Reward-based crowdfunding (also called crowdfunding with rewards) is a great way to motivate supporters to give to your nonprofit’s fundraising campaigns. Read on to learn how your charity can encourage supporters to donate more by offering merchandise or other incentives at different donation amounts.
What We’ll Cover
- Why Reward-Based Crowdfunding Works
- What Are the Best Crowdfunding Rewards to Offer?
- Using Products or Services as Crowdfunding Perks
- Utilizing Special Recognition as Crowdfunding Rewards
- Offering Virtual Rewards or Impact Levels
- How to Price Crowdfunding Perks
- Always Offer a Range of Rewards
- DoJiggy’s Crowdfunding Platform Supports Reward-Based Crowdfunding
Why Reward-Based Crowdfunding Works
Many nonprofits use rewards in their crowdfunding campaigns to boost revenue and increase supporter involvement in a cause. Rewards are perks or gifts given to supporters at defined donation levels. A common example is an organization offering donors a custom t-shirt for $100 or more in donations.
Some argue that offering perks for certain donation levels removes the philanthropic aspect of giving to a good cause. Nevertheless, the main idea behind crowdfunding campaigns is to raise as much awareness and money for your charitable organization as possible. So, providing perks during your campaign equals optimized donor participation, which in effect spreads awareness about your cause. There really is nothing to lose and plenty to gain!
Offering a limited number of perks allows your organization to create a buzz around your campaign on social media. Consider posting on Facebook each morning something like this:
“Only 10 custom t-shirts left! Donate now to get yours today.”
This will provoke a sense of urgency, which is a great tactic to encourage your supporters to donate sooner rather than later.
What Are the Best Crowdfunding Rewards to Offer?
Perks or rewards that are directly connected to your crowdfunding campaign and cause and which let people participate in your fundraising campaign are the best rewards to offer. Offering perks gives you another opportunity to connect with your constituents, so keep this in mind. You probably know better than anyone what your community wants, so manage this along with rewards that your organization can fulfill. You certainly don’t want to be left without funding to mail your perks or having oversold an item.
We generally see three types of reward ideas used with nonprofit crowdfunding campaigns:
- Custom products or services that relate to your organization
- Rewards of recognition or sponsorship
- Virtual perks that foster your charity’s mission
Using Products or Services as Crowdfunding Perks
Offering custom products or services in exchange for donations has been around for a long time, and for a good reason, it works! Many organizations offer custom shopping bags, stickers, t-shirts, and more custom apparel options for donors. The nice thing about offering this type of merchandise is that it also allows your supporters to easily advertise and advocate for your charity. Once they see your cool logo and brand, everyone will jump on the bandwagon to get one.
Organizations can also offer customized services as crowdfunding rewards. Again, using this type of reward should highlight your cause and expertise. Classes, tours, and special access events are all possibilities. If your organization supports local farms, why not offer an Eat Local cooking class or farm tour as a unique reward idea? You could also recognize supporters and campaign volunteers with a VIP happy hour or performance.
Utilizing Special Recognition as Crowdfunding Rewards
Sponsorships or special recognition is always a popular fundraising idea. Getting their name on or sponsoring a part of a project can be successfully used as a crowdfunding perk for many types of charities. Imagine a library that offers customized bricks for a new addition. Schools can create a wall of fame with an engraved plaque of donors. At the highest giving level, many charities offer event naming rights to business sponsors. Something like this can also be incorporated into crowdfunding campaigns. The key here is being creative on what can be sponsored and limiting the opportunity to increase buying urgency and demand.
Offering Virtual Rewards or Impact Levels
Another idea that many organizations successfully use is virtual crowdfunding rewards that represent suggested donations and impact levels. These rewards are tied into your organization’s mission and routine activities and show supporters how their donations will make an impact. For example, $50 feeds a child for a month. A donation of $500 allows our organization to clean up an entire park.
When people can visualize where their money will go and how it will be used, they feel more comfortable giving.
The great thing about virtual crowdfunding rewards is that you don’t need to worry about shipping or fulfillment. You are already doing this work and now have the funding to affect more people.
How to Price Crowdfunding Perks
When people think about backing your project, they will likely ask themselves whether your rewards are a good trade for what they’re contributing. Yes, they want to support your organization, but everyone loves a good deal.
Remember that your primary goal in offering perks is to increase donations, so think about your typical crowdfunding donation level. It varies by organization, but if you aren’t sure, it’s likely around $25 – $50. In this case, why not offer your first perk for $35? Most people will pay the extra $10 to opt in and receive something for their donation. If your rewards are virtual rewards, then $25 may be the perfect level. Don’t forget shipping or delivery fees. If there are costs involved with shipping your crowdfunding rewards, you’ll need to build them into your perk levels.
Always Offer a Range of Rewards
Many organizations use suggested donation amounts to encourage donations at specific levels. Suggested donation buttons make it easy for donors to quickly review and select an option. While many donors will give $25, you don’t want to discourage donors who can support you at a higher level. Be sure to offer tiers with the perks’ value increasing with the donation value. Usually, organizations have success by offering 5-8 reward tiers.
DoJiggy’s Crowdfunding Platform Supports Reward-Based Crowdfunding
Our P2P crowdfunding platform provides a complete fundraising campaign management experience with the ability to customize and brand your website for individuals and teams using personal fundraising pages. Securely register or import event participants and process donations and pledges for peer to peer campaigns, allowing your organization to raise more money than ever.
Conclusion: Give Back to Your Backers with Crowdfunding Rewards
Showing appreciation for your constituents is a simple concept that goes a long way toward donor retention and stewardship. Reward crowdfunding is a great example – the more you show your supporters they’re appreciated, the more willing they’ll be to support your crowdfunding campaign. Just be sure to offer perks your organization can fulfill without negatively impacting your fundraising goals.