For experienced cross-border sellers, crowdfunding is a valuable platform to help them validate product ideas and make informed product selection decisions.
Crowdfunding platforms allow sellers to submit products for review by potential customers before they go into mass production. Sellers can publish prototypes, new products or even concepts and set a fundraising target amount. Interested investors (backers) can provide funding for the project in exchange for products or other rewards.
After the crowdfunding campaign ends, sellers can use the funds raised to produce their products and deliver them to backers. This process provides a valuable opportunity for sellers to collect customer feedback, refine product design, and build an early following. Through crowdfunding, cross-border sellers can reduce product launch risks and increase their likelihood of success in the market.
Three key advantages of crowdfunding
1. Reduce inventory risk
Crowdfunding adopts a "sales-production" model, which is different from the "production-sales" model of traditional e-commerce. Through crowdfunding, sellers can understand product demand in advance and produce based on the funds raised, thereby avoiding the risk of inventory overstock.
2. Improve product selection accuracy
Crowdfunding platforms provide sellers with the opportunity to receive feedback directly from consumers. By launching new products and observing consumers' willingness to fund them, sellers can more accurately judge the product's market potential and audience needs, thereby making more informed product selection decisions.
3. Accelerate brand development
Crowdfunding platforms are a valuable channel to connect with consumers and build brand loyalty. Through crowdfunding campaigns, sellers can interact with backers, collect feedback, and build a loyal early following. This helps brands quickly gain attention and influence in the early stages.
So, how do novice sellers start a crowdfunding project? What are the mainstream crowdfunding platforms? This article mainly introduces the crowdfunding process and mainstream crowdfunding platforms to help sellers successfully use crowdfunding to select and test products.
一、Crowdfunding process
Crowdfunding process
1. Preliminary market research
- Determine target audience and market needs.
- Analyze competitors and industry trends.
- Establish clear crowdfunding goals and timelines.
2. Content production
- Create a compelling crowdfunding page, including product descriptions, videos, and images.
- Prepare promotional materials such as press releases, social media posts, and email templates.
3. Warm up before going online
- Build awareness of your crowdfunding campaign through social media, email, and influencer marketing.
- Offer exclusive offers or incentives to attract early backers.
4. Officially launched
- Officially launch the campaign on the crowdfunding platform.
- Actively promote events and engage with potential supporters.
5. User relationship maintenance
- Regularly update backers on project progress.
- Answer questions and resolve concerns.
- Build a supportive community to foster loyalty.
6. Post-financing management and project extension
- Process funds and fulfill rewards.
- Explore opportunities to expand projects or launch new products.
7. Long-term relationship maintenance
- Stay connected with supporters and provide ongoing value.
- Ask for feedback and gather insights for future projects.
1. Preliminary market research
Preliminary market research
Preliminary market research is a critical step in a crowdfunding plan because it helps sellers evaluate the feasibility of their product idea and identify their target audience. Crowdfunding is generally a platform for product launches. Backers need to wait for a long time and take great risks to support new projects. Therefore, the product needs to be creative and technologically advanced to make backers feel that the wait and financial support are worth it. Here are some detailed steps:
- Determine your target audience Be clear about the people your product or service is aimed at. Consider their age, gender, interests and needs.
- Market demand analysis Research the market to see if there is a demand for your product. Analyze competitors, industry trends and consumer feedback.
- Competitor Analysis Identify your key competitors and analyze their products, marketing strategies, and customer base. Understand their strengths and weaknesses.
- Set a crowdfunding goal Set a realistic fundraising goal and create a timeline to achieve it in stages.
By conducting thorough market research, sellers can increase the likelihood of a successful crowdfunding campaign and ensure their product or service meets market demand.
Although there are various crowdfunding projects, there are some projects that are naturally attractive on the crowdfunding platform. These categories include: Categories: cutting-edge technology products, smart hardware, 3C digital products, design and creative products, small devices, outdoor travel products, etc. , such as headphone speakers, scooters, smart homes, sports backpacks, etc.
2. Preparation and production of crowdfunding content
Content production is crucial to a successful crowdfunding campaign as it engages potential backers and convinces them of your product or service. Here are some detailed steps:
- Copywriting Write clear and concise copy that highlights your product’s unique selling points and value proposition. Use strong verbs and emotive language to pique your readers' interest.
- Images Choose high-quality product images that showcase various aspects and features of your product. Use high-resolution images and make sure they display clearly on all devices.
- Video Create compelling videos that show how your product solves a problem or fills a need. Engage your audience using creative storytelling and high-quality production values.
Social media and advertising
Social media and advertising can play a vital role in a crowdfunding campaign. Here are some detailed steps:
- Social Media Accounts Set up all relevant social media accounts and develop a content publishing plan. Use these platforms to engage with potential supporters and build community.
- Advertising Develop an advertising budget and plan daily delivery costs. Use social media ads and search engine ads to reach your target audience.
By creating compelling content and effectively utilizing social media and advertising, sellers can increase the visibility and impact of their crowdfunding campaigns.
3、Warm-up before project launch
Before your project officially goes live, allow 1-2 months for warm-up activities to build momentum and attract potential backers. Here are some detailed steps:
- Media PR Reach out to mainstream media and promote your project. Write press releases and contact reporters and bloggers to promote your product or service.
- Social Media Marketing Create hashtags and campaigns on social media and use these platforms to engage with potential supporters. Share behind-the-scenes footage, exclusive content, and countdown updates.
- Influencer Marketing Work with influencers to let them experience and promote your products. Choose influencers who are relevant to your target audience and provide valuable content.
- Email Marketing Build a landing page to collect email addresses of potential supporters. Provide subscribers with exclusive content, discounts and event updates.
Other preparations
- Google Analytics Set up Google Analytics to track your website traffic and analyze the performance of your marketing campaigns.
- Media and influencer list Create a list of media and influencers to contact during the pre-event.
By conducting a comprehensive pre-launch campaign, sellers can build momentum for their crowdfunding campaign and attract a large number of potential backers.
4、The crowdfunding platform is officially launched
During the project launch period, sellers need to continue to carry out all-round promotion activities to attract supporters and build momentum for the project. Here are some detailed steps:
- Paid advertising Increase your efforts with paid advertising to reach a wider target audience. Promote your project using social media ads, search engine ads, and display ads.
- Social Media Marketing Continue to be active on social media and share project updates, behind-the-scenes footage, and exclusive content. Use social media advertising to reach new audiences.
- Media PR Continue to contact the media and promote your project. Issue press releases and contact reporters and bloggers to promote your product or service.
- Influencer Marketing Continue to work with influencers and let them promote your project. Offer exclusive content and discounts to incentivize them to participate.
- Email Marketing Send regular updates to your subscribers and promote your projects. Use email marketing to cultivate potential supporters and encourage them to take action.
- Offline events Host offline events, such as launches or seminars, to promote your project. Offer exclusive experiences and discounts to attract attendees.
Page maintenance and supporter interaction
Maintaining a crowdfunding page and engaging with backers is crucial while your project is live. Here are some detailed steps:
- Page Maintenance Update your crowdfunding page regularly and make adjustments based on user feedback. Make sure the page content is accurate and showcases the best aspects of your product.
- Supporter Engagement Answer supporters’ questions and collect their feedback in a timely manner. Use social media, email, and comment sections on crowdfunding platforms to engage with backers.
By conducting comprehensive launch promotion and maintaining a crowdfunding page, sellers can attract a large number of supporters and build momentum for their project.
5、Maintain user relationship before delivery
The end of the crowdfunding project does not mean that the project operation work has come to an end. While you're waiting for your product to be produced, it's important to maintain your product page in a timely manner and maintain good interactions with your backers. Here are some detailed steps:
- Product page maintenance If the design or product is modified based on user feedback received during the crowdfunding period, please update the product page promptly. Make sure the page content is accurate and showcases the best aspects of your product.
- Supporter Engagement Continue to interact with supporters and update them regularly on project progress. Use comments sections on email, social media, and crowdfunding platforms to share product milestones and answer backer questions.
- Cultivate user favorability The user relationship maintenance process before shipment is an important opportunity to cultivate product fans and build user favorability. Reward supporters by offering exclusive content, discounts and events.
By conducting comprehensive pre-shipment user relationship maintenance, sellers can keep supporters engaged and prepare for a successful product launch.
6、Post-financing management and project extension
Completing the final product delivery is the last step of the crowdfunding campaign, but this is just the beginning for the product’s development in overseas markets. Sellers need to carry out effective post-funding management in order to make full use of the success and popularity of overseas crowdfunding, and take advantage of the trend to boost the overall brand's overseas popularity and the company's overseas strategy. Here are some detailed steps:
- E-commerce sales In addition to delivering to crowdfunding backers, sellers can also sell products through e-commerce platforms and brand official websites. Use the traffic and popularity gained from crowdfunding to win sales.
- Brand promotion Relevant data results of successful crowdfunding projects can be displayed on the company's official website and social media pages, playing a long-term role in promoting the brand.
- Subsequent product development Based on the feedback received during the crowdfunding period, sellers can develop subsequent products or services. Leverage crowdfunding platforms to test new ideas and gain market validation.
- Overseas market expansion Crowdfunding can serve as a stepping stone into new overseas markets. Leverage crowdfunding platforms to build an overseas audience and build brand awareness.
By conducting comprehensive post-funding management and project outreach, sellers can maximize the success of their crowdfunding campaigns and lay the foundation for long-term growth of their business.
7、Maintain long-term interaction
After the crowdfunding campaign ends, sellers need to establish long-term interactive relationships with backers. This is critical to cultivating a loyal customer base and driving continued growth for your brand. Here are some detailed steps:
- Collect feedback Gather user experiences through email questionnaires and improve products and services based on feedback.
- Continuous updates Regularly update supporters with product-related guidance information, new features and activities.
- Social media engagement Conduct regular interactive discussions on social media pages or fan groups and solicit input from supporters.
- Trials Launch new product trials to give supporters a chance to experience and provide feedback.
By maintaining long-term interactions, sellers can cultivate the loyalty of their supporters and build a strong community. This will help the brand achieve “word of mouth” and provide impetus for the continued growth of its business.
二、Mainstream crowdfunding platforms
Kickstarter(USA)
Kickstarter is a crowdfunding platform that allows individuals and businesses to raise funds for creative projects. Launched in 2009, it has become one of the go-to platforms for raising funds for creative projects.
Mode of operation
- Project sponsors create project pages outlining their project, fundraising goals, and rewards.
- Supporters can pledge donations in exchange for rewards such as products, experiences or exclusive content.
- If the project reaches its fundraising goal by the deadline, the project sponsor receives the funds and fulfills the commitment to backers.
- If the project does not meet its fundraising goal, supporters' donations will be refunded.
Advantage
- Reach a wide audience Kickstarter has a large creative community, giving project sponsors access to a wide range of potential backers.
- Test market demand Crowdfunding can be a way to test market demand and get feedback on a new product or service.
- Build a community Crowdfunding can help project sponsors build a community around their project and develop loyal supporters.
- Get funding Kickstarter can provide project sponsors with funds to start or expand their projects.
Suitable projects
Kickstarter is suitable for all types of creative projects, including:
- Product design
- Movies and videos
- Music and performing arts
- Publication
- Technology and innovation
- Food and cooking
Cost
Kickstarter charges a 5% platform fee for successfully funded projects. In addition, project sponsors pay a payment processing fee (usually 3% of the donation amount + $0.20).
Indiegogo(USA)
Indiegogo is another popular crowdfunding platform that allows individuals and businesses to raise funds for creative projects and social impact campaigns. It was founded in 2008 and is one of Kickstarter's main competitors.
Mode of operation
- Project sponsors create project pages outlining their project, fundraising goals, and rewards.
- Supporters can pledge donations in exchange for rewards such as products, experiences or exclusive content.
- Indiegogo offers two fundraising models: All-or-Nothing (if a project doesn’t meet its fundraising goal, backers’ donations are refunded) and Flexible Fundraising (where project sponsors keep the funds whether or not they meet their fundraising goal) ).
- Project sponsors can set different fundraising thresholds and offer different rewards for reaching each threshold.
Advantage
- Flexibility Indiegogo offers flexible fundraising options, including all-or-nothing and flex funding.
- Global Reach Indiegogo operates globally, allowing project sponsors to reach a wide audience.
- Community support Indiegogo has an active community where project sponsors can connect with potential backers and get feedback.
- Marketing Tools Indiegogo offers a variety of marketing tools to help project sponsors promote their campaigns.
Suitable projects
Indiegogo is suitable for all types of projects, including:
- Product design
- movies and videos
- music and performing arts
- publication
- technology and innovation
- social impact activities
cost
Indiegogo charges the following fees for projects that successfully raise funds:
- All or Nothing Fundraising 5% platform fee + 3% payment processing fee
- 弹性筹款: 8% platform fee + 3% payment processing fee
Makuake Makuake is a crowdfunding platform focused on the Japanese market. Founded in 2011, it has become one of the largest crowdfunding platforms in Japan.
Mode of operation
- Project sponsors create project pages outlining their project, fundraising goals, and rewards.
- Supporters can pledge donations in exchange for rewards such as products, experiences or exclusive content.
- Makuake operates on an all-or-nothing fundraising model, meaning if the project doesn't reach its fundraising goal, backers' donations will be refunded.
- Project sponsors can set different fundraising thresholds and offer different rewards for reaching each threshold.
Advantage
- Focus on the Japanese market Makuake is focused on the Japanese market, allowing project sponsors to reach a broad Japanese audience.
- Rigorous Review Process Makuake conducts rigorous reviews of submitted projects to ensure they meet the platform’s quality standards.
- Strong community support Makuake has an active community where project sponsors can connect with potential backers and get feedback.
- Localized Support Makuake offers Japanese customer support, making the platform easier for Japanese project sponsors to use.
Suitable projects
Makuake is suitable for all types of projects, including:
- product design
- technology and innovation
- food and cooking
- fashion and accessories
- arts and culture projects
cost
Makuake charges the following fees for projects that successfully raise funds:
- Platform fee 10%
- Payment processing fee 5%