Wednesday, May 26, 2010
Pricing and Value
I've recently landed an awesome new job. I'm demonstrating the Provo Craft Cricut in my local Michaels craft store. I spent two and a bit days in Las Vegas doing intensive training in the product and sales techniques. When I interviewed over the phone - twice - for the position I was a little thrown by some of the sales jargon in the questions. I had to pause and think, which has got to be a good thing, before answering. However pauses in the middle of a sales pitch had better be brief, or the prospect might wander off without a conversion. As you can see I've been researching some of this jargon that eluded me during my interview, to be better prepped for my working days. I've also been researching the Cricut and reading on the blogs of scrapbookers and artists who use the Cricut. I've learnt that really the only criticism anyone has of the product is the price. I was asked a question about price and cost in my interview, and although I can't remember my exact words, eventually my answer came down to talking about "value", rather than "price", demonstrating to the potential client how the product has value to them. All this reading about sales, marketing and Return on Investment (ROI), and thinking about the concept of value TO THE CUSTOMER, has got me looking at my Etsy store and the objects I have for sale, and rethinking about my pricing. I make and sell a couple of decorative luxury items. My art dolls, especially the Bead Head dolls, have no practical purpose beyond the spiritual lift created by seeing and appreciating an object of beauty. The Bead Head doll currently for sale is priced at $250.00, while the eight inch Dream Star dolls are only $30.00. No one has ever complained that the Dream Stars are too expensive based on examining the amount of work involved and their pretty appeal. However evidently in these times of economic downturn, most people think two fifty is too much to pay for something that is essentially eye candy, even if it is thoughtful eye candy. I have come to realize that the process of setting a price based on how much work I have put in, how much time I took, how costly were the materials I used, leaves out the one thing that might be the most important factor - the customer's need. In my product description - my sales pitch - I have completely left out why my art doll at this price would have value for the customer, what would make this doll, beautiful as she is, worth the relatively high price to the customer. Doh! The workmanship is obvious, the photos show plenty of detail, her story is cute. But where is the value of her to the customer? Why would a customer want her in their home? What good and positive result will the customer have from having her there to look at? "She costs this much because of the time she took me," isn't much of a pitch, is it? So I'm going to be doing some brainstorming, and some more reading of product descriptions on the Etsy stores of people who are run off their feet making sales, whose items appear and are snapped up, and see what I can do better. I know "Journey" has a home somewhere out there, where she will be valued, and I just have to make sure her future owner realizes what that value will be.