The Studio Source.com

This just in—the economy is a construct.

I know. That’s not news. We usually think of the economy in terms of paycheques and employment rates and the price of electricity and groceries. But the “economy” is like a strange fantasy world where we exchange pieces of paper for the work we do. Somebody somewhere put a value on that work, and we more or less agree with that value. The things we buy are also assigned a value. Sometimes that value changes.

It’s pretty weird when you think about it that way.

It gets even weirder when you don’t actually receive little pieces of paper for your work. A lot of the time, there are only numbers on a larger piece of paper that comes from the bank. Sometimes you just look at the numbers on your computer screen.

We can get a little more real. Say I fix your front gate, and you give me a loaf of bread and basket of apples in return. There is a direct exchange between you and me, but the transaction still requires an agreement of value.

It’s the agreement part that can drive you nuts.

I see people underprice their work out of fear that no one will buy it otherwise. These are often artists and craftspeople. There’s a wild variation in style and skill among people who sell the things they make, and therefore an equally huge range of prices. Instead of looking for an established price range in their medium and skill level, and instead of finding the right place to sell it, they panic and undersell—often to the wrong audience.

I see people present their work in a way that undermines their customers’ perceptions of it. A poorly designed website or amateurish business card or retail display doesn’t convey a sense of quality. So by ignoring these important details, they risk losing a portion of their audience, because they break the value agreement.

This may sound stupidly obvious, but people who share agreements on value tend to gravitate towards the same places. They respond to similar visual cues—things like packaging, design, colour, the tone of advertising copy. A television commercial for Kia isn’t going to have the same look and feel as, say, a commercial for Volkswagen. The audience is different. The agreement of value is different. To use the jargon, the demographic is different.

Embarrassing true story: when I started my jewellery business, I signed on to do a show sight-unseen, based on a recommendation from someone who had participated in a show with the same promotions company, but in a different location. My first show, and just to add to the hilarity, it was out of town.

I found myself across from someone who was selling quilted water cooler bottle covers, in the midst of a crowd of customers who balked at a $40 necklace.

The bed and breakfast was lovely.

(Note: never walk into a venue without doing proper recon, even if someone tells you it’s good. They may not have the same perception of value as you do, or they may have had a good experience, but discover some unfortunate inconsistencies down the road.)

You see the problem. If I had found myself at the high end of the price and quality range of the show, I could have been a big fish in a small pond. But I turned out to be a (ahem) donkey. If I’d somehow landed in the midst of the best of the best, I could have beaten everyone on price, but would likely have ended up with the same dilemma: not fitting in with the audience’s perception of value.

The good thing about a construct is it provides a framework. You can find comparable work and see if your pricing fits within the accepted range. You can see how people in your field are presenting that work. You can find untapped audiences by using the framework as a starting point, maybe even push the boundaries of the framework—if you give the audience something they agree is truly valuable.

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