If you are planning to launch a crowdfunding campaign, one of the first elements you need to consider are your perks, which you’ll offer in exchange for contributions. The more exciting the offer is, the more likely backers are to contribute. The name “perk” might lead you to believe that perks are optional, but they make a huge difference in the success of a campaign. Campaigns with perks raise an average of 143% more than campaigns without them. We know that it’s difficult to figure out what kinds of things to offer as perks, how to price them, and how to showcase them on your campaign page, and we’ve got lots of advice to help.
Firstly, you have to work out what sorts of things you will offer to your contributors as perks. It might sound obvious, but if your campaign is based on a product, then the majority of your perks should be the product itself. Unlike with creative campaigns, backers are far more likely to contribute to get early access to your product, rather than getting branded merchandise such as t-shirts or bags. That’s not to say that you shouldn’t also offer non-product perks; you should have a range of perks that work for any wallet.
Take for example Livia – a wearable device that alleviates menstrual pain. Their campaign essentially find only two types of perks – the product itself and its exchangeable elements: pads and skins. The only thing that changes is the number of items or color, respectively, bundled in a kit.
Another way to diversify the perks is to consider offering any additional goods that might come with your product. When planning your perks, think ahead about any upgrades or accessories that can be added later in the campaign. Introducing new perks throughout your campaign will continue to drive momentum after launch.
When pricing your product as a perk, think about your bill of material. Make sure to also factor in shipping, import taxes, as well as market research and labor. Costs will vary with volume, but be sure to estimate your costs at the lowest expected production volumes, in case your sales are lower than expected. Our data shows that in general, the most popular perks are priced between $25 and $99.
Use consumer psychology to your advantage and end your perk price with an odd number. Pricing research shows that including an odd number can give the appearance of a lower price point. So instead of pricing your perk at $50, try $49, or instead of $100, try $99.
When your campaign kicks off, it’s also worth considering an ‘early bird’ special price. This ‘discount’ creates a strong incentive and sense of urgency for early contributors to support you. Starting strong and getting close to your target in the first few days increases backer trust and excitement.
When deciding what countries you should offer to ship to, just remember that if you end up with a hit product, people from all over the world could want it. If it’s possible, try to offer global shipping so you can expand your target audience and reach new markets.
If you decide to ship products around the world, it’s important to factor in shipping costs ahead of time. Find out what it costs to ship internationally, look into potential customs issues, and know how much you need to charge for each country.
Just as you should factor in shipping costs when deciding on the structure of your perks, you must also be very clear with your backers about what they are getting, when it will arrive, how much shipping costs, etc. This also means that from the very beginning you have to think about scaling and delivering your perks. You must be sure that you will be able to fulfill your perks within the timeframe that you’ve promised if 2,000 people order one, or if 200 people order one.
A few other things you should consider
The above suggestions are just the tip of the iceberg when it comes to your perk strategy. When thinking about perks over the course of your campaign, you should consider using flash sales, limited time-sensitive special offers and secret perks. All are great ways to keep the momentum going, capitalise on interest from existing contributors and offer something exciting and new! For more advice on perks, check out Indiegogo’s perk strategy guide.
When planning your product crowdfunding campaign, don’t leave thinking about your perks until the last minute as they are essential for the smooth running, and overall success of your campaign!