Motivation, Value and Pricing

I was taking a break from beading and looking for a little inspiration when I stumbled upon a TED talk about motivation. The synopsis said that the talk aimed to explore human motivation at work and challenge the idea that we will work harder if we’re simply paid more money. I thought that sounded interesting…and it was. In fact, it set me to thinking about craftspeople and how we all sell our work. I’m pretty sure that most people would say that the biggest challenge they face when it comes to selling, is knowing what price to set. The kind of experts who blog on sites like Craftsy and Etsy all tell us not to sell ourselves short. There is plenty of guidance about the correct way to calculate the price ie cover your materials costs, cover your time costs and add on something to cover other general overheads. It all sounds so simple, but how on earth do you value your time?

The TED speaker had conducted a few experiments with people to try and determine motivation. His results seemed to indicate that people naturally put something of themselves into carrying out any task. If that effort was recognised, then they felt motivated to carry out the task again. If the effort was ignored, then even if they were offered more money for carrying out the task, they mostly declined to do so. The speaker went on to draw parallels with IKEA furniture – even though it’s not necessarily the most beautiful looking furniture, he thought that he probably valued those items of furniture in his home more than other items that he had bought, even though they might be more attractive. He suggested this was because he had been involved in the production of the furniture, in transforming it from flat-pack pieces to an actual serviceable item. Probably it was less well-built than a similar factory bought item, but to him it seemed more valuable. All these theoretical experiments seemed to test out in the office environment. In a large corporation, those employees who felt that their efforts were recognised, worked harder than those who were ignored, even though this may not be reflected in their respective pay grades. However, it was the final experiment that he described that set me thinking about craftwork and pricing.

A group of people were given instructions for building an origami object – something fairly complex to build, but not particularly attractive to look at. Having built their object, each was asked to name the price for which they would be prepared to sell it. Then another group of people were brought in and, instead of being asked to make any origami, each was presented with one of the pieces that had just been made and asked how much they would be prepared to pay for it. Perhaps unsurprisingly, the selling price the builders had set was significantly higher than the price that the buyers thought they should be paying. The experiment then received a further twist. A new set of ‘builders’ were invited to make the same piece of origami, but in this instance, the written section of the instructions had been removed and the ‘builders’ had only diagrams to follow. This not only made the task a lot harder to complete, but the resulting origami pieces were less well-made and therefore less attractive to the outside observer. The same pricing test was carried out and these ‘builders’ set even higher prices than in the previous experiment. Conversely, the ‘buyers’ viewed the pieces to be less attractive and reduced their prices accordingly. The conclusion was that the more effort we invest into a project, the more highly we value it.

Every craftsperson I have spoken to, regardless of their craft, seems to live by the rule that it’s virtually impossible to receive a ‘fair’ price for their work. ‘Fair’ being defined as reflective of the amount of time and effort it has taken to create the project. I obviously have a vested interest in jewellery and I find myself looking at it wherever I go, whether it’s being worn by other people or on sale in shops. I can’t help noticing that it is possible to buy a beaded necklace in a high street shop for under £10. I can look at such a necklace and make a fairly educated guess as to how it has been constructed and how much time that would have taken. I also know that high street stores will ‘mark-up’ their prices by 200-250%. So, if that necklace is on sale for £10, I know that the absolute maximum paid to the maker will have been £5. Out of that, it is probable that, even allowing for purchasing at huge wholesale discounts, the materials are going to cost around £2 at least, so that means, assuming there was no third party trader involved, the person who made the necklace is going to be paid an absolute maximum of £3 for their labour and I would question whether it is possible to make such an item in under an hour. On closer inspection, such pieces usually turn out to have been made in China, possibly in Eastern Europe, but definitely in a part of the world where living costs, and therefore labour rates, are lower than in the UK. Nonetheless, I always question whether, when broken down, this is actually a ‘fair’ recompense for the work carried out. Knowing what that work involves, I would say ‘no’.

How does one decide on what is a fair price for labour in the UK? The minimum wage provides a guide as to the minimum we should expect to receive for our hours of work, but then I would classify crafts as skilled labour. It takes many, many hours of practice and training to acquire the skills and hone them to a standard that makes them acceptable to sell to other people. Therefore, we should be charging something higher than the minimum wage. However, what is a sensible trade to which to equate our skills: plumber, electrician, mechanic, doctor, lawyer, dancer? Here we return to the experiment outlined above: for me, my craft literally has saved my life – preserved my mental health at a time when my physical health was very poor. I know this to be true for many people. However, I am well aware that it is unlikely that any of my finished beadwork is going to provide the same benefits for whoever buys it. It’s back to the difference between the value I place on an item because of the effort I have put in, versus the value of a casual observer who knows nothing of the process behind its creation. Take my Battle of the Beadsmith piece: it has taken me around 120 hours to complete and that doesn’t account for the hours of time I spent designing or revolving problems over in my mind in order to create the end result. If I charge £10 per hour, which isn’t that high a rate given the skill involved in design and construction, it means a labour cost of £1200. By the time I add in materials and overheads, the piece is going to be worth considerably more than that. Would anyone pay that amount of money for it? I have no intention of selling it because it has such huge worth to me in terms of being able to look at it and think to myself, ‘I did that’. Of course, if it is classified as ‘artwork’ rather that ‘craftwork’ it probably could command that kind of price, or higher, depending on the demand for my work.

For the most part, people who buy craftwork are still buying it for the same reason as they buy anything: they like it enough and want it enough to feel justified in paying the price that is being asked. I know there is a difference between people who are craft workers themselves and people who have never done any craftwork. The former do have some sort of appreciation for the skill and effort involved, the latter often make a comparison between the crafted piece and a similar necklace they saw on the high street last week and wonder why the crafted piece is so much more expensive. Even so, whilst I can make a fairly informed judgment about other beadwork, I have never crocheted, so would have no idea how long it might take to make a crocheted table mat, or what skill is involved, so I am still judging it by how much I like and want the piece of crochet. On those grounds, sales come down to luck: to what extent have you managed to produce something that captures the imagination of another human being? If you capture the imagination of many others then you stand a chance of selling well, but if not, then perhaps the price doesn’t matter so much after all!

If you’ve been reading this far in expectation of my answer to this thorny problem, then I’m sorry, but I will have to disappoint you! These are just the meanderings of my mind based on an interesting piece of research. I still have no more idea how to price my work ‘fairly’ than I did when I started trying to sell it. If however, anyone would like to guide me on this, then I’m very happy to hear your thoughts!