When developing a product launch marketing plan as an early-stage entrepreneur considering preorders, one crucial decision stands out: choosing between a crowdfunding campaign on a popular platform like Kickstarter or Indiegogo, or going an e-commerce pre-order route on your own website.
The answer depends on your risk tolerance and growth goals. Based on hundreds of successful product launches, we’ll break down both paths to help optimize your launch.
Crowdfunding success requires an aggressive front-loaded approach to your product launch marketing plan.
About 70% of your marketing investment happens before launch day, with visual content strategy playing a critical role in campaign page optimization. Think of crowdfunding as a sprint and e-commerce as a marathon. With crowdfunding, you’re front-loading about 70% of your marketing investment before launch day, aiming for an explosive start that captures media attention and creates urgency. Your growth metrics typically show a sharp initial spike, then leveling off as the campaign progresses.
Visualized as a graph, this type of launch trajectory would show logarithmic growth during the launch period:
One of our favorite crowdfunding success stories is the U.S.S. Enterprise NCC-1701 Replica from STAR TREK™: The Motion Picture. Strong prelaunch investment, trust-building efforts and content strategies to resolve sales objections and build excitement resulted in a massive $2 million launch day and $4.6 million total raise.
Play around with our crowdfunding calculator to get a sense of the budget you’d need to hit crowdfunding launch goals.
E-commerce pre-order strategies follow a different conversion rate optimization path. Instead of the crowdfunding campaign’s all-at-once approach that focuses heavily on prelaunch, an e-commerce preorder product launch marketing plan evolves through continuous testing and refinement.
Only about 20% of investment is made prelaunch, resulting in a smaller launch day revenue raise but also in less risk. Strategy can be adjusted based on real-time performance data, leading to steadier, more predictable growth.
A project of ours running with this e-commerce approach was Altangle. This approach was slower and steadier than what a Kickstarter campaign might achieve, but created a sustainable and scalable foundation for the brand while maintaining excellent profitability and ROI from day one.
The growth line starts modest but builds consistently, often resulting in more sustainable long-term success. Over time, a successful launch would see this trajectory become exponential, once traction picks up and the ripple effects of the smaller steps early on begin to become more pronounced.
Explore our advertising ROI calculator to better understand what results might look like on this path.
Pros & Cons
Crowdfunding Pros & Cons
Pros:
- Can take your product from zero to global hero in a matter of days
- Draws higher levels of interest from investors, media, and other stakeholders
- If you fail fast, you learn fast (and can pivot quickly)
Cons:
- Riskier and more stressful (more pressure for a big, fast, successful launch)
- Can require substantial budget prior to bringing in any revenue
- Becoming a victim of your own success is very real. You are often beholden to production and manufacturing partners, who may be unable to ramp up quickly enough to meet the demand (resulting in unhappy customers).
Should be considered by entrepreneurs and creators who:
- Have sizeable budgets that come from sources other than their own launch revenue (e.g. bootstrapping, VCs, angel investors)
- Seek immediate success at launch, due to their need for data to show investors promising data, to capture market share quickly, or to feed their own ego
- Have a higher tolerance for risk
- Have a product or idea ready to go, for immediate shipping/delivery to early customers
- Have a comprehensive team alongside them (whether internally or working with external partners) and substantial time/bandwidth to invest in the launch
E-commerce Preorder Pros & Cons
Pros:
- Ability to minimize inefficiencies in spend (budget/time)
- Production and manufacturing remains manageable, does not get overwhelmed
- Allows you to use profit as your marketing budget from day one
Cons:
- Does not provide big, impressive launch day revenue numbers to quote to media, investors, and other stakeholders
- Requires patience and longer-term thinking, does not generally allow for quick, significant strategy pivots
Should be considered by entrepreneurs and creators who:
- Have small budgets and require revenue in order to invest further in their launch strategies
- Have a particularly low tolerance for risk
- Have tight margins and need a laser focus on making each and every marketing effort profitable before scaling up
- Are in the very early stages of product/idea development (for example, a prototype does not exist in any form)
- Are pursuing their idea as a side gig or part-time project, with limited hours available to commit
While crowdfunding demands higher upfront investment, there’s a significant strategy in any product launch marketing plan that can limit risk: validation testing. Before full campaign deployment, our Five Step High Profit Launch System optimizes conversion rates and ROI through targeted product market fit analysis and go-to market experiments. This data-driven approach has proven successful across diverse product categories and all sorts of launch campaigns.
