This article is the first of my series of articles, where I explore the simple principle that if you want to be a successful fashion brand, you start by learning from the success of others.
Creating your brand is not easy but what seems to be the most difficult part is funding. It’s true that there are many business incubators in tech, biotech, and financial services. However, launching a creative fashion brand does not seem to attract many incubators or investors eager to focus on growing and scaling figures rather than on your story or your desire to change fashion habits. Even the latest fashion incubators in France are more likely to work with innovative startups who have technical promise onboard. So, a designer doesn’t have too much choice today and is usually forced to choose between startup prize contests or building a crowdfunding campaign.
Unfortunately, I’ve seen many designers, who have been unsuccessful in this field.
Let’s look at the most successful ones and what is special about them, enabling them to gain momentum and ensure a successful launch?
The biggest crowdfunding platform is Kickstarter based in the US and selling globally. It benefits from double-digit growth in this market, which is expected to be a $25b market by 2022 versus $12b today. Kickstarter counts 25,000 fashion projects since its launch in 2009, 6,300 of which were funded, making an average success rate of 25%. Potentially, there are 11 million backers put there to convince or 255 backers on average per project. Another point we shouldn’t overlook, when we talk about success on crowdfunding platforms such as Kickstarter, returns project creators: those who succeed in their first round of crowdfunding for their new collections then return to repeat the success for their next collections. Kickstarter communicates on 92% of gold project success rate with $4,4M of funds collected per project.
In this article, I will talk about Kickstarter. Other platforms, such as Ulule in France, which many designers use, seems to lack of ambition, as we are talking about on average a 10k project. I want you to aim higher. How ambitious can you be?
So, let’s take a look at the top ten fashion crowdfunding campaigns on Kickstarter over the last year :
1. BauBax, travel jacket – $4M with more than twenty thousand backers in 60 days. Their first campaign three years ago, allowed them to finance $9M.
2. Tropicfeel, the ultimate travel shoes. $2,1M and almost thirty thousand backers
3. Smart belt 2.0, $1,4m, fourteen thousand backers in 60 days
4. Errant, the ultimate everyday backpack, $1,3m and almost ten thousand backers
5. Adv3nture Hoodie, $1,8m and fourteen thousand backers
6. The 10-year hoodie, $800k, and $1m 5 years before that, with almost ten thousand backers each time.
7. The Kosan Go Travel Dress, $900k and six thousand backers
8. The Italian Suede Bomber Jackets Without the Luxury Markup, $400k, 1,400 backers.
9. Ultimate outerwear, $395k and one thousand backers
10. Filippo Loreti, accessory watch brand, used Kickstarter three times and leveraged more than €9m during these campaigns with forty thousand backers.
So what is the secret of their success?
- Product. it’s not a creative part of the product that attracts most people, it’s more about its ingenuity. What is a genius about your product? Ingenuity can surprise, demonstrate there is a gap in the market and that people need and subscribe to your idea. Basically, if you have a run-of-the-mill product, that focuses only on aesthetics or ecological credentials, it may be difficult to create an infatuation around your product. In all likelihood, you will not be exposed to a big fashion consumer driven by aesthetics, with this platform, instead, you will touch the minds and hearts of people looking for a product that is ingenious in its use. Don’t forget that 75% of backers are male, that’s why most of the projects that are successfully backed are unisex.
- The story. The story is not about your video or presenting the founders and the product. The story is about the WHY: how did you come up with the idea, why did you do it, what is the value for me as a consumer? For example, have you cut out the middle man, does your product have a multitude of useful features, innovation, or some kind of disruption or unconventional point of view on fashion? For example, the Baubax jacket has 25 features, that’s about 24 more than a normal jacket has, and it’s about cutting out the middle man costs. Tropicfeel has combined four shoes in one, looks like Nike, but is sneakers, water shoes, running shoes and hiking boots all rolled into one. Lastly, don’t forget that donors support the idea of personal connections between donors and causes. Put your backers first: think of them as part of your story, everything you do should be connected with them or for them. Personal connection with them is crucial. If you don’t have a community, you can start to create one long before your project is launched. Use the relevant media to target your audience, connect with them, send them your product, and as for writing an article, let the audience learn more about the future you propose. Start telling your story long before your project is launched, get the emails ready and activate them on D-Day.
- The Price. Limited offers make people book and wait beforehand because it is economically advantageous. Think about boundaries, your product, and services, or about multi-buy offers: two or three for the price of one. The stories like “no middleman” work very well and you can reinforce it with your price point. Don’t think of pledges as something basic, think of it as a value for the price, what value do I provide exactly for that price? And how attractive is it for my target audience? Just to mention that $400 is an average pledge amount on Kickstarter.
- Marketing plan. “When you control time there’s no such thing as being late” – says Jamy Stegmaier in his Crowdfunder’s Strategy Guide book. The instrumental part of campaigns is communication supportive marketing campaigns and data analysis. This part should be planned in advance, you don’t start it when your project page is done and you’re ready to go. You should look at this as a strategic plan for your success. Everything counts: how you go about your campaign, what channels do you use to consolidate maximum attention, how would you kick-off, run and end your campaign? Don’t forget that the first four days are crucial to the success of your campaign, everything happens here. People from your first circle and second circle (friends, family, friends of friends, current customers, a hot emailing list should be considered first), should be informed in advance to support you on D-day. People you don’t know or who discover you for the first time will judge your performance and base their decision to back you or not according to this. Your strategic plan is about using what works for others plus a bit of your own creativity and lots of planning and research in advance as to how you will run the campaign. Your financial projections should be supported by real investments because the use of marketing funds is crucial when you get to the next level of your campaign, which uses data and scaling for paid ads. Paid ads will consume most of your marketing budget. Use the time-lag advantage between the moment you launch your paid ads and when you pay for them. There’s a whole bunch of time that you can use by not paying immediately for your ads. It’s crucial to calculate it and launch your ads at the right time.
- Leveraging the data. Don’t forget to use Google Analytics for your Campaign page. There’s free useful information about the traffic and origins of your audience backers. There are many start-ups that will help you to exploit the maximum amount of data in order to play big. You should not ignore them, as when you have achieved $100k or $200k in the backing, you can scale up to $1m and $3m based on data that these start-ups will leverage to scale you up. They will take a percentage of pledges but it makes sense because you will be on the top-play list of biggest Kickstarter projects. Just aim high, work hard, research the biggest and use what they used in order to get to where you want to be. And remember if your project is successful and highly backed there is a good chance that you can repeat the success for your next development stage. In this case, Kickstarter becomes not only a financial and backing platform but a partner and brand-building platform, because you develop long-term relationships, you win much more than just a one-shot campaign and you keep your company independent while assuring funding, growth, and sales.
The brands I mentioned before were born through crowdfunding. So, if you’re more than just a nice couture brand, this option is certainly something to consider. In fact, what backers will be looking for in your product is functionality, an acceptable price point, many useful features, and a relevant story connected to their lifestyle. Besides, if you’ve already tried a platform such as Ulule, and been successful on it, I highly recommend using Kickstarter for your next crowdfunding campaign. Using insight from your previous experience, you can target a global consumer and this is much more important for your brand exposure than just staying local. As other successful stories show, once you have built your audience, continue to build it further during the post-campaign stage and launch your next project as you will already have your fans on the same platform. Focus on the long term instead of a one-shot campaign. If you consider the French market, in particular, think about creating a built-in French project on your Kickstarter campaign page, and any other language can then be added for a customizable message to your target audience.
The primary objective here is a focus: your need to know your audience so well that everything you do should be relevant to them. Having pages in different languages means you are duplicating your efforts for several different markets so it will be much more complicated to manage.
Crowdfunding’s greatest advantage is that by pre-selling it enables a new brand to secure costs ahead of production. Also as some designer said: “If you have a good idea, give it a shot. You don’t have to win the approval of Barneys anymore.” Instead, you need the approval of the masses, or at least enough of them to reach your funding goal.
It’s powerful because it’s about stories and stories excite people. What’s important with Kickstarter is that it forces you to focus on your story and it’s the story that sells.
Now, I’m not saying that everyone needs to crowdfund for their brand, most probably not, as people search for specific features and a personal connection to the brand. As designers are looking for a more creative part in building a collection, it may be irrelevant for them. But you can learn a lot from this campaign: how to match your message with the audience, the Ad structures and the costs integrated into the funding amount.
Communication costs may represent between 10% and 20% of such campaigns. Consider ROI x20 to 30 out of your most efficient paid ads. I also propose integrating these costs into your whole minimum required amount pledge. For instance, if your marketing budget is $5K, you will probably get 20k to 50k of return on investment from paid ads, then you need to add costs of shipping and production costs to build an effective budget and financial metrics, which need to be followed closely once you’re in the game of hunting for funds.
Here are some my top takeaways from crowdfunding campaigns:
- fund your campaign to have substantial value.
- consider that there is a large community of male backers in the crowdfunding world.
- when it comes to backing crowdfunding campaigns, desktop browsers are favoured.
- global shipping is crucial for crowdfunding campaigns
- highly funded campaigns receive between 3,200 and 15,330 visitors on a daily basis
- Every single day of your campaign is important, start to work on promoting your day one three months before it starts. Preparation is crucial to success.
- Success depends on strategic planning in order to get noticed amongst the crowd.
- The more you give the more you get. If you do all the work to get the funding on platforms like Kickstarter, experience shows that up to 40% of backers come from Kickstarter itself. That’s why it’s important that Kickstarter prioritise your project, if you beat records relevant to their metrics.
If you would like more advice like this, please follow my blog, subscribe to my newsletters, like and share. Also, I post videos each Thursday on my youtube channel. Helping emerging fashion brands is my mission, so stay tuned.
In addition, here’s a checklist of things to do prior to launch from Jamey Stegmaier, from his latest Kickstarter book:
- Start a blog and write one to three entries per week for three months
- Hunt down and subscribe to 20 blogs related to your project, read them everyday comment on at least once a day.
- Read every Kickstarter article on the blog of Jamey Stegmaier and use other renamed sources, such as Richard Bliss funding the dream podcasts
- Back 10 crowdfunding project, 1 project backed is 23% of success, 11- 25 backed projects is 55% of success. By backing others, you learn a lot from them.
- Add value to something that is important to strangers every day for two months, share a crowdfunding project you love, send a message to a project creator, go to relevant FB pages, comment, and share.
- Create a spreadsheet to compare projects in your field
- Create an extensive budget for your project, how you are going to ship your product is crucial.
- Pay a professional designer to create great artwork to attract attention to your page
- Send out samples of your products to high impact bloggers, you should be their fans for a while and interact with them beforehand.
- Share your project preview with at least twenty people before publishing
- Send out 15-20 blog personalized press releases one week before the launch
- Clear your schedule for the launch day and spend it sending and responding to personal messages.