How to Price Your Art - Resources for Artists

Below you can find SUMMARIES OF DIFFERENT APPROACHES TO PRICING ART

Whatever the market will bear: A market led approach to pricing which tries to find the price which ensures a piece will sell. This usually involves testing out different price points to find the one which maximise sales. The results will depend on the channels used to test prices.

Based on comparable art where I live: the artist studies prices displayed in local galleries and other places where art is sold and finds a comparable artist in terms of media and/or subject matter and relates prices to these. Success with this strategy depends on whether or not the baseline artist is selling work and how much a reputation earned over years has been factored into the price they charge.

Based on comparable art on the internet: the artist looks at what else is available on the internet and picks an artist or group of artists, notes the prices asked (or achieved at auction) and then adjusts accordingly. More astute artists search for information about the price asked which actually achieves a sale.

Cost plus (wage rate+materials cost+markup): The artist determines an hourly rate for their work, adds in the cost of materials (and matting and framing if applicable) and then adds a flat rate or a percentage as a mark-up which covers marketing and other business expenses and/or a profit element.

Price per square inch/cm: The artist determines a standard price per square inch or centimetre and applies this to all artwork. A different standard price may be worked out for very small or very large pieces. This can lead to odd prices.

Specific prices for specific sizes: This is a variation of the price per square inch which adjusts (rounds) the price to a value which sounds more like a reasonable price. It avoids odd sounding prices.

No. of hours spent on the artwork: The price is determined by a calculated hourly rate based on the notion that materials costs are incidental and the crucial cost driver is the number of hours required to complete the work. It bears no relation whatsoever to whether or not the market will pay the price.

Percentage increase each year: This approach is often used by an emerging artist who wants to grow sales income over time. The emphasis is always on relating to prices charged in previous years rather than what the market will bear or is currently paying for comparable work or input costs.

Plucked from the air: this is the "it feels like a $500 painting to me" approach. There is no obvious rationale other than a gut feel and/or a wish to avoid doing research to check out the current state of the marketplace

My mother/family/best friend says.....: Pricing based on the opinions of your nearest and dearest. Rarely, if ever, a sound basis for pricing art

Take a look at the two charts (above and below) below and note the differences in opinions between the UK and USA

The numbers 500 and 1,000 are hugely influential in terms of people's perceptions of what are the big price hurdles.

* Both produced a peak and very similar values in terms of percentage responses
* after which there was very little activity until the next price hurdle was reached.

The important point is that these are completely different prices due to the exchange rate!

POPULAR OPTIONS FOR PRICING ART

Of the 146 people who took part in the poll:

* 21% price their art on per square inch or square cm basis
* 20% have specific prices for specific sizes
* 18% base prices on comparable art for sale where you live

What this says to me is that artists have tried very hard to be consistent in their pricing - in relation to size and place where it is sold.

Price per square inch/cm (21%)

The artist determines a standard price per square inch or centimetre and applies this to all artwork. This can lead to some very odd prices unless a different standard price is used for very small or very large pieces.

The advantage of the price per square inch approach is that it makes it very easy to price artwork (if you keep frames or any other additional costs consistent). It's certainly one I use as a check on prices I set for specific types and sizes of my art.

However it does tend to underprice small works and overprice large artwork. If you subscribe to the notion that price should be determined by both skills (the fixed cost) and the variable costs of the size of the canvas or paper covered (the variable cost) - as well as what the market will bear. Otherwise it's becomes a bit like pricing for painting a room!

The other problem is that it can result in some rather odd prices which people generally end up rounding to the nearest $10/£5

A number of artists commented that size was immaterial - and that in fact it was more difficult and took longer to produce quality artwork in small sizes!

Specific prices for specific sizes (20%)

This is a variation of the price per square inch which adjusts (rounds) the price to a value which sounds more like a reasonable price. It avoids odd sounding prices.

This, if you like, is the cleaned up and harmonised version of price per square inch/cm! You'll rarely find prices which are odd sums with this approach.

Casey Klahn suggested that it was very important to compute your "most sales" price point. The notion being that this provides a guideline for how you divide your time between pieces of different sizes. The more pieces you produce in the size and price range that has a good track record for sales, the more likely you are to achieve actual sales in reality.

Based on comparable art where I live (18%)

The artist studies prices displayed in local galleries and other places where art is sold and finds a comparable artist in terms of media and/or subject matter and relates prices to these. Success with this strategy depends on whether or not the baseline artist is selling work and how much a reputation earned over years has been factored into the price they charge.

This proved to be much more popular than I was expecting given that the poll was being taken by an online audience. I guess it's because many people seek to sell their art locally as well as online and consequently MUST be aware of what sort prices are being achieved for artwork in local galleries and other place selling artwork.

It's also worth bearing in mind that irrespective of where you live buyers often check out an artists prices online and they're certainly not going to be buying in galleries if they find the same or similar work online for a different (lower) price.

ALTERNATIVE APPROACHES

The three options in the middle of the pack are based on gut feel - and some research.

Plucked from the air (10%)

This is the "it feels like a $500 painting to me" approach. There is no obvious rationale other than a gut feel and/or a wish to avoid doing research to check out the current state of the marketplace

I've used this one before now and my guess is most people probably have at one time or another. But it's difficult to use this approach over time to provide a consistent basis for pricing artwork. It's also difficult to escape the fact that sooner or later we all need to do some research!

This approach works better the more you look at art and build a knowledge about how other artists are pricing their art within different marketplaces, galleries and other places for selling art. I cannot recommend too highly that you go and see exhibitions and collect exhibition catalogues!

I always go round exhibitions making notes about which works are selling and what seems to be the upper and lower limits of the range of sales - which are obviously different for different sizes and artists. I often find myself looking back at catalogues from the exhibition last year! (Which is not to say that I always agree with prices people put on their work. What I judge to be overpriced work gets a great big exclamation mark on the catalogue from me!)

Based on comparable art on the Internet (9%)

The artist looks at what else is available on the Internet and picks an artist or group of artists, notes the prices asked (or achieved at auction) and then adjusts accordingly. More astute artists search for information about the price asked which actually achieves a sale.

Just as locality played a more important role, it appears rather fewer artists than I expected base their prices on comparable online artwork. Or maybe they don't feel they have the time to do the research - or just don't understand some of the pricing decisions used by some artists who sell artwork on the Internet. I know I certainly come into the latter category now and again. I'm amazed at the number of people - with extremely variable talents - who think that the price of a daily painting is $100!

Cost plus (wage rate+materials cost+markup) (8%)

The artist determines an hourly rate for their work, adds in the cost of materials (and matting and framing if applicable) and then adds a flat rate or a percentage as a mark-up which covers marketing and other business expenses and/or a profit element.

Sounds complicated doesn't it? However it's certainly an approach which is worth using 'backwards' as it were to see how much you're paying yourself as a wage for your work. I'll do a post later this week showing you how to do this.

LEAST POPULAR APPROACHES TO PRICING ART

The options with the fewest votes might be deemed least popular. But are they?

No. of hours spent on the artwork (6.2%)

The price is determined by a calculated hourly rate based on the notion that materials costs are incidental and the crucial cost driver is the number of hours required to complete the work. It bears no relation whatsoever to whether or not the market will pay the price.

This approach had very few supporters. I'm wondering if this is because it has to prove itself as a successful approach in terms of generating sales for it to be adopted in the longer term. I'm guessing this is an approach which gets tried and abandoned by quite a few artists.

One of the things I observe talking with artists is how many of the more astute ones work out ways to speed up their art-making as they begin to realise that time has an opportunity cost - and is one of the key variables which you have a lot of control when it comes to earning money. What do you spend your time on?

Many start to adopt approaches which might reek of 'the conveyor belt' to some whereas they are in fact quite straightforward and sensible approaches to being efficient in the use of time. Such approaches can be quite simple things like gessoing 20 boards of a standard size in one go. Or even better getting the spouse, partner or responsible child to do it for you!

Artists did confess to feeling guilty for charging high prices - and getting sales - for artwork which didn't take long to do. To which my response is to ask how long have you spent working at your art so that you can work quickly and with skill?

Percentage increase each year (2.7%)

This approach is often used by an emerging artist who wants to grow sales income over time. The emphasis is always on relating to prices charged in previous years rather than what the market will bear or is currently paying for comparable work or input costs.

This was the least popular option - but that might be because if was seen as a refinement of one of the others which formed the basic approach.

It occurs to me that those people who voted for this option might well also include people who have already set prices according to 'specific prices for specific sizes'. These are typically not emerging artists but rather those who have got several years experience who have worked out which price bracket their art sells in and only need to adjust for inflation

I guess the question is will artists adopting this approach also need to adjust for deflation in the future?

Other options identified by respondents

Artists participating in the survey also identified other ways of pricing art. These included:

* Gallery guides on/decides pricing policy for an artist's work
* If the artist likes a piece a lot then it has to have a high enough price which would make a sale worthwhile!

The main reason people tend to buy a painting is "because they like it". However that needed unpacking as to WHY people like paintings

In this instance we can see PRICE IS A RELATIVELY IMPORTANT FACTOR in why people buy a painting - in the opinion of the people who read Making A Mark

Read more in this blog post - What makes somebody buy a painting? (Poll results)

Let's not forget that the price of a piece of art that you see does NOT equate to a sale achieved - unless the picture has a red spot or sold ticket next to it.

* Artists can and do sometimes price their higher than the value of the art as perceived by others ie the potential buyers.

* So the fact that you see an artist pricing at a certain level doesn't make that price correct or one that should be used as a baseline for other artists pricing their art.

If you want a baseline to measure against, it's far better to look at the prices which have achieved sales for artists of equivalent merit in the same location and selling through the same sort of venue (channel)

For more about the important of 'place' as an influence on 'price' continue reading.....

FIND OUT THE ANSWERS TO THESE QUESTIONS

1. Where do serious art collectors go to buy art? What sort of prices do they pay?

2. Where do the people who like and buy your sort of art go to buy art - and what sort of prices do they pay?

3. What are the typical prices being achieved for your sort of art at the place you want to use to sell your art?

4. Is there is a minimum price (defined or implicit) in the place you want to use to sell your art?

5. What's the celing on the price which has actually achieved a sale - for your sort of art?

The same art could sell for different prices in different places.

Where you sell your art undoubtedly has the potential to influence how much artwork sells for. The company it keeps (eg other artists in a gallery or online) also affects how people perceive the value of your art. The number of people with money who frequent the place where your art is selling is absolutely critical to achieving both sales and the best price for your art. Buyers are the only traffic worth counting.

Different places where you can, in theory, sell your art are listed below.

In practice, an artist will only be able to access some of these channels. The critical question is to work out which place can generate the best result for you in the longer term.

Channels for selling artwork include:
* prestigious auction houses
* prestigious art fairs
* prestigious galleries in national cities
* prestigious galleries in local towns
* art society exhibitions in national cities
* art society exhibitions in local towns
* galleries in local towns
* art fairs in local towns
* vanity galleries (ie hire your own)
* plein air events
* local open studios
* artist's own studio
* artist's workshop
* online auction site (eg eBay)
* online gallery site
* artist's shop on major shopping site (eg Etsy)
* artist's shop on minor shopping site
* artist's own website
* artist's own blog

This next chart demonstrates the changes in the four years that I have been running this Annual Opinion Poll.
- gallery sales have increased
- commissions have wobbled
- online sales: use of eBay has declined

A few words of caution about interpretation of this poll at the outset.
* This is a poll rather than a properly conducted survey. People responding selected themselves and as such may not represent artists in general. I have no knowledge of whether or not they are professional, semi-professional or amateur artists. Nor do I know whether or not they make a living from their art or sell an occasional drawing or painting.
* Similarly the poll asked about most sales - not about which channel was most profitable.

Quite a lot of artists never crunch the numbers to work out which are their most profitable channels for marketing and sales.

Asking which is your most profitable channel for generating sales (rarher than the MAIN way of selling art may have generated a completely different pattern of results - although I rather suspect it could have been very similar. The results of the Making A Mark Polls do NOT suggest that you can set up a blog or website to sell art and resign your job tomorrow! ;)

QUESTIONS TO ASK - RE CHANNELS AND PRICING ART

Questions to ask- What makes selling on your own account more successful than the alternatives?
- Is selling on your own account "a good thing"? Why?
- Why is selling direct or via your own networks better than other options? Is it easier or more profitable or both?
- Should artists always aim to sell their art through art galleries?
- Are sales to friends or family really sales?
- What proportion of sales are commissions from friends/family?

A significant number of artists sell most of their work online - through their own websites and blogs
- Are these artists who derive serious income from these sales channels or are these artists who have sold one or two works using this form of direct selling?
- What makes a difference to selling art from your website or blog?
- Should artists pay more attention to the design of their blog/website and ease of selling via blog/website?- Do artists who sell direct get more sales because they charge less than gallery prices?
- Are artists who sell direct able to reduce the price because of lower overheads associated with the cost of sale?

A significant proportion of artists sell most of their art in conventional places where you find art sold - bricks and mortar art galleries and art fairs
- Are these responses only from people who are professional or semi-professional artists ie people who are generating serious sales revenues?
- Is this option only really applicable to art with a higher price tag?
- Once the costs of sale (eg commission and/or stand fees etc) are taken into account, are either or both of these options still considered to be both profitable and preferable?

Things to think about when NOT trying to sell art via a gallery

The main purpose of some online gallery sites is NOT about selling art, it's about making money for their owners. Their business goal is very simple - sign up as many people as possible to the site for a fee while expending the least amount of effort or money.
- Has eBay (and similar) had its day?
- Do artists now sell more or less art through eBay since the recent changes in how sales are conducted (fees and feedback)?
- Has the credit crunch affected sales via auction sites?
- What are the factors which contribute towards sales from an artists' own studio?
- Are secondary sales mainly online or mainly gallery?
- Are online sites a useful sales channel even if they don't generate most revenue from sales?
- Are online sites actually generating any significant sales for anybody?
- Which is the best online art gallery site?
- Why do so many people believe it's a good idea to belong to a group blog? Do people hosting group blogs and websites need to work harder at their stats to demonstrate how buyers arrive at an artist's website or blog?
- Do artists need to do more work to find out how their buyers found them?

Who sells via art societies - professionals, semi-professionals or amateur artists - or all of them?
- Is selling via an art society serious income?
- Or is showing art on art society exhibitions an art marketing exercise where it's nice if you come home with a profit?

Extracted from Making A Mark - What's the MAIN way you sell your art? - The Results