Product Sampling on Reward-based Crowdfunding Platforms

On reward-based crowdfunding platforms, uncertainty in investment outcome severely hinders transactions between online backers and fundraisers due to backers' inaccessibility to actual products. The industry is dedicated to alleviating these dilemmas through campaign design and platform function design. In recent years, online product sampling has been introduced as a new promotion instrument for fundraisers. Using a unique dataset of 4060 campaign-level observations collected from China's highly influential JD Crowdfunding website z.jd.com, this study discusses whether an online sampling strategy is beneficial to crowdfunding campaigns. More specifically, differences in the strategy's effectiveness across product types are examined. Empirical results suggest that adopting online product sampling is helpful to crowdfunding performance, because it increases the total number of backers, the total fundraising amounts, and the average amount of funds raised per backer. Counter-intuitively, this approach only contributes to campaigns for search goods rather than experience goods