ShawN shawN • Good question Felta. There is a danger of marking down too much your artwork for clearance sales. You don’t want to endanger your long-term prices as galleries will start to drop you as an artist if they see your prices fall. On the other hand, if you have gotten to too high of prices, then maybe you moved too quickly up in prices and need to move the price point down to selling levels. The key I believe is to offer reasonable prices, where you are selling your work regularly and not discounting in special sales. A good way to handle this is not to offer open discounts on your website or gallery, but if a client asks for a discount, then to allow that discount. This way you don’t have to reflect the price discounts openly, but can still keep your sales coming in in a soft economy.
Another thing you have to remember about art is that it is a luxury item to the select upper class and possible upper-middle class. So how do prices work there? Look at how they sell luxury watches, cars, houses, jewelry, etc. Do they have 2 for 1 prices? Free this, free that? Not really. The way they handle selling is to work the brand and then when they have a problem selling a particular item they use back-channel sales minimally. So the luxury retailers always have very remote outlets in the middle of nowhere or 3rd party like Ross and Marshalls to dump their product, but they offer little or minimal sales discounts in the true stores. This way 70% of sales are full price and they secretly sell in other places items on sales.
How do you do a clearance sale then without affecting your core prices? I have seen some artists do special sales at garage sales or even a bit of eBay to move product while leaving the gallery prices the same. Again, the same principal of moving the majority of product with minimal discounts and then secretly discounts in other less known outlets. This is a bit tricky for if you start to eat too much into gallery sales, then you for sure have sunk your boat selling there regularly. So you need a line in the sand type of marketing.
Another great option I have seen artists use is to offer limited edition prints at great prices to reach the middle class, but keep their painting at close to full price. Another option is to do very small paintings to reach this group and then monster large work. The smaller budget customer can buy a small work and later aspire to buy the large work as they get a raise/promotion that allows it. It offers a tier system that the rich will appreciate as they get exclusive access to your larger work since they can afford it.