HOW TO OPEN STUDIO #10: Discounts: Yes or No?

Everybody loves a bargain, right?

That’s why we artists buy our supply in bulk, so we get those volume discounts. And back in the recession of 2008, all kinds of businesses, desperate for income, offered discounts to their customers.

Should artists offer discounts??

It depends. And mostly it depends on how, when, and why you offer them.

Me? The one and only time I ever offered a discount (during that same recession), it backfired. It turns out the customer asked for one, “just because” they’d read that Macy’s was offering discounts. And it turns out they just “threw it out there”, and would have bought the artwork at full price. IF only I hadn’t been feeling desperate and said, “Sure!” Oy vey.

If you believe that discounts work for you, no argument here. Just some clarity about the downside, and suggestions for actions that might work better.

1. Is cheaper always better? If it’s really “all about the price”, then trust me, your potential customer can find something similar for less. And when they do, they won’t be back. The measure of our work is how well-made it is, how much skill goes into it, and how unique it is. The story behind it, YOUR story, your personal vision. If it’s something anyone can make, there’s someone who does/will, and then it really is all about the price.  And if you say it’s worth $100, but you’re willing to take $80, then what is it really worth?? Know the value of the work you do.
2. Can you afford to offer a discount?  When we figure our actual cost in creating a work of art, we think about the cost-of-goods-sold: Our materials, our tools, etc. Most artists also factor in time, which makes sense. Except maybe it takes YOU ten hours to paint that piece, and another artist can do it in two hours. And if that other artist has a long history of followers and sales, maybe they have repeat customers who have truly earned a reward now and then. (More suggestions about this below.) And if they support themselves with their work, have to pay for a studio space, the cost of participating in events, exhibitions, shows, etc. the prices will of course be higher. Take into account the amount of money from sales that you’ll pay income taxes on, too.
3. Are your prices already too low? When I first set prices for my work, I wasn’t in any galleries or stores. My prices actually reflected my wholesale price. Once I was represented by galleries, I realized that I would get only 50%-60% of my retail price. So my prices went up. Because….
4. Are you respecting your galleries? Galleries are a powerful way to get our work in front of potential customers who can’t come to our studios.  This means we have to respect galleries for what they do for us. If we discount prices in our studio, and a gallery finds out, that could be the end of your relationship with them. Galleries, on the other hand, and with your permission, could offer their faithful customers a discount. Some even offer to take it out of their own commission. Make sure you let them know if this is acceptable, and definitely let them know if it isn’t! Even they do take it out of their profit. Again, what’s the message here? “We’re so desperate to sell this artist’s work, we’ll cut our losses!” Ouch.
5. Will a discount help me close the sale? Maybe. Tempting, right? Let’s talk about WHO gets a discount first. I would advise not offering one to a new customer. First, it’s not fair to your loyal customers, especially those who have collected your work for years. And yes, they might find out! I’ve found that people who get a bargain love to brag about it. And with social media marketing so popular now, your loyal customer might very well come across that post. The trust and integrity we’ve worked so hard to build is gone in an instant. If anyone deserves a discount, it’s our repeat customers!
6. Do discounts work? I believe they can help us make small gains in sales when we are starting out, when all our customers are new. But it kinda goes against what our work stands for: Handmade, artisan-made, implies our work reflects skill, quality, and integrity (ours)–not something you can find at a dollar store, where items are mass-produced, often in countries that don’t pay makers well, and are discounted once the shelves have to be cleared.. Discounts can work against our “brand” as someone who creates a unique body of work.
7. But I believe discounts work! Okay. But BE PREPARED. First, before you offer a discount, check with them what they’re looking for. My first (and last) discount, I offered 25%. (I was desperate.) Turns out they were hoping for 10%. Whoops. Second, factor discounts into your pricing. Always make sure you will still make a profit, even with a discount offer. It’s like “free shipping”. It feels less expensive, but you actually factored the shipping cost into your price, right?
8. But what about loyal, repeat customers? Two thoughts on that: First, I’ve learned the hard way that even a stated “one-time discount” offer registers as “forever” to our customers. “But last year you gave me a 10% discount!” “Your ad said 25% off!” (Yep, that was 6 months ago…) Instead/second, offer another incentive: If you have prints or cards featuring your work, offer those instead. Or offer smaller work to the purchase that can be added with a discount. (Smaller means a smaller amount of money ceded, or it could be a one-off you are ready to pass on to a worthy person anyway.) Or a coupon for a manageable amount to use on their next purchase. (Again, even a “one-time” coupon will register as “forever.” It’s just a human thing…) Offer a one-off, stand-alone work a direction you experimented with, but decided not to pursue. For one new collector, I offered to come to their home and talk about the piece for a small gathering of their friends. (It closed the deal, but they didn’t take me up on it.) I have a fellow artist who borrowed my car to deliver larger works to their customers. (Only twice, I have a boxy car, and they came to my rescue several times in difficult situations at my old studio. I’m glad to repay their kindness by helping them offer an incentive to a customer!)
9. Is it really about the price? It’s common to assume that when a potential customer is hesitant about purchasing our work, it’s about the price. That’s when some of us jump to a conclusion, and offer a discount. But over the years, I’ve found that isn’t so. If someone is obviously interested in an item, I’ve shared the story, I’ve answered there questions, and they’re still hesitant, I’ve learned to as this simple question: What’s holding you back?  Turns out it’s something totally different: “Will it go with the new rug in my living room?” “Can I fit it in my car?” “I want it, but my budget is short this month–will they accept a layaway?” Easy solutions to address!
10. How a challenge can work even better than a discount. When someone asks if you can discount a work of art, try this highly effective counteroffer:                                                                                                                                                                       “No, but if….”

Examples: “No, I’m sorry, I can’t do that. This work represents a lot of time, skill, and care. It’s a high-quality piece that will bring you joy for a lifetime, and no one else does anything quite like I do. But if you purchase it today, I’ll give you a free copy of a magazine that did an article on me and this very piece!”

“No, I don’t discount my work. But if you decide to take it today, I’ll be happy to give a free artist presentation to your coworkers/friends and family/favorite club/guild/association.”

“No, this is one of my best pieces, and it’s fairly-priced. But if you take it home today, I’ll hold your credit card information for a week while you decide. If you return it within a week, no charge. And if you don’t return it, I’ll process that charge on (date).” The woman I offered this to? I wrapped it up, gave her all the postcards, story cards, etc. I include with a sale, and gave her the bag. And as she left, she whispered, “I don’t think this is coming back!” It didn’t. (I still waited a week, though!)

For a wholesale order for a gallery/store: “No, my prices accurately reflect the value of my work, in time and materials. But if you place your order today, I’ll rearrange my shipping schedule to accomodate your upcoming gallery event.”

The last reason I rarely offer discounts (and usually only on older pieces that have ‘aged out’ of my collection)? Because I felt like I wasn’t respecting my own artwork. If I can’t respect what I do, why do I think others should?

Do you discount your work? How? When? And for whom? Share in the comments, I’d love to hear your strategy!

If you found this article helpful, let me know! And share it with others you think would find it useful, too.

 

 

 

MAKING A DECISION and HUNGRY ART

WAYBACK WEDNESDAY A Few Days Late…

I published this post on 10/26/04. Still true!

Making a Decision

I have to make a hard decision today. I have an opportunity to do a teaching gig that would pay fairly well, a week’s work. Something I would have jumped at a few years ago.Trouble is, I’m an atypical artist. I don’t want to teach other people how to do what I do. I never really wanted to in the first place. As time goes on, and my art is more important to me, I find I’m even less interested in teaching it. I want to do it.

Running a business based on making your art sucks up a lot of time. I spend lots more time on the business side than the making art side. So setting aside time to allow other people to make art while I watch is particularly painful sometimes.

Nevertheless, it is an opportunity. And I can’t make up my mind whether to do it or not.

A friend once said, “When you have a situation you just can’t make up your mind about, make a list of the pros and cons. Otherwise, it’s like doing long division in your head.” (I originally typed “long decision in your head.” Quite Freudian!) The trick then is not how many pro’s vs. con’s. It’s to pay attention to which ones make you cringe.

Here’s what my decision list looks like.

Pros:

1) It’s a thousand dollars.

2) It’s a week’s work. 3)

It’s teaching, and I’ve always liked teaching.

4) I could really use the money.

5) The guy who asked me is really nice and excited about my work. His enthusiasm is infectious.

6) It’s hard for me to say no.

Cons:

1) It’s much, much more than a week’s work. It’s actually 8 classes, 6 per day, for 5 days. That’s 30 different teaching sessions.

2) It also means a lot of preparation time. Probably several weeks’ of preparation time, for presentations, projects, etc.

3) It’s a long drive, too.

4) The last time I did something similar to this proposal, it turned into something awful. It was the most miserable day I’ve had in my entire professional career.

5) For a variety of professional reasons I won’t get into, I don’t want to teach how I make my own artwork. I’ve made a point of not teaching how to make it, and I don’t want to start now. Even in modified form.

6) If I’m going to teach, I want to either introductory skills (with jewelry, polymer clay, stamp-carving, etc.) or professional skills (writing an artist statement, etc.)

7) It’s a month before my major wholesale fine craft show, which takes a huge amount of time and energy to prepare for. Including the two to three weeks I’d sink into this teaching opportunity if I were to take it on.

8) Other than financial, it doesn’t fulfill a single other professional, business, personal or artistic goal I have.

9) As hard as it is to say “no”, I have to say “no” sometimes in order to make room for other things that are more important to me.

As I look over my reasons, I can see that some of the cons are fear-based, As in, “The last time I did this, it turned out badly.” And there is some good to be gained—some money to put back into my business, and the opportunity to hone my teaching skills.

I can also see, though, that what I could learn from taking this opportunity is something I’ve already learned. And don’t need to do this same thing again to learn the same lesson again.

The teaching skills I want to hone are as a presenter of professional skills. Teaching my methods will not help me with this teaching goal.

I was talking with the same friend about something completely different, and she said something that’s now stuck in my mind.

I’d said I was really excited about teaching the workshops on my schedule now—self-promotion for artists,  wholesaling, writing a powerful artist statement, etc. It could be something that might conflict with my artistic/professional goals. But it didn’t feel that way right now.

I found as I prepared for this seminar, my thoughts clarified. I began to gain more insights into my own processes. While researching press releases, I learned how to make mine even better. I’m actually working out my own roadblocks and obstacles by sharing what I’ve learned along the way with others. I’ve learned more as I prepare to teach.

She said, “I’ve found that I often teach what I want to know.”

Such a simple phrase, but very useful today.

I’m going to have to call that very nice gentleman and refuse his generous offer. I hope I can think of someone else who might be able to fill the slot, someone who would be grateful for such an opportunity, who finds it a better match for where they are in life. As nice as I’d like to be, I need to be kind to myself, the artist, first.

HUNGRY ART (follow-up to the above post.)

A few people e-mailed me after yesterday’s blog entry, to ask how the decision had gone. This is how:

I thanked the person for the opportunity, said no, and offered to pass on the name of another person if possible. And this morning I did just that. I thought of another artist who might work well, and contacted both parties with information about the other. I really hope this works for both of them.

Another e-mail from a former student commented that she was spending a lot of time buying art materials and playing with them, but wasn’t actually making much art. She sounded like she has the right attitude, though—“All in good time, all in good time,” she said.

It’s natural to hit fallow periods where the art doesn’t come easily. Julia Cameron, in her book “The Artist’s Way” calls these periods “filling the well.” They are necessary and can be very productive, healing times. Playing with new materials and new ideas often leads to exciting new developments in our art.

And some people don’t feel the need to go any further than this. Their art is truly a pastime, something pleasant and enjoyable.

If you begin to feel a nagging sensation, though, a “could” rather than a “should”, maybe it’s time to impose a little more structure.

I started to do something this morning, and realized some of our pets hadn’t been fed or given fresh water. I thought, “I’ll get to it after I eat breakfast.” And then stopped. No. They are dependent on me for their physical needs. I need to take care of THEM first. And I did.

Our art has the same dependency on us. The unique vision we have as a unique person, a unique artist, cannot come into the world except through us. It sits and waits, sometimes patiently, sometimes anxiously. If you ignore its need to exist too long, however, it will come crashing through. “FEED ME!!”

Don’t let your art get too hungry today.

THE 3D CONUNDRUM: Decisions about Discounts and Donations, Part 2

This says it all.

 Luann Udell
This post is by Luann Udell, regular contributing author for FineArtViews. She’s blogged since 2002 about the business side–and the spiritual inside–of art. She says, “I share my experiences so you won’t have to make ALL the same mistakes I did….”  For ten years, Luann also wrote a column (“Craft Matters”) for The Crafts Report magazine (a monthly business resource for the crafts professional) where she explored the funnier side of her life in craft. She’s a double-juried member of the prestigious League of New Hampshire Craftsmen (fiber & art jewelry). Her work has appeared in books, magazines, and newspapers across the country and she is a published writer.

This is a continuation from last week’s article, click here if you missed Part 1.

Donating to art auctions is a tricky business. These are not the ones we see in movies, where people get into a bidding war about how many millions they are going to drop on a Van Gogh. People going to art auctions are looking for a deal. Charity auctions can be the best for them, because a non-profit may not offer a minimum bid. I’m only gonna say, I’ve never seen a doctor, lawyer, or dentist offer their services valued at thousands of dollars for free (to the charity.) (Maybe they would, if it’s tax deductible. But we already know that artists’ work is NOT tax deductible at full market value, only the cost of materials.) (I think that’s changing, but not soon enough.)

So my new rules of the game:

1.     I rarely donate my work to any auctions anymore, even if I love the cause. If I do, it’s because a) they will set a minimum bid, equal to what I would have gained from a consigned piece in a gallery; and b) a lower-priced piece, such as a print, a piece of jewelry, etc.

2.     I limit such donations to x number a year, and I decide months ahead which groups I’d be willing to donate to.

3.     If an organization is pressuring me to donate, I tell them #2 above, and tell them I’ve already chosen the ones I’ll donate to this year. If they still want my work, they can ask before next year’s auction. It’s surprising how many don’t follow up with that. (As in, none.)

4.     I have, and will, give my work to someone I sense really really needs it. (I go by intuition, which isn’t solid, but it’s all I got.) Again, usually something small or not too expensive.

5.     But I never give work to people who ask for, or even demand free work. (And yes, that has happened.)

These boundaries were created because this is what happened to me, and how I felt afterwards, and how it feels even in the moment. Your choices, and your results may vary.

But before you donate a major piece, a quality piece, to a fundraiser, and you are not offered at least your wholesale/consignment price, I would urge you to do this:

6.    Do your research! Go to that event first. See who’s there, see who bids, and see how much they bid. If they truly want to support that organization, and they are truly your audience, then, in a perfect world, they should be willing to pay full price. Because then half the money goes to the organization, right? And they have a wonderful piece of artwork at no additional cost to them.

7.     But if they are looking for a bargain, if you see people complaining because they had to bid so high, they only got half-off the price, they are not your audience.

8.     And go ahead, ask a few attendees what they’ve purchased in the past at these events. Ask them if they went on to collect more work by those artists…or not.

9.     Even high-end galleries offer discounts. Sometimes the galleries cover the discount, sometimes the artist shares half the discount, too. But I would argue that discounts should go to loyal customers, ideally people who return regularly to buy either more of your work, but minimally, to regularly buy work from that gallery. Otherwise, it’s like those hugely-annoying discounts to new magazine subscribers, rather than offer a discount to longtime subscribers. Why not reward the people who have committed to us, who support us every year, instead of those who will cancel as soon as the rates return to normal? And if a return customer keeps coming back for more, it’s probably time to raise our prices!

10.    On the other hand, when people ask US for discounts, think about what our representing galleries would think of us if we agree. I’m guessing they would not be happy about us underselling our work when they are asking full price. And we can share that with the discount-seeking customer: “I would jeopardize not only my integrity, but ruin the relationship I have with a gallery that has done right by me for years.”

11.   Finally, there are other ways to reward a loyal customer, or sweeten the pot with a new one. You can offer a giclee print of your work, a package of greeting cards with your art images, or a similar, small item in your inventory. One artist hosts a special “brunch/soft opening” of new work in their home to a small, select group of collectors. You can give them first dibs on new work at an open studio. You can offer to deliver and perhaps even hang the work (if they live nearby). Or you can offer to visit their home and give an artist presentation on your work to friends and family. Have you created other ways to thank your collectors? Please share!

As I said earlier, this is my personal experience, and my personal take. And please feel free to share what worked for you, and even what didn’t work for you. If you’ve found discounts and donations to work for you, please share your story! I am an eternal student of life, and I’m always happy to change my mind if the “other side” is truly compelling to me.

If you got value from this article, please feel free to forward this to someone who could also benefit. And if you’ve received this from someone else, and enjoyed it, you can sign up at  Fine Art Views for a variety of author views on art marketing. Or sign up for more of my articles at: LuannUdell.wordpress.com

THE 3D CONUNDRUM: Decisions about Discounts and Donations, Part 1

Luann Udell discusses discounts and donations on your artwork

9/17/2019 9:32:31 AM by Luann Udell
23 Comments
Topics: advice for artists | Art Business | FineArtViews | Luann Udell | pricing artwork | art auctions

This post is by Luann Udell, regular contributing author for FineArtViews. She’s blogged since 2002 about the business side–and the spiritual inside–of art. She says, “I share my experiences so you won’t have to make ALL the same mistakes I did….”  For ten years, Luann also wrote a column (“Craft Matters”) for The Crafts Report magazine (a monthly business resource for the crafts professional) where she explored the funnier side of her life in craft. She’s a double-juried member of the prestigious League of New Hampshire Craftsmen (fiber & art jewelry). Her work has appeared in books, magazines, and newspapers across the country and she is a published writer.

It’s your choice, there are pros and cons, and it’s okay to do what’s right for YOU!

I have to admit, I’m totally at sea about discounts.

First, I love to get them, but I hate to give them. (Human nature, people, don’t judge!)

Second, my experience with them was problematic at best, and humiliating at worst. And rarely satisfying.

My first art donation was to an art auction in Boston many, many years ago. It was an annual event, and for the life of me, I can’t remember who benefited from it. It started as book illustrators donating work–for which they’d already been paid. This year, they opened it up to other artists and fine craftspeople. I put in one of my early art quilts, hoping for good exposure to a crowd of buyers who presumably appreciated art work.

I drove two hours from Keene, NH to attend the reception. I was surprised but delighted to see many people from the law firm I’d worked at before we left Massachusetts: Lawyers, the firm’s office manager, partners. (Don’t get excited, I was a lowly member of the secretarial pool, sent to new lawyers to the firm to transcribe/type their tape-recorded briefs.)

I chatted with several of them, but quickly realized they were having a hard time switching from seeing me as “lowly office worker” to “artist.” It got worse.

There was a “minimum bid” on the artwork but it was pretty low. Maybe one-fourth of the retail value. One person, viewing a beautiful, handmade child’s bed quilt (and I mean beautiful, quality sewing, pattern, and use of color) fell in love with it. But they said they just didn’t want to pay for even the minimum bid for it. (Trust me, even at full price, it was underpriced.)

This person made a lot of money. A LOT of money. And they were complaining at purchasing this high-quality work for $150.

I was so angry, but I pulled myself together and gave a little presentation on the piece. “This is an amazing work,” I said. I pointed out all the marks of quality, and gave an estimate of how many hours had probably gone into the piece. “It’s worth every penny of the FULL price, and would bring your child many years of enjoyment. But….” I added, “I get that handmade fiber art is not for everyone.”

And then I left.

When I looked back, they were looking at the quilt more carefully. I drove home fuming, but glad I’d said my piece and at least stood up for that artist’s work.

Years later, my first exhibiting at a high-end retail fine craft show, two people came into my booth, and one of them fell in love with two of my fiber works. They wanted a discount if they bought both.

Fortunately, the show had a strict policy about sales, discounts, and seconds. As in, NO. I shared this with them, and again did a brief summary of my process.

And my heart fell as they walked out the door.

I was devastated. But after talking with another artisan, I realized that, hard as it was to lose a sale, any sale, I would not have been happy with taking that offer.

And a few hours later, they both returned, and the person bought both pieces! Full price! Their friend had waited til they left my booth, and cajoled them into coming back. “You love them, they are reasonably priced, and they will look amazing in your home!” Hallelujah!

A few more years later, at the same show, a (problematic) acquaintance came into my booth, looked at all my work, and declared, “I want a piece of your work. But I’m disabled, so I’ll need a discount, or we can trade for my work.” (Actual quote, and no, not all people living with disabilities say stuff like this!)

I said I couldn’t do that, and did a brief recap of everything that goes into my work. I also said I had huge expenses that year, as my child was starting college, and I couldn’t afford to trade. (BTW, you can steal this quote, or your own version of it, if you don’t want to trade with someone!) “But I have some lower priced work over here, that might fit your budget.”

They bought the lower priced work. Hurrah!

A few years later, a couple came into my booth (same show) on opening day. They fell in love with a big work. After much discussion, one of them said, “Will you take $$ for it?” It was amounted to 25% off.

I was desperate for income that year. My fiber work doesn’t sell quickly. So I offered 10% off, and they took it. I wasn’t happy about it, but at least I had a sale!

As I wrapped it up, I mentioned that I don’t offer discounts very often.

“Oh,” said the husband, “I’ve never asked for one before. But I read in the (famous newspaper) last weekend that it never hurts to ask for one, even at stores! So I thought I’d try it, and it worked!”

So the guy was willing to pay full price, decided to try out a discount offer, and I, insecure artist, accepted it.

I did not like the taste in my mouth. Still don’t. (I did not say anything to them along these lines, just smiled, ran their credit card, and thanked them for their purchase.

This last bit hurts so much, it’s hard to write about. Same show, years later. A couple walk by, see my work, and chatter excitedly together. They come in and share their story:

“Did you have a piece at such-and-such a show in Boston blank years ago?”

Yes, I did.

“We bought your piece! We love it!”

My heart started to lift as they raved about it. Maybe they wanted another???

“When it came up for bidding, no one bid on it! Absolutely no one! We couldn’t believe it! We bought it for $25!!” (I’d had it priced around $500, which was still underpriced.)

“We got such a bargain! Well, we just wanted to let you know!”

And they left without even signing up for my mailing list, or taking a damn postcard.

So here we are, between a rock and a hard place.

Tune in next week to read about the boundaries and strategies I turn to when I’m asked for a discount or donation.