

6. WHY will they choose you?

How do you stand out in a world of infinite choice?

OPPOSITE ADJECTIVES

FAST CHEAPEXCLUSIVE DISPOSABLE ELEGANT

SLOW EXPENSIVEOPEN DURABLE FUNCTIONAL

Elegant

Eco-friendly

Functional

Plastic

100% in 10 days147% funded

Made overseas

Disposable

Made in America

Durable

DIFFERENTIATION VIDEO & COPY

PRESS & BLOGGERS

PURER THAN PUR ELEGANT

ECO-FRIENDLY

Lesson: OWN A UNIQUEPOSITION LIKE

SOMA

TAKEAWAY

FILL OUT YOUR POSITIONING

GRID

7. WHAT will they tell their friends?

How will the story spread? Because the story has to spread. When they tell their friends, what words will they use? How will they feel? Smarter? In-the-know? We buy portable stories.

IT’S GRIZZLY-PROOF!

Lesson: TELL A STORY

THAT LETS YOU CHARGE MORE

TAKEAWAY

DEFINE YOUR PORTABLE STORY

8. HOW will they become aware of what you have to offer?

How will they hear about you? Who do they already know, like and trust? How do they hear about other things they buy?

Notice that this is number eight, not number one. The earlier answers greatly inform this answer.

Cat Owners

Design

HIGHLY TARGETED

LEADS

NINJA TRICK

Lesson: FIND YOUR

CUSTOMERS AND BUILD PERMISSION

TAKEAWAY

FIND YOUR HAUSPANTHER

FLASH PRESS VS.

CASH PRESS

Lesson: KNOW WHAT THE

DIFFERENT TYPES OF PRESS ARE GOOD FOR

TAKEAWAY

DEFINE YOUR FLASH PRESS AND

CASH PRESS

9. HOW will you know it’s working?

What defines success? What is your Champagne Moment? Is everyone in agreement on what success means? What specifically will you measure and how often?

IGNOREVANITY

METRICS

LIKES FOLLOWERS

WEBSITE “HITS”

HOWIDIOTSTRACKSUCCCESS

2 METHODS

$82

Lesson: HAVE SPECIFIC

MARKETING GOALS

TAKEAWAY

DEFINE YOUR CHAMPAGNE

MOMENT

Lesson: MEASURE YOUR

MARKETING FAIRLY

TAKEAWAY

DEFINE YOUR SEE, THINK, SO,

CARE FRAMEWORK

10. HOW will you iterate and learn?

How quickly can you validate, test, fail small, test and learn?

Clay Hebert clay@clayhebert.com 651.303.9422

clayhebert.com crowdfundinghacks.com