Prepping for the Writer's Dice Kickstarter: Part 1: Pricing

In the spirit of transparency, here's the cost breakdown for the Writer's Dice. This is the kind of budgeting and planning you have to do before you launch any Kickstarter campaign.

Production Estimate
Quantity: 100
19mm, .4 oz, Opaque Square-edged Blank Dice, Red
Custom etching on each face
Each die costs $1.75, a total of $175.

Shipping (according to USPS Price List Effective June 6, 2011)
Domestic package shipping up to 3oz (~4 dice + padded envelope) costs $1.71
To Canada, it costs up to $2.24
To Mexico, it costs up to $2.86
Everywhere else, up to $3.46

Pricing Strategy
I want to charge a flat rate of $5 per die, just like the Mathematician's Dice kickstarter. That means the single-die orders are going to be the most costly for us. We'll only have about $1.50 cushion for a single-die domestic order. We'll take At least a 17¢ hit on each single-die international order.

So, we have a couple options here. First, we can just hope we'll have more domestic orders than international and that they will offset our losses. Furthermore, if we have roughly the same turnout as the Mathematician's Dice, the vast majority of our backers will order multiple dice at once. That will further offset any small losses from international orders.

Otherwise, our other option is to charge shipping for international orders. Not sure how the Mathematician's Dice kickstarter afforded not charging international shipping, but I assume they went with the strategy described above and hoped for the best. I think I will do the same. A flat rate for all orders is nice and simple for the customer.

In the Mathematician's Dice campaign, only 83 got a single die. 669 backers got two dice at $10 and 413 got four dice at $20. Assuming The MD team had the same costs as us and these were all international orders outside of North America, those single orders cost them a total of $17.43. The two-die orders got a total profit of $662.04. The four-die orders got a total profit of $3940.02. Their highest tier, $50, only got 60 orders, but each one is a massive profit that more than offset the single orders.

Now, there is a very valid argument to be made in favor of including full shipping charge in the pledge amount, so single orders would be $7. (Essentially charging $5 for each die plus $3 for the shipping.) Then we cut that price down to $10 for two dice. And so on, offering further discount deals at higher quantities. It's a totally valid structure, and one we're weighing, but we honestly just like the no-muss, no-fuss single-price, even if it doesn't explicitly encourage a higher-volume order.

In the end, we'll probably end up with a compromise clause in the single-order pledge tier: "International orders, please add $1." That would suffice to cover the additional expense and still keep our otherwise smooth pricing structure.

This doesn't even take into account the percentage cut that Kickstarter and Amazon will take from the final Kickstarter pledges. But let's set that aside for another time. :P

EDIT: And, of course, after bringing it up with Megan, she immediately came up with an elegant solution. Offer a PDF product at the $10 level to encourage a jump from one die to two. A handy little guide for incorporating Writer's Dice into games and using them in writing exercises on their own. No cost to us, but it would be just enough to spur an impulse upgrade. Nice!

EDIT 2: Okay, we figured out the expenses for the Kickstarter and Amazon cuts. Turns out we must compromise on the $5 flat price in the case of international orders. An extra buck or two for international orders should cover the extra costs.