Some people claim that the best way to create effective crowdfunding rewards is to find the all-time best-selling reward prices and copy them.
I say screw historical statistics from Kickstarter or Indiegogo.
Let’s go through an example.
Here are two charts:
1. Top 10 Best Selling Reward Prices in Design & Average Reward Price:
2. Top 10 Best Selling Reward Prices in Tech & Average Reward Price:
What can we tell from these charts?
For one, the best-selling rewards on both platforms are within the $25-$99 price range (chart on left).
However, the average reward price for each platform is much higher (chart on right).
From this, we can see that this is a faulty method to use to create the most effective crowdfunding reward.
Instead, here’s the key:
The most effective Kickstarter or Indiegogo reward is one that your audience wants.
There are three reasons why:
1. Every single campaign is different
Sure, collecting and averaging a ton of data across every single campaign on Kickstarter or Indiegogo might tell you that a $25 reward is the level that most people pre-order at.
But by doing this, you’re forgetting the fact that every single campaign is different.
Think about it this way, you’ll be comparing apples to oranges when you average the price of a Fidget Cube ($14) with an eBike ($1099).
This also applies to the reward type.
Sure a music campaign will send out mp4 downloads every 3 months, but a campaign about a new-age Pogo stick won’t be able to do that.
So what good does averaging campaigns do for you?
2. You’ll have already done market research
No one should EVER run a crowdfunding campaign without doing the legwork to research the market.
Since you’ve done this (if you haven’t, PLEASE PLEASE PLEASE do it), you’ll know what other products in your niche market are priced at.
Why yes, other similar drones are priced at $500, why should you offer a $25 reward on your campaign?
You’ll either be making massive losses (product cost is higher than price, shipping cost is higher than what you’ll charge, etc.)
Or you’ll risk people not believing in you/your product because the price takes it outside the realm of certainty.
Side note: if you’re able to offer the same features and quality as a $500 drone at a $25 price point and STILL make a profit then by all means. But usually, that isn’t the case as prices already take into account everything from the general cost of supplies in the current market conditions and the accepted margins for that product type.
Your market research will also have CLEARLY shown you what types of rewards other campaigns in your niche has offered.
Have other million-dollar campaigns about headphones offered t-shirts?
Then don’t do it.
It’s most probably not something people are looking for or it’s not something people will pay money to pre-order for that particular niche.
3. Crowdfunding is all about the “crowd”
This is similar to the point before but is different enough that it warrants its own heading.
The word “crowdfunding” literally is formed by two words: “crowd” and “funding”.
By running a crowdfunding campaign, you’re hopefully creating something that solves a problem for the crowd (their problem).
Seriously, you’ll be gathering a group of strangers interested in your project and collecting donations from them via the internet.
Make sure your product is solving a problem for them.
Make sure your product is at a price point that works for them.
Make sure that in every part of your campaign, it’s all about them.
Your Crowdfunding Rewards Should Be Flexible
On a final note, the crowdfunding rewards you offer during your campaign will undoubtedly change.
Sure you’ll have a list of 7 rewards when you launch, but after a few days, you’ll already be getting comments and suggestions from your backers.
You’ll get feedback on your product right away AND you’ll be leveraging the ideas and brains of the crowd to make your product that much better.
A week into your campaign, you might even get enough ideas from your backers to add another 7 rewards as upsells and stretch goals.
That’s the beauty of crowdfunding.
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