How to Manage a Successful Crowdfunding Campaign

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If you have played your cards right with marketing and campaign content, you have blasted past your funding goal and should be excited to move onto the next step. You have already put a significant share of work into the project this far, but now it’s time for the real work to start!

Receiving Funds

Depending on the platform(s) you went with, you can expect to receive the funds into your account anywhere from two days to two weeks from the conclusion of the campaign period. This is a really exciting step! The funds getting to your account are going to be less than your funding total due to platform fees, payment processing fees, and some customer’s cards declining the transaction. We’ve mentioned these in previous articles and your funding goal was set to accommodate this difference.

Product Certification

The first thing you’ll want to do after celebrating that the funds have arrived is to have your first set of ‘final’ boards manufactured if you haven’t already done so. Send these right off to the certification lab before doing any further production to avoid any possible complications and issues. If you have followed best practices for EMC, and your prototypes have performed well during pre-compliance testing, there shouldn’t be any issues. Your lab should be able to certify your product globally (except for in a couple of countries that require in-country testing).

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EMC and electrical safety testing are not optional, but rather a mandatory legal requirement to sell your product. If you are shipping products into the USA, Canada, Europe or Australia, there is a risk that customs will withhold the shipment(s) until certification documents can be produced. This is a more significant risk if you are sending a bulk shipment of the product to a fulfillment facility or distributor/retailer. Fines for marketing/selling an uncertified product can be hundreds of thousands of dollars, making it cheaper to go through certification before you start mass production!

Mass Production

Once your product has passed certification testing, you can prompt your contract manufacturer to build the full production run. If they are doing a full box build for you, then you can sit back and wait. Otherwise, it’s a great time to start preparing your workspace to receive the product for final testing, programming, and packaging.

You’ll want to order packaging and shipping supplies. If you’re fulfilling orders yourself rather than relying on a third-party service, you’ll want to make sure you have a label printer and a good quality laser printer if you have a large order volume. While these printers are more costly upfront than a cheap home or small office printer, the cost per page they provide is significantly lower. When you need to print 3 invoices plus a packing list for every international order, page counts rise very rapidly and taking your printing costs down to 2.5c per page from around 25c for an inkjet or budget laser printer can give you an immediate return on your investment. 

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I’ll leave this section at that, as manufacturing your product is likely the part of the process for which you have the most experience and knowledge!

Fulfilling Orders

If you only have a few hundred orders, it might be easier to fulfill the orders yourself, paying yourself or your staff the labor, rather than paying a fulfillment center to take care of it for you. Beyond several hundred orders, a fulfillment center that is both used to and equipped to deal with that volume of shipments is almost certainly going to be your most viable option. If you have a significant quantity of orders in another country, it may be cheaper to ship a large box or pallet of items to a fulfillment center in that country, and delegate distribution to them, than it is to ship directly to each customer.

If you’re using Crowd Supply for your project, they will take care of the shipping for you at a reasonably small charge per shipment. If your contract manufacturer is doing a box build and full testing, Crowd Supply can receive that delivery and fulfill all your orders for you. You can also do it yourself or use any other fulfillment provider.

If you are using IndieGoGo or Kickstarter, the real challenge is figuring out what to send to each customer. If you have some experience with databases or are willing to learn, importing the CSV data from your campaign into a simple database like Microsoft Access or OpenOffice Base can save you an enormous amount of time. Getting all your orders into a database allows you to use views to massage the data into a more usable format. Additionally, reporting functionality built into the database gives you an easy way to generate packing lists and customs invoices. Using views can also put the data into a format expected by your shipping website. It’s very satisfying when you go from entering the shipping details for every order into a shipping website manually to uploading a CSV file from your database and purchasing a hundred labels at a time. As a comparison, shipping 30 parcels would take me around four hours using a shipping website (including weighing orders and customs paperwork) as compared to around fifteen minutes to do the same job with a database export.

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If you are not experienced with databases, don’t want to hire a freelancer who is, and don’t want to dive into the deep end with them, then data management platforms like BackerKit can help you out if you used Kickstarter. Keep in mind, however, that they will take a percentage of your total funding for that convenience.

Status Updates

Frequent updates to your campaign aren’t just a nuisance the crowdfunding platforms force onto you, but rather a great way to show off what you’ve been working on. Post photos of updated prototypes, your visit to the certification lab as you do your pre-certification work, first articles from the contract manufacturer, and other production progress your customers may find interesting. By showing progress, you keep the hype going as well as help relieve the nervousness of backers who want to be sure they’ll get their product.

If you have the editing skills and feel comfortable in front of a camera, posting video updates can also be very rewarding for your backers, and make them feel more involved in the whole process.

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These updates are not just to keep the backers happy, but also to help build hype for the post-campaign availability of your product, allowing you to continue making sales even after your campaign has concluded. When making these posts, keep in mind that future customers will be looking at them and enjoying the journey, perhaps years into the future. Topping it off, being able to show progress, challenges, and triumphs in this form can help your future campaigns as well.

Future Sales

Now that you’ve successfully delivered the product to the people who pre-ordered from your campaign, you can start selling directly. Hopefully, you manufactured a few extra units allowing you to have some stock ready and prepared for sale at full price. If you are a new company and don’t have an existing sales channel or website, the decisions you make now can stick with you for several years, mainly because it can be arduous, time-consuming, and expensive to change your eCommerce system once you’ve started using it.

If you used Crowd Supply for your campaign, you could continue selling through their platform and having them ship your product. I had not intended to include this in the article initially, but looking at buying a Software Defined Radio transceiver from Lime Microsystems , I can see that this is a viable option that appears to be working well for them. I’m not sure how this would work if you wanted to release small add-on products, extra cables, or third-party products on your store, however, if you only plan to sell your main product(s), this can be a great way to keep utilizing the marketing links pointing at your campaign.

If you run a small hobby business or are targeting hobbyists, a website like Tindie could be an easy route to online sales as you work towards making sales from your website. This will also give you an additional sales channel once your website can accept sales. If you haven’t heard of Tindie, it’s like Etsy for electronics and geek goods. 

Amazon, eBay, Facebook Store, and other sales channels can increase your sales, but the fees and percentages they take can be fairly steep if you didn’t build much margin into your product. That being said, they do have massive customer bases and may offer you significant sales opportunities compared to selling directly through your website.

Rather than, or in addition to, utilizing an online marketplace, you might want to sell directly to your customers from your website. There are two main ways to approach this: using a hosted eCommerce system (Software as a Service – SaaS) or hosting your own webstore.

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The major Software as a Service (SaaS) platforms are Shopify, BigCommerce, BigCartel, and Volusion. Wix and Squarespace are website building platforms that also offer some eCommerce functionality. They all charge a (sometimes hefty) monthly fee and can come with some severe limitations, which can often be overcome by using plugins that cost you monthly. My experience using SaaS has been an expensive one, the base package of $20-$30 a month can quickly balloon out to $300-$500 a month with just a few additions like some marketing, calculated shipping, product customization, and other such plugins. Using a SaaS eCommerce package sounds like a cheap and easy means to get started with eCommerce, but unless you don’t have the skills to host or interest in hosting your own system, it is likely to either cost you a relatively large amount of money or leave you lacking basic features. Ten years ago, eCommerce systems were all about how many features they could pack in. In comparison, today’s systems seem to be about how few features they can get away with, and how well they can charge you extra for even the most basic functionality, like calculating shipping fees at checkout or printing a packing list. There are some significant advantages of using a SaaS system though. For example, they take care of security, compliance, and scale to large volumes of traffic very well.

If you still want to have your own eCommerce system and are unwilling to pay a hefty premium for someone else to take care of it for you, it’s not overly difficult to set up your own system reasonably cheaply. There’s a wide range of commercial, open-source and “open source” platforms available which you can host yourself. I put the second open-source above in quotes because they are commercial ventures masquerading as open-source software using a freemium model. Many of these options also include a hosted option for the software, typically at a much cheaper price than that of the big SaaS packages. Like SaaS options, they offer a bare-bones webstore package and require you to pay for add-ons that give you some of the most basic features in an eCommerce store (like calculated shipping or even just a weight/destination table priced shipping option in the checkout).

My preferred package for eCommerce is nopCommerce , which is an open-source enterprise-grade eCommerce system that is free (you can pay to remove the ‘powered by’ message) and extremely well featured.  It runs on ASP.NET, so does require windows hosting which can be a little more expensive than Linux hosting, yet it’s fairly easy to set up and configure and has a good community behind it for support. There are paid add-ons and themes, but they are relatively cheap and one-off payments. I haven’t managed to find another eCommerce package with quite as many features as nopCommerce has out of the box.

There are plenty of other popular open-source websites available including Magento, WooCommerce, PrestaShop, OpenCart and many others. These can require quite a bit of extra setup work over the SaaS options, but after a year, you could be looking at significant cost savings.

Thank you for following along with this series on using crowdfunding platforms to launch your product. I hope it’s the start of an epic journey toward a product launch success for you. Crowdfunding, and dealing with the volume of orders you receive all at once can be daunting but it can also be an incredibly exciting experience. There are not too many other methods available to generate as much interest in your product or grow your business as rapidly as crowdfunding offers. The opportunities for a cash-strapped startup or someone wanting to run their ‘side business’ full time are just as big as for a large company looking to gain extra marketing reach and make a big impact. In the end, if you want to boil this series down to its essence, I feel the key point to take away here is that planning and marketing are what will make your campaign successful. With good planning, you can respond to events and unexpected circumstances rather than just reacting. Your project will be more likely to stay on track and on budget. Having well-planned marketing will drive interest and traffic to your campaign making it a huge success. Something I haven’t mentioned in the series but is just as important as everything else: Don’t forget to have fun, enjoy the experience, and make sure you take some time for yourself and family. It’s very easy for a campaign to become all-encompassing in your life leaving you working long hours and missing out on enjoying the experience.

If you haven’t read the first article in this series and want to learn more about crowdfunding in general, start here to read the whole series. Or sign-up for our service, see what is new with Upverter or contact us for more information if you want to learn more about the capabilities of browser-based design and product development.

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