When I first opened my shop on Cafepress five years ago, I had the same thoughts as most new shopkeepers do. The base prices are way too high! I couldn’t imagine anyone paying that much for a t-shirt, so I set most of my markups to $1.00-$2.00, and $.50 on small stuff like buttons and stickers. As the year went on I gradually increased to $4.00 and $5.00 markups, and then after Christmas I threw caution to the wind and went with $7.00. Sales were good. And then came Barry.
If you’ve spent any time on the Cafepress or PODforYou forums, you might be familiar with Barry and the Barrification process. It involves setting substantially higher markups than most shopkeepers were used to, in the $10.00-$15.00 range. I was a little hesitant at first, but I tried it. And surprisingly, I still sold stuff. Now of course that whole situation has gone down the tubes so I don’t worry about prices at Cafepress anymore since most of my sales come through the marketplace.
Setting prices at Zazzle is a little more troublesome. I liked the system at Cafepress of being able to set individual markups for each specific product. That way I was able to choose a price point that I thought was attractive for each item, and I could avoid uncomfortable prices. It’s a strange psychological thing, but some prices, like $20.99, have an uneasy feeling, whereas $21.99 seems much better. I also tried to avoid $25.99 and $28.99, setting them at $24.99 and $29.99 instead.
When Zazzle first began allowing it’s shopkeepers to set their own percentage of profit, I came up with a sliding scale. For shirts that were in the $20.00 or less range I set them at 50%. Shirts in the $20.00-$30.00 range were set at about 30%, and then the more expensive shirts in the $40.00 range got 15%. But then I realized that the fact that the customer can choose the design on a different shirt would totally screw up my sliding scale. If a customer clicked on a basic white shirt in my store, but decided they wanted the design on a sweatshirt, the 50% would kick the price up into the $60.00-$70.00 range. (I’m all for barrification, but that’s a bit much) Conversely, choosing an expensive shirt and changing to the cheap white t-shirt would net me about $2.00. So I scrapped the whole sliding scale thing and just set a flat percentage of 35%, which gets me an average of $8.00-$10.00 per shirt. (The 35% is mainly for t-shirts, I’m still experimenting with prices in my shops that have mainly paper products)
There are a lot of different ideas about pricing. Some go for the quantity method, keeping prices low which theoretically sells more shirts and then they make money on the volume bonus. Some people feel guilty about setting prices too high, especially when the economy is bad. Some set higher prices on artwork and lower prices on simple text designs. So what does one do? Here are my thoughts:
- Don’t feel guilty about raising your prices above the default 10%. Your customers are not being forced at gunpoint to buy your stuff.
- Don’t fall in to the trap of thinking but Wal-mart sells cool t-shirts for $5.00, why would anyone pay $30.00 for mine? If all you are looking for is a shirt to cover your nakedness, then Wal-mart will suffice. But when you are looking for that perfect, unique item that makes people say where did you find that?, then you, like most others, are probably willing to pay a little more money for it. How many people pay $4.50 for a cup of coffee from Starbucks when they could get it at the gas station for $.50?
- I set all of my prices the same, whether it’s a simple or complex design. Even if it’s a “simple” text design, it still took me time to come up with the saying and choose an appropriate font (especially if you have a font hoarding issue like I do).
In closing, I would like to say, Dear Zazzle, if we were allowed to set specific markups for each individual product, that would be awesome. Like, totally.
Thanks for such a detailed and helpful post. Yes, I agree, individual markups would be a great help for Zazzle products. I’ve battled the sliding scale issue and come up on the short end of it. lol