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Some say now is the best time to start a new business.
Thanks to social media, crowdfunding and affordable ecommerce platforms, you can quickly take an idea to market. But the startup space is crowded. It’s why entrepreneurs need to think more creatively if they want to stand out and attract the right customers.
One strategy that can work well is giveaways. Yes, holding a simple contest can attract tons of new people to your company — and get them to become loyal customers.
My company, BestSelf Co, an ecommerce site focusing on delivering people products to help them be their best self, began its journey on Kickstarter with our first product, the SELF Journal.
We knew from experience we couldn’t post a campaign and hope for the best. To secure crowdfunding, we had to build a buzz and manufacture a surge of bids within the first 48 hours. Without this, it’s tough to get momentum and attract the number of backers needed to fund a bid.
So in the lead up to our Kickstarter launch, our focus was on building up our email list. How did we do it? A giveaway. The tactic secured 54 percent of our pre-launch list.
And while we used the giveaway for a crowdfunding campaign, it can work in a number of situations, including launching a product or opening an ecommerce store.
Here are a few pointers:
1. Avoid this costly giveaway mistake.
Successful giveaways can quickly build into a list of potential buyers, but choose the wrong prize and you end up attracting the freebie hunters.
That’s why your choice of prize is critical. Obvious products such as iPads, iPhones and games consoles are a terrible idea, because they have too wide an appeal. So while they may build a big list, only a small percentage of entrants will be potential customers.
You can avoid this problem by creating a prize that appeals specifically to your target customers.
For example, we wanted to attract high-achievers and entrepreneurs (because we knew they’d be our best backers), so we designed a “Productivity Bundle” worth over $1,000, which included our journal, business books, a brain fitness tool and coffee.
Notice that all the prizes are around the productivity theme and we purposely included our product alongside other brands.
We knew a SELF Journal alone could be seen as self-promotional, which could limit the giveaways reach. In comparison, a bigger bundle would attract wider shares — an outcome we knew was key to the giveaway’s success.
2. Focus on the tactics that make your giveaway go viral.
Even if you pick the perfect prize, your giveaway will flop if no one enters. It’s the toughest challenge for startups. If no one knows who you are, you struggle to get momentum — and you struggle to get momentum, because no one knows who you are!
To avoid this, leverage the assets you already have.. For example, we emailed our existing list, posted on our website and shared via our social channels. But these tactics alone would only help us reach our existing audience. We needed to widen the net.
To help, we turned to KingSumo Giveaways, a WordPress plugin that makes it easy to run viral giveaways. The main feature is it encourages people to share the giveaway, as the more friends who enter, the more entries they earn.
Another strategy we used used was reaching out to people in our space who had a large following. We knew if a big influencer shared our giveaway, we’d see a spike in entries. It’s why we invested a lot of time and energy in outreach.
We used the tool BuzzSumo to help us identify people who’d already blogged or talked about the items in our bundle. Then we got in touch and invited them to promote the giveaway. To do this we sent a simple email outlining how we knew the influencer was a good fit for the prize’s theme. We also included a reason why sharing the giveaway would add value to their audience (critical). This tactic helped us get the support from key people who gave us a significant visibility boost.
Finally, we used Facebook ads to drive traffic to our giveaway page as well as an Instagram influencer strategy, which involved identifying Instagrammers with an audience of people interested in subjects such as motivation, productivity, and self-improvement. We then reached out to these people and in return for a fee, they posted a picture, put a link in their bio and shared our handle with great results.
3. Convert your list into customers.
For a giveaway to be profitable, you need a robust follow-up strategy to turns entrants into customers. Otherwise you’ll spend heavily on a prize for little or no return.
In our case, our key objective was for entrants to back our Kickstarter bid. To achieve this we designed an email plan to build desire for the SELF Journal and position us as credible sellers. It’s why we emailed regular tips about productivity, performance and creativity as well as teasing the upcoming launch. We also created a Facebook group to start building a community. It was called I Love Productivity. As well as helping to position us, this group sparked conversations that gave us a deeper insight into our customers pains and desires –marketing gold!
As mentioned above, the giveaway tactic helped us secure 54 percent of our pre-launch list — and helped make our Kickstarter campaign successful. We had a goal of $15,000 and we surpassed $320,000.
When starting out, it can feel risky to invest in a giveaway to build your list. However, with the right prize and follow-up strategy, you can build a targeted audience, build relationships with influencers, and convert data into profitable customers that buy from you again and again.