Marketing is a separate line item

Marketing is a separate line item

When using pricing spreadsheets, some of them don’t include marketing costs in the formula. That means it’s lumped into overhead. This approximates something that can be pretty easily calculated.

In 2009, I worked with a consumer beverage and we established regional marketing budgets at $.25 per case sold.  For jewelry, consider this example:

10 hours spent on marketing activities per month X hourly rate of $100 = $1000

Plus hard marketing costs per month (web hosting, software, memberships, etc.) $40 = $1040

Divide that by how many pieces you produce in a month, let’s say 20

$52 = Marketing line item per piece

While it would be great to tack on $52 per piece to the price, it’s probably more realistic to distribute the $1040 across items based on their value instead of straight line allocation. And even if you don’t add in anything to cover marketing it’s a good way to look at things every once in a while so you know what costs you’re covering in overhead.

_________________________________________________________________________________________________________

THEGRAYIST.com is a collective of makers, elevating their craft and doing good. Each maker designates a non-profit to receive 5% of their sales through this channel. As the umbrella organization, THEGRAYIST.com also designates a non-profit to receive 5% of their profits. The grayist the grayist community the grayist marketplace the grayist featured artist the grayist featured item the grayist auctions the grayist give back the grayist gallery because art isn’t black or white Makers for charity Artists for charity Art for charity Artisans for charity Shopping for good Shopping for charity Cause shopping Shopping donation Best Business Practices for Creatives Visual artist entrepreneurs Successful art businesses Successful art business practices Best art business practices Easy art business practices Art entrepreneurs Art entrepreneurs best practices Best business practices for art entrepreneurs Art business startup checklist Successful art business startup checklist Best art business startup checklist Easy art business startup checklist Starting an art business from home Starting a successful art business from home Successful visual artist Successful visual art entrepreneurs Best practices for visual art entrepreneurs Successful music artist Successful music entrepreneurs Successful music entrepreneurs best practices Best practices for music entrepreneurs Best practices for music business Starting a music business from home Starting a successful music business from home Joining a marketplace Marketplace for artist and creatives Marketplace for musicians Marketplace for crafters Marketplace for handmade products Marketplace for metalsmiths Marketplace for fiber artist Marketplace for photographers Marketplace for painters Marketplace for seamstresses Marketplace for quilters Marketplace for knitters Marketplace for fiber artist Marketplace for ceramicists Marketplace for sculptures Marketplace for mixologists Marketplace for bartenders Marketplace for woodworkers

Several Words about pricing

Several Words about pricing

There are several options when pricing goods:

  • Cost-based
  • Market-based
  • Value-based

With cost-based you calculate the raw materials, overhead, and labor expenses to arrive at a number. Then you add on a profit amount and that’s the price.

With market-based, you look at comparable items and how they’re priced.  Subtract your cost and whatever is left over is your profit.

I would argue that for handmade art, value-based pricing makes the most sense.  Look at competitive offerings.  How are yours different?  What is the value of that difference? 

If you can’t immediately define the point of differentiation, know that your customers will likely not be able to do so either. 

In that case, the knee-jerk reaction might be to lower the price.  This is the beginning of the end.  Handcrafted art cannot compete on price alone. 

Understand your target audience.  They are the people who can appreciate workmanship, are willing to pay for the unique, and value the entrepreneurial nature of artists.  If you aren’t targeting this group of buyers, you’re doing a disservice to your work.

Pricing isn’t easy but it can be simple:

  • Identify your point(s) of differentiation
  • Assign a monetary value to them
  • Target your messaging to educate your customers as to why the price makes sense

Don’t be afraid of asking for what your art is worth.

____________________________________________________________________________________________________

THEGRAYIST.com is a collective of makers, elevating their craft and doing good. Each maker designates a non-profit to receive 5% of their sales through this channel. As the umbrella organization, THEGRAYIST.com also designates a non-profit to receive 5% of their profits. The grayist the grayist community the grayist marketplace the grayist featured artist the grayist featured item the grayist auctions the grayist give back the grayist gallery because art isn’t black or white Makers for charity Artists for charity Art for charity Artisans for charity Shopping for good Shopping for charity Cause shopping Shopping donation Best Business Practices for Creatives Visual artist entrepreneurs Successful art businesses Successful art business practices Best art business practices Easy art business practices Art entrepreneurs Art entrepreneurs best practices Best business practices for art entrepreneurs Art business startup checklist Successful art business startup checklist Best art business startup checklist Easy art business startup checklist Starting an art business from home Starting a successful art business from home Successful visual artist Successful visual art entrepreneurs Best practices for visual art entrepreneurs Successful music artist Successful music entrepreneurs Successful music entrepreneurs best practices Best practices for music entrepreneurs Best practices for music business Starting a music business from home Starting a successful music business from home Joining a marketplace Marketplace for artist and creatives Marketplace for musicians Marketplace for crafters Marketplace for handmade products Marketplace for metalsmiths Marketplace for fiber artist Marketplace for photographers Marketplace for painters Marketplace for seamstresses Marketplace for quilters Marketplace for knitters Marketplace for fiber artist Marketplace for ceramicists Marketplace for sculptures Marketplace for mixologists Marketplace for bartenders Marketplace for woodworkers