Pitches that contain certain key words on crowdfunding website Kickstarter are more likely to succeed than ones that don't use those terms, researchers at Georgia Tech have found.
In a recent paper Tanushree Mitra and Eric Gilbert, from the School of Interactive Computing at the Georgia Institute of Technology, analyzed more than 45,000 Kickstarter projects.
Inventors and other creative entrepreneurs use Kickstarter to secure funding to complete projects. Projects as diverse as Hollywood movies, board games, computer games and new gadgets have used the site successfully to raise cash through a concept known as "crowdfunding."
"Our research revealed that the phrases used in successful Kickstarter campaigns exhibited general persuasion principles," Gilbert said. "For example, those campaigns that follow the concept of reciprocity – that is, offer a gift in return for a pledge – and the perceptions of social participation and authority, generated the greatest amount of funding."
It may be intuitive that offering a gift to a financial backer would improve the odds of getting funding, but the research showed that the presence of certain specific terms matter.
For example, the phrases "also receive two," "has pledged" and "project will be" had a strong correlation to projects that were eventually funded. On the other hand, phrases like "dressed up," "not been able" and "trusting" were generally attached to unsuccessful projects.
Broadly, the research found that phrases that employ one of six basic notions increased the likelihood of being funded:
- Reciprocity or the tendency to return a favour was a good thing, evidenced by phrases such as "also receive two," "pledged will" and "good karma."
- Scarcity or attachment to something rare is also helpful, so using terms like "option is" and "given the chance" did well.
- Social proof plays on the notion that people depend on others for social cues on how to act. In that category, phrases like "has pledged" were likelier to succeed.
- Social identity or the feeling of belonging to a specific social group is a powerful motivator and phrases such as "to build this" and "accessible to the" tend to be successful.
- Liking is obvious enough, as people generally support people or products that appeal to them, and the term "and encouragement" was strongly associated with that idea.
- Authority is also helpful, as people are drawn to expert opinions for making efficient and quick decisions. In this category, phrases such as "we can afford" and "project will be" were more likely to succeed.
'Cats' also popular
The paper also singled out a few bizarre phrases with an inexplicably strong correlation to success: pitches that used the words "Christina," "December" and "cats" tended to do well.
For "December" the researchers speculate the word subtly signals donors that there are tax exemptions possible if they donate before the end of the year.
The researchers say "Christina" mainly refers to a celebrity endorsement (such as Christina Aguilera, for example) but as for cats: "we had no clear explanation for the occurrence of cats — except for the commonly accepted
wisdom that the internet loves them."
The research looked at more than 45,000 projects — 51.53 per cent were successfully funded and 48.47 per cent were not, while attempting to decipher the difference between the winners and losers.
They then focused on more than 20,000 phrases before compiling a dictionary of more than 100 phrases that seem to have a high correlation with success or failure of projects.
After variables such as funding goals, video, social media connections, categories and pledge levels are stripped out, the researchers say the language used to pitch the project accounts for about 58.56 per cent of the variance around success.
"Our ﬁndings indicate a fundamental force which drives the crowd to fund crowd-projects," the paper reads: "Language."