A while ago I listened to a podcast and the interviewee, a marketing expert made the point that if you discount your products, you replace the unique story of your beautiful handmade goods with the story of the customer who will then make this about “look how cheap I got this!”. This replaces the story of your product with the discount story, the amazing deal story that we all know and reproduce well. We tend to be happy about the deal, as if, by getting the product so cheap, we managed to “get away with something”.
The interview was focused on the question of offering discounts at craft markets, but really, I think it applies in general.
Now, I won’t go into details of the “discount issue” or culture. However, one side note on why some products are so cheap is necessary: we, as in society, do not calculate the prices correctly. Some manufacturers do not take into account the real costs of production (environmental and social impact) and some other manufacturers produce in ways that are not in conformity with local laws. I recently watched a very interesting video (in Italian – sorry) on how much of our own waste, instead of being recycled locally, gets sent to China where, within illegal facilities, the plastic gets sorted, reworked and transformed into new cheap raw material, with which to make new products. These products end up in the local and international market. Stuff we buy too. Cheap stuff. This is only one of the reasons why some of the things we find are cheap, so cheap it’s almost unbelievable. But this is not the case of handmade products.
Let’s go back to handmade goods, shall we. Accidentally, while researching this topic, I came across an interesting article on the Etsy blog, on the issue of discounts and Holiday promotions. One of the points made is that “bargain hunters are not your target customers”, an excellent point also reiterated in this interesting article on “3 Reasons Why Discounts are Deadly for Crafters“. Needless to say, I agree completely with the cited article in that discounts on handmade goods, carefully handcrafted and often already underpriced, are not advantageous to artists.
The idea that offering discounts allows you to “attract new customers” and get people’s attention (an argument used for example by Dawanda while activating a pre-Christmas discount – which will run from the 24th of November to the 6th of December – that has left me a bit puzzled) is not necessarily dishonest. [Note: While participation is obviously voluntary, the discount is heavily advertised on the home page. Also, for the sake of completeness, Etsy does not offer platform-wide discounts but some have developed an application (not directly linked to the company) which allows sellers to put their shop or some categories on sale. Etsy also offers a coupon feature which is already explained in the article above. This to say, discounts seem to attract everyone.]
Among those who will see your shop during a sale, some may start buying even non-discounted products because they love your work so much. This could happen, but we are not talking about a secure and sustainable way to promote oneself in the long run. I have participated in some discounts actions before and I didn’t find them incredibly beneficial. Ultimately, each one is responsible for her/his own business but it is true that a general environment in which sales are constantly pushed affects the entire market and each individual action is not isolated.
The problem is more about finding the right customers, the right target group and I know all too well how difficult that is. But the work and money for doing this research is better spent than giving up much of the already meagre profit on crafted goods that are not supposed to be able to compete with cheap imports. This is also the problem: all too often handmade is set to compete with imported and resold and all too often these things are treated equally. While consumers will see and compare these two categories, it is up to us (makers and handmade community people) to educate consumers on why choosing to buy handmade makes a difference.