Saturday, May 24, 2014

The Business Chat - 4 kinds of work you MUST have

 “Wow, I LOVE this, it’s totally fabulous! It fits perfectly and it’s so gorgeous”, gushes the customer as she puts your necklace back on the display and walks away. Huh? Why didn’t she buy it? She loves it!

Who knows, maybe she just paid a huge car repair bill. Maybe she just bought a house. Maybe it’s a big statement necklace and she doesn’t have any special occasions coming up to wear it to. 

Making it easy for your customer to give you money isn’t just about the physical exchange of cash for goods. It is about providing the customer with a variety of goods at a variety of price points to allow them to find one that fits their needs.

Back to our shopper from above. The piece she tried on was a very large statement necklace. True, she did love it however she couldn’t figure out where she would wear it, and really, at $600 it was beyond her budget. The customer here loves your work but you haven’t provided her with a way of giving you money. What if there was a smaller version of the necklace? Or a pair of earrings at $35 in the same style?

As another example, think of a painter who has created a stunning landscape painting, magnificent and 6’ X 8’ and $2500. No matter how gorgeous, it will be difficult for her audience (who primarily live in downtown condos) to find a space for this work. The painter could make smaller prints of the work for a more affordable price and at a size that people could envision in their living room. She could also make greeting cards, or create a calendar of a selection of her works.

Take a look at your own product line up. What is your most expensive piece? What is your least expensive? Chances are, the gap is relatively small.
My jewelry ranges in price from $20 to $600. That's a pretty big range, and I've got lots of price options in between. Pieces in the lower end of the price range give customers a lower entry point into my line, while higher end pieces give customers something to aspire to. When I do sell a large piece, it is almost always to someone who has been collecting my work for a while.
It’s critical to your success that you provide your customers with a variety of items at different price points. A really good collection of work should have 4 types of work: 
  1. entry level
  2. bread and butter
  3. dream pieces
  4. upsell
The entry level work is for those just starting out as your customer. A $600 necklace isn’t an impulse buy, it takes a while to build up trust with a customer so that they do purchase one of your dream pieces. Instead of a $600 necklace, create a $50 pendant in the same colours or style as the huge necklace. For the painter, an entry level piece could be a 5”x7” print. The entry level work gets something of yours into the customers hands and begins your relationship. 
Your bread and butter pieces are the mid level pieces that keep your business afloat. My mid-level pieces range between $50 and $150. I will sell a LOT more work in this price range than I do in the upper level. And while yes, I sell a lot in the $20 - $50 range it takes a lot more of those to add up to real money. 
The dream work are the bigger pieces that people aim for. It’s the $600 necklace. The $2500 painting. I always have a couple of large statement necklaces on display in a very prominent place. People oogle and drool, and then they buy the smaller pieces. It’s the bigger pieces that pull people in, it’s the smaller pieces that pay the bills. 
Lastly there’s the upsell pieces. There’s a very large corporation that paid a lot of MBAs a lot of money to come up with the sentence “would you like fries with that?” It works. Use their research, find your fries. 
Your fries are what ever you can add on to the customers purchase. I have a whole line of simple, reasonably priced earrings that are displayed very close to my checkout desk. As I package up an order, I always mention, “oh, did you see these earrings that match your necklace? They’re only $25!” They sell a lot. 
Money is like water, it will flow where ever you direct it. Go ahead, direct as much as possible in your direction. 

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