Electronics distributors are seeking to tap into the growing “do-it-yourself” (DIY) movement in electronics through some unique incentive programs. Starting today, Jameco Electronics will begin paying royalties on design kits. The program, dubbed “Club Jameco,” provides designers with the opportunity to generate revenue without taking traditional business risks associated with sourcing components, designing packages, and marketing new products.
Under the program, the designer develops and submits an idea, builds the bill-of-material requirements and provides step-by-step instructions for the device. Diagrams and photos are encouraged, along with a video to post on the Website or on YouTube.
Royalties will vary depending on quarterly sales. Kits generating sales of less than $200 per quarter receive 5 percent of sales; and those with more than $500 per quarter get 10 percent.
Quantifying the value of the project will depend on Jameco's ability to source components at a reasonable price, ensure the device works as intended, and determine whether the kit instructions are clear and concise. A crowdsourcing model, where developers in the Club Jameco community comment on the project, will provide feedback on the viability of the design. Once approved, the description and SKU for the kit will be posted online.
Jameco will source the components from more than 150 suppliers to create the kit, stock it in their warehouses, and promote it on their Websites, catalogues, and through social media.
Greg Harris, Jameco's vice president of sales and marketing, said both distributor and developer own the intellectual property rights. The creator retains the right to sell the design through other sites. The distributor takes the responsibility for pricing, based on costs for components, marketing, and other business-related issues.
The service isn't without challenges. The first: Jameco must recruit developers to design the kits. Harris isn't concerned. “By using the power of the crowd, we could have thousands of kits to offer hobbyists in a very short period of time.”
The crowdsourcing model lets the community vote for projects during the design phase to help designers create the best projects and ensure builders get what they want and need. This pay-for-projects concept, combined with crowdsourcing, creates engagement in the electronics hobbyist community.
Jameco will market each kit to hobbyists in magazines and newspapers ads, online banner ads, email marketing, Facebook, and through participation in the Maker Faire. The distributor also developed partnerships with other hobbyist organizations. Jameco already uses search engine marketing, paid search, affiliate marketing, and social media, such as YouTube, but has not yet tied these efforts into Club Jameco. Harris has no immediate plans to dive into promoting the kits on the social site, Pinterest.
Harris believes Club Jameco will assist the distributor that specializes in selling small quantities to hobbyists, to create a Mecca for thinkers. The effort is also targeting customers like high school and college students working through design challenges related to robotics and other sophisticated electronics.
One hobbyist at Jameco combined origami skills with LEDs to create a Mother's Day bouquet. The flowers, made with paper, light up with color LEDs. This kit provides an example of how people, other than engineers, can create designs and earn cash.
And while Harris declined to provide Jameco's investment for the project, he called it “significant.” The Website and royalty programs become the first projects in a long line to build out the Club Jameco. The distributor plans to launch the project at the Maker Faire on May 19, but the site goes live on May 18. Club Jameco membership is free.
That is wonderful concept. Designer will love it. I hope to many wonderful product coming out of this model.
Well, I agree with you, it seems also the trend started initially by our needs for customizing personal objects, including electronic devices and transfering similar attitude to microelectronics, right way for doing that should be to conceive special pack for delivering of gitfing. As Laurie reported, especially for young people, there are several possibilities for providing creations, ideas or attending contexts with the chance for receiving payments which could allow them some indipendency from parents, in a such way.
Hi, Laurie
“Harris has no immediate plans to dive into promoting the kits on the social site, Pinterest.”
I don't believe Pinterest is a good place for the kits. Of course I might be wrong. I am just skeptical about the usefulness of the site for this particular project.
-Susan
I think this is a pretty cool program as well; as is element14's efforts in DIY. In general, electronics distribution is bridging the gap betwwen the stuff you'd buy at Radio Shack and the 'industrial” side of things. There's no reason why hobbyists and modders shouldn't buy from this channel–I just don't think anyone really reached out to them before.
Kind of cool thing for all the interested electronics engineer out there looking to sell their ideas.
Hi Susan,
I was skeptical about Pinterest, too, until recently. Pinterest is a great place for kits because each pinboard would highlight the components that comprise the kit. The photos of the components click-through to the manufacturer's website to provide more information on specs. The site is purely a marketing machine. Once Pinterest integrates ad targeting, the boards will pretty much provide the data to create audience segments for targeting.
Hope this helps.
Laurie
It will be interesting to follow up and see the type of people interested in buying and building the kits — gender and age group. And, how Jameco markets the kits to the masses.
Well, in my opinion there is an additional aspect to consider and it is about on line distributors for customizing, at the beginning business cards and so on; as of today they are migrating in allowing the on line design and customization of friendly objects, especially kits for home or personal (micro-devices). I believe they could act as an additional player of this game.
This is a very interesting and fun idea. Encouraging a ground up swell of design involvement might just be that innovative idea to start a new trend. I look forward to seeing how others respond to this development.
It is a great way to identify new talent. Not every designer/developer gets recruited in a reputable firm. However, designing components is not an easy task. It requires considerable hardwork. Many will backout due to the risk that their design might remain unsold and their hardwork goes drowned. Plus there isnt long term job security in the task until many companies like Jameco step into crowdsourcing designs.
@Laurie, thanks for the informative post. I feel this is an excellent community to learn, design, sell, teach electronics projects. I will definitely register with this community.
Plus there isnt long term job security in the task until many companies like Jameco step into crowdsourcing designs.
@Waqas, true. I feel this portal is win-win for both the designers and suppliers. Its helps designers to sell their idea and suppliers to sell their products. I hope we will see more innovative product being created by this portal.
@ tirlapur
It is a win-win situation for only the developers that get successful in selling their design. For those developers who put their hardwork in and dont get their designs to be sold, their hardwork is drowned. Nevertheless, we can be hopeful that many distributors and other members of supply chain will be able to step into the crowdsourcing projects and make this model a way for designers to get paid well without tolerating the painful process of recruitment at firms.
It is a win-win situation for only the developers that get successful in selling their design.
@ WaqasAltaf, I dont think success can only be measured by money earned. I am sure this portal will help many of the designers to improve their design skills because they can interact with other designers too.
@ tirlapur
Ya you are right that money isnt the only measure. Designers will learn a lot too from the experience and competition. However, component designing while following extensive guidelines with a probable end result of your design being rejected can make you extremely disappointed when you are not rewarded. In case of a hobby, this might be acceptable as money wont be the only source of satisfaction.
This looks to be a good idea. The individual designers can get a platform weher they can generate business without the associated financial investment.
How will the intellectual property rights handled in such a scenario is however not clear
Hi Praabhakar_deosthali: Jameco said both designer and the distributor would hold the rights. Greg (Harris, Jameco VP of sales and marketing), perhaps you can elaborate.
Best,
Laurie
A very inovative idea i must say, and a great opportunity for young designers to have their products on the market.
Another great benefit is being able to get customized kits that makes it easier for a DIY enthusiast to find something very close to what they need.
On the part of hte designer, anyone coming here should understand that it is more than just cool designs, but meaningful designs. You can create anything that makes you feel good, but if its not relevant then no one will buy it. I think it would be a good lesson for designers, most of us think that once we've spend alot of effort in creating something, then everyone else must want it.
crowd sourcing, funding has been a big trend in the past year or two. The main reason is the amount of people that are willing to invest small amounts of money (starting with Obama's 2008 campaign).
This is a different approach but it also looks for the social aspect of the World we live in.
Great idea that offers people scope for creativity and a bit of profit.
This model has helped me understand the concept of “crowdsourcing” better. Whne I first saw the term, it was very confusing on how the process actually works. This may be one of the simpler applications of crowdsourcing, but I get the idea.
I honestly didn't give a second thought to the term crowd sourcing in the article, had to go back to look it up.
It is my first time encountring the term too, and i think its just a great model, and yes this is a unique implementation of that model.
I think this is one of the best uses of crowdsourcing that I have seen. Great idea, indeed. This will certainly help the company come up with out-of-the-box ideas that their paid engineers may not have been able to think about.
I think intellectual rights management will be important. If the original designers do not get to keep the patents and do not get the royalty for their products, they may not find it attractive enough to participate. They may want to launch the finished product themselves because that may be a better option financially.
Hi, Laurie
Do you believe that people are going to log in to Pinterest to click-through to the manufacturers Websites?
-Susan
Hi Susan,
I don't believe people will specifically log into Pinterest to click on an image, but yes I do believe if they're in the site they will click on an image they like. Marketers and businesses need to prepare for that click through by developing well optimized landing pages attached to those images.
Laurie
Laurie,
What makes me skeptical about all this Pinterest issue is that the site started as a place where people could have “collections” of their favorite things all grouped under categories, but still a hobby place. If marketers start tranforming the place in a marketing arena, is the meaning of the site going to change? Of course it wouldn't be the first place a site transforms from its original idea.
-Susan
I don't believe that was Pinterest's original plan. Not after researching the company's investors. I believe the original plan was to turn the site into a marketing platform after they ramped up adoption, similar to Twitter and Facebook.
Laurie,
In that case, I will wait and see how it evolves. Sometimes the original plans have to be changed according to the response of the users, though.
-Susan
I truly is a great way. It helps people who don't have access to much funds. The risk of posting their idea is very low, so I will expect it to grow significantly over the years.