Crowdfunding can be a novel and effective way to validate market assumptions posed by R&D projects and acceptance by customers.
Besides raising money, crowdfunding allows the project team to gain feedback on some of the most critical parts of the product before its release into the public marketplace.
For example, the R&D team is able to gauge pricing information, demand for the product, feedback on how design might be improved, demographic on potential buyers, precise information about market demands, and direct customer interaction. It can also lead to word-of-mouth recommendation and other social marketing.
Crowdfunding establishes a direct link between the team and the customers. This link is the first step towards marketing, customer loyalty, participation, and emotional attachment to the product.
Moreover, the outcome from a crowdfunding campaign facilitates the understanding by early stage investors, including Business Angels and by other entrepreneurs and SMEs being the feedback by bakers already a proof of the concept and a test of the market grip of the results and solutions stemming out from a R&D project.
Even more important is the time in which the project owner is able to make this assessment; a two-month long crowdfunding campaign is a relatively fast turnaround for getting an idea off the ground.
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