Effective Pricing for Multiple Marketplaces
December 01, 2009
Hello Harriete,
I just read your post "Should I link to my Etsy shop on my website?" and I have a follow-up question about one specific point you made. You stressed the importance of keeping the online prices consistent with prices in the galleries. I am always concerned about consistency in pricing from one retail venue to the next but am having trouble because different places that sell my work have different markups. The highest mark-up of my work is 250% (which seems excessively high). The buyer who marks up that much claims that this is a "standard jewelry mark up." This buyer recently saw on my Etsy shop that an item she carries is priced less on my shop because my mark up was a simple 200% mark up. I don't want to ruin the relationship with the buyer by undercutting her prices, but I am concerned that the average shopper through my online shop will be turned off by such an increase in price. Do you have any suggestions? I would very much appreciate hearing your advice.
Your website is a wealth of information. I have enjoyed looking through it and will consult it often.
Thank you in advance for your time and thoughts. Signed, Mark-up Challenged
Great Question! I think prices should be the same everywhere if possible… but I realize this is a really thorny issue.
Many stores and galleries do mark up more than 200%. Some want a 60 /40 ratio (or 60% for the store and 40% for the maker). Others usually work on a 50/50 ratio. It all presents a problem. How to keep your prices consistent?
What is true is that galleries/stores are run as businesses to make profits. They expect to make money! They have planned on their commission ratio and will also try to maintain consistency in their commissions to their artists and makers; but, everything is negotiable.
Business Relationship You have a business relationship and it is perfectly acceptable to tell your retail locations your "suggested retail price." This is the price that you should try to maintain consistently from venue to venue. The plan is that you are trying to keep your prices the same all over the U.S. to avoid pricing competition or pricing inconsistencies. Explain this to the galleries or stores that sell your work. However, it is up to the store/gallery to mark it up as they see fit. If they charge more, it is their responsibility. With the Internet, it is very easy for the consumer to compare prices. In addition, people travel quite a bit. The client/collector is likely to notice when one store or gallery charges more than other locations for the same items.
Other options As a compromise, you might consider raising your retail prices a speck on Etsy to about 225%. Another option is to make a somewhat different version or line of work for the brick and mortar locations so that they feel they have a unique body of work to sell.
Personally, I looked at your work on Etsy and I think is it very well priced. What you and the galleries are experiencing is the power and impact of the Internet. Galleries and stores used to be the only way to market art and craft. Now that artists and makers have alternatives for showing work to consumers, i.e. the web, price shopping is as easy as a push of a mouse button.
One more point. You should not feel guilty or feel like it is your fault if a store rejects your "suggested retail price." This could be the gallery's problem, not yours…but too often artists are asked to make the concessions. This is why I started the Professional Guidelines to establish professional standards so that everyone knows what is reasonable and professional.
Establish what you think is a fair retail price. You can even discuss this with your galleries and stores that carry your work. They know their consumers, but ultimately this is your decision! If the readers of ASK Harriete have another solution, please let me know or leave your suggestion as a comment.
This post was updated on January 5, 2022.