Many clients of my firm know that the topic of pricing is one of my favorite topics during coaching sessions. I love the intricacies, the intimacies and the behavioral aspects of pricing your customers. I love digging into the processes of a company and matching the price to what is being delivered. In the end, my clients win (and make more money) and the customer wins (and gets more value).
This love of pricing is why I like to see creative pricing models from other creative businesses (which my firm serves exclusively). TEKSTartist was a recent find that intrigued me. This dude creates images, or artwork, from the text of paragraphs or a string of text. As described by TEKSTartist himself, “I create art by warping, twisting, stretching and distorting words into the very thing they are describing.” And, dang, he is good too! And he has some unique canvases.
My main interest is in the pricing of his 2012 project where he creates a piece of TEKSTart every day for the entire year in 2012 (an idea he got from his friend, Jason Sadler, who uses it for his sponsored T shirt advertising company). Here is how the pricing works for this year long project: the first half of the year you can buy pieces of art he has produced himself. The price for the piece you will buy on January 1 will be $1, and each day the art goes up by an additional dollar. So the price of the piece you can buy on January 2nd will be $2, and so on. The last half of the year are commissioned works you can ask him to TEKST for you. These are sold, and continue to be priced, under the same pricing model as the first part of the year.
Again the pricing model intrigued me. A few thoughts on the pricing of his work and this year long project (maybe you can apply some new techniques to your product or service). Note some take-aways in bold:
1. The prices really have nothing to do with the art itself. Of course, I couldn’t sell my artwork online, so I know his work has appeal alone because it freakin’ rocks. But essentially, he is adding an additional dollar to his art each day so price goes up just because. Is each piece of art properly valued at a dollar more just because a day has elapsed? Only your customers can decide that. His ideas seems to be working. You sell more than just what you sell. Huh? That is, you can apply premium prices to more than just the product itself – the user experience, the customer ‘touch’ service process, the delivery method, the speed with which you produce products, and anything else you can dream up can be priced (as long as customers find it valuable).
2. The pricing model is a positioning and branding decision. This may be one of his main reasons for doing it, but I’m not sure. He is doing it to gain attention, and is publishing the idea just to let people know he is trying it. He is making an interesting statement about his company and his art by simply doing something different than most artist. Even if there were other TEKSTartists, they are probably still using traditional models to sell their artwork. Just being different could make your product or service more valuable to the marketplace. Experiment with this. The way you sell is just as important as what you sell.
3. He is pricing the different types of his work in different ways. His own works are sold during the first half of the year, while the commissioned works (requests from customers) are sold in the latter part of the year. This probably makes sense on two accounts: (1) he may have a lot of inventory to sell, so this was a good way to offload some of his own stuff, and (2) commissioned works are typically more costly if you ask an artist to create a special piece for you. The commissioned works fall in the latter part of the year (the more expensive part of the year for his art), so he is making money on the commissioned pieces. Don’t sell ALL of your work for the same price. You could sell the same piece at different times for different amounts. Ask the customer, do you want it now, or do you want it in one month? The price will change depending on their answer.
4. Selling art on a calendar basis has many customers built in. Think birthday, anniversary, etc. People are already buying special days, like September 14th and October 15th (these blocks on the Art Calendar have ‘sold’ written across them). I imagine these are gifts for other people, though I’m unsure. I’m shocked there are not more dates sold around December 25th. Can you tie your product or service to a holiday or a calendar date? Is your product special enough to be given as gifts? Can you make it special enough to be given as gifts?
5. This model has a ‘Buy Early’ undertone to it. It’s obvious that the earlier you buy, the better deal you’ll get on the piece of art you want. So, you better buy soon before the earlier blocks are all taken! How can you take advantage of the ‘time is of the essence’ model of pricing your work?
6. Creative pricing could earn you a great salary. Who says the artist is starving now? If I did my math correctly, the TEKSTartist will make $67,161 in 2012 if he sells out every calendar day. Do you feel like you are not making a ‘living wage’ being an artist? Maybe you should change how you sell, instead of what you sell.
7. He has a no-haggle rule built right in to his product. TEKSTartist has assigned a dollar value to each day of the year. It’s understood that if you want his artwork on a certain day, then the price has already been predetermined. If you want it cheaper, then you’ll have to buy an earlier day (if it’s available). There seems to be no discussion on the pricing – the process has dictated that it is what it is. Can you develop a process around your product where the price is predetermined in advance? Developing pricing in advance gives options to the customers – and customers always seem to respond well to options.
Pricing is fun. What say you?
XCM Solutions, Inc. (a robust workflow product we use in our firm) conducted a research project last year to identify the differentiating factors between high and low performing firms. Some of the findings are amazing and support the things THRIVEal firms have been doing all along. We’ll check them out over the next 7 posts. Click the image to the left to download a copy of the full report.
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