“Indiegogo is by far the best vehicle we’ve used out of all our various efforts for marketing outreach,” says Bruce Borenstein, CEO of AfterShokz.
“In terms of sheer numbers, we have close to 3,000 Indiegogo pledges in this 2 week period of time. With other vehicles we’ve used for customer engagement, like Facebook or Twitter, we’ve never been able to generate that same level of following in that short of window.”
This is AfterShokz’ fourth year in the consumer electronics business. They are not your typical consumer electronics startup trying to validate their product through a crowdfunding campaign.
As an established business, AfterShokz decided to launch a crowdfunding campaign to increase customer engagement.
According to Borenstein, “we were coming to market anyway. It was more about using crowdfunding as a platform for customer engagement.”
“As of right now, we are at $346,557 raised in 16 days. That’s 533% of our target goal of $65,000.”
With Indiegogo, they surpassed their goal within the first two hours.
Product Peel connected with Borenstein to find out why an established business like AfterShokz would chose Indiegogo instead of Kickstarter for marketing and customer engagement.
The INDIEGOGO vs. KICKSTARTER bake-off
“Once we came to the conclusion that we wanted to investigate crowdfunding as a customer engagement option, it’s really been a lot of outside help.”
First Bruce setup a conference call with Kickstarter and with Indiegogo to find out what was going to work best for them.
“We did some outreach both with Kickstarter and Indiegogo and setup a conference call as we explored the two different platforms and what was going to work the best for us, being an established company they have a pretty good idea that this will have a fairly high level of success, which will raise a significant amount of dollars, which is how they make money by taking a percentage.”
They also had a crowdfunding coach from a company called the Silver Telegram, which also provided guidance when they started the campaign.
INDIEGOGO provides hands-on support
Their initial thought was Kickstarter.
According to Borenstein, “just talking pure numbers, Kickstarter is probably 6X the size of Indiegogo in terms of number of subscribers. But then it became more obvious to us that Indiegogo would provide a better vehicle to accomplish what we wanted to accomplish.”
“The reason why we liked the Indiegogo platform is that they are very hands-on, they provide a lot guidance.”
Their coach felt that the hands on approach for their first campaign was better, even though the audience was smaller, the outreach would be larger ultimately because of the ability to get direct guidance from Indiegogo and participate in their newsletter.
“There would be more things going on to connect with more people on the Indiegogo platform than the Kickstarter platform. The Kickstarter campaign would have been much more driven from the outside. Kickstarter doesn’t provide the same level of interaction to the client that Indiegogo does.”
“We have a weekly call with Indiegogo. We had one yesterday, where we talked about our stretch goals, once we blew away our initial goal, they shared their experience of the most successful vehicles for reaching a stretch goal. They have the experience and we get to be the beneficiary, they share what does work and doesn’t work. So our energy can be most successful.”
According to Borenstein, the other thing Indiegogo does that Kickstarter does not do, is InDemand, a post campaign continuation.
“If you run a Kickstarter campaign for 45 days, and then it’s over. With Indiegogo, you can work with them inDemand, to extend the life of the campaign for a longer period to keep the customer engagement engine running.”
7 Tips for established businesses running their first crowdfunding campaign
In his own words Borenstein shares 7 tips for established businesses running their first crowdfunding campaign.
1) Think of crowdfunding as a customer engagement platform
The best example is Pebble, who initially did their first or early round of funding on Kickstarter and then came back several years later after they’ve been in the marketplace and been pretty successful with a campaign for a new product which raised what I believe was something like $20 Million. Which is pretty incredible.
We’ve had 2,293 funders so far, and in the comments section on the site, we’ve gotten 177 comments from individuals.
Then we capture all of these names, part of what Indiegogo does, we have the contact information for all the followers so that we can communicate with them directly, market to them. This is the beauty of crowdfunding.
People pay a lot of money to get followers, to interact with consumers to let them know about their product, to do surveys, collect other marketing information, all of these followers now become part of our database of consumers, for example, when customers buy the product and register their product with us, we capture their information, we have something in the neighborhood of 15,000 names in that database. Some of these customers we’ve gained through Kickstarter are already Aftershokz fans, but many of them are new, we haven’t gone through the sorting to see who’s new and who’s not. Clearly there’s a lot new.
We’re hopeful by the end of the campaign, it would be double from what it is today. We have another 25 days left in the campaign, if we could get another 5,000 funders that would be great.
Let me read a new comment that just got posted 2 minutes ago. “If headphones are banned from your workplace for safety reasons you may want to consider talking to them about the open ear design of Treks and how your ears are still available to hear your surroundings while using them. We’ve had many customers say AfterShokz headphones are the only acceptable headphones in their workplace because they allow you to hear everything around you.”
2) Engage with a coach who has done successful crowdfunding campaigns
If you’re an established company, engage with a coach, somebody who has done successful campaigns for other companies, and you get the value of their experience so that you’re not spinning your wheels, going down a road that may not prove to be successful, based on someone who has done a lot of campaigns and has experience. That’s a great tip.
3) Investigate which crowdfunding platform is most beneficial to you
Spend the time to investigate the platforms and see which one would be most beneficial to you. In our case, that hands on approach from Indiegogo was very attractive so ultimately we engaged with them to be the platform for our campaign.
4) Build a pre-launch campaign distribution list with everybody in your organization
Prior to the actual launch of the campaign, there were certain pieces that are needed. The first is the video and the other piece is the outreach to your contact list, everybody within my organization has X number of contacts, and then designing an email to go out to your personal and business contacts to let them know you are planning a campaign and looking for their support.
The outreach prior to the campaign included our database of registered users. Registered users are already fans, so we definitely reached out to them and they are given opportunity to take advantage of early bird specials. Which sold out very quickly in the first day.
5) Set a modest goal, success begets success
People like to get involved with campaigns that are successful. If for no other reason, the campaign being successful means they are going to get their product. In the case of Kickstarter, if you don’t hit your goal you don’t get the funding and the people that pledged would get a refund, on the Indiegogo platform, even if you didn’t meet your goal, you can still commit to deliver the product.
When you engage with Indiegogo and with your coach, you want to make a modest goal because one of our objectives is to make sure your campaign is going to be successful.
When people come to the Indiegogo site and look at various campaigns there is a whole range of products, not just in the tech space, but in a variety of spaces. Most people like to engage with successful campaigns, if you show that your campaign is successful, their confidence level increases, if they commit to buy a product they want to make sure they can get the product.
Our story and our ability to hit our goal very quickly made it more compelling for Indiegogo followers to come on and commit to the product. It snowballs, success begets more success.
From our vantage point, it really wasn’t about money, it was about customer engagement.
We set a goal that we knew we would hit right away. If our objective in engaging in crowdfunding was to generate a lot of customer interaction and engagement and new followers to AfterShokz, we wanted to make sure the goal was very modest, so we set a modest goal knowing we would hit it very quickly.
6) Hit your goal as quickly as possible
The whole idea is that when your campaign actually launches you want to hit your goal as quickly as possible, ideally in the first couple of hours, which we were able to do. Ideally you want to have this setup in advance. That’s where the first piece of outreach comes in, we incorporated it in our website, we actually had a count-down on the website for the launch of the campaign. The proposition for consumers is a hit because not only are they getting the product first, but they get a discount.
In our case it’s a product that will retail for $129, but if you’re an early bird and were the first 200 to come to the site you were able to buy the product for $79. If you are interested in the product, the sooner you pledge, the better the deal is for you.
7) Use crowdfunding as a validation and selling tool for distribution and manufacturing partners
When people vote with their pocket book, that really does give validation to the product you’re looking to bring to market, and it becomes a great tool from a selling standpoint as you go into distribution partners, to illustrate and say this product has been validated by a number of consumers who have put up money months in advance to secure the product, because it’s a product they obviously want to buy.
Bruce Borenstein’s Bio in his own words
I’m president and CEO of AfterShokz. I’ve spent the majority of my career working with startup companies and helping them establish themselves in the retail channel.
Prior to working with Aftershokz I was with the NEAT company who made the NEAT receipt scanner for digitizing paper, expense reports and business cards. And prior to that I was with Digital Innovations with a product called the Skip Doctor which repaired damaged CDs and DVDs, which back then was a big deal.
I started in the inception of these companies and have taken them to the next level and then moved onto the next challenge. Typically it’s a 4-5 year cycle for me. Prior to that I’ve been in manufacturing representing companies like Nintendo, Maxtel, Alpine Audio, etc. I’ve always been in the consumer electronics business. I’ve been very active in the Consumer Electronics Association. I’ve been the division chair in the accessory division for a couple years. Also served in the board of industry leaders. I’m currently serving in the CEA foundation, bringing award $s to agencies that can take technology and improve the quality of life of their constituents.
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