Congratulations on tapping into crowdfunding to get your project off the ground!
There are plenty of million-dollar Kickstarter projects, such as Pebble and Bunch O Balloons, that make crowdfunding look easy. But—as you’re probably aware—successfully crowdfunding a project is a challenging endeavor. Few aspiring entrepreneurs or small business owners hit their goals, so reaching yours is cause for pride.
In fact, the odds of achieving full funding using Kickstarter are only a hair above 36 percent. For a campaign goal of around $10,000, chances increase to 38 percent, which represents the highest likelihood of success. However, if your goal is to reach $50,000, the success rate plummets to just 18 percent.
Even if you’ve already reached your monetary goal, stay focused: You’re not out of the woods yet.
The crowdfunding crutch
Platforms such as Indiegogo’s InDemand make it easy to engage with the early-adopter community that crowdfunding sites specifically cater to. With this built-in audience, you avoid the hassle of creating a robust ecommerce site with entirely new messaging. Without a doubt, this is a great short-term solution that helps you preserve momentum and keep sales going.
The problem arises when entrepreneurs rely on this methodology long after their campaigns have concluded. Crowdfunding platforms can be cumbersome, and maintaining a presence on them longer than necessary can make it look like your company has stagnated and can’t deliver on its original promises.
When it comes time to move on, you need to be ready to fly the coop. After a period of initial investment and sales, your crowdfunding dependency isn’t doing you any good. In fact, it’s holding you back. Crowdfunding platforms can make marketing your product more difficult. Not only is it harder to run ads, but customizing the buyer experience is also more complicated and there is less flexibility for your sales and marketing teams.
Crowdfunding platforms can be extremely volatile, and the promotional offers you receive are living proof. For example, after the Benjamin button Kickstarter project weeded through all its suspect offers, it had narrowed the field down to two it felt were reliable. Each came complete with stellar reputations and glowing references, but in the end, one yielded a single campaign backer while the other failed to move the needle despite its impressive four-digit budget.
Another painful but obligatory part of a crowdfunding presence is being held at the mercy of angry backers. When you have what feels like a million other urgent priorities and there’s one backer who isn’t satisfied with your product, you’re forced to take the time to address his or her concerns, regardless of whether they’re reasonable.
Because you never know how much influence backers or those in their networks might wield when it comes to your campaign’s success, you must treat everyone as if he’s a key stakeholder in your endeavor. According to Kickstarter’s ranking system, the total number of backers supporting a project is more important than the total amount raised. As a result, you could knock your fundraising goal out of the park and never make it into the rankings of top projects, which is a critical loss in terms of publicity.
Introducing the Amazon alternative
When your project has been raised on a crowdfunding platform and has reached its fundraising goal, graduating doesn’t mean going it alone. Amazon Exclusives is a great option for continuing sales if you have a shippable product, and it’s as easy as setting up an Amazon shop.
Reaching Amazon shoppers, a total of 310 million as of 2016, is simply a matter of adding keywords. As you continue to grow your startup, Amazon handles not only customer service but also shipping and returns. As a crowdfunded project, there’s also a chance that your product qualifies for a position on Amazon’s Launchpad program.
With Launchpad, Amazon works with both Kickstarter and Indiegogo to identify innovative new products from entrepreneurs and startup companies. These products are then featured with brand-building resources including a Q&A video. Products such as the Petzi Treat Cam remote treat dispenser and the Canary Security System got started on their own but found big success when they were featured on Launchpad.
4 steps to making the move from crowdfunding to Amazon
After a successful crowdfunding operation, Amazon is a great place to further your brand and your product. If you’re ready to make the leap, start with these four steps:
1. Get set up on Amazon Seller Central
Start with the basics, including making an account, profile, and web store. Figure out what product category you’ll sell under, and consider a professional plan for $39.99 per month that allows you to sell an unlimited number of items with no fees. If you’re selling a much smaller number of higher-cost items, the individual plan will cost you 99 cents for each item without a monthly fee.
2. Prepare your listing
Of course, you’ll have to include the item’s condition along with the price and quantity, but it’s also important to include sale dates, prices, restock dates, SKUs, pictures, and descriptions. Keywords are also critical, but it’s increasingly important to develop quality copy for listings.
3. Set up fulfillment by Amazon
One of the perks of Amazon is the hands-off approach it allows you to take when it comes to order fulfillment. If you’d prefer these items to be taken off your plate, set up fulfillment by Amazon for accurate and on-time delivery. According to Fortune, 2016 was a breakthrough year for the program that saw Amazon deliver 2 billion items for other sellers—twice as much when compared with the previous year.
For more on this aspect of the process, check out this Bplans guide to starting a fulfillment by Amazon business.
4. Create an ecommerce marketing plan
Amazon certainly simplifies the selling process, but don’t expect your products to fly off the shelves all by themselves. An astounding 44 percent of customers go directly to Amazon when shopping online, but a good marketing plan is still critical. I always recommend working with an agency that specializes in ecommerce to ensure your sales goals are met. If you’re not sure where to start, marketing agencies like Enventys Partners can help. At the very least, read up on how to put an overall marketing plan together.
Your crowdfunding success so far is a great sign, and you’re probably feeling optimistic about what’s to come. However, don’t get too relaxed, because these next steps are pivotal to the future of your business. To give yourself the best chance possible at success, follow them closely and utilize Amazon to ride your crowdfunding wave as far as it will go.