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Author Topic: A different perspective on the failure of a Kickstarter  (Read 1933 times)

wraith808

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A different perspective on the failure of a Kickstarter
« on: December 09, 2012, 03:22:16 PM »
Why I'm Glad My Kickstarter Failed Miserably

From someone who had an idea and the funds to produce it through normal channels.  But didn't.

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Just a little bit over a month ago I started the OSR Calendar Kickstarter with a goal of $7,500 (or roughly 375 backers). It's over now with a grand total of 5 backers and $130 raised.

This, I believe, qualifies as a substantial and miserable failure.

More at link.

mouser

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Re: A different perspective on the failure of a Kickstarter
« Reply #1 on: December 09, 2012, 06:35:26 PM »
The author makes a good point: kickstarter *might* be a way to find out if there is enough interest in the idea and if it's worth pursuing.  So that a "failed" kickstarter is really a successful test of the marketplace that demonstrates limited interest in your idea.

On the other hand, the impression I get from kickstarter and other similar things is that success is as much based on your *MARKETING* skills and luck as it is on the quality of the idea -- probably more so.

So a failed kickstarter may very well mean little about the quality of your idea -- and more about *your* ability to *market* your idea.
« Last Edit: December 09, 2012, 07:00:33 PM by mouser »

wraith808

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Re: A different perspective on the failure of a Kickstarter
« Reply #2 on: December 09, 2012, 08:07:51 PM »
I think its a combination of the two, just like any other speculative venture.

1. Good idea with need
2. Good plan/proposal
3. Good stretch goals for incentive
4. Good marketing (which might not necessarily be your own)
5. Good communication

I think you can fall down on any two of these points.  But more than that, and you are stretching it.

Paul Keith

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Re: A different perspective on the failure of a Kickstarter
« Reply #3 on: December 10, 2012, 12:30:36 AM »
I think it's neither:

Counter to #1: There are so many horri-bad ideas with insane backings for their value.

Unlike ventures where failure has real costly consequences, Kickstarter projects are much closer to costly Youtube productions with real products that people could want if they do support that video. Because of the allure of that real product, you can get away with a worse Youtube quality video but gain the same audience so long as you can promise the core backers to shell out their donations. It's like a successful capitalist equivalent of a donation based infomercial and like most infomercial, it's not about the needs nor the idea.

Counter to #2: Good plans and proposals are often bad plans and bad proposals

Even a good start-up idea that takes off can have a faulty business model that forces it to shut down eventually. Bad plan/bad proposal but it took off.

Now consider how many kickstarter projects are even worse than that. How many that once they do succeed, they still fail. How many that if they weren't on kickstarter, they wouldn't be backed?

It's easy to assume that just because many have successful kickstarters that it was the marketing or the proposal of those people that helped them but for many, it's just as true that without kickstarter their proposals wouldn't get anywhere.

It's the marketing of the marketplace with Kickstarter as the marketplace that helps make these proposals take off. Yes, there are plans/proposals that can take off without Kickstarter but by all going to the same place and by helping Kickstarter become a notable place, those good proposals and plans in turn help those with bad proposals succeed or those with lesser proposals try to get in.

Yes, the attempt is there for each project leader to try to insert their own marketing and their own efforts but in the end it has nothing to do with their marketing nor the demand of the product why the kickstarter succeeded. If it did, many successful proposals had to have more sound ideas in them but they don't. There's no rhyme or reason other than when it comes down to it, the project has something "inside of the marketplace" for people to back it. It's not like a proper venture where you have to recognize your audience to target it, it's an extension of a proper venture. An example of the new economy provided by the web where the audience all gather to support kickstarter and it becomes a tradition/mode of e-commerce to go there thanks to the place being marketed by every failure and successful projects and people talking about them.

Counter to #3: What exactly are the good incentives?

I think if good incentives or stretch goals where standardized then every blog article advises on how to make a successful kickstarter would lead to success or at least 90% success rate and we wouldn't have post-failure articles like this making sentences of why it's a good thing.

The fact is this is another example of kickstarter doing the marketing for the products and the projects' marketing not mattering at all outside of the project's marketing needing to matter because it is part of the competency of the  one hosting the thing needing to be backed and cause the "fear of failure" is so ingrained to the project cause the rate of success is supposed to be high.

It would be on par with saying a good stretch goal to give reason for people to buy fish is to have the fish available for long periods of time or for optimum period of customers walking past the fish place.

In the end, the stretch goals is just a built in marketing mechanic for kickstarter to promote kickstarter by giving the vendors an incentive to entice the buyers, not for the buyers to be enticed by the vendors. The buyers simply want a product they could acquire and any added bonuses is not incentive but rather a way of acquiring the "full package" or the "special package" of the product. None of that is marketing or market driven. That's just sales. Sales that could be done with no need for stretch goals because neither marketing nor markets really come into play when people back kickstarter projects. All it takes is for it to be available and people being capable of giving back and expecting that what they give back would allow for a product to be available. No different for the reasons why people may want to donate to a NANY only DC doesn't market DC nor make more people want to market for it while Kickstarter does.

Counter to #4: Good marketing

...and here's the rub: If Kickstarter had good marketing, you'd think every product there would make people go crazy like every Apple releases or that more people would end up going there to sell something much like E-bay products having their huge pay-offs and their small pay-offs rather than the no-pay-off that Kickstarter has if the project fails.

The marketing exists but it's a non-factor compared to the art when a visitor first clicks on the product and the "notability" of the project after all that including the comments and the peer pressure of your money counting to the project cause it may not be popular enough.

It's a weird sentence to say "this is not good marketing" because it's not like I could do any better. It's not like Kickstarter hasn't become a successful tool.

The problem I have with saying good marketing here matters is that there's no real markets that are made from Kickstarter.

After a project is successfully funded, that's it. Maybe a few people would check back on the updates and maybe the project is still chugging along fine thanks to the funds but unlike a branded product or an actual venture where it's continued success and the stability of it's outcome still matters...most Kickstarter projects have none. Once the Kickstarter is over, it's over. It regresses not extends beyond a Kickstarter project where if good marketing did occur, the project should be bigger not smaller after the Kickstarter. After all, isn't this the core difference between marketing and sales? Marketing drives the demand, sales drive up during discounts, promos and trends?

If marketing or market demand was such a core aspect to why a project failed or succeeded, why do projects get treated as lesser products once it no longer needs Kickstarter/is part of an ongoing Kickstarter? Why does the base shrink?

A speculative venture needs marketing because it's base is always under threat and it needs to be constantly growing until it becomes notable enough to be a stable venture that can protect it's products and customers from being flooded by the copycats. Most kickstarter projects don't even get near that stage even with little competition. They just disappear to the brand much like NANY projects or DC apps disappear into the DC brand and few in the web talk about those software without first lumping them into Kickstarter or DC.

5 I don't have a counter to and I think it actually matters more than both marketing and markets. A failed Kickstarter could teach someone to spot where they failed to communicate their product more than understanding the market demand.

I mean look at that link. Post-kickstarter failure and people are still communicating about the failed project but where are the ones expressing why they demanded and didn't demand to have it? In comparison, failed ventures are rarely talked about except to lament why it failed. Successful ventures make everyone shut up instead of making the venture more successful. Failed marketing tricks don't get people thinking how to make it better so it can get back inside a marketplace where it failed and try again because it can't afford that risk. Successful marketing ventures get people to ignore their minds and act in-line with the marketing demands of the seller. Kickstarter projects very rarely have people that continue to want to fund it again on Kickstarter. It's often been about communication with the product/project managers. The actual marketing is being on Kickstarter and being noticed on Kickstarter itself because once in there, the marketing doesn't matter. People just want to get in, want to see the pretty stuff on the window and then they want to communicate cause they want to support and acquire it until it's over. The failed ideas didn't raise their notability except being failed ideas. The successful ideas didn't raise their notability except being products that successfully got funded. Very few markets have been established after that. Very few national products ended up being global and very few regional products ended up booming rather than being as if they were marketed and not just sold. In short, it was most, if not all, face value much like how selling things in a marketplace work.

wraith808

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Re: A different perspective on the failure of a Kickstarter
« Reply #4 on: December 10, 2012, 12:49:17 PM »
I think that your points are based on Kickstarter being something that it's not.  Kickstarter is a platform.  Comparing Kickstarter projects to youtube productions is disingenuous or wrong even.  There are no promises with youtube productions and money is made through youtube on them.  At it's core, its a video sharing site.  With kickstarter you *are* promising a project and pitching it to investors.

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Is a creator legally obligated to fulfill the promises of their project?

Yes. Kickstarter's Terms of Use require creators to fulfill all rewards of their project or refund any backer whose reward they do not or cannot fulfill. (This is what creators see before they launch.) We crafted these terms to create a legal requirement for creators to follow through on their projects, and to give backers a recourse if they don't. We hope that backers will consider using this provision only in cases where they feel that a creator has not made a good faith effort to complete the project and fulfill.

Real projects have no consequences if funding is sought before they start, and that funding is not reached.  In that, they are similar to Kickstarter.  I've started quite a few projects, tested the waters, and bailed because there was not enough interest/I couldn't raise enough funds.  That's the same level of involvement that you are starting at Kickstarter.  If they receive the funds, then cannot deliver, there are very real consequences.

And in contrast to your heading for #1, there are horri-bad projects in your eyes.  What's one man's garbage is another's treasure.  This is what Kickstarter measures.  The pet rock, the wrist band shapes, and several other questionable things have made tons of money because there was a demand beyond what I'd perceive as value.  Were they bad ideas?  An emphatic no!  They made their creators tons of money, and I wish I'd thought about it.  Just because it has no intrinsic value to me, doesn't mean that it doesn't to someone else.  And if they're willing to put their money where their mouth is, then who am I to speak on the value of what they see?

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How many that once they do succeed, they still fail.

Ok.  How many?  I've backed almost 100 projects.  Some have been late, and the execution on some have been less than I'd thought.  But (1) looking back at the proposal, I see in hindsight what I missed- that part is my fault, and (2) sometimes things happen that are out of the control of the project and weren't taken into account.  That stuff happens.

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How many that if they weren't on kickstarter, they wouldn't be backed?

That's sort of the point.  Crowdfunding lets those that are interested in seeing it succeed contribute to that success.  It takes the huge weight off of the shoulders of a few with a lot of money, and puts the control in the hands of those that have less.

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It's the marketing of the marketplace with Kickstarter as the marketplace that helps make these proposals take off.

I'd disagree.  If so, then why is there only a 44% success rate?  If it was kickstarter itself, wouldn't that number be higher?  Having that platform allows there to be a critical mass of backers, true.  But that's like saying having a street corner by grand central station to sell your creations from is the reason for your success.

Quote
I think if good incentives or stretch goals where standardized then every blog article advises on how to make a successful kickstarter would lead to success or at least 90% success rate and we wouldn't have post-failure articles like this making sentences of why it's a good thing.

In regards to good incentives, that is a measure of the project, and directly counter to your second point.  You have to recognize your audience, and tailor your proposal and the incentives towards that.  That's why people publish to a set group of people before the kickstarter launches- to get that feedback.  That's why incentives are changed during the kickstarter- to give the people what they want.  It's a subset of the good plans- but such an important one that I separated it in my analysis.

Quote
The fact is this is another example of kickstarter doing the marketing for the products and the projects' marketing not mattering at all outside of the project's marketing needing to matter because it is part of the competency of the  one hosting the thing needing to be backed and cause the "fear of failure" is so ingrained to the project cause the rate of success is supposed to be high.

Respectfully... what?  Kickstarter itself has nothing to do with the incentives.  It is fully a measure of the person creating the project.  As someone who's gone through the beginning stages to see what's going on behind the scenes, I can say categorically that you're wrong there.  There's sample projects and suggestions- but nothing past that.  There's no direct correlation there.

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In the end, the stretch goals is just a built in marketing mechanic for kickstarter to promote kickstarter by giving the vendors an incentive to entice the buyers, not for the buyers to be enticed by the vendors.

Again... what?  Have you looked at stretch goals?  Those aren't even a Kickstarter thing, and aren't officially supported by Kickstarter.  It's something that certain projects have found that works for them in their presentation to be able to lower their price of admission and add gold plating (or fund additional add-ons) as an option, depending on what the backers want.  There's not even an infrastructure in place to support them.

Again, I think from your statements you might have the wrong idea of what Kickstarter is, and isn't.  Of course it could be that we're just looking at it from different angles.  But your arguments seem to be more geared towards traditional definitions, when Kickstarter (and Crowdfunding in general) is anything but.

Mark0

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Re: A different perspective on the failure of a Kickstarter
« Reply #5 on: December 10, 2012, 04:42:34 PM »
I just saw today a podcast with David Braben (of Elite fame) and Chris Roberts (ditto for Wing Commander). Both have ongoing Kickstarter campaigns for their next games.

Kickstarter - Elite Dangerous
Kickstarter - Star Citizen

One interesting point made by Chris, was that he used Kickstarter also as a way to show other private investors that there was a lot of interest in his project. So he not only surpassed the Kickstarter target by a big amount, but also got even more money from other sources.

Paul Keith

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Re: A different perspective on the failure of a Kickstarter
« Reply #6 on: December 11, 2012, 11:16:01 AM »
I think it's exactly that. Kickstarter is a platform. Youtube is also a platform.

Platform is just a fancy way of saying things are here.

In fact, opening up a youtube channel does have a promise. A webseries sucks if it has no ending.

It's only disingenuous to individuals who find something to feel bad about it. No different than someone feeling bad that a donationcoded software is not on DC. It can happen but it's on the individual, not on the actual model.

I would even go beyond and say you are going against your case.

"If" Kickstarter is a "promise" then what is this? Jerk moves to break promises?

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Real projects have no consequences if funding is sought before they start, and that funding is not reached.  In that, they are similar to Kickstarter.  I've started quite a few projects, tested the waters, and bailed because there was not enough interest/I couldn't raise enough funds.  That's the same level of involvement that you are starting at Kickstarter.  If they receive the funds, then cannot deliver, there are very real consequences.

The answer is obviously no but it sounds like this "if" we apply the wrong analogy of Kickstarter being a promise. Yes I know what the nice sounding quote is but there's quotes and there's reality. The quote you pasted was a rhetorical FAQ style question. It wasn't meant to be some sort of official adjective for Kickstarter

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Ok.  How many?  I've backed almost 100 projects.  Some have been late, and the execution on some have been less than I'd thought.  But (1) looking back at the proposal, I see in hindsight what I missed- that part is my fault, and (2) sometimes things happen that are out of the control of the project and weren't taken into account.  That stuff happens.

A LOT.

People learn from mistakes. People like to think they learn from mistakes especially business people. (Not alot of them are able to write really good books on it that go beyond feel good platitudes and bullet points but hey, it's a necessary irrational attempt)

The problem here is, again, you're making the case for why Kickstarter is not a promise. At least no more than a Youtube video being a promise to Youtube viewers.

If we apply the promise analogy, it just seems like a jerk move. You were late for your "promise" and you didn't execute it. K...but what's the compensation? Is it equal compensation? No, because it's a project not a promise once it fails. See how that works?

...there's something else aside that, something that's promise-like but I don't think it can be clearly defined when you want to stick to your version of a Kickstarter as a promise. One that allows you stop making that promise when it's convenient cause it's not really a promise at all.

Until you can see how wrong that is, it will sound like the point of crowdfunding is about backers but it's not. You know it when you jump away from backing or promises when you defend Kickstarter but jump back to crowdfunding when you want to focus on one sentence about the model.

If this were only about what Kickstarter's definition should be about, it's one thing but it's not.

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And in contrast to your heading for #1, there are horri-bad projects in your eyes.  What's one man's garbage is another's treasure.  This is what Kickstarter measures.  The pet rock, the wrist band shapes, and several other questionable things have made tons of money because there was a demand beyond what I'd perceive as value.  Were they bad ideas?  An emphatic no!  They made their creators tons of money, and I wish I'd thought about it.  Just because it has no intrinsic value to me, doesn't mean that it doesn't to someone else.  And if they're willing to put their money where their mouth is, then who am I to speak on the value of what they see?

Pet rock - would still have a base after it get funded
Wrist band shapes - would still have a base after it get funded.

You're making the mistake of talking about trees while missing the forest. Why did I reply? What was mouser's statement? What was your statement? What was the article about?

The sentence is not There are horri-bad projects that get funded but Counter to #1: There are so many horri-bad ideas with insane backings for their value.

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If it was kickstarter itself, wouldn't that number be higher?

Why is 44% low for a market? Because Kickstarter is a crowdfunding website not a:

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Having that platform allows there to be a critical mass of backers, true.  But that's like saying having a street corner by grand central station to sell your creations from is the reason for your success.

It's one of the most well known crowd funding site. It's one of the most successful go-to sites. It's on the internet which has a different scale both for ease of entries and actual entries.

...and a street corner has to compete for space. Kickstarter has to compete for attention. It's just an immediate wrong analogy.

No offense but I think your reply just got off the wrong premise. As soon as that wrong premise start flowing, everything was just jagged. It's not criticism so much as explaining why I tried not expanding on statements such as directly counter to your second point. Maybe it's my fault for bolding it but my statements were counters to your statements. They don't function as headlines or sentences in isolation.

If you treat them as isolated sentences to be cherry picked, we get to such rhetorical bullet points as:

recognize your audience
tailor your proposal

...even: Kickstarter has nothing to do with incentives (which raises issues like how an interface can promote behaviour and only works if you don't have this view that Kickstarter is solely a platform that allows you to promise something)

Finally, I think it's important to emphasize that I'm not making arguments. I'm making a direct reply to what mouser is saying only instead of making it a direct reply, I based my direct reply on counter-evidence to why in my opinion, it was neither.

If you focused too much on what is traditional and not traditional, it would just lead to more fruitless disagreements and not because we are looking at different ways this time but because then we'd be truly arguing on which one of us is the one having a traditional view when that isn't the subject to begin with. There is no tradition here. There is no argument against Kickstarter here. Kickstarter is not being attacked. Crowdfunding is not being redefined. It is about projects. What lessons could be learned from them. (the main article) Why we disagree with mouser's impression (both of our replies) and what was the nuancy behind what mouser is saying which led to our own contrarian replies to him.  

« Last Edit: December 11, 2012, 11:21:25 AM by Paul Keith »

wraith808

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Re: A different perspective on the failure of a Kickstarter
« Reply #7 on: December 11, 2012, 12:15:49 PM »
If it was a direct reply, then I don't see why the point for point was against my points, which seemed as if it was a reply to my reply.  It's apparent that we have different views on things, as I allowed for in my final point.  And the debate doesn't seem to be even in the same realm, as the arguments are quite nebulous and unsubstantiated, i.e. I backed up my statements on what kickstarter is with quotes from the site, and from the creation of the prospectus.  But you seemingly tossed those away, in favor of what you think that kickstarter is, rather than how they position themselves.  But as you said that you aren't making arguments and were replying to mouser, I'm just going to bow out now.  :Thmbsup:

40hz

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Re: A different perspective on the failure of a Kickstarter
« Reply #8 on: December 11, 2012, 06:33:09 PM »
Platform? Let's get real.

Kickstarter is basically an unregulated forum for solicitation of investors.

You can call it whatever you like. And I'm all for what it attempts to accomplish. But it's still a mechanism for people to solicit money from the general public. And it's ripe for abuse because of it's current lack of regulation and status. So it's only a matter of time before the con artists start taking advantage of that.

We've already seen some amateur attempts at gaming the Kickstarter system already.


Paul Keith

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Re: A different perspective on the failure of a Kickstarter
« Reply #9 on: December 13, 2012, 01:59:09 AM »
If it was a direct reply, then I don't see why the point for point was against my points, which seemed as if it was a reply to my reply.  It's apparent that we have different views on things, as I allowed for in my final point.  And the debate doesn't seem to be even in the same realm, as the arguments are quite nebulous and unsubstantiated, i.e. I backed up my statements on what kickstarter is with quotes from the site, and from the creation of the prospectus.  But you seemingly tossed those away, in favor of what you think that kickstarter is, rather than how they position themselves.  But as you said that you aren't making arguments and were replying to mouser, I'm just going to bow out now.  :Thmbsup:

I replied because you replied. That's the point.  ;)

Platform? Let's get real.

Kickstarter is basically an unregulated forum for solicitation of investors.

You can call it whatever you like. And I'm all for what it attempts to accomplish. But it's still a mechanism for people to solicit money from the general public. And it's ripe for abuse because of it's current lack of regulation and status. So it's only a matter of time before the con artists start taking advantage of that.

We've already seen some amateur attempts at gaming the Kickstarter system already.

Well there's always two kinds of world. The perfect one and the imperfect one.

All businesses is based on imperfect ones IMO but to borrow wraith808's word, they want to "position" themselves as a perfect one.

I would just like to emphasize that perfect here is not quality but peace of mind.

In an imperfect world, there are scams just as there are legitimate products and a platform that can elevate scams, can also elevate legitimate products. Cue the internet.

In an illusionary perfect world, there are criminals who are invested to bypass the rules and the regulations end up hurting the more amateur project providers of legitimate products. Cue the "if you ban something, you subsidize it".

Not that it has much of an effect for "rich" countries or Kickstarter per se (their major base) but if Kickstarter gets regulated, it would hurt many amateurs on it and motivate many amateur scammers to be more professional about their scams as there's a legitimate space left behind by those who are willing to back amateur/micro-funded projects. It's one of the ironies of crowdfunding IMO as well as markets in general.

If it were a mere mechanic for moving money, it would be no different than a microfinance site but lack of regulations led to more time for creativity, more time for creativity led to a different enthusiasm for solicitation, the attitude shift create a different kind of culture which then led to a more dreamer type expectation of shopping mechanic than the less exciting and serious world of micro-loans and you get a "platform" of a different brand. One that has a dynamic that transcends the mechanic for good and for bad.