Tag: Rewards

The Paradox of Choice

We love choice. In any given year every single film on Netflix is watched at least once. The Long Tail is an economic theory and excellent book, which explains why this happens. It states that due to the infinite shelf space of online retailers, people will now have almost limitless choices as to what they consume. We are living in a world where people can find exactly what they’re looking for and are willing to pay unbelievably high prices to get those special unique items.

At the same time, we hate choice. Having too many choices when we don’t have a lot of time, can be overwhelming and confusing. Limitless choice works when people have the time and energy to pay attention and look for the very best. When they don’t, people want quick and easy choices.

The Coffee Joulies project is one of the top-funded design projects on Kickstarter, and it has only three backing levels. It’s simple, and people visiting the page do not have to think much about what level they are going to choose.

Then again, the Womanthology; Massive All Female Comic Anthology! project was incredibly successful with a very complex system of rewards and almost 50 different backing levels. They even had unlockable rewards that, like in video games, became available when a certain goal was reached. This, however, was probably planned out ahead of time, and a lot of work went into putting them all together.

When creating your rewards, it is probably to best make ones that have meaningful value. If you are having trouble coming up with a $5 reward, then maybe you don’t need one. Having too many rewards ultimately clutters up your page and makes it difficult for people to decide. However, you may want to have a lot of different rewards. Either way, make it a conscious decision. Creating rewards just to fill price points probably won’t be meaningful enough for backers.

A Kickstart’s Guide to Kickstarter TOC:

pssst…you can read all of this offline by downloading the e-book.

Introduction
A Kickstarter’s Guide to Kickstarter: Introduction
How Kickstarter “Kickstartered” it’s own website
Understanding Kickstarter
The Basics of Kickstarter
Kickstarter is an updated version of the Parton Model
Kickstarter is like girl scout cookies…without the calories!
Make sure your project has an ending
Some additional benefits to running a Kickstarter project
Perry Chan’s Six Principles on why Kickstarter projects are successful
Yancey’s thoughts on getting funded
Brainstorming Your Project
What is this damn thing about?
Simplify your project for success
Is your project a Purple Cow?
Making Lemonade And Telling A Good Story
Reward The Patrons
Naming Your Kickstarter Project
Doing Your Homework
Before you launch, do your homework
No one cares about you
Some People Care About You
Who is Your Audience?
Where is Your Audience?
Resonating With Your Audience
Crossing Chasms
What Will it Cost?
Understanding Profit Margin and Costs
Setting Your Goals
Make or Break Decisions
Running the Numbers
Focus on what you need
Reasonable funding goals
Why be Reasonable?
How long your campaign runs depends on one thing, momentum
30 days or less
Managing Deadlines
Going for the BIG bucks
The Allure of a Large Backer
Pricing theory, thoughts about pricing your Kickstarter rewards
The Paradox of Choice
Crafting Your Pitch
Creating a compelling pitch for your Kickstarter project
Four questions people want answered when visiting your Kickstarter page.
Show some credibility to get more backers
Clarity is your friend
How to ask for Support
Kickstarter is a video-driven site
Examples of great pitch videos
Launching Your Project
Launching your project
How to track the progress of your Kickstarter campaign
The 30% Kickstarter project “Tipping Point”
Conclusion
How to engage an audience with a Kickstarter project: Idea & Story

Pricing theory, thoughts about pricing your Kickstarter rewards

The psychology of pricing is very difficult and complex. This book is too short to really get into it, but here are some things to think about. If you would like an in-depth look at pricing theory, I recommend Smart Pricing by Z. John Zhang

People enjoy a purchase more if they pay more for it. This is counter-intuitive. A common misconception is that people are very price sensitive, and always look for the best possible price. That might be true for food or gas, but most people coming to Kickstarter want to connect with other people. Stay away from really high reward levels, but don’t undervalue your rewards either.

If a higher priced reward is not significantly better, then why pay more? The tricky part about creating rewards is increasing value to match the increase in price. For example, if you are making an album you could offer a digital download and a CD as rewards. But, how much more valuable is a CD vs the digital download? I don’t mean monetary value but sentimental value. If the download is $10 and the CD is $25 is there enough of a difference that I would purchase the higher priced reward? For me, no. In fact I might pay you $15 extra NOT to make a CD. What’s the point? It wastes resources and gets scratched. However, if your CD is personally burned, and has an extra track, and sold for $50, then it might be a compelling enough reward.

A Kickstart’s Guide to Kickstarter TOC:

pssst…you can read all of this offline by downloading the e-book.

Introduction
A Kickstarter’s Guide to Kickstarter: Introduction
How Kickstarter “Kickstartered” it’s own website
Understanding Kickstarter
The Basics of Kickstarter
Kickstarter is an updated version of the Parton Model
Kickstarter is like girl scout cookies…without the calories!
Make sure your project has an ending
Some additional benefits to running a Kickstarter project
Perry Chan’s Six Principles on why Kickstarter projects are successful
Yancey’s thoughts on getting funded
Brainstorming Your Project
What is this damn thing about?
Simplify your project for success
Is your project a Purple Cow?
Making Lemonade And Telling A Good Story
Reward The Patrons
Naming Your Kickstarter Project
Doing Your Homework
Before you launch, do your homework
No one cares about you
Some People Care About You
Who is Your Audience?
Where is Your Audience?
Resonating With Your Audience
Crossing Chasms
What Will it Cost?
Understanding Profit Margin and Costs
Setting Your Goals
Make or Break Decisions
Running the Numbers
Focus on what you need
Reasonable funding goals
Why be Reasonable?
How long your campaign runs depends on one thing, momentum
30 days or less
Managing Deadlines
Going for the BIG bucks
The Allure of a Large Backer
Pricing theory, thoughts about pricing your Kickstarter rewards
The Paradox of Choice
Crafting Your Pitch
Creating a compelling pitch for your Kickstarter project
Four questions people want answered when visiting your Kickstarter page.
Show some credibility to get more backers
Clarity is your friend
How to ask for Support
Kickstarter is a video-driven site
Examples of great pitch videos
Launching Your Project
Launching your project
How to track the progress of your Kickstarter campaign
The 30% Kickstarter project “Tipping Point”
Conclusion
How to engage an audience with a Kickstarter project: Idea & Story

The Allure of a Large Backer

While large backers definitely give your project a boost, they also take away from the size of your new audience. One of the biggest benefits to Kickstarter is that it allows you to talk to more people. Every time you post an update, you get into the inbox of people who want to hear from you. Large backers are, in a way, a double-edged sword. They help your project, but hurt your reach.

Let’s say you launch a project for $3000. You get six backers and raise $400. Then a BIG backer pledges $2000 and almost completes your project. Now you only have a handful of people you can talk to. One of the best things to come out of my first project, Identifying Nelson, was the 170 people I can now talk to directly. Next time I want to launch a creative project I have a small group of people that I can share the idea with first.

Quantity OF Quality

When creating rewards the goal should be to have an adequate quantity of quality backers. You want to design the rewards so that most people will pledge right in the middle of your reward levels. You want some high backers and some low backers with most falling in the middle. Having a good spread of rewards, especially in the $25 to $250 range, will really help get a solid group of backers.

A Kickstart’s Guide to Kickstarter TOC:

pssst…you can read all of this offline by downloading the e-book.

Introduction
A Kickstarter’s Guide to Kickstarter: Introduction
How Kickstarter “Kickstartered” it’s own website
Understanding Kickstarter
The Basics of Kickstarter
Kickstarter is an updated version of the Parton Model
Kickstarter is like girl scout cookies…without the calories!
Make sure your project has an ending
Some additional benefits to running a Kickstarter project
Perry Chan’s Six Principles on why Kickstarter projects are successful
Yancey’s thoughts on getting funded
Brainstorming Your Project
What is this damn thing about?
Simplify your project for success
Is your project a Purple Cow?
Making Lemonade And Telling A Good Story
Reward The Patrons
Naming Your Kickstarter Project
Doing Your Homework
Before you launch, do your homework
No one cares about you
Some People Care About You
Who is Your Audience?
Where is Your Audience?
Resonating With Your Audience
Crossing Chasms
What Will it Cost?
Understanding Profit Margin and Costs
Setting Your Goals
Make or Break Decisions
Running the Numbers
Focus on what you need
Reasonable funding goals
Why be Reasonable?
How long your campaign runs depends on one thing, momentum
30 days or less
Managing Deadlines
Going for the BIG bucks
The Allure of a Large Backer
Pricing theory, thoughts about pricing your Kickstarter rewards
The Paradox of Choice
Crafting Your Pitch
Creating a compelling pitch for your Kickstarter project
Four questions people want answered when visiting your Kickstarter page.
Show some credibility to get more backers
Clarity is your friend
How to ask for Support
Kickstarter is a video-driven site
Examples of great pitch videos
Launching Your Project
Launching your project
How to track the progress of your Kickstarter campaign
The 30% Kickstarter project “Tipping Point”
Conclusion
How to engage an audience with a Kickstarter project: Idea & Story

Make or Break Decisions

Probably the three most difficult questions of any Kickstarter project are how much, how long, and how to price rewards. The next series of posts will focus on addressing these though questions.

While researching this book I came across a post call Kickstartup by Craig Mod. It provides some detailed analyses and great insights on these very tough questions. I highly recommend checking it out, as it was mentioned by most of my interviewees as an important reference.

How Much?

Picking your funding amount is difficult, because if you go for too much, you risk losing it all. With Kickstarter’s all or nothing model, the biggest risk you take is setting your funding goal too high.

I will look at why it is so difficult to get large amounts of money from Kickstarter and why you might be better off going for a smaller amount. I know what you are thinking. What about those people who make tens of thousands of dollars for their projects? A lot of those are outliers. I want to talk about what a typical project can expect.

How Long?

One of the emotionally difficult decisions you will have to make is how long to run your campaign. As soon as you press go, the clock starts ticking, and it doesn’t stop or wait for you to figure things out. This can bring a lot of stress because your entire project is at stake.

However, the clock can also be a powerful ally. It forces people to choose whether they’re going to help you or not, and it gets the word out quickly. If everything goes well, the clock can rally your supporters and make your project a success.

Setting the length of your Kickstarter campaign is about sustaining momentum and meeting production deadlines. The maximum campaign length is 60 days, but as you will see, you may want to run a shorter campaign.

Pricing Rewards

The Creating Rewards page of the Kickstarter school informs you that the most common pledge is $25 and the average pledge is $70. You do not have to have these price points, but it might be a good idea to create tiers at or around these price points. Craig Mod provides further insight with his analysis of the top projects during March, 2010. He found that the highest grossing reward amounts were $25, $50, $100, $250 and $500. Craig concludes that people don’t mind paying $50 or higher for projects they love.

A Kickstart’s Guide to Kickstarter TOC:

pssst…you can read all of this offline by downloading the e-book.

Introduction
A Kickstarter’s Guide to Kickstarter: Introduction
How Kickstarter “Kickstartered” it’s own website
Understanding Kickstarter
The Basics of Kickstarter
Kickstarter is an updated version of the Parton Model
Kickstarter is like girl scout cookies…without the calories!
Make sure your project has an ending
Some additional benefits to running a Kickstarter project
Perry Chan’s Six Principles on why Kickstarter projects are successful
Yancey’s thoughts on getting funded
Brainstorming Your Project
What is this damn thing about?
Simplify your project for success
Is your project a Purple Cow?
Making Lemonade And Telling A Good Story
Reward The Patrons
Naming Your Kickstarter Project
Doing Your Homework
Before you launch, do your homework
No one cares about you
Some People Care About You
Who is Your Audience?
Where is Your Audience?
Resonating With Your Audience
Crossing Chasms
What Will it Cost?
Understanding Profit Margin and Costs
Setting Your Goals
Make or Break Decisions
Running the Numbers
Focus on what you need
Reasonable funding goals
Why be Reasonable?
How long your campaign runs depends on one thing, momentum
30 days or less
Managing Deadlines
Going for the BIG bucks
The Allure of a Large Backer
Pricing theory, thoughts about pricing your Kickstarter rewards
The Paradox of Choice
Crafting Your Pitch
Creating a compelling pitch for your Kickstarter project
Four questions people want answered when visiting your Kickstarter page.
Show some credibility to get more backers
Clarity is your friend
How to ask for Support
Kickstarter is a video-driven site
Examples of great pitch videos
Launching Your Project
Launching your project
How to track the progress of your Kickstarter campaign
The 30% Kickstarter project “Tipping Point”
Conclusion
How to engage an audience with a Kickstarter project: Idea & Story

Reward The Patrons

You probably have some ideas for rewards. Some rewards are obvious. For example, if you’re making a book, then a possible reward is a print copy of the book. Other rewards might not be as easy to come up with.

Really think about all the different things you can do and offer as rewards. Just like your main idea, you want them to be as creative as possible. Rewards are an important part of Kickstarter because they are where the most “value” is exchanged. Having compelling and fun rewards are all part of the Kickstarter experience.

One thing to think about is the difference between physical goods and digital goods. Digital goods are easy to replicate and cost very little. Physical goods cost more to produce but have a higher intrinsic value. It’s not that digital goods are meaningless. In fact, they can be quite valuable. However, they don’t invoke the same feeling as physical goods. Think about receiving a handwritten letter vs. the hundreds of emails we get every day. There is a reason why wedding invitations are still sent via “snail mail.” Treat your physical awards as souvenirs, and give them to people who care the most about your project.

Don’t worry about pricing your rewards just yet; that will come later. For now, generate a list that you can come back to later. As the details of your project become clearer, you will have a better sense of which rewards will work best for your project.

There are rewards that are created as a result of your project, and rewards that are created to complete your project. While brainstorming, you may come up with both types, but the former will be much more effective.

For example, if your project is to make an album, then the result will be a set of songs that you can send to people. Offering the songs as a digital download or CD would probably happen even if you didn’t use Kickstarter. However, having a T-Shirt as a reward might attract backers, but is not necessarily something you would make while producing an album.

Sometimes you may need to create additional rewards, but most of the time you will want rewards that are a direct result of your project.

A Kickstart’s Guide to Kickstarter TOC:

pssst…you can read all of this offline by downloading the e-book.

Introduction
A Kickstarter’s Guide to Kickstarter: Introduction
How Kickstarter “Kickstartered” it’s own website
Understanding Kickstarter
The Basics of Kickstarter
Kickstarter is an updated version of the Parton Model
Kickstarter is like girl scout cookies…without the calories!
Make sure your project has an ending
Some additional benefits to running a Kickstarter project
Perry Chan’s Six Principles on why Kickstarter projects are successful
Yancey’s thoughts on getting funded
Brainstorming Your Project
What is this damn thing about?
Simplify your project for success
Is your project a Purple Cow?
Making Lemonade And Telling A Good Story
Reward The Patrons
Naming Your Kickstarter Project
Doing Your Homework
Before you launch, do your homework
No one cares about you
Some People Care About You
Who is Your Audience?
Where is Your Audience?
Resonating With Your Audience
Crossing Chasms
What Will it Cost?
Understanding Profit Margin and Costs
Setting Your Goals
Make or Break Decisions
Running the Numbers
Focus on what you need
Reasonable funding goals
Why be Reasonable?
How long your campaign runs depends on one thing, momentum
30 days or less
Managing Deadlines
Going for the BIG bucks
The Allure of a Large Backer
Pricing theory, thoughts about pricing your Kickstarter rewards
The Paradox of Choice
Crafting Your Pitch
Creating a compelling pitch for your Kickstarter project
Four questions people want answered when visiting your Kickstarter page.
Show some credibility to get more backers
Clarity is your friend
How to ask for Support
Kickstarter is a video-driven site
Examples of great pitch videos
Launching Your Project
Launching your project
How to track the progress of your Kickstarter campaign
The 30% Kickstarter project “Tipping Point”
Conclusion
How to engage an audience with a Kickstarter project: Idea & Story