Stretch goals have been a common feature of crowdfunding campaigns for years now, but they can be just as deadly when used wrong.
On that note, let's walk through The Cyanide & Happiness Show's 2013 Kickstarter ($770k).
The stretch goals here are straightforward, but let’s unpack the merchandise stretch goals.
The plushy worked out perfectly. As mentioned above, we added nearly $60k within 24 hours of making this announcement. Clearly, it resonated with fans, but this started a dangerous pattern with higher goals.
Flip books weren’t too bad from a cost standpoint, but with the Purple-Shirted Eye-Stabber plushy already added to tiers above $60, we were making less money per pledge than before. As we unlocked more merchandise items, we realized that we were making less per pledge due to the production, artwork, and shipping costs we had to pay to make these things happen. In other words, the more money the project made, the less money we made per person. That’s bad.
The calendars were another, larger misstep. While we knew the price per product was cheap, we didn’t consider that the product became useless in a short period of time and/or came late. Additionally, we didn’t think of how hard it would be to sign every single calendar. We had to fly all the creators in from separate states for two eight-hour days of signing calendars like machines. It was a rough couple days for sure, and we should have put a hard limit on the number of signed goods. That’s a lot of money that could have been spent on animation.
The more money we made, the less money we made per pledge. F that.
We were fortunate that it didn’t kill our project, but a campaign like Cult of Cthulu 7th Edition ($561k) wasn’t so lucky. Their stretch goals involved writing four additional books for the campaign.
I’ll repeat myself for dramatic effect.
Wait for it…
Keep waiting for it…
Their stretch goals had them create four additional books.
Stretch goals require a full cost/benefit analysis prior to your campaign. Coming up with stretch goals during your campaign because you were "surprised" at funding is equivalent of mass texting everyone in your phone "you up?" at 3am. Sure, you'll get some takers, but you'll also be making your next Thanksgiving real awkward.
If you're planning your campaign to hit $150k and you're only asking for $50k (which you should, more on this in future emails), you should have built your maximimum stretch goal price per pledge directly into your profit calculations. Once your campaign hits your top stretch goal, STOP. It's easy to get the mid-campaign jitters and screw up all your thorough planning, but do your future self a favor and focus on getting more pledges instead of jeopardizing your profit margins.