How is the final amount built in a crowdfunding process? Impact of messages sent during the campaign by the project holder

Details

Supervisors

Ducarroz, Caroline

Faculty

Louvain School of Management

Degree label

Master [60] en sciences de gestion (horaire décalé à Charleroi)

Abstract

Crowdfunding is a mechanism for collecting the financial contributions of a large number of donors to finance a project launched by a project leader, usually all over several weeks, via an online platform. The donations make it possible as time goes by to reach the aimed amount of a campaign. The project holder can send information and encourage donations during the period of the crowdfunding. This news system is implemented by messages posted on the project web page. This paper will study how a campaign global amount is built from the individual donations of donors, and will analyze more specifically the impact on this final amount of the information given by the project holder as crowdfunding progresses. Moreover, interesting similarities can be found between this crowdfunding mechanism and the English auction mechanism. We will transpose, in the case of crowdfunding, the econometric model elaborated in the article written by Ducarroz C., Yang S. and Greenleaf E. in 2016 in Journal of Marketing (Understanding the impact of auction promotional messages), to see if the results obtained in crowdfunding converge with those described in the article. The results converged on some points and more specifically showed that in crowdfunding on the aggregate level the number of jump-donations and more simply just donations had an impact on the final amount collected. On the micro level, we observed that with the increase in the number of donations the project holder is less likely to issue messages. However, persuasive messages have a positive impact on jump donation.