Showing posts with label new economy. Show all posts
Showing posts with label new economy. Show all posts

6/17/2011

Why Deep Discounts Don’t Benefit Your Artisan Business

marci w Iragrant bag

bag from Iragrant

The Handmade Revolution was founded to support indie artisans in making a fair wage living by selling retail without a middleman or working for a corporate chain. As part of the New Economy, “a fair economy that works for people and the planet”, artisans have unprecedented opportunities to connect with an avid and growing sector of buyers who want to change the world by changing their spending habits; by voting with their wallets. As part of the New Economy, I buy free range organic eggs from a local farm. I buy luxury quality handmade bags from an indie designer, one of a kind individually made jewelry, and hand stitched home decor.

Jewelry from PoleStar, hearts from SewnNatural

These things are not selected because they are the cheapest available. Each of these small business owners has a family to support, and, just as I buy fair trade coffee, I expect to pay a price for these quality goods that supports the modest lives of the makers and allows their dreams to grow.

As artisans, we can compete on price or quality, and competing on price is a losing proposition, as factories can always sell their soulless goods for less. Discount shoppers and bargain chasers are not our target market. And this is why Heartsy, which is a Groupon version for Etsy shoppers, cannot deliver on their promise to grow your indie artisan business.

If people want to support indie handmade businesses but want 65% off in order to do it, they are highly unlikely to  return for more at full price. They are far more likely to simply use the next Heartsy coupon available, which is what happens with Groupon shoppers overall.

It is infinitely more worthwhile to advertise and promote the quality of our work, and to reach out to buyers who are looking for that. 70% of my Etsy buyers return for more, and I offer no discounts. I give the best that I have at the fairest price to everyone, and this is building the kind of customer base that allows me to make a living wage. Offering a modest (10%- 15%) discount is all a good indie business needs to do when an incentive seems necessary. This business model works for me, and I recommend it to other artisans. When you put your heart and soul into making an honest and conscientious business, you deserve to profit from it, and slashing profits drastically isn’t necessary to gain attention.

editorial by Lee Wolfe