Are you wondering how you should price your items? Do you also wonder why people love to buy expensive things?
How we frame a product’s price & features greatly affects its perceived value. This is called pricing bias!
Recent research suggests that by changing the way we frame the price of a product in relation to its features (and vice versa), we can help consumers choose products that they will be more satisfied with in the long run.
Pricing biases is definitely useful sometimes but other times we’re being a victim of our own cognitive bias.
Obviously this works in reverse, with cheaper products being perceived as lower quality.
But do you wonder how this affects the perception of handmade products?
Before everything else, you need to keep in mind these advices:
Don’t be too affected with what others are charging. You do not know their costs of doing business: They might have sisters helping them make their goods for no charge; have to rent a studio space; have to pay for childcare so they can work; etc.
But if you think you just come up with a price that you are sure the market won’t respond to, there’s a trick for that.
If the item is priced too high for the market, it’s not the price you need to alter, it’s the design or the way you produce your work. Get creative and see how you can adjust the item to reduce your costs.
Laurie Santos (Yale University) examines how people’s economic choices tend to confuse price and value. She then describes how these so-called pricing biases compel people to assume that higher priced goods will often work better.
Check this video to understand what pricing biases are and how it can affect your business:
How To Price Your Craft Work Easily
On the brighter side, the process of pricing shouldn’t be as complicated as pricing biases.
You can use our FREE Craft And Jewelry Pricing Calculator that will help you to work out the exact price you should be charging for all your handmade creations easily and quickly because they’ve done all the math for you.
If you need help to stay extra organized with your inventory, product pieces, taxes, pricing, etc. Craft Maker Pro is your best friend so get your pricing and inventory’s best pal now!
That’s it. Do what you think is best based on all the information you have. Good luck, and happy selling!