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Robert Genn on pricing

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Marilyn Kaminski
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Robert Genn on pricing

Postby Marilyn Kaminski » Wed Feb 18, 2004 9:43 am

This week's Genn newsletter struck a note with me. Useful advice to all of us!

http://www.painterskeys.com/letters.asp?let=040217

I'm still pondering the advice on "price only on size" -- maybe it applies more to painters than it would to glass artists?

- Marilyn

Cynthia

Re: Robert Genn on pricing

Postby Cynthia » Wed Feb 18, 2004 11:38 am

Marilyn Kaminski wrote:This week's Genn newsletter struck a note with me. Useful advice to all of us!

http://www.painterskeys.com/letters.asp?let=040217

I'm still pondering the advice on "price only on size" -- maybe it applies more to painters than it would to glass artists?

- Marilyn


Genn's 10

Thou shalt start out cheap.
Thou shalt publish thy prices.
Thou shalt raise thy prices regularly and a little.
Thou shalt not lower thy prices.
Thou shalt not have one price for Sam and another for Joe.
Thou shalt not price by talent or time taken, but by size.
Thou shalt not easily discount thy prices.
Thou shalt lay control on thy agents and dealers.
Thou shalt deal with those who will honour thee.
Thou shalt end up expensive.


If quality of craftsmanship and the artistry are at the same level...A 20 inch bowl with premium glass and 400 hours of work has to sell for the same price as a 20 inch bowl with inexpensive glass and 40 hours of work. To the customer the value percieved when comparing one piece to another is more attached to size and they don't know how much work or the cost of materials went into one versus the other...nor do they care me thinks.

Good article. Thanks for sharing it.

Dennis Brady
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Postby Dennis Brady » Wed Feb 18, 2004 1:08 pm

Agreed.

The key to pricing is perception. The customer doesn't know and doesn't care how long it takes to make something. They care only what they perceive it's worth. Most believe bigger is worth more.

The customer isn't entirely wrong in this attitude. How long it takes for an artisan to make something varies substantially from one to another. Some are slow - some are quick. The biggest difference between an amateur and a pro isn't quality - it's speed. Pros work much faster than amateurs. An amateur might take 40 hours to do something a pro can easily complete in 10. Regardless of which artisan makes the work, the customer should only be expected to pay for 10 hours work.
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Bert Weiss
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Postby Bert Weiss » Wed Feb 18, 2004 1:36 pm

I totally agree with this outlook. It is one reason why I value my big kiln. The amount of time that it takes me to cut out a rectangle 78" x 20" is maybe several seconds more than the time it takes to cut out a 12" x 12" square. The cost of the larger piece of glass is about $25 more (for me in 10mm float). The 12" piece is worth about $75 after kiln work. The larger piece is worth $1200... Even if I were to cut out 11 12" squares which is a lot more work, they still aren't as "valuable" as a larger slab.

one aspect of good design is about maximizing precieved value and minimizing process requirements. Works for me.
Bert

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Paul Housberg
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Re: Robert Genn on pricing

Postby Paul Housberg » Wed Feb 18, 2004 4:58 pm

Marilyn Kaminski wrote:This week's Genn newsletter struck a note with me. Useful advice to all of us!

http://www.painterskeys.com/letters.asp?let=040217

I'm still pondering the advice on "price only on size" -- maybe it applies more to painters than it would to glass artists?

- Marilyn


Looking at Genn's work, I suspect the time it takes to complete each painting of a similar size is pretty consistent. (Dare I say it appears rather formulaic.) For work that is essential similar, then pricing by size probably makes sense.
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Suzan
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Postby Suzan » Wed Feb 18, 2004 5:01 pm

Bert Weiss wrote:I totally agree with this outlook. It is one reason why I value my big kiln. The amount of time that it takes me to cut out a rectangle 78" x 20" is maybe several seconds more than the time it takes to cut out a 12" x 12" square. The cost of the larger piece of glass is about $25 more (for me in 10mm float). The 12" piece is worth about $75 after kiln work. The larger piece is worth $1200... Even if I were to cut out 11 12" squares which is a lot more work, they still aren't as "valuable" as a larger slab.

one aspect of good design is about maximizing precieved value and minimizing process requirements. Works for me.


I understand the reasoning for this and the above comments, but it makes me sad. This kind of thinking may lead people (myself included) into spending time and effort in developing cheaper & faster working methods, rather than focusing on the artistic intention of the work, and then finding ways to achieve the design.

But I do wish I had a bigger kiln :badgrin:

Cheers,
Suzan

Bert Weiss
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Postby Bert Weiss » Wed Feb 18, 2004 5:38 pm

Suzan wrote:
Bert Weiss wrote:I totally agree with this outlook. It is one reason why I value my big kiln. The amount of time that it takes me to cut out a rectangle 78" x 20" is maybe several seconds more than the time it takes to cut out a 12" x 12" square. The cost of the larger piece of glass is about $25 more (for me in 10mm float). The 12" piece is worth about $75 after kiln work. The larger piece is worth $1200... Even if I were to cut out 11 12" squares which is a lot more work, they still aren't as "valuable" as a larger slab.

one aspect of good design is about maximizing precieved value and minimizing process requirements. Works for me.


I understand the reasoning for this and the above comments, but it makes me sad. This kind of thinking may lead people (myself included) into spending time and effort in developing cheaper & faster working methods, rather than focusing on the artistic intention of the work, and then finding ways to achieve the design.

But I do wish I had a bigger kiln :badgrin:

Cheers,
Suzan


Susan

Perceived value works both ways. If you put a lot of work in to a piece and it looks fabulous, it could compell a buyer to pay the big price. The catch is that just because you put all of that work in to the piece, it doesn't always result in "perceived value"

The idea is that the buyer cares not an iota what you had to do to create the work. They want to feel that their money has bought a piece that moves their imagination. They won't be bragging to their friends that the artist made 10 firings to get that look.
Bert



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Geri Comstock
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Postby Geri Comstock » Wed Feb 18, 2004 7:00 pm

I've been pondering this all morning because the advice to price like-sized items the same makes no sense to me...

Take it out of the realm of glass work and think about a woodworker. If s/he made a table out of pine that was the same size as a table made out of ebony, would they sell for the same price? Of course not! Pine is one of the least expensive woods and ebony is one of the more expensive woods.

Or a jeweler makes 2 identical rings out of sterling silver and 22KT gold. Would they sell for the same price? Of course not...The current price for silver is about $6.60 and the price of gold is around $410.

In both of these cases, the difference in the cost of materials is a factor that has to be considered in pricing similar sized items made from the same material (in these examples, wood or metal).

As for glass, a piece of unfired dichroic costs as much as 50-100 times more than the same size piece of float glass. Just as BE costs way more than float glass.

Most people know that 22KT gold costs way more than silver, so they don't have a problem paying more for a gold ring than an identical silver ring. Most people also are aware that pine is significantly less expensive of a wood than ebony so they'd be willing to pay more for the ebony table.

This isn't the case with glass yet, though. Our job is to teach our customers the difference between work we make with various kinds of glasses so we can charge realistic prices for them.

My $.02....

Geri
Last edited by Geri Comstock on Wed Feb 18, 2004 9:59 pm, edited 1 time in total.

Carol B
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Postby Carol B » Wed Feb 18, 2004 9:52 pm

Geri Comstock wrote:
As for glass, a piece of unfired dichroic costs as much as 50-100 times more than the same size piece of float glass. Just as BE costs way more than float glass.

Most people know that 22KT gold costs way more than silver, so they don't have a problem paying more for a gold ring than an identical silver ring. Most people also are aware that pine is significantly less expensive of a wood than ebony so they'd be willing to pay more for the ebony table.

This isn't the case with glass yet, though. Our job is to teach our customers the difference between work we make with various kinds of glasses so we can charge realistic prices for them.

My $.02....

Geri


Bingo Geri.

But I have one more thing to add. I sell mostly jewelry, most of it made with dichro. My profit margin is much bigger in jewelry items. I have found that my customers are willing to spend much more per ounce on a piece of personal adornment than they are a dish, tile or wall art.

I am a member of an artists cooperative. Most of the members are painters in various mediums. I have to say I agree with the article....when it comes to painting the bigger it is the more they will pay for it. I wonder if it comes from the Costco mentality. If there is more of it I must be getting a better deal.

I have found this discussion very interesting and am going to share the link with my co-op gallery members.

Carol

Dennis Brady
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Postby Dennis Brady » Wed Feb 18, 2004 10:37 pm

I think the key isn't so much size as "perceived" value.

This can be used to your advantage. Making it larger is one way. Customers do usually equate size with value. Adding embellishments is another way to improve profits. Often you can add some small thing that doesn't take much time but looks as if it did. Using materials of high perceived value is one of the best ways to maximize profits. As pointed out, customers are willing to pay more for gold jewelry then for silver. It doesn't take much more time to work in gold then in silver, so why bother working in silver?

Perhaps the major problem with trying to convince customers to pay higher prices for work done in higher priced glass is they don't seem to place as high a value on that glass as we glass artisans do. They don't believe it's worth more. I've tried experiments with work in Spectrum alongside almost identical work using Uroboros or BE and found the customers were as likely to choose Spectrum. My greatest shock was how many prefer cathedral to opalescent glass.

Real value is irrelevant. Only the perceived value matters when you're selling. It's not for us to "educate" the consumers, but to respond to them.
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Postby Susan Moore » Wed Feb 18, 2004 11:50 pm

Dennis Brady wrote:I think the key isn't so much size as "perceived" value.

This can be used to your advantage. Making it larger is one way. Customers do usually equate size with value. Adding embellishments is another way to improve profits. Often you can add some small thing that doesn't take much time but looks as if it did. Using materials of high perceived value is one of the best ways to maximize profits. As pointed out, customers are willing to pay more for gold jewelry then for silver. It doesn't take much more time to work in gold then in silver, so why bother working in silver?


As to customers perceiving a higher value for gold - it is higher in value, as Geri pointed out it is about $400 per ounce more expensive than silver. Customers are willing to pay more for gold because they know it costs more. Why work in silver? - it is more affordable and very, very popular.

Susan

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Postby Jackie Beckman » Thu Feb 19, 2004 2:47 am

Customers do usually equate size with value. Adding embellishments is another way to improve profits. Often you can add some small thing that doesn't take much time but looks as if it did. Using materials of high perceived value is one of the best ways to maximize profits.


You know Dennis, you have valid points in some of what you say in your posts, but I think you tend to speak more from a "gift-shop" sort of perspective. Not just what you've written here, but in a previous post about one of a kind pieces, etc. I hate to see a true aspiring artist take what you have to say too seriously without pointing out that it's just your opinion, and one based on a completely different sort of market. I believe what you say to be true based only on your particular experience and venue. For example:

My greatest shock was how many prefer cathedral to opalescent glass.


May I list some folks who might disagree? William Morris, Dale Chihuly, Toots Zynsky, Klaus Moje, Janusz Pozniak, Preston Singletary, Mel Munsen, Marvin Lipofsky, Flo Perkins, Deborah Horrell, Mark Zirpel, Scott Chaseling, Paul Marioni, Sonja Blomdahl, Claudia Borella, Kathleen Sheard, Lee Lyon, Steve Klein, Matthew Curtis, Carole Perry, Jessica Loughlin, Giles Bettison, Brock Craig, Marty Kramer, Avery Anderson, Jane Bruce, Amy Schleif Mohr, Jun Kaneko, Doug Randall, Catharine Newell, Amy Buchwald, Jackie Pancari, Kirstie Rea, Bob Leatherbarrow, Cynthia Oliver, oh yeah - and me. (My apologies to the tons of other artists I forgot to mention who find some level of success using opals in their work)

Let me just say that I don't think anyone is fooling the collectors by "adding some small thing that doesn't take much time but looks as though it did"

It's not for us to "educate" the consumers, but to respond to them.


Really? I couldn't disagree more.

Lets face it Dennis - half of what you write you do so in hopes of getting someone to bite at your bait. There you go, you got one on the line.

Jackie

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Postby Paul Housberg » Thu Feb 19, 2004 10:07 am

Geri Comstock wrote:Take it out of the realm of glass work and think about a woodworker. If s/he made a table out of pine that was the same size as a table made out of ebony, would they sell for the same price? Of course not! Pine is one of the least expensive woods and ebony is one of the more expensive woods.

Or a jeweler makes 2 identical rings out of sterling silver and 22KT gold. Would they sell for the same price? Of course not...The current price for silver is about $6.60 and the price of gold is around $410.....

...Most people know that 22KT gold costs way more than silver, so they don't have a problem paying more for a gold ring than an identical silver ring. Most people also are aware that pine is significantly less expensive of a wood than ebony so they'd be willing to pay more for the ebony table.
Geri


True, BUT, the materials represents only a portion of the cost, say 25% maximum (rule of thumb). And the cost of a lesser material still costs something. So, in the end, how much do differences in materials actually affect the cost, 10%, 25%, 50%?

There are exceptions of course. A diamond is a heck of a lot more than a rhinestone. And dichroic is a lot more than float, but in actual practice—and I can only speak about my own work—I've found that considering all the factors that go into pricing, labor, overhead, materials, etc., similar kinds of work tend to fall within a relatively narrow price range.

I don't price exclusively by size (my work is all architectural) but, I can use a square foot range with reasonable accuracy. I keep pretty good notes and at the end of a project I'll compare the quoted price with the actual costs.
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Postby Bert Weiss » Thu Feb 19, 2004 11:18 am

The key to this discussion is the notion of "perceived value" The public does perceive that diamonds are worth more than Cz's and gold more than silver. They also are impressed by sparkle and size. Dichro sells well because it has sparkle, not because it is expensive for glass artists to purchase.

The bottom line is that some works of art contain a factor that is compelling to buyers. When you got it, you got it, whether it is from size or sparkle or content or color... The catch is that Picasso had it and so does Chihuly and Thomas Kincaide...

I'm laughing at Jackie's post because my years in stained glass basically turned me off to opalescent glass.
Bert



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Postby Paul Housberg » Thu Feb 19, 2004 12:34 pm

Bert Weiss wrote:The bottom line is that some works of art contain a factor that is compelling to buyers. When you got it, you got it, whether it is from size or sparkle or content or color... The catch is that Picasso had it and so does Chihuly and Thomas Kincaide...


Interesting set of examples, Bert. Picasso: provocative, challenging, often beautiful, never pretty. Chihuly: decorative, accessible, beautiful, often pretty. Kincaide: pure schmaltz (though skillfully executed). IMHO

And each found a market for his work.
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Postby Dennis Brady » Thu Feb 19, 2004 1:58 pm

They all succeeded by producing something the marketplace accepted.

Perceived value is about what the market accepts - not about what the producer expects. The value of anything is determined by what a buyer is prepared to pay. If an artist prefers to work with opalescent glass but the buyer prefers the crystalline look of cathedral, then cathedral glass is worth more than opalescent. That the buyer sets the standard is a fundament of economics. Art is no exception.

Trying to "educate" consumers is like trying to herd cats. The harder you try, the more likely you'll fail. If consumers could be educated, nobody would be scammed into paying so much for diamonds.
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Postby Cynthia » Thu Feb 19, 2004 3:33 pm

Dennis Brady wrote:They all succeeded by producing something the marketplace accepted.


Oh help me please. #-o Kincaid produces what the pedestrian market accepts. There's lots of financial success there, but not much art integrity. And again, forgive me, but Chihuly also produces what the market will accept...but his work has a stonger foothold in legitimate art and art historical concerns than does Kincaid and has a legitimate place in the financial successes as well as the foundations of art...

But Picasso? He and his contemporaries were anything but acceptable in their day. What they were doing was cutting edge, pushing the limits of acceptable far beyond acceptable...and pushing the limits of art although well founded in formal concerns, which is why they achieved art success...but I doubt you can say Picasso was a huge commercial success. Do you see the difference between commercial popular success and formal art based success? I don't know how you can put Kincaid, Chihuly and Picasso in the success category in the same ways in any sense of the concept.

Your experiences as a retailer and wholesaler of production works aren't necessarily applicable within the concerns of art and marketing art. This isn't a value judgement, it's simply different markets with very different concerns. I think we are talking about a broader range of work than simply the gift trade. Perhaps that is why it gets so difficult to discuss these concerns. The markets, audience and venues involved, and the work being discussed is too diverse to make such generalized statements. You can't talk about pieces of art with the same set of criteria as you do a floral formed piece of baroque, or what formula works in a gift venue vs. a gallery setting.

I"d like to ammend my earlier statement about pricing according to size. My work within the same series will be like-priced by size...but not compared to the same size and similar work of another artists. Jewelry is a whole 'nother animal, but makes a good example. Pricing according to material is common and expected for jewelry...but one piece of work by jewery artist X that cost exactly the same to create as a similar piece by artist Z will not necessarily fetch the same price. The difference in value will lie in the level of artistry achieved, good design and good crafstmanship. These factors will translate into higher recognition, value and hopefully demand which comes about by appealing to the expectations or desires of an arts savvy or educated consumer. If you aren't interested in the achievement of unique artistry and it's rarity as a one of a kind, then you may be more prone to purchase a production line piece (which may very well be an acievement in artistry, but is less valued than an indivudual and one-only kind of piece. Simply a different market, but very different concerns exist here about value, percieved or real.

Trying to "educate" consumers is like trying to herd cats. The harder you try, the more likely you'll fail. If consumers could be educated, nobody would be scammed into paying so much for diamonds


That doesn't give them (us, since we are consumers as well as producers) much credit. You have some good points, but you talk as if jewelry, minerals, canvas, posters, crafts, fine crafts, and giftware are all the same thing and are created and marketed using the same paradigm. I can't go there, this concept simply isn't applicable across the board.

My grumpy two cents worth. I bite so readly. :lol:

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Postby Amy Schleif-Mohr » Thu Feb 19, 2004 3:36 pm

Ok Dennis,

I think you are contradicting yourself when you say that it is not our (the artists) responsibility to educate the consumer but to respond to them. Then you go on to say that the consumer accepted Picasso.

If we (artists) are supposed to respond to the consumer then we will always be playing catch up. This doesn't make sense. I personally create my work because that is the language I am most comfortable using. Then through various means I am developing a market for it to be heard. One of the means I use is education. I just reciently had an opening where I spoke with several people about my work and the number one question was how did I do that. The consumer wants to be educated. Personally, I don't blame them, because if I'm going to spend several thousand dollars on something I better know what I'm doing. I know because I educate myself.

I think all this is dependent on the price point of the piece. I'm not going to care as much if I buy a $20 suncatcher than if I spend $2000 on a piece of art.

Amy

Dennis Brady
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Postby Dennis Brady » Thu Feb 19, 2004 5:09 pm

It makes no difference what you produce or what you price it at. The price a buyer is willing to pay will be governed by the buyers "perceived" or "believed" value.

If people are willing to pay a higher price for a work done by Picasso or Chihuly, it's because they believe the work is worth more than something done by someone they've never heard of. Recently someone bought a painting for a few hundred dollars because they believed it was worth that price. An appraisal determined the painting had been done by Rembrandt. Now everyone believes that painting is worth tens of millions of dollars. What changed? ONLY the perceived value.

Whether it's a trashy imported trinket, or a unique and exceptional piece of art, the selling price is determined by the buyer's perception of value. If you want to alter your prices, you'll first have to alter the buyer's perceptions.
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Postby Geri Comstock » Thu Feb 19, 2004 5:26 pm

And the way that artists change people's perception of the value of something is by educating them.

Geri


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