Clintavo's Musings on Art, Marketing, Wine and Fine Living

Why it's fine for artists to lower their prices


The wine bottle's bright orange label called out to me.  Sure, you're not supposed to judge a wine based on the label, but the little placard that Costco [1] had placed next to the bottle of Poppy proudly proclaimed a 90+ rating.  The price of $17 per bottle was a tad higher than I'd normally spend, but not unthinkable.  "Try that one," my wife said pointing right at the same bottle of Poppy with it's orange label.  Who am I to argue? Sold.

 

Poppy quickly became one of our favorites.  As a fruity, easy-drinking Pinot Noir, Poppy quickly earned a favorite spot in our wine rotation.  However, for everyday wines, I usually try to find "hidden" gems priced in the $9 - $12 range, so at $17/bottle, we didn't drink it quite as often as I would have preferred.   After a few months, I noticed that it Costco had lowered the price of Poppy to $15 a bottle.  A few more months went by and it was down to $13.50...and that trend continued until it stabilized where it is now, at $11 per bottle....perfectly within our "everyday drinking price range."

 

So, once Poppy hit $11/bottle, do you think that I marched down to my local Costco and demanded that they raise the price back to $17 or more, because how dare they ruin the value of my earlier Poppy "investments?"

 

Of course not.

 

I'm thrilled that the price has gone down, because I'm able to by more Poppy at $11/bottle than I could at $17/bottle.  I wish it would go down to $5/bottle.

 

When we're talking about wine, milk, or movie tickets, this seems obvious.  But people tend to get confused when we start talking about stocks [2] . . . or art.

 

 

Let me share something with you that I've been hearing people tell artists ever since I entered the art business in 1989:

 

"Be careful when raising your prices because once you raise them, you can never lower them."

 

Whenever anyone in the art business utters the above statement, everyone else in the room nods knowingly as if it's important, sage wisdom.  It's as if it was written in ancient, sacred texts and passed down to us through generations of wise men and women.  They nod as if thankful it has been decreed that "thou shalt never lower your art prices."  So our enlighted generation doesn't have to make that mistake.  So it is written.  So it shall be.

 

Unfortunately for the nodders, however, it's BS.

 

I have a few pieces by an artist whom we'll call Vincent Manet.  Vincent's work used to be extremely affordable and I purchased a piece.  Then he became a bit more popular, and his works went up in price, but I found another one that I love, and acquired another painting.  But then he hit the "big time", and even his little paintings are now $5,000 and up.  I really, really love Vincent's art but $5,000 is a lot of money.  So now, I must love them from afar.

 

If tomorrow, Vincent cut his prices in half, would I be upset?  Nope, I would purchase more.  Just like I did when Costco lowered the price of Poppy.

 

Sincerely,

 

Clint Watson

FASO Founder, Software Craftsman, Art Fanatic

 

PS - This article is not to tell you that you should lower your prices....nor is it telling you not to raise your prices.  But I sometimes meet artists who feel that they made a mistake in their pricing and wish to lower prices but don't because of the old "never lower prices rule."  This post is for those artists.

 

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Footnotes:

 

[1] Believe it or not, Costco has an excellent wine selection.

 

[2] Warren Buffet famously said that he likes it when a stock he owns goes down in price, so he can purchase more of it.  If you believe in a company and want to own it, then it's OK when it's stock price goes lower because you can buy more of it.  If you're simply hoping to sell your shares next quarter at more than you paid for them, then your speculating, which is a whole different discussion.

 

[3] Thanks to Lori Woodward's blog post, "State of Confusion", I remembered I had been wanting to write about this subject.  Unfortunately, I can't seem to find the link to her original post.

 

34 Responses to Why it's fine for artists to lower their prices

jack white
via faso.com
Clint,
Remember what happened to Dalhart Windberg when he dropped his prices. It almost destroyed his market. Collectors who paid $60,000 to buy one was livid when he sold the same size for half that price. They purchased for an investment. Just saying.

Art is not wine. In art we are not looking at a $5 discount, but thousands of dollars in some cases.

It's safe to lower some, but not drastically. Instead they can make smaller pieces. jack

Clint Watson
via clintavoblog.fineartstudioonline.com
You have a point, but, most people aren't in the $60,000 range.

I would rather an artist whose work I own lower their prices and stay in business and have a good career than just simply have to give up because they can't sell their work at the higher prices. Collectors must learn to consider the long term as well, even if it means their "investment" goes backwards in the short term.

I would also point out that the new people who got a Windbergs at $30,000 certainly weren't livid, and may not have bought at $60,000.

Most artists are in the under $10,000 (and even under $5,000) range, where this isn't going to be as big a deal as they think.

So my point isn't necessarily that it's always a good idea to lower prices, but that it's not a hard and fast rule as the old industry veterans make it out to be. It's something that can and should be considered if it's in the best interest of the artist's overall career.

Lastly, I do know artists who have done it and had little to no impact as far as people getting upset and did increase sales. So again, my main point is that it's not a hard and fast rule as artists are often told.



Clint Watson
via clintavoblog.fineartstudioonline.com
Just re-read your comment, Jack. Yeah it sucks for those who paid $60,000. However, this line: "They purchased for an investment."

They should have listened to the advice of people saying "buy art you love, don't buy art as an investment."

If they bought art as an investment, they were speculating. Losing 50 percent does suck, but people have lost a lot more in the stock market. People need to remember that investments go up AND down.

If those people had bought because they truly loved and believed in Windberg, they could have looked at a $30,000 price as an opportunity to get more at "half price" rather than being livid.


Lori woodward
via faso.com
Clint. Uh oh, I think I deleted the psit state of confusion because I got flack from my artist friends, a couple were very angry about my making my art more reasonably priced.

However, when I've asked "serious" art collectors what they think about prices falling, they replied with an answer much like your own... More art!!!!

Galleries are giving 10 percent off without blinking an eye. Prices have indeed come down for many artists. I'm not talking about the few at the top... Whose prices have inched up over many years, I'm talking about artists whose prices rose astronomically in the last 6 or 7 years. I believe that when the economy was hot, we had an art buying bubble.

My studio mate has never worked with a gallery. Her prices are very reasonable. She sells on her own. She has sold 65 paintings this year, and recently she raised her prices, and sales are still brisk, ut I think she was underpriced before.

I'm looking at her as an example. I lowered my prices and began to sell paintings unframed.. Older ones. I'm selling more than in recent years and still making a profit. It gets really depressing to see my work sit at higher prices.

In the meantime, I'm developing a higher level body of work for special invitational shows. These will have expensive frames and higher prices, but still way inder $5000. My goal is to make a profit but entice sales.


Clint Watson
via faso.com
Lori:

"I got flack from my artist friends, a couple were very angry about my making my art more reasonably priced."

"when I've asked "serious" art collectors what they think about prices falling, they replied with an answer much like your own... More art!!!!"

Ironic. Basically I read that as other ARTISTS telling you that you can't lower your prices but COLLECTORS are fine with it.

Why were your artist friends angry? That's what I don't understand.

Clint Watson
via faso.com
Lori, also this: "I lowered my prices and began to sell paintings unframed.. Older ones. I'm selling more than in recent years and still making a profit. It gets really depressing to see my work sit at higher prices."

That kind of "proves" my point that it can be the right decision to lower prices in some situations.

Lori Woodward
via clintavoblog.fineartstudioonline.com
Clint, not many of my friends are angry. Some don't even care what I do, but a couple of them couldn't understand why I'd want to lower my prices. They are in top galleries and think I could go that route and sell my work for much more... and maybe I could, but I'm not sure I really want to deal with selling through galleries.

I know I can sell my work on my own for lower prices, and if I entered the gallery system again, I'd have to raise my prices significantly to make the same amount of income, and it's possible that my work will just sit there. By selling on my own and keeping my prices lower, I can attract a larger audience.

I think artists get angry when they feel they are in competition with other artists for recognition and sales. They want their friends to do whatever they're doing. That's human nature.

However, I'm never going to sell in the "investment" range anyway... I can hear those artist friends getting irate with me as I say that. They think I'm being negative about my work and potential. And maybe they're right.

But if I don't really want to deal with all the hassle of getting into top galleries, who may close, and paying for expensive ads, going the high end route, that's my choice.

What I really care about is - getting my work sold and into homes of people who will really cherish it. I need to stop thinking about money all the time and get to the point where I grow to the artist I want to become, for arts sake. As long as I make a profit and grow my audience over time, I'm happy with that.

With the Internet, I have many more avenues to get my work in front of potential buyers - I don't want to sell my work for Walmart prices, but I do want it to move onto someone else's walls besides my own.

Hope that kinda answered your question. One other thing that I surmise, "Artists who work exclusively with galleries" are worried with whether galleries will survive the long term, and how that will change their careers and potential to make a living.

I'm in a good place, because I didn't let my prices go "sky high" when times were good. I also sell at heavy discounts to past buyers who bought from my galleries 10 years ago, but now those galleries have closed, and I'm free to sell at whatever prices I feel is appropriate.

As long as I make a profit.


Clint Watson
via faso.com
That's crazy. Basically what you're telling me is a few other artists, who don't even collect your work got upset because you "broke" the "rule" of "never lower prices."

And the people who matter - the people who buy your art, don't really seem to care.

Anyway, agreed - it's your choice and you can do it if you want and if it makes sense for you. Which was pretty much my point as well.


On galleries - I think we'll see a continued shrinking and consolidation in the gallery world. Galleries won't go away but will change in their focus from what they've done historically. That's a different discussion though.


Lori Woodward
via clintavoblog.fineartstudioonline.com
My answer doesn't help the artists who did raise prices and are now worried about lowering them.

Two things: If you're selling, no need to lower. If sales were doing well and now you're wondering whether to throw in the towel and quit, lower them slowly until sales pick up again. Find the sweet spot. Prices of artwork have come down - even with some very famous artists.

The old rule no longer applies. By the summer of 2010, many collectors who lost money in the stock market and in housing investments decided to put their artwork on the secondary market in galleries. A lot of the work just sat there (especially if it was by a newer artist whose prices rose too quickly in the last decade). When these collectors were not able to cash in on their investments, they stopped buying art - especially from living artists whose prices could not be proven over a long period of time.

Some of these resales are still in the galleries, and the prices of them are coming down - just in the same way that housing prices drop until sales pick up again. If the artist is living, and the value of their past work is deflating - guess what, the overall value of their work drops.

Why do folks think that art investment is different than other investments? If it ever was, it was because dealers and curators puffed it up. Now, no one pays attention to the experts - collectors know art, they are educated, and can see a ton of great art online and compare prices.

The Internet has affected the value of antiques too, so much in that what was worth hundreds or thousands of dollars 10 years ago, is not sold for half those amounts. Why? Because people can shop online and compare values for price.

The same kind of shopping is being done for artwork. Unless an artist is old or dead, they'll wait for the best deal, or worse yet, compare it to similar work - and just as good - for a more affordable price.

Any thoughts?


Lori Woodward
via clintavoblog.fineartstudioonline.com
Thanks Clint for this discussion. Yes, it's crazy.

Artists don't know whom to believe anymore. One line of advice I'm still hearing is: Raise your prices so that it raises the perceived value of your work.

Yes, there are coaches who are still using the jewelry store story about how an artisan didn't make sales until she tripled her prices. I do think that worked back in the 90's, but doesn't work now.

If my studio-mate sold 50 paintings a year for around $1000 each, she'd be making some decent money. Since she doesn't work with galleries, she gets to keep it all. She has sold 65, for less, but made way more money than I did this year.


Clint Watson
via faso.com
Yeah, well...whatever.

"Perceived value" doesn't pay the bills. Cash does. I knew a guy who believed that back in the 90's who put a price tag of $1,000,000 on some of his bigger works.

Guess what - he didn't sell anything. But I guess he consoled himself that people "perceived" his art to be worth a million bucks.

That jewelry store example is usually taken out of context. I higher price can work in a situation where it leads people to believe that the supply is extremely limited and it's a now or never thing (kind of like, in an extreme example, gas prices surge during a natural disaster). But that type of frenzy is very very difficult to create in art. You can get it sometimes in an auction setting with a room full of hundreds of collectors all bidding against each other. But normally most "regular" artists won't be able to create that kind of feeling in their followers.



Lori Woodward
via clintavoblog.fineartstudioonline.com
Quoting Clint: That jewelry store example is usually taken out of context. I higher price can work in a situation where it leads people to believe that the supply is extremely limited and it's a now or never thing (kind of like, in an extreme example, gas prices surge during a natural disaster). But that type of frenzy is very very difficult to create in art. You can get it sometimes in an auction setting with a room full of hundreds of collectors all bidding against each other. But normally most "regular" artists won't be able to create that kind of feeling in their followers"

Clint, very good points! Supply and demand.. and creating competition still applies. You are so right.

I seem to have created a higher demand for my work by lowering my prices - more folks can afford it. It's not that people don't enjoy my work, they also ask, do I really have the extra money to spend on this?

So, I totally agree with you - artists can lower their prices, and probably should if sales slow down during economic crises. For me, as an artist,having that flexibility makes me feel more secure about my career.

One other point I thought about. I know one collector that buys for investment, and is concerned that if many galleries close and prices come down as a result - that their art collection won't be worth much.

As you said, Clint, investments go up and down. I think investment type collectors used to think art was a safe haven, but they were mistaken. It's sad, but I'm sure you know as a past gallery owner and collector yourself, former thoughts and rules don't apply now.

Have you ever bought for investment alone? A gallery owner (of a well-known gallery) tells me that most everyone comes in asking if the worth of this artists' work will increase. He tries to get them away from that kind of thinking, but he says it's fruitless.

I'm wondering if collectors who buy from galleries think that galleries only carry artwork that works as an investment... if you have time, what do you think about that?

I do need to get to the easel today, but I'd like to know what you think.


Lori Woodward
via clintavoblog.fineartstudioonline.com
OK, now I'm on a roll... another question/thought..

If an artist has really high prices, then the collector is wanting proof that the price is substantiated and will retain it's value.

That sure puts a lot of pressure on artists who sell their work in the tens of thousands. They have to jump through hoops to ensure that their work is worth what they say it is.

The internet has allowed previously unknown artists, who are just as good, or even better than some of the higher priced well-known artists to gain an audience.

Galleries used to protect their artists by keeping low priced, talented artists who would compete with their top earners.. out of the gallery. But with the Internet, there's no stopping comparison shopping.

BTW: I now get more hits to my website from the daily art show on FASO than any other source. Just thought I'd share that because it's a perk that doesn't cost me any extra money.

Complex subject, but bottom line, you're right - artists don't need to follow out-dated rules. Collectors will just have to acknowledge that art prices have become flexible, and like everything else, art "investments" can go up and down.

OK, I'm gonna go paint now... so I can have more work to sell ;-)


Clint Watson
via clintavoblog.fineartstudioonline.com
I've never bought for investment alone. I used to tell people to never buy for investment because it's really hard to make any money on art....even if you're a dealer!

Most galleries take a pretty high commission to resell a work of art. So even if an artist's works go up quite a bit - you still won't make much money on most living artists.

For most people, art is a pretty bad investment from a pure money standpoint, it's not liquid, transaction fees are high, demand for any given piece is pretty low.

If someone really wants to invest in art, they need to be rich enough to buy the "dead guys" who are famous and have a fairly high-demand market at Sotheby's and Christie's.

The rest of us need to just buy art we like and want to enjoy and can afford, which gets to my point.

I have a very few pieces that,although I bought because I liked them, I thought, in the back of my mind, that they might be "OK" for an "investment". But you have to remember that I bought those when I was a dealer and I was ALREADY paying wholesale (which was 1/3 off retail on the sculpture that I own and less than 50 percent off retail on some russian paintings I own that I bought in a big bulk purchase). So, in theory, I could come out if I ever tried to sell those because I got them at wholesale to begin with.

Your average person paying retail will almost never come out from an investment standpoint and even with my "dealer's advantage" on those pieces, I still wouldn't make very much even if I sold them. (And I never would anyway unless I was desperate because I love them).

Clint Watson
via faso.com
"If an artist has really high prices, then the collector is wanting proof that the price is substantiated and will retain it's value."

If a collector ever asked me that, I would tell them there are no guarantees. An artist or dealer should never make such a guarantee. I suspect that guarantees like that are why Windberg's collectors were pissed. Some dealer probably sold them as an investment.

If you don't make a guarantee, then, yes, you might lose the sale. But you'll be able to sleep better at night knowing you didn't promise something you might not be able to deliver.

Lori Woodward
via clintavoblog.fineartstudioonline.com
Thanks Clint... really appreciate your insight and experience!


Lori Woodward
via clintavoblog.fineartstudioonline.com
Clint, also this post has helped me tremendously to cut out all the confusing voices and opinions about pricing my work. Your advice has helped with the "state of confusion" I was in.

Anyone else? This isn't just the Clint and Lori show, ya know. But I must say, it's helped me a great deal.


Clint Watson
via clintavoblog.fineartstudioonline.com
Lori - the discussion will be more lively when this goes to the full FAV list (over 22,000). My personal email list is only 294 subscribers.

jack white
via faso.com
Clint and Lori,

Too bad collectors don't read this post. The truth is deep down people buying art expect to be buying the next Andy Warhol. They may not say so, but they do dream of their art increasing in value. Mine is based on 40 plus years dealing with clients.

The art dealers of old sold art as an investment and some still do. They speak so loud only a few collectors buy out of love.

I remember a few years ago a client purchased an $8,000 Senkarik. Two years later he was in the gallery and saw a giclee about the same size as his for $3,500. He made a scene until the gallery owner was able to calm him down. Even then he was not totally happy. He thought he had been cheated

It's okay to cut your price if you are selling art for very little, but be careful if your art is over $5000.

jack

Carolyn Hancock
via faso.com
My work is not in the high-end range, but even so I had no sales. In December I lowered prices, showing them on my website, and held an open studio. That combination brought in sales and commissions. The high dollar value is not as important to me, right now, as is developing collectors. So lowering prices works for me.

Diane Overmyer
via faso.com
Great post, wonderful discusssion! I use to own an art gallery. At one time we had over 75 artists and fine craftsman whose work I represented. My highest priced sale was a painting for $14000. So of course my sales were small potatoes compared to the big galleries out on the West and East Coast. But I did learn a lot about collectors and artists in that time period. Number one, I never, let me repeat Never, met a true collector who wasn't looking for a great deal or at least real value for a painting/sculpture they were considering purchasing. I never once had a collector complain if an artist's work was selling for a price lower than it had been a few years earlier. We had some of the top artists from around the midwest and even a few from other countries....and we did attract many collectors who collected work by artists who they knew personally.

I am an artist as well, so I understand an artist's need to survive! I now have my work in several small but nice galleries in the midwest. I basically have told gallery owners what I need to get out of a painting. They add their commission on top of that. None of them have complained that my prices are too low. I could go on and on, but the basic prinicple that I have come to live by is this. When I start making more sales than I can keep up with I raise my prices. When I have more work than I need to keep my galleries stocked or room to store, then I do something to increase sales.

So thank you again Clint for saying what I feel is true! Most if not all of the professional artists that I know have all lowered their prices somewhat...if they need to compete and sell work. I do feel however that artists need to really think through how they are pricing their work and if they do lower prices, they need to do so cautiously....that is a whole other discussion however!

Marsha McDonald
via faso.com
Lori and Clint, this discussion has been of great help to me! I have pondered this a LOT in the last couple of years myself. I've been back and forth trying to figure out what to do. Fortunately, my paintings are in the 5000.00 and under range, so I agree Lori, that my clients, for the most part, wouldn't notice much difference and probably wouldn't care? At my last show in December, several of my collectors were quite happy to see some of my pieces priced a bit lower. Also, I have begun painting certain kinds of works that are different from my commissioned pieces, and those paintings are quite a bit less.
So far, no one has complained?

In a nutshell, I want to continue painting, and this is my only job, so I must do what it takes. I always call it my JOB, because there are so many people out there - even other artists - who don't really consider what artists do as a job. I can't figure that out, but nonetheless it seems to be true!

Billy
via faso.com
I just give my paintings away i'm just glad some one will except e'm!!

Billy
via faso.com
Yes I do have all my paintings on Face book!!!!

Karen Weihs
via faso.com
Clint: there is also a perceived blue to quality. I am going to write a blog on art, food and wine as it is perceived by content and value. It should shed light on what you have spoken on this blog, a great topic that should continue! Artt and wine each have a perceived value to the customer that can bring a purchase to closure, loved this post!

Christine Marx
via faso.com
I started painting in 2009. I got into a gallery shortly thereafter. The first piece I sold was a $4000 22 x 28" commissioned piece for a nice couple that came in to the gallery and saw my work. Was it exciting? Yes. Was it a good move for me? No. At that point I had no collectors. They were the first. So, my art sat for the next 18 months in this gallery. Not one sale. The gallery owner assured me my prices were not too high, and to lower them would be the worst thing I could do for future art sales, maybe I should raise prices. Well, I hung in there for a year and half, and finally made the tough decision to lower my prices, which were more in line with other artists who I felt were at my level in quality. I took the bull by the horns and decided to establish and always set my own pricing with my work. I moved to another gallery, where the gallery owner supported my decision and helped me to establish realistic pricing, and also works tirelessly promoting his artists. And guess what, I am selling more than I had imagined I could. He sold two pieces the first week of this year to one collector. She bought one, and then came back an hour later and bought another! He has sold several pieces of my work recently, and I have sold several online through my FASO site. At this point, I am not even considering raising my prices. I am happy and feel well compensated for my work, and hope my collectors feel happy and want to collect more of my work!

Christine Marx
via faso.com
I got so caught up in passing along my story that I forgot to say what a great article Clint! And Lori has been inspirational to me for years. Her articles helped me make many important decisions regarding my career. Thank you for the wonderful, helpful articles and the great website! I couldn't have sold nearly as many pieces without both of you.


Marsha Hamby Savage
via faso.com
Thank you for pointing us to this post and the discussion. I always enjoy reading what Lori has to say... one of the voices of reason. I am like another person posting here, I have talked and worried over the last few years about this issue. You have given, and Lori and others, reasons to really think what is right in this time to do.

sam
via faso.com
Really interesting post thank you. I was certainly of the opinion that we should never reduce prices as artists. My way of thinking is really that each piece of art we produce is more than likely to be better than the previous (certainly from year to year) We learn from every painting therefore we should get more financial reward for the more experience we have. Looking at it from the clients viewpoint I imagine they would be annoyed if after they had bought a piece of art, and a month later they see it for a lot less.
Having said that offering a discount on a piece of art seems much more acceptable and does happen frequently in practice.
Looking at your comments Clint you have certainly got me thinking. Although I have never lowered my prices I would certainly do this rather than have paintings to be sat in galleries for too long.
We definitely need to judge the market well and take the necessary steps to continue to sell and produce. I wouldnt have any problems reducing my prices if it meant I could carry on doing what I love and that must be one of the most important things to consider.

Marishka
via faso.com
Clint and Lori, and Everyone else who commented,

Thank you all for all the thoughts and comments on this subject, as it has been perfect timing for me. As things have been so roller-coaster-like with sales, I have been banging my head against the easel over what to do. I had an idea of doing a "moving" sale with the current studio inventory on hand, but I was worried about my current collectors and galleries reactions.On the other hand, I need to earn an income from my art, pay my bills and I really am moving. My highest priced paintings are priced at $4000 retail in galleries and most are at the $2000 range. I do sell, but the last 2 months have been no sales, and I have been brainstorming ideas. Your article, Clint, and all the comments following have convinced me to go with my "moving sale" idea.

Dorothy Siclare
via faso.com
Though you'd like to know Clint that I lowered my prices last June at a solo show I was in. Sold a painting.

Early this month I decided to lower my portrait commission fee by 20 percent and have been commissioned by 5 people since doing so. I have never gotten 5 commissions in one month before. A lot to be said for lowering ones price during rough economic times.

Karen Weihs
via clintavoblog.fineartstudioonline.com
Perceived value is very important to know when you are making the customer in charge and comfortable of their decisions. My Galleries use a discount rate now to understand the client's reaction to perceived value. Important to flex that 10-15 percent margin.

Lori Woodward
via clintavoblog.fineartstudioonline.com
I've been traveling without Internet and just catching up with email. Thanks for the encouragement from readers. You don't know how much your words make it all worth the while.

Lori


Darleene MacBay
via faso.com
Enjoyed the truth. No BS.