PRICING YOUR ART THE RIGHT WAY Part III: Constructing and communicating your price
In the last two blunders we discussed the importance of calculating ones base expenses and all-around financial needs on a monthly basis and the concept of added value. Today, I’d like to combine the two and take a deeper look into how various models can help us to set fair and consistent prices for our work.
First of all, we need to acknowledge a very important fact; the pricing model we use to determine our value shouldn’t necessarily be the same one we use to communicate that value to others. Not to be misunderstood, I don’t mean that we should hide such info or act as we’re beyond money — the main problem here is semantics.
While it might be preferable for a contractor that comes to fix our heating or helps us build our house to disclose his or her hourly price and estimated expenses, so as we don’t end up either broke or hospitalised due to a heart attack after picking up the bill, doing the same in the arts isn’t exactly the best way.
There of course are bad examples of how prices are communicated (or even, not communicated) — some galleries for example don’t disclose prices because they never know if somebody would be willing to pay more than they or the artists would like to get from any particular work.
But many techniques and practices in the arts revolve around a very important fact: the collectors and buyers of art are not looking for contractors and price breakdowns, they’re looking for remarkable experiences at (hopefully) reasonable prices.
And because of this fact, the communication of a price should not look like the tab of a restaurant, but more as an organic part of the whole artistic experience — even at christian churches, they have fancy rituals like tithing that are integrally connected with the whole ritual of mass.
So, first of all, we’ll take a look at the various internal pricing models to use for our art and then we’ll package them neatly and fairly so as to make our communication with potential collectors and buyers smoother and most importantly more professional.
PRICING BY THE HOUR
This model has a lot going for it — especially for anyone starting out — as it is the easiest to use in order to determine how we’re going to make the minimum amount we need to make, for our business and personal life to flourish and even eventually come to the point, where art becomes our full-time profession. But it has a lot of problems, too!
Setting it up is simple; we find a fair hourly wage (we calculated this in the first blunder of this series) and calculate how much time we spent on making the work. Then we just multiply both and hopefully what we get is a decent number that won’t make us starve to death. Easy.
This option may be good for any classical portraitists or realistic style painters and sculptors, as it reflects the labour intensive work of creating realistic depictions, and communicates the sheer number of work hours that one puts into making such works.
But it gets problematic for anyone that makes abstract paintings that only take about a day or sometimes a few hours to complete (especially if they’re big ones); this isn’t a realistic approach and a different pricing structure should be used if you work quickly — especially if the speed at which you are able to work is based on a lot of years of training.
Though you could brag to your fellow artist friends that your hourly wage is 400€! Just don’t tell anyone how many hours there are in a work day — or year for that matter!
There’s an issue with such an approach to pricing art though; you just don’t base the price of a Rothko on the number of man hours he and his assistant put into any particular work — and you don’t compare him to Raphael or Tizian either.
Also, if we just compare a Pollock vs. a Rothko; the Pollock’s price is inflated solely because of his story — let’s face it, the art part isn’t that great — but a Rothko actually is exceptionally well made and the concept behind his works only enforced his quality, effectively making him one of the most expensive painters of his era (and in my opinion rightfully so, but I’m a blotchy painting fan boy, so I’m not being unbiased here).
My point is: Any pricing model that depends solely on the work and/or materials input, but does not consider the added value of the artist’s skill, background, or any other trait of the creator, that differentiates them form anybody else who could’ve attempted to create a similar work (and the varying levels of success any one of us could have had — compared to the original creator), must be taken into account when pricing our work.
Art is a commodity (at least in our price bracket), but it’s never without the added value factor that actually creates the experience of it being art vs. just a pretty picture. If indeed all were making were pretty pictures with no stories and no added value to be uncovered by the right audience, we would be artisans — I’m not saying this is better or worse, but our goals and pricing structures should absolutely be different from those that don’t actively produce narratives around their work.
To put it simply; a decorative pretty flower print is worth as much as the paper and colour it was printed with, combined with the work that went into it and maybe a 10% mark-up because, I don’t know, the printshop manager felt like it.
A flower painting made to embody the profound sensual experience of the flower petal and that was actively imbedded into the then contemporary flow of culture and time — like Georgia O’Keeffe’s work for example — will be worth as much as the market deems this particular experience of artistic expression valuable in the context of not only her time, but ours and the totality of what we think has happened in human existence and how it all relates to the story her work is telling us.
As we have figured out in the last blunder on added value and worth, the reality is, this is how art is valued. To be honest, it’s how everything ever made is valued, at least by any average human that has their basic needs met — a person dying of thirst will indeed not give one damn about the perceived difference between generic tap water and a crystal flask of pure Evian.
(Fun fact: Try reading Evian backwards and think about this particular product being extremely overpriced — compared to other, similar quality products.)
So, pricing by hour is great if you work a decent amount of hours, but bad for anyone that works quickly. But there’s a variable we can use to adjust this issue:
PRICING BY SIZE
Similar to the hourly-based model, pricing by size focuses on the physical aspects of ones work, but unlike the former, does not base the value on the time spent creating the work and as such only focuses on the finished product — rather than on the process.
I find this perspective especially useful when making my abstract paintings — they usually take less than a day to complete but are equal in quality to anything more realistic in my opinion, because the time spent on one such work is incomparable to the effort spent on something as complex as mimicking natural forms.
But just because abstraction doesn’t take that long to create, doesn’t mean it’s crap compared to realism (my guess is, we’re opening pandoras box now); both realism and abstraction require a lot of learning, skill and attention to detail in order fo any one artist to produce a quality product, but often a realist work will take a long time to complete (especially if you put a lot of effort and energy into shading and texture work).
And because it takes a long time, the process is divided into a myriad of small steps — easy to do and simple to fix if done incorrectly (unless you spot a mistake in the proportions or composition only long after you’ve painted 80% of the work).
But the process of abstract painting (or sculpting, drawing, etc.) isn’t as segmented; you really only do maybe 10% of the amount of steps compared to a realist portrait, but as such the steps you have to take are larger and harder to fix if done incorrectly.
It’s not hard to fix weirdly painted eyes (even though it might have taken you 60 minutes to get them to that point), but it’s incredibly hard to fix a badly executed bold brushstroke — think of Cy Twombly’s pantings; I don’t like his work, but one can imagine that if the last stroke on his white canvas was badly executed, he couldn’t just correct it by painting over it — he’d have to start all over again.
You can think of it as risk, really; a slow, controlled process like realistic portraiture isn’t risky, just time consuming (think of all the videos of people drawing realistic portraits; they always segment the work into small batches and almost never work on the face as a whole).
But a fast-paced process like abstract expressionism (again, think Rothko, not Pollock), is quick, semi-controlled and chaotic; the percentage of bad paintings that are created and then binned by abstract expressionists is exceptionally high, but quite low for realist painters.
So, what the price-by-size model compensates for is exactly this difference; time vs. amount of risk. It would maybe even be better named as the risk-evaluation model, but I think such a funky name wouldn’t really cater to us creatives as I guess it makes a convoluted topic like compensation even more foreign — we’re not financial analysts, our games are played with crayons and paint tubes, not Bollinger Bands.
To give an example of a price-by-size approach: In Slovenia, a 50 x 70 cm painting averages about 400€ (I know…). 50 x 70 cm is 3.500 cm2 and to make it short, a square centimetre costs about 0.10 € total.
This 0.10€ can now be used to define prices of any other works we do, so a 100 x 100 cm painting would then cost about 1000€ (and yep, again that’s the average price in our beloved country).
But while prices for larger works are easy to calculate like this, it gets tricky for smaller ones; an A4 work would cost about 63€ (if calculated like this), but the average is about 100-150€, because to sell a work for 60€ is effectively akin to giving it away.
That is why a good practice for this model is to start with a base price; a set amount to which we then add our price calculations. Call it studio fee, or base cost or whatever you like, the point is to always start at 50€ or 100€ (or any other number that works for you) and then add to that the size calculated price (I usually make an average of my material costs and call that my studio fee — mine’s 100€ — then add the total material costs for that particular work and the size calculated price on top (effectively doubling my material cost reimbursement, which has many times helped me cope with unexpected material expenses I forgot to calculate into my price, but as it was my mistake could not add to the final sales price at the end).
The point is: Never forget to add you material costs to any model you use!
The smaller works will always cost more than you spent on them and as such, selling them will make much more sense, but the base price won’t affect your larger work as much (an A4 sized work will cost 200% more if a studio fee of 100€ is added, but a 100 x 100 cm sized work will only cost 10 % more if 1 cm2 is set at 0.10€).
Now, there are other ways of calculating price, these two are the main ones I use and therefore the only ones I feel adequately comfortable discussing as I have tried them extensively throughout my time working as an artist.
You could also price your work by value to the customer for example, but such a structure is more commonly used in design (because with design, the value created for the customer can be much more easily measured). So as far as visual art is concerned, I myself like to stick to size and time variables form my pricing structures.
But if you work with a lot of advertisement agencies or businesses that create a lot of value form you work, value based pricing is probably the best way to go; think if you worked on an advertisement campaign that used your paintings or a licensing deal, where a company would use your drawings or paintings as designs for their products.
If this is the case, the best way is to have a long and thorough conversation about what the company you’ll be working with has in mind, how much the audience size will be and what they wish to make (they might not give you this information on a sliver platter, but most will be willing to talk about it if you’re persistent enough and ask the right questions — or more importantly aren’t afraid to ask such seemingly unrelated and direct questions.
To really establish a good price based upon the potential value created by our art, we need all of the info we can get, because without it, it’s impossible to pinpoint the ballpark of how much we should charge — let alone an exact number.
COMMUNICATING OUR PRICES
We’ve talked about setting our prices by the hour and calculating them via size and base fees, and touched upon value based pricing. Now it’s time to tie it all together and package it up into an easily communicable and (this is important) easily replicable model.
The easiest and most straightforward way is to just add-up all of our expenses, base fees and pricing model of choice and end up with some rounded-up number, but a bit of tweaking can make our prices a lot more understandable and transparent to our customers.
I always divide my prices into two main segments; the value of the materials I use and the value I bring to the table (so the price of me making a painting, rather than somebody else).
To just touch upon material costs; it’s a great idea to talk about the materials we use and to give a little bit of context about how much they actually cost.
A lot of people do not know that high-quality acrylics cost a fortune and if we can explain to them that the paint we use is future proof (most brands say that they won’t crack or fade in direct sunlight for at least 100 years if not more) and the canvas of a high quality.
So, just quickly describing the value that such materials have, compared to the cheap ones, can not only make the higher material costs understandable to anyone who may not be aware of their prices, but also provide a lot of peace of mind to anyone, that has never bought art before.
From my personal experience, people do value the information that the work they are buying is made with quality materials, because while they are of course buying you and your story, that story has to be embedded into something (the art work) and it’s preferable that it ages better than an open milk bottle on a summer day in Florida.
As for the artist fee; this is where I use my price calculations and base fees to determine its amount. The important thing to keep in mind here is that nobody cares how you structure your prices — and as we said, usually telling people the exact mechanics of your pricing will actually devalues your work!
We all know that prices need to originate from some place (preferably a consistent one), but I feel that as soon as somebody tells me they charge 500€ for their work, based on some simple size calculation, it subconsciously devalues the experience of their art for me.
What I mean by this is that while all the pricing structures we use focus solely on the product and thus make determining the price much easier for us (especially when we need to give a quote on-site), the end goal of our art isn’t just to make a product.
The main factor is actually the experience that it provides for our customers. And if we do not address this experience as part of our evaluation for the customer, they will deem it unimportant — when in reality, it’s the most important one!
How I tackle this issue is by roughly calculating my price via one of the two models I use (mostly I do price-by-size, as most of my commissions are abstract paintings) and add my base fee and a varying markup percentage — this only changes if I am doing work for a friend (because I know they won’t sell the work and as such I don’t fear such price inconsistencies affecting my market price as a whole), but thinking about sales to friends and family and having a “discount” preprepared for such occasions just helps me stay consistent with my pricing.
So, after I have my price, I tell them the whole number as my fee; I don’t discuss the ways I calculate it, I do not defend it or try to persuade them in any way if the price quote I gave is too high. We might sometimes haggle a bit, but usually I only do so when making more than one work.
I feel a large order deserves a bit of flexibility but I would never give discounts to my customers (especially on commissions) — I might let some older work go for less than what I want if it turns out there’s no demand for it though.
Giving discounts only teaches people to ask for one every time we make business and nobody wants to be known as the discount artist.
Posted from my blog with SteemPress : https://survivingart.com/2019/09/14/pricing-your-art-the-right-way-part-iii-constructing-and-communicating-your-price/