These past couple weeks I’ve been helping several of my clients raise their prices. It’s a really emotional step for an artist because we are so worried about making our art unaffordable for people (a totally valid concern, no matter what all the other art business experts tell you). So over the next few posts, I want to talk some about why you raise prices, or set them in a certain spot in the first place, and how to know if it’s time to raise your prices or not.
Let’s dive in.
There are a number of things that might prompt a raising of prices.
Traditionally in the world of business, you raise your price when your demand (the number of people wanting to buy your product) exceeds the supply (the number of products you have). This is a red flag that you have the opportunity to raise your prices, but there are other more subtle indicators that it might be time.
When I teach artists how to price their art, we always start with their target market.
It’s so crucial to know who you’re selling to in order to price well. If you don’t know who you’re selling to, no matter how you price your art you’re just playing a guessing game. There’s nothing intrinsically wrong with the guessing game (I like to call it a business experiment) but it does mean you won’t sell as well and it will take you longer to make the income you want to make and to build your business.
So one reason you might raise your prices is if you realize that your target market expects to spend more on art (notice that I didn’t say they’re “willing to pay more” which is an okay reason, but certainly not compelling for most artists who are trying to avoid gauging their customers for all they’re worth).
This is an under-examined part of the art buying process.
Collectors (and casual art purchasers too) have a certain expectation for how much art should cost. Depending on their personality and current life circumstances, they may want to pay less than they expect, exactly what they expect, or more than they expect. Most often, people who are open to buying art – which usually feels like an unnecessary luxury – are in the latter category of wanting to pay more than they expect the art would cost.
Why? Because of how it makes them feel.
When you spend a lot of money, you feel like you’re getting something of incredibly high quality. Most collectors want to purchase high quality art (and other things in their life as well). It might leave them with a bad feeling if they go out to eat and order the cheapest thing on the menu. That makes them feel cheap. And the same happens with art. A collector wants to feel like they can afford something high-end. They want to treat themselves. They want to feel like they have great taste – and the price tag reflects the quality of art, and thus their taste level. (More on that in the next post.)
So when you’re picking a price, and potentially raising your prices, you need to think about how that price will make your customer feel.
Think deeper than “this bar of soap costs less than this bar of soap”. You’re not selling soap. You’re selling art, which is a very emotional purchase. Put yourself in your customer’s shoes. Does your customer want to buy something for a great deal and hang it on their wall and proudly proclaim to guests how little they paid for it (they might – some target markets are like this).
Or does your customer want to spend some money, feel like the art is worth that money, and proudly display it on their wall as an example of both their taste level and their monetary success?
Most markets will pick the second one. Though if you ask them, they’d say somewhere in between.
Never ask your customers what they would spend for art.
Imaginary dollars and real dollars are very different and customers are notoriously bad at predicting their own future buying habits.
Back to the point. Your customers don’t always want to spend as little as possible to get great art. And you have to keep your customers in mind when you’re pricing your art, or your art won’t sell.
Match your price to your target market.
This is part 1 in a 3-part series on pricing art, leading up to a more thorough online lecture I gave on July 9th, 2015. The recorded lecture will take you through my favorite method for pricing art and all the components that go along with that so you never question your prices again. You’ll get immediate access to a recording of the lecture when you sign up over here.