There are many mistakes that crowdfunding campaigns make. However, in my opinion, several of the worst involve not having an audience before you launch, poor graphics and page layout, pricing, meaningless rewards, and delivering to backers after your product is available to the general public. This post will focus mostly on pricing and delivering to backers after your product is available to the general public.
For pricing, I recommend using Jamey’s guide: https://stonemaiergames.com/kickstarter-lesson-201-a-step-by-step-guide-to-pricing-your-core-reward/ as a starting point.
Using this formula and estimating around a $10 shipping subsidy, here are my recommended Kickstarter core reward prices per MSRP (for lower-cost items, shipping can often be lower than $10, so just use the above steps):
- $30 MSRP: $25
- $35 MSRP: $29
- $40 MSRP: $34
- $50 MSRP: $39
- $60 MSRP: $49
- $70 MSRP: $55-$59 (at this point and beyond, I’m assuming the size and weight of the product is requiring a higher shipping cost)
- $80 MSRP: $65-$69
These prices allow for $20-$30 profit on a per-unit level. Of course, you have Kickstarter and Stripe fees, art and design, freight shipping, and other ancillary costs to factor into your overall budget, and you might use most of that profit to simply make more retail versions of the product.
But I think you’ll find that your chances of Kickstarter success improve significantly if you offer an appealing price, and an appealing price still offers nice margins for you because you’re selling directly to the consumer.
In his examples above, he factors in a $10 shipping subsidy cost. For digital only copies (PDFs, etc.), you wouldn’t need to factor in a shipping cost if a backer only buys digital copies of your product.
Another interesting concept – https://stonemaiergames.com/kickstarter-lesson-92-the-psychological-benefits-of-ending-price-points-with-the-number-9/, and one reason gas in the U. S. is generally priced the way it is. Same for car sales.
The key point Jamey makes is you need to offer backers a discount to potential backers. On the flip side, you don’t want to charge the same price to backers that you charge to customers who buy your product later. The only thing worse is to charge your backers more than they would pay if they purchased it later. For example, a digital movie that you can download costing $20 to backers when they could go see the movie for $5. Or, $20 for the download only, but $15 – 20 for the DVD version.
The other major mistake is delivering the product to your backers after it’s available to the general public – https://stonemaiergames.com/kickstarter-lesson-97-delivering-on-time/.
Deliver to Backers First
There is no better way to lose future backers if you deliver on time to retailers and late to backers. Don’t do it. If you’re working with other parties who have control of when your product is released to retailers (like a distribution broker), make sure you have a very clear, written understanding that they cannot release the game to retailers until you authorize it.
I would take this to the next level. Don’t make your backers wait to get the product until after it’s available to the general public. I will be posting a campaign later today (2:02 P. M. U. S. Central Time, bit over an hour from now) that’s a good example of why you shouldn’t violate these concepts. It was funded at 204%, but it could have done much better.