7 ways to screw up your crowfunding in fashion !

 Dear alumni 

Maxime Desmet, who graduated from the Specialised Master® in Fashion and Luxury in 2012, has worked since the IFM in the field of digital marketing for luxury brands such as Dior, Nina Ricci, Valentino and Mugler. He also participated alongside Pascal Gautrand (IFM Management 1999) in the development of Made in Town, an agency specialising in the promotion of local products. 

Today, Maxime Desmet assists fashion and lifestyle brands in their marketing and digital communication operations. 

He also supports young brands in their crowdfunding initiatives. Maxime publishes a newsletter dedicated to crowndfunding news that you can find directly on linked in :

 Maxime Desmet 

Today, he shares with us the 7 anti-advice of crownfunding!

7 ways to screw up your crowfunding in fashion !

We often talk about success in entrepreneurship with miracle recipes. Today I am here to change the game. Let's take a look at the best tips to screw up a fashion crowdfunding campaign. After reading this article I hope you have all the keys to fail your crowdfunding campaign with panache.

For those who would still like to successfully launch a fashion brand thanks to crowdfunding, I suggest to read this article to the end.

1. Let the platform deal with the contributions

- What you might be tempted to think:
If crowdfunding platforms such as Ulule, KissKissBangBang and Kickstarter exist, it is to simplify crowdfunding and bring in contributors. So why bother to plan and execute a strategy?

+ Why should you only count on yourself? 
Your “failure strategy” is certainly very strong. It is true that platforms have good assets. Here are two:
>Crowdfunding platforms represent a trusted third party. As contributors you would be more reassured to participate in a project through one of these famous platforms. They represent guarantees such as the reimbursement of your contributions if the project does not succeed.
>As a brand’s founder, these platforms give you access to a little training at the start. If your project has potential, it can also give it more visibility.
But beware ! you will have to prove your potential with strong figures.

2. Don't talk about your product before launching it #top secret 

Probability of failure? Between 60% and 80%.

- What you might be tempted to think :
Your future product is incredible. It aims to revolutionize the way humanity will dress up forever. You think the best thing is not to tell anyone. For sure, no one had thought about it before.

+ Talking about your idea is confronting reality
In a crowdfunding process, not talking about your product before launching your campaign can be a disaster.

It is highly presumptuous of you to assume that "no one had thought of it before"

But there is worse. You may well be the first to think of your revolutionary clothing. The problem is that it only interests you. Another way of looking at it is to introduce your product to its market using "customer development". The phase before the launch of your crowdfunding campaign could match to the “customer discovery” and your campaign to the “customer validation” phase.

For more details, I recommend reading “The Manual for start-up creators” by Steve Blank and Bob Dorf.


3. Business plans are for accountants only. 
Probability of failure? The haphazard.

- What you might be tempted to think:
You think that crowdfunding is not expensive. Three photos and a story on Instagram and off we go. So don't bother making a pivot table on Excel for that.

+ A little bit of forecasting
Does launching a fashion brand in crowdfunding does not require some economic intelligence? No ! Many of you will underestimate the costs of marketing and logistics. You will find it difficult to calculate your production price as accurately as possible. And as usual in small businesses, you are going to make a too small margin. You can’t count on the unexpected !

You cannot navigate on sight. You will need to determine at least few indicators: a production price target, margin level, cost of acquisition, etc. The main risk is to run a campaign with a deficit that will weigh on your cash flow. If you get there it will be the end of the adventure : you will probably get to the point of no more money and the demonstration that you are a bad business manager.

4. Starting production after receiving campaign payment #cashmoney
Probability of failure? 50%

- What you might be tempted to think:
It seems logical. If you do pre-sales…

+ Anticipate your production
In real life, your vendor has a very strict organization for years. You are going to need to be extremely rigorous on your production planning and to establish good relations with your manufacturers if you want to respect the delivery before Christmas which you promised. It is not excluded to order and pay for the raw material even before you have launched your campaign. That’s why you need to properly calculate your level of success thanks to a business and marketing plan. There is a good chance of taking six months longer than you had originally planned without it. Can your first clients wait that long ?


5. I don’t need pattern makers and engineering offices ?  #howitfits
Probability of failure? Almost 100%.

- What you might be tempted to think:
After all, why use professionals who offer expensive services to achieve a garment that will not have a size or fit problem? We can avoid this service, anyway our shirt is sold on the Internet. No one is going to try it before buying.
The fit will not stop someone to buy our product.

+ The return rate
Do you know the average market return rate for e-commerce businesses that sell clothing? It can go up to 25%.
You can imagine your return rate with a product that does not fit as you promise
A failure for sure !

This disaster will cost you the little margin that you will make in return and reimbursement. And you didn’t do all of that work to get your first disgruntled clients.

6. Launch your campaign as quick as possible #fastandfurious
Probability of failure? More than 100% (yes it is definitely possible).

- What you might be tempted to think:
Your your proto is not that good but the next one will be perfect. The fabric is out of stock but the manufacturer will find a solution guaranteed! you only have 100 email addresses of interested people?
But that’s normal, You haven't asked for help to Ant Karen yet. She has an amazin network. So let’s go ! Why should we wait more ?

+ All-in-one
This is probably the best mistake to make. By launching your campaign too quickly you will accumulate the issues and probably aggregate more important ones.
Think about this french phrase : "It is better to be late than creating a great disaster"


7. To do shipping yourself #doityourself
Probability of failure? Potentially. You will for sure age prematurely.


- What you might be tempted to think:
It is not the price of a stamp that will ruin me. And how long does it take to send a couple of parcels ?

+ Outsource repetitive tasks
You can definitely preparing a parcel to ship your sales from Vinted. But shipping 600 pants in three colors and five sizes is another challenge. And how can I forget that : ... did I mention international shipping with specific invoices and customs duties?

Let’s say that preparing a package takes 5 minutes of your time : folding of the box, printing of a thank you card, an invoice, adding some goodies, and then some handling operations such as folding the garment and going to pick it up from the stock.

So let’s do the maths. How long does it take to send your 600 parcels ? 6.25 days!
Frankly, you will have something else to do with your precious time for your business !

For those who want to succeed in crowdfunding in fashion

By listing these 7 mistakes, my goal is fight against some clichés. Crowdfunding is a great tool to launch a fashion brand (and not only), but it often suffers from a lack of awareness on the part of project leaders and a misleading vision. This ideal vision is conveyed in marketing speeches full of superlatives. If a brand exceeds five times the target, do you really think it’s the only result of word of mouth ?

If you want to learn more about this topic, I suggest you join me. I’m editing a newsletter that aims to give you all the keys to a successful crowdfunding campaign. To receive my best advices and tips in your email box please come here : tinyletter.com/CrowdfundingMode

Maxime Desmet

Contact

→ linkedin.com/in/maximedesmet/