The Intersection of Social Media and Crowdfunding: Building a New Marketplace

The Intersection of Social Media and Crowdfunding: Building a New Marketplace

- in News Update

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The change in the consumer landscape is apparent. Think about how the Internet has changed the way you choose what to buy. Say you’re in the market to buy a new bike. Are you going to watch TV or listen to radio ads to figure out what brand is the best? Odds are you’ll type something along the lines of “What’s the best bike to buy?” into Google and end up reading bike blogs and consumer reviews. This more communal take to product buying is what has influenced the Triberr Influencer Marketing Campaigns, a program in which influential bloggers are paid to promote products.

Because the Internet has changed the way consumers buy things, it has subsequently changed the way products are marketed. Social media has given people from across the globe the ability to connect instantly, creating a globalized marketplace that is accessible to just about anyone. An accessible globalized marketplace gives average people — entrepreneurs, innovators, and artists — the means to access consumers and build and promote their own brand without the backing of a more prestigious and institutionalized company.

With the proper usage of social media, an average person can accrue a following, build their own brand and even become an influencer or industry leader. The ease of global connection creates a world where everyone has the capability of becoming his or her own branded business and now, emerging technology has found a way to provide these people with a way to raise funds for their product ideas or creative projects.

Crowdfunding and social media

Crowdfunding is a relatively new concept that many people are still unfamiliar with. Crowdfunding is a means for businesses, entrepreneurs, innovators and artists to raise funds for their business or creative projects prior to their creation. The ability to crowdfund from an existing network and fan base allows branded people and businesses to mitigate some of the financial risk associated with the production of a new product or creative project. Furthermore, crowdfunding also allows them to gauge the initial market viability of the project. Crowdfunding is most successful when used by people who have branded themselves on the Internet. People who have used social media to connect with their audience, build a loyal following and become an influencer in their industry will be able to utilize their connections to fund their project.

Most crowdfunding platforms operate on a rewards system, which means the creator of a crowdfunding campaign creates rewards levels — various different incentives a supporter receives in exchange for their monetary pledge towards the campaign. Now we have a model where consumers are not just helping to fund the products they want to see produced, but they are often times receiving the product as a reward at a later date, almost like advanced purchasing.

With the introduction of crowdfunding, the global consumer marketplace is evolving once again. Now, consumers have the ability to become the gatekeepers, deciding what products they would like produced. This invert of the consumer pipeline does come with it’s troubles. People who have had unexpected success funding their product are often unprepared for the fulfilment – from badly formatted excel spreadsheets tracking customers to production scheduling that is non-existent. It’s a new world for someone who is usually fairly unprepared.

The world is becoming smaller and social media, blogging, and now crowdfunding will continue to change the landscape of how businesses are created, products are funded, and art is produced. Global accessibility provides average people with the means to do extraordinary things if they use the proper tools in an effective manner. What has been your experience with crowdfunding successful or otherwise?