Doing Your Homework Archives - A Kickstarter's Guide

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Understanding Profit Margin and Costs

By Nelson/Roberto On December 5, 2011 · 29 Comments · In Doing Your Homework

When someone backs your project and selects a reward, there is a cost associated with producing that item. The difference between what it costs you to produce the reward, and the amount of money a backer pledges, is the profit margin. Kickstarter projects aren’t really about making a “profit,” but it’s one of the most important metrics in business and can help you structure your project effectively.

Lets say you are offering a DVD and DVDs cost about $5 to produce. It also costs a dollar to ship the DVD to your backers. That means the total cost to produce the DVD is about $6. If you sold a DVD for $10, and it coats you $6 to produce then you are making $4 of profit. This profit is going to be used to complete the rest of your project, and having a poor profit margin can hurt your ability [...]

What Will it Cost?

By Nelson/Roberto On December 2, 2011 · 25 Comments · In Doing Your Homework

Crossing Chasms

By Nelson/Roberto On November 30, 2011 · 20 Comments · In Doing Your Homework

In Crossing the Chasm, Geoffrey A. Moore talks about how new businesses must target a niche to get traction. Once they have established themselves with an initial group of customers, they must work quickly to find other niches. This is because there is a “chasm” between early adopters and the mainstream. The only way to cross is to get a small number of customers from different niches. Once the business has a solid base of customers and is viewed as established, it can be embraced by the mainstream.

Your Kickstarter project is very similar. There is chasm to cross, and the only way to do so is to get a small number of people from different niche audiences to back you. Once your project has gained enough support to be viewed as “established” it will be much easier for people to back it. Unsuccessful projects struggle to find [...]

Resonating With Your Audience

By Nelson/Roberto On November 28, 2011 · 23 Comments · In Doing Your Homework

Where is Your Audience?

By Nelson/Roberto On November 25, 2011 · 17 Comments · In Doing Your Homework

Now that you have an idea of who your audience is, it is time to start interacting with them. I highly recommend reaching out to your audience well before your project begins. That way you, are part of the community and not some stranger trying to make a fast buck. Of course that’s not what you’re trying to do, but if the audience doesn’t know you, it might come off that way.

If you’re passionate about the subject matter, chances are you’re already part of an online community. If not, now is the time to start looking. Look for any blog, podcasts, online video shows, forums, or social networks related to your subject matter. Start joining these online communities and try to get a sense of what they’re all about. You don’t have to contribute right away, but you can if you want.

The important thing is to try to [...]

Who is Your Audience?

By Nelson/Roberto On November 23, 2011 · 18 Comments · In Doing Your Homework

Now it’s time to really think about your audience. It will be made up of people from various niche audiences, whose interests are similar to the subject matter of your project. Think about all the different groups of people that might be interested in your project. I do not mean the demographic or any other generic marketing term. I do not mean people who like photography or paintings or any other genre of art. Who is the specific subset of people that are going to LOVE your project? The more specific, the better.

The hard part about defining your audience is that you might not be entirely sure who is going to like your project. That is why you are really going to need to do your homework. You need to have at least one group of people in mind that the project might appeal to.

Ultimately the more niches [...]

Some People Care About You

By Nelson/Roberto On November 21, 2011 · 18 Comments · In Doing Your Homework

No one cares about you

By Nelson/Roberto On November 11, 2011 · 26 Comments · In Doing Your Homework

This was the most important thing I learned from my Kickstarter’s campaign. If you take away nothing else, try to understand this very difficult lesson about marketing ideas online.

While surfing online looking for advice on marketing, I stumbled upon this video featuring Seth Godin. It’s only 1:43 long but it is so powerful.

Seth was interviewed about the explosion of YouTube. “YouTube had five billion videos viewed in July. How could that possibly be?”, says the moderator. “We are all running businesses, how do you put that to work?” Seth cleverly answers the question by explaining that the Internet was not invented to sell ads.

This is SO important. Ready? No one cares about you! They invented television to sell ads to you. They invented radio to sell ads to you. They invented newspapers to sell ads to you. That’s not why they invented YouTube. That’s [...]

Before you launch, do your homework

By Nelson/Roberto On November 9, 2011 · 25 Comments · In Doing Your Homework

Before you create your project on Kickstarter you will want to do some research. You need to know how much it will cost to execute your project and produce rewards. And you need to know who your audience is going to be. I will examine each of these aspects in more detail, starting with audience since it is often the most overlooked.

Without an audience, a project will not get funded. You will want to have a good idea about your audience before your project launches. I often find people searching for an audience while their campaign is running. I certainly did this the first time around, and I don’t recommend it. If you are lucky enough to already have an online audience, then you probably already know how to reach them. This section is primarily for people who don’t have an audience and are trying to build one through [...]