Becky's Business Tips
Repost: My Experience of Pricing Something Too Low! It’s About Perception!
This is a repost from June of 2018, but the content is so very important! It is amazing how tweaking the price can change the results of the customers perception. I hope you find this informative!
How do I price my jewelry?
A common question that I am asked here at Nunn Design is, “How do I price my jewelry?”
There are standard formulas to explain the process, but sometimes even following the formula can leave one scratching their heads wondering, “what the heck?” I, too, have experienced challenges and even once improvised to increase my pricing while exhibiting at the New York Gift Show!
My Experience at the New York Gift Show:
About 8 years ago, I developed a jewelry line. It wasn’t really a finished jewelry line, it was parts and pieces that the end consumer could select and “assemble” themselves. Although there were companies offering high end “assembly style” jewelry, such as Pandora, I was a little ahead of the trend in creating an affordable jewelry line that was nicely designed with non-precious metals.
Opening day of the New York Gift Show, the Nunn Design booth was sandwiched in-between several beautiful jewelry lines. All of the companies near us were artisan jewelry manufactured from precious metals, and had precious stones incorporated into their work. Our booth was lovely and looked similar in “high-design” to the booths that were around us, but our products were pennies on the dollars in comparison. We were casting in pewter and were plating with precious metals. We were selling mass production jewelry, not artisan handcrafted goods.
In the gift industry, there are stores who sell high end artisan jewelry and there are stores that do not. Because we were in a cluster of booths that sold high end artisan jewelry, very few buyers were even looking at what we had to offer. They were just glancing to the left and to the right and moving right along. After a couple hours of not having a single person look our way, I knew we needed to make some changes! I dug through our stash of samples and dumped a couple dozen charms into a beautiful dish. I then positioned myself at the edge of our booth and when we got that “glance,” I would say, “would you like a free charm?” I would say that 70 percent of the people I asked would stop, look at the bowl and say, “wow, these are lovely.” I’d ask “do you sell jewelry” and the conversation would start.
What I Learned:
Here is the part where I really learned a lot. Our products were WAY underpriced! Now, if you know me, you know I did my research. I did all of the formulas correctly. But the thing that I didn’t consider was the buyer’s perception of value. I was offering a product that really wasn’t yet available in the marketplace. I had underpriced our items and therefore was met with a buyer that was looking at me with a sideways glance saying “what’s the catch? This is too good to be true. Are these imported from China? Are they made with pot metal?” I was spending all of my time convincing the buyer that I was “for real” and that my products were as good as I said they were.
My Solution:
So, how did I fix it? Instead of starting the conversation out with the wholesale price of the individual charms that were in my bowl, I started the conversation out with the suggested retail price of a necklace that I was wearing around my neck. I had assembled several charms onto a chain to make a necklace. I would then work backwards to all of the individual parts and piece prices once I had established a little connection with the buyer.
I did manage to have a great show. Yes, the charms I handed out were an expense that I hadn’t calculated into my show expenses, but doing a show without any sales would have been a much greater expense!
What is Your Experience?
From our original post, we received this great comment.
Deb Dagavarian says:
Years ago, I did a two-day craft show. At the time, I was doing leather work in addition to handcrafted jewelry. The first day, I priced my goods at very low costs, thinking I’d sell a lot because they were so inexpensive. That first day, I hardly sold anything. The next day, I figured I’d experiment with higher prices, pretty much double what I had the day before. Well, to my surprise, I sold lots of jewelry and leather items! Becky, you’re absolutely right about the importance of “perception.” I learned a valuable lesson that time.
Do you have a story about perception? A story about a tradeshow that you had to change course with? Please leave a comment and share!
Resources:
Here are some resources to help you price your jewelry:
- www.jewelrymakingjournal.com/jewelry-pricing-formula/
- www.creativehiveco.com/pricing-handmade-items-guide/
- www.wikihow.com/Price-Your-Jewelry-Designs
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