How to Price Artwork for Beginners

In Art Collecting, Artists

Art is always considered an aspect present and influential in human life for the longest time ever. Over time, art has been used to shape society in different ways, such as criticizing, enjoying, and appreciating different things and people. Furthermore, art is considered crucial to society since it helps in preserving memories from one generation to another. The art aspect has always been considered crucial in educating people. Some artists, practice as a hobby while others attempt to make the pursuit a full-time career. Since art is considered as commercial products in the market, it is important to consider establishing strategic prices to attract customers. A study conducted by Sharma (2020) argued that the market is characterized by different forces which the seller needs to consider before setting prices for his/her products. In pricing art, a new artist needs to understand that there are no correct set standards for artwork pricing. This article focuses on providing a basic framework for how new artists can price their first work.

Pricing Your First Work

First-time artists are faced with numerous challenges in ensuring penetration of their products in the market. Unlike experienced artists, beginners are faced with increased challenges of ensuring their product penetrates the market. In the art market, there are different marketplaces whereby the products can be sold after it leaves the studio. For instance, the product could be sold through the gallery in an online platform, open studios, art fair, or agent. Like other businesses in the market, the art industry has been heavily affected by Covid19; therefore, it is crucial for first time artists to establish a unique platform for their products. In real market places, the products are bought and sold to different parties, depending on their quality and marketing quality. In most cases, the market always dictates the prices of different products. Similarly, the art prices, whether from the first-time artist or experienced artist, are not pulled off the air, but they are determined by the market.  A study conducted by Chen (2020) said that pricing artwork is one of the complex tasks for the emerging artist. Further, the study established that most artists price their products based on their emotions, thus complicating the whole process.

The artwork pricing always varies depending on the factors considered when setting the prices. For instance, some beginner artists overprice their work with the objective of impressing their viewers by making their work look more valuable. Sometimes, this strategy might work for some artists, but there are increased chances of facing contrast forces for overpricing (Angelini & Castellani, 2018). In contrast, the majority of new first-time artists who set their product’s prices under emotions tend to underquote the products hence making them feel sorry once the buyer spends more on the Artwork. Therefore, through such confusing moments, the beginner artist is always supposed to remain considerate when setting his/her prices. Further, they need to ensure that they remain objectively when setting the prices for the market. (Meckes, 2018) With the emotion and anxiety aside, here is the best simple formula which the beginner artist can adopt in setting competitive prices in the artwork market. 

A study conducted by Elena (2016) argued that the pricing formula of Artwork helps in reflecting the products’ position and reputation on the market. For instance, if there are more buyers of your products than for the competitors, it is either you have underquoted the price of your products are high quality but sold within competitive prices. The study suggests that it is always crucial to ensure that your products are affordable when starting out. Selling at affordable is totally different from making a loss. Thus, first time artist is always supposed to ensure that their products are sold at a small product which helps in sustaining the business.  In setting the prices, the beginner artist is supposed to separate feelings and emotions from the facts. Even though it is always complex and hard to separate feelings when setting the prices, the artist is supposed to ensure that potential buyers like the prices (Angelini & Castellani, 2018). Unlike other businesses, Artwork involves time, creative efforts, and emotions, thus increasing the chances of investing them while setting the prices. In pricing, first time artists are supposed to adopt different formulas, such as the sizing formula. This formula deals with physical attributes, thus reducing the chances of personal values.

In reality, there is no new artwork as there is related art already in the market. This similarity in size, shape, medium, or color et cetera could help the artist to set a much competitive price for their art. A study conducted by Elena (2016) argued that artists are not living in a vacuum; therefore, the art must have a relationship with already existing products, therefore; thus connection could facilitate setting effective prices. Although this technique looks easy, the beginner artist is supposed to be open-minded and focused on creating uniqueness on the products, thus creating a similar or higher experience to customers for them to charge the same way to competitors. In most cases, this approach would be considered the most appropriate, especially to the first-time artist with minimal sales experience. For instance, the beginner set the price based on factors such as material costs, time, and labor costs. Under this, it is always crucial for artists to define the market (local or international market), customers, and distributors. Secondly, the artist is supposed to consider their nature and physical traits. Again, the artists are supposed to establish the industry where his/her Artwork fits well and establish similar products under such industry through an online search, open studios, among other selling venues. By establishing such products, the artist is then able to compare the prices of various artworks then set a good estimate as to the initial price. After setting the price, the artists are supposed to remain consistent with the prices, thus attracting and maintaining customers (Leko Šimić, 2019). Further, the beginner artist can consider a different pricing technique, such as size formula. A study conducted by Chen (2020) considered the artwork size formula pricing strategy as the most accurate and perfect mechanism to set competitive prices in the market. For instance, the size formula involves multiplying the paint width to length, thus leading to overall size either in square inches and meters. For instance, assuming that the oiled landscape medium paint of 16” by 20 “is sold in the market by the bigger artist. The artist can decide to offer her product at $6 per square inch; therefore, the price for the above product would cost (16*20*6) $1,920. This formula is considered effective and simple as every unit is sold in a specific unit. Generally, this is not the only formula way of pricing. The artist can also set prices based on material and labor costs. For instance, the material could cost the artist $400 in wholesale. After considerate consideration, the bigger could decide to sell the final paint double cost the price of materials. Therefore, the price of subsidized paint could be $800 (400*2). Through the formula pricing strategy, the artist is always able to consider different factors involved during the whole art activity, thus setting the real price. In maintaining relevancy, the arts are supposed to maintain the price consistent to give room to a greater reputation for the products. Thereafter, the price can be shifted positively depending on the marketing demand and economy (Elena, 2016).

Importance of pricing 

The Artwork is among the intellectual works that have remained relevant in the market since ancient times. Similar to other products, the prices of arts are determined through forces of demand and supply. The art developers depend on their arts to earn a living, making pricing an integral part of the entire art development process. With the increasing supply and price pressures in the art market, the right pricing approach is attached to numerous benefits, including ensuring that the arts remain competitive in the market (Rekettye, 2011). Arts bring the developers the value they deserve for their products and secures the profits they require to invest in change and development. The art developers must be consistent and honest with their price levels to attract and retain a large customer base. More importantly, they should implement cost-cut initiatives regularly to increase the efficiency of their sales.  

Pricing is essential to artists because it represents artists’ assessment of the quality client see in their arts and are capable and willing to pay for the arts. While the other marketing mix elements remain relevant in art marketing, price is the element that impacts artists’ income, and hence, what they earn as profits (Leko Šimić, 2019). Price can lead to their demise or survival in the market since, like other businesses, they require enough capital to keep their business continuing. Price adjustment has profound effects on the art’s marketing plan and is founded on the price elasticity of the arts in the market; it often impacts the products’ sales and demand. Typically, the price that is too low or high tends to limit growth, and incorrect pricing can negatively influence the cash flow and art sales (Piercy, Cravens & Lane, 2010). Therefore artists should ensure they fix price for their items at the right level following thorough market research and evaluating factors affecting market prices such as competitors’ market penetration strategies, market situations, and production cost. 

Another importance of pricing is that it creates the first impression. Typically, price is the first factor that a client notices about the art of any other product. While clients may base their end purchasing decision on the overall art’s benefit, they are more likely to compare arts’ prices with their perceived value to evaluate their worth (Meckes, 2018). After learning the price, customers move on to learn about the qualities of the items. If art is priced too high, customers may not be interested in knowing more about them. However, if they feel that the prices are reasonable, then they can decide to get more information about them. Therefore, the pricing attracts customers’ interests in the arts and guides them to price their arts fairly to attract customers and make huge sales. More importantly, pricing is an essential factor in sales promotion. Despite being the most flexible marketing mix component, price is an essential component of sales promotion (Meckes, 2018). The art developers can encourage mass purchases by revising art prices downwards but should not fluctuate the prices too frequently to encourage more sales. 

Pricing enables first-time artists to compare the cost of inputs and the value of arts in the market. First-time artists may not be aware of the best market price that makes them maximize their profits. Through pricing, the artists can establish the idea profit attracted by each art and plan accordingly (Piercy, Cravens & Lane, 2010). The artists can revise prices for their products upwards or downwards, depending on the market behavior. For instance, the cost of inputs is too high; they may decide to search for an alternative source of relatively cheap inputs instead of revising prices upwards. As previously mentioned, high prices discourage customers from buying. Therefore, it would be more sensible to look for cheaper input sources rather than increasing prices to maximize profits (Sharma, 2020). However, with there being no source of cheap inputs and guided by the fact that art prices are generally high in the market, the artists can increase their prices a bit but be sure not to go over the prevailing market price. 

Pricing is a competitive weapon that can help first-time artists to exploit market opportunities. Like other businesses do when introducing new products in the market, artists can use pricing techniques to exploit new market opportunities. This includes setting prices at a level different from those existing in the market and observing customer reaction to the price. The customer may or may not be attracted to buying the arts. However, it must not be forgotten that other than the price, the arts’ quality will determine the clients’ purchasing behavior. Therefore, if setting the prices relatively high than the prevailing market price, then the artists must ensure that the arts are of high quality and appealing to customers (Leko Šimić, 2019). More importantly, new artists can consider inventing unique arts and setting a different price to study customer behaviors. Therefore, with pricing, quality, and uniqueness of arts, the new artists can easily exploit new marketing opportunities and strategically plan them within the art market. 

Lastly, pricing is essential in choosing arts according to customers’ financial capabilities and needs and making consumers confident about their purchase value (Sharma, 2020). Through pricing, new artists can study customers’ preferences in terms of their art needs and financial abilities. This implies that if customers are interested in relatively inexpensive arts, then the artists should focus on developing the arts that meet such needs. Therefore, pricing gives the artists the actual picture of the art market, forcing them to focus on developing arts that meet the customers’ value and financial needs (Rekettye, 2011). As previously mentioned, there should be a direct relationship between the arts’ value and price. Often, customers require honesty in business. If the quality of the products rhyme with the price charged, the artists are more likely to win the customers’ trust, ensuring high demand that translates to more sales and increased profits. However, suppose the price is high, and the quality is poor. In that case, that destroys customer relationships with the business, making it hard for customers to develop trust with products offered by such a business.  

Conclusion 

From the above discussion, it can be established that beginner artists always have a long way to go before their product penetrate the market. In ensuring effective market penetration, the artist is supposed to competitive pricing in different ways. For instance, he/she is supposed to compare the artwork price for similar products in the market, then set prices basing average pricing. Also, the artist can set an effective price by using a pricing formula that considers different aspects such as time, labor, and material costs. After setting, the prices, the artist is always advised to keep the artwork prices consistent for a specific period to increase product reputation. Further, he/she is supposed to adjust the prices depending on the economic performance and other factors such as demand. These pricing strategies are helping the seller in exploring new markets. Again, it can be used by customers to gauge the quality of your products. Therefore, it is crucial for new artists to set competitive prices for their products in the market to call for easy market penetration.

References

Angelini, F., & Castellani, M. (2018). Understanding the artwork pricing: some theoretical models (No. 17-25).

Borowiecki, K. J., & Greenwald, D. S. (2018). Arts and culture. Handbook of Cliometrics, 1-24.

Chen, L. H. (2020). Artwork Pricing Modeling by Grey Theory and Application Verification. International Journal of Uncertainty and Innovation Research2(2), 115-133.

Elena, C. (2016). Art Criticism And Analysis As Factors Affecting Artwork Pricing. Annals of marketing-MBA, 3.

Leko Šimić, M. (2019). Book review” Pricing. The New Frontier”. Ekonomski vjesnik: Review of Contemporary Entrepreneurship, Business, and Economic Issues32(1), 245-246.

Meckes, R. (2018). The Importance of Pricing. Simon-Kucher. Retrieved 7 November 2020, from https://www.simon-kucher.com/en/blog/the-importance-of-pricing.

Piercy, N. F., Cravens, D. W., & Lane, N. (2010). Thinking strategically about pricing decisions. Journal of Business Strategy.

Rekettye, G. (2011). The increasing importance of pricing. E. Hetesi, & ZS Kürtösi, The diversity of research at the Szeged Institute of Business, 13-22.

Sharma, M. (2020). Importance of Pricing in Marketing Strategy. Your Article Library. Retrieved 7 November 2020, from https://www.yourarticlelibrary.com/marketing/pricing/importance-of-pricing-in-marketing-strategy/49106.