Intro to Kickstarter
Many of you might already be familiar with the largest crowdfunding platform, Kickstarter. For those who are not, Kickstarter allows creators to raise money to get the fund they need to bring their ideas to life.
I stumbled upon Kickstarter in 2014, specifically on the Kickstarter page of Leonard & Church, when I was searching for a good quality yet affordable watch back when I was in university. From there, I started discovering more and more cool products on the site.
While a great product is essential to the success of a Kickstarter’s project, launching a product without historical information on what works and does not work is like taking a shot in the dark. I’m going to take you on a deep-dive into 2018 Kickstarter projects data to understand the different attributes that affect a campaign’s success. Credit goes to Mickaël Mouillé for providing this dataset on Kaggle.
These are specific questions that I am going to address:
- Are there differences in project popularity or amount of goal across different categories?
- Is the goal realistic?
- What is the average amount pledged by each backer? Are people willing to contribute more of their money into certain projects?
- Are there differences in project popularity or amount of goal across different durations?
Let’s take a glimpse of the data. Ignoring the ID column, it seems that the data for the quantitative variables are extremely right-skewed. There is a huge difference between the median (50%) and the maximum point of the data (max), as compared to the difference in the median and minimum data point.
Project Count by Main Category
On the figure above, I counted the number of projects in each category. You can see that the ‘Film & Video’ category has the highest number of project count (63,585), followed by ‘Music’ (51,918) and ‘Publishing’ category (39,874).
At the bottom of the list, we can see ‘Dance’ (3,768), ‘Journalism’ (4,755) and ‘Crafts’ category (8,809).
Total Number of Backers by Category
This figure shows the total number of backers for each category. We have a really high proportion of projects that belong to the ‘Games’ category (11,336,829), followed by ‘Design’ (7,255,880) and ‘Technology’ (5,356,513). We again see ‘Dance’ (161,275), ‘Journalism’ (182,091) & ‘Crafts’ (240,342) with the fewest total number of backers.
Here, I am actually summing up the number of backers in each category. The caveat of doing this is that there may be fewer projects in the particular category in the first place; therefore there will not be a lot of backers in total.
Let’s try to find the median number of backers per category instead.
Median Number of Backers by Category
As seen previously, the data are extremely right-skewed. I am using median instead of mean here as a central tendency measure as it is more robust to outliers.
It is interesting to see that ‘Comics’ category has the highest median number of backer (40) in a single project, followed by ‘Design’ & ‘Games’ (29 for both). On the other hand, ‘Journalism’ & ‘Crafts’ are still at the bottom of the list.
Nonetheless, the number of backers does not always determine the success of a project. A project can have only a few backers, but if the amount of money contributed by each backer is higher than the average, then it can still outdo those projects with lots of backers.
Median Total Amount Pledged by Category
The top three main categories with the highest median amount pledged are ‘Design’ (USD 1,923), ‘Dance’ (USD 1,839.88) and ‘Theater’ (USD 1,550). Not only ‘Design’ projects have a lot of backers, but they also have the highest median amount pledged. At the bottom of the list, we again see ‘Journalism’ (USD 51) & ‘Crafts’ (USD 94).
Let’s also take a look at the median amount of goal for each category. It does not matter if a project accumulated a high total amount pledged or attracted a lot of backers but it is still far away from the goal. It would certainly be easier to have a successful Kickstarter project if the goal set is realistic to begin with.
Median Goal by Category
The median amount of goal for ‘Technology’ (USD 20,000) projects is significantly higher than those in other project categories; it is twice the median amount of goal for ‘Design’ & ‘Food’ projects (USD 10,000). This is an interesting insight as ‘Technology’ has a relatively low number of backers & median amount pledged.
Fortunately, the goal for ‘Crafts’ projects is at the lower end of the spectrum (USD 2,345). Even though it does not have a high median number of backers and amount pledged, it seems to be less risky to launch ‘Crafts’ projects as compared to ‘Technology’.
Median Goal & Median Total Amount Pledged Comparison
To have a better visual comparison, I put the number for the median amount of goal and total amount pledged side by side. Then, I added a fourth column, pledged_minus_goal, that subtracts the total amount pledged from the goal. This way, you would have a clearer idea of which categories tend to have a high amount of losses.
As expected, ‘Technology’ ranks first, followed by ‘Design’ and ‘Food’ category. Certain project categories such as ‘Technology’ usually require a larger amount of fund as it involves a lengthy R&D process, manufacturing and packaging expenses to start building the product. Therefore, creators need to be well-informed about the budget needed to bring the project to life, no matter how cool their products are.
On the right-hand side, you can see ‘pledged_over_goal_rate’ column that is calculated by dividing the ‘usd_pledged_real’ over ‘usd_goal_real’. This represents the success rate of each project category.
As you can see, the category that has the highest success rate is ‘Dance’, followed by ‘Theater’ and ‘Comics’. This is expected as the nature of projects of these categories are quite different than that of Technology projects, for example. Most of these projects do not require fixed overhead costs, such as manufacturing and packaging.
Median Goal, Pledged Amount and Backers Count by Duration
Initially, I thought those projects with higher goal amount tend to have longer duration to allow more time for the projects to attract backers. However, based on the top-left figure, the highest median goal amount interestingly belongs to the projects with duration that ranges from 30–60 days. Longer duration does not necessarily mean the projects are set with higher goal amount.
Similarly, a longer duration of a project does not necessarily mean the project will end up attracting more backers, as can be seen in the ‘Median Backers Count by Duration’ histogram. The duration range that attracted the highest number of backers is 30–40 days.
Again, the highest median pledged amount seen in Kickstarter projects in 2018 belong to the 30–40 duration day range according to the bottom-left figure.
While crowdfunding Kickstarter projects seem lucrative, it does not mean that there is no risk. When a project is failing, the risk extends to both project owners and backers. Project owners who have invested a large amount of money into building the product will suffer from a huge loss if the goal is not met. Backers who have contributed the projects may end up not receiving the products that they expected to get.
In the analysis above, we did a comparison of several success metrics of a project (e.g. number of backers, amount pledged) across different categories & project duration. The aim is to help backers & project owners to be more discerning of the different factors that affect project success.
Here is a summary of our findings:
- The riskiest category is ‘Technology’. Not only does it require a lot of funds in the first place, but it also has the lowest success rate across all main categories.
- ‘Journalism’ & ‘Crafts’ also have low success rates even though the amount of funds required to build the project is relatively low. When these projects failed, the amount of loss tends to be a lot lesser than the loss of Technology projects.
- From the initial analysis, ‘Design’ seems to be pretty popular among backers and it has the highest median amount pledged. However, the goal that is set for Design projects tends to be high, which makes it more challenging for it to be successful.
- The safest category to go for is ‘Dance’, followed by ‘Theater’ and ‘Comics’. These projects do not require a lot of fixed costs to start and have the highest success rates.
- If product owners can reduce the cost associated with Design projects significantly, then it can be a good category to launch your product.
- Duration does not seem to affect the success of a project much. Setting a longer duration does not necessarily increase the amount pledged and the number of backers.
- Based on the analysis, the ideal duration is around 30–60 days, where it can attract the highest number of backers & generated a good amount of money pledged.
I hope that this gives you an interesting insight into Kickstarter data. Click here if you want to see the notebook that I created for this analysis. Any feedback would be appreciated, thanks for reading!