James Dawsey asked me to distill some of my comments from this Google+ conversation into a linkable blog post, so here goes!

International shipping for a Kickstarter is a problem from a bunch of different directions. The way I see it, you’ve basically got three options:

You can not offer international shipping, and get complaints about it;

You can offer it at a high but fairly honest cost and get complaints about it;

You can offer it at a cost that the international backers think is fair, but which pretty much eats up all the actual revenue value of their pledge, rendering their contribution effectively moot and potentially undermining your financial goals for the campaign.

These are not good choices, but they’re the choices.

Before you pop on down to the comments to tell me how I’m wrong here, let me say this: I’m happy to see options like facilities that can offer bulk international shipping start to open up for the international market. That said, such options open up a number of additional logistic hurdles which aren’t always worth the effort, especially if you’re a) going to be selling the game after the KS through distributors (or other internationally accessible channels) anyway, and b) your game is going to be distributed to the target market in question through one of those distributors.

Bottom line on that: When I’m running a KS, I have to budget both the money I’m getting and the impact on my time. So while some of the expense can be moved from the money column to the time column, that’s not always the best of exchange rates. 🙂

But what’s the deep core issue here, aside from, y’know, the fact that the United States postal system is underfunded and legally constrained from increasing domestic postage rates to the point where their costs would actually be covered, so they’re doing what they can by making regular-ish, big increases in their international shipping charges?

Comes down to the algebra of reward tiers.

With Kickstarter, because shipping gets wrapped up in the pledge, you have to watch your percentages. You could have a $25 tier that ships domestically, and a $50 tier that ships internationally, and that’s great — to an extent — if the international folks are willing to pay it.

But suppose that the $25 domestic tier represents $5 shipping + $20 contribution to the goal, and the $50 international tier represents $30 shipping + $20 contribution to the goal. When an international backer pledges that $50, they’re putting the project $50 closer to its funding mark… while only ACTUALLY contributing $20. Compare this to two domestic backers pledging $25 each and actually contributing $40 towards the goal. So in this example scenario the international backer’s pledge is only “worth” half a domestic pledge in terms of actual revenue contribution after shipping. This can be super problematic if the budgeting on the project, and its ultimate funding goal, is built around the scenario of a pledge that’s 80% meat, 20% shipping.

The two strategies (aside from “don’t offer international shipping”) for dealing with this are not all that satisfying.

First is “well, why not bill for shipping as a separate thing after the KS is over?” — And the answer to that seems to be a pretty consistent “because international backers don’t realize exactly how high a charge that will be, and the sticker shock will produce a lot of anger, especially amongst those who didn’t bother to read the pledge tier text closely”. That’s a huge emotional and cognitive load for a projectrunner to parse through when the shit starts hitting the fan, and it inevitably will.

Second is what we did with the Fate Dice kickstarter: if the budget’s ratio holds that 80% of a pledge should go towards the actual goal, with a max of 20% for shipping, then you should take the expected average cost of international shipping, and solve the equation for that. This is algebra in action! If X is the reward tier, and 20% of it needs to go towards shipping, and your international shipping charge is going to be about $30, then your equation to solve is .2x = $30. This tells us that the international shipping pledge tier needs to be $150: that way $30 goes towards shipping (20%) and $120 goes towards the actual non-shipping project costs. Voilla! Except, ohhh, the complaints you’ll get for only offering a $150 tier as your entry-point for an international backer.

At the end of the day project runners take the blame for factors beyond their control. They can’t control the fact that out-of-the-US shipping costs are spiraling out of control, and are highly unpredictable 6-12 months in advance, which is often the (minimum) hang time on many KSers; they can’t get KS to adopt a more sensible mode of splitting the shipping charges off from the project tally (at least not so far); and they can’t adopt an international-friendly shipping package that would ultimately bankrupt the project if it got popular. Congratulations! The math says every option is bad.

And so, that has me pursuing the least expensive, still disappointing, first option from that list up top. “Please order from an FLGS supplied by one of the following distributors” is fast becoming my go-to strategy for international stuff. Pair that with a cheap all-digital buy-in, and I don’t feel like I’m forcing the international folks to miss out on much. The only thing they’re potentially missing out on is a little bit of a speed-win for the delivery of the product, and that is something I’m comfortable asking them to take and like. If someone’s truly interested in being a supporter of what a Kickstarter campaign is about, and not just in it for the what-are-you-gonna-do-for-me of it, they can wait, and optionally, buy in for a buck to stay abreast of backer-only updates and developments. That’s lowest risk for everyone and doesn’t come with an implicit demand that the projectrunner choose insolvency in order to serve a few additional customers.

One possibly unnecessary footnote: There’s no judgment here. If you’re an international potential-backer, I’m not saying you have no value to me. I’m saying present circumstances are making it very hard to serve you and at some point I have to focus on the things I can do, cheaply, in bulk, and set aside anything that requires a lot more time, slow and close attention to detail, and so on. Business realities are what have put the squeeze on your role in a Kickstarter. Yes, these things could be worked around, at least marginally, but I think the best, strongest workarounds come through selling the results of a Kickstarter to you outside of the Kickstarter itself. As part of my acknowledgement of that, I avoid designing Kickstarters that have exclusive content — or if they do have it, they’re designed such that you can get at them digitally. I don’t get to choose my ideal results here, and I’m sad about it. But I also have to be smart about what I do and don’t do, for the health of my company.