December 11, 2013 @ 9:57 am By Charles Luzar
A new crowdfunding site has launched and it is geared specifically toward brands. It’s called Farallon, and it aims to amplify some of the tangential benefits of crowdfunding – namely market testing and crowdsourced feedback.
Farallon founder Alex Blunk believes that niche-focused crowdfunding sites will drive the next round of growth in the space. Having said that, Farallon is not your typical crowdfunding play. It’s a curated marketplace crowdfunding for established brands only. It targets brands that have been around for at least a couple years. More importantly, these brands can and should have an established network and manufacturing infrastructure.
We are defining ourselves by curating based on brand quality, enabling fan feedback, and high-touch customer service to the crowdfunding experience. This works perfectly in the scope of established and reputable brands because we’re taking risk off the table for both our brand partners and our customers. By having our team run project campaigns from start to finish, our partner brands are able to explore ‘on-the-fly’ product idea submissions without interrupting their already busy day-to-day operations. Through this model, we give them a lightweight ‘sounding-board’ to experiment with and engage their own fan base – as well as other partner brands’ audiences.
Farallon also may take a more active role in a campaign. The team may handle customer service and fulfillment on behalf of brands that crowdfund on their platform, for example.
There is also a strong element of crowd involvement. Members on the site can submit product ideas to brands for consideration. If an idea is adopted, that member can get a kickback from the brand and the brand gets to build and sell a product based on what their customers want.
“We want to collect project ideas, compile them in volume, and then bring the ideas to our partner brands,” Blunk told Crowdfund Insider. As these user-submitted ideas come to life, all parties benefit: Brands will collect useful information about future product direction, we empower a two-way line of communication between customers and great brands, and users who submit ideas will get credit towards the project that they helped bring to life. The ol’ win, win, win.
Blunk alludes to three major uses for the platform. One, its a place for brands to market test ideas before doing a larger production run. Two, it is a great way to sell limited edition merchandise. Finally, it is an engine for collaboration, and an engine with a lean business model. Right now there is no central place for brands to collaborate. Farallon hopes to fill that void.
Farallon campaigns are all-or-nothing campaigns and goals are usually based on unit volumes. Interestingly, campaigns also usually include a max so as to not stretch brands beyond what they can feasibly produce.
“We want to scale our service based on our partners’ capabilities,” said Blunk. “If they know that ‘X’ products backed will stretch their existing production capabilities thin and hurt their ability to deliver, we want to know those limits and will account for them in each project. It’s all about providing the best service and communication to the backers that we possibly can. As an added benefit to the early adopters, it adds a nice layer of exclusivity. ”
The core goal here is to improve upon some of the ills experienced by backers on other crowdfunding platforms. Blunk doesn’t want Farallon to get a reputation for late projects, for example. He wants to bring on-time delivery and great customer service to his userbase.
There is also the element of risk, which in theory would be reduced by working exclusively with companies that have a track record of manufacturing success. “By heavily vetting and building relationships with the brands that we do business with, we’re able to reduce risk for backers by ensuring that the brands have experience with what they’re making,” Blunk said. “Our partner brands have been doing business for years or understand how to bring an idea to life without much friction. We take pride in providing a more customer-friendly experience than most crowdfunding services — in the off chance that a backer receives a product not as described, we’ll give them credit towards a future project; or will work with the backer to make it right.”
So, if Kickstarter isn’t a store is Farallon? Sort of.
Farallon Co. is a very dynamic ‘store’. Specializing in an experience that opens the door to a new type of product development and fan engagement. Where we stretch the idea of a ‘store’ is by utilizing a familiar shop interface in an arena where no production or shipment will occur without the necessary support from its fans. We will have a return policy, unlike most crowdfunding platforms, but will be tighter than a traditional retail shop because we don’t stock any product.
Source : Crowdfund Insider