How Flexible Pricing Can Help You Sell More Merch

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Why the Value of Your Merch Changes Every Day

Let’s say you just started a hot-sauce business. The price of your product probably changes depending on the buyer; lower-end grocery stores, shi-shi markets, restaurants, and direct customers on your website will all pay a little something different for the same mouth-burning sensations– to say nothing of the folks who will try free samples at the store.

Musical products aren’t that different; the value of your merch changes from gig to gig, and should (or could) be priced accordingly. This is NOT “Name-Your-Price,” but an alternate system where the band and manager keep the context of the concert in mind when setting today’s “market price.” And unlike fish, your music won’t grow stale,… right?

Every audience is unique, and every concert is not created equal

If you’re one of those folks who thinks, “Hey, I spent a lot of time and money on my recording; I say it’s worth $12– for everyone, everywhere, all the time!“– well, I understand that attitude. But consider the possibility that you might sell more music if you thought of your merch items as mementos from an event that will never happen again.

As Tom Jackson says, the art of live performance is all about “creating moments” on stage, moments that stick with the audience so much that they want to take a part of that concert home with them. And if that’s the case, your merch is worth only as much as the memories you created.

Most people will pay a lot more for a Mickey Mouse hat from DisneyWorld than they would for a keychain from the Darryl’s Texas Ribs in the back of a gas station in El Paso. Similarly, your latest CD is “worth” more when you play a 2-hour concert at a beautiful venue with amazing acoustics than it would be if you played on a 5-band bill at an all-ages club in a warehouse. It’s worth more if you add something extra to the show– choreography, videos, fancy lights, special guests, etc. Merch is worth less if you’re just filling in last-minute at the local bar.

 Consider 3 things when pricing your merch

1. Demographic of audience- Think about the economic means of the folks in attendance. The point is to get your music out there, right? Sometimes lowering your price to encourage sales can actually result in larger earnings overall.  Conversely, there are some venues and communities where raising your price above normal will have no adverse effect on sales. If you feel like you’ll give them a show they’ll remember, go ahead and raise the price.

2. The show- How unique is the event? What was your energy expenditure? Production budget? Crew? Again, the better the show– the richer the memory; the richer the memory– the more valuable the memento.

3. The merch itself- How many songs are on the CD? Are the T-Shirts made with the most comfortable materials? Are the posters limited edition? This is perhaps the most obvious consideration, but the better your merch, the more it’s worth; and that gives you even more leeway with your prices– whether you’re adjusting up OR down.

Have you sold more music with flexible merch prices? Let us know in the comments section below.

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  • Fawn

    Hmmm, but what happens afterward? I recently bought a CD (for $20!!) at a concert. The concert itself was magic and I went home vibrating. I didn't buy the most recent album, because the theme of one of the older ones appealed more, and all four albums cost the same. The next day, I found out I could get it for $15 on Amazon. And it's $10 on iTunes! That grates a bit.

    What do you think about that?

    (The kicker is that I can't even listen to the album all the way through because, although pretty, it's long enough to get monotonous.)

    • Well, I would say the artist maybe could've done more to make that hand-to-hand sale more valuable than an iTunes download or Amazon purchase. Did they autograph it? Did they sell it to you themselves? Did they talk to you after the show? Sometimes what you're buying for that extra price is the experience of getting it right from the artist, which (if they handle it well) can be really special. I'm thinking specifically of Richard Thompson and how he comes out after every show and greets fans. That was memorable.

    • Ayers_tyler

      I think artists have been being royally screwed for years and still are and deserve to make money somehow. iTunes can afford to charge $10 because they incur none of the production cost or time and they still take a 40% cut from the artists for each sale. How’s that for rape? Amazon is similar, by the time you’re done signing up and paying their fees, jumping through all their hoops you’re already broke and they take a high percentage there too. When you take into account the fact that any decent album takes thousands of hours to produce from the writing to practice and performance time to mixing, editing, artwork, mastering and then the actual cost to manufacture the CDs and shipping not to mention time involved on websites, file conversion for web transmittal and then most “fans” download all the material for free after all that work, time and out-of-pocket expense: let’s just say it’s what made me stop making music for the ungrateful public that doesn’t understand simple economics principles. I realized you’re better off selling marijuana, it’s the only thing people will actually pay for anymore. If you think music should be free I’m coming to your house to take what you produce with your time in return. Sadly most Americans don’t produce shit anymore so even that concept is worthless.

    • Buryyourdead76

      Gotta say u got ripped off probably could of gotten it at best buy for $13 too! Screw all this talk about memories its a cd…really….not to mention to make a cd doesn’t even cost that much money

      • Sid Helmer

        ” to make a cd doesn’t even cost that much money” Really? Well it depends on if you have a tight band, LOW studio costs and other things, like a solo artist Should cost much less.
        But not all the time. I would say, and we have ALL heard them,” it doesn’t cost much to make
        a mediocre or Shitty cd”.

  • Marianne

    Absolutely, be flexible. Our CD's typically sell through CD Baby for $15 each. We also sell them at shows for $15, but a few years ago we started a policy of selling two for $20. And that's two of any combination of the three projects that we have out. We saw a remarkable increase in sales at shows as a result of this new policy.

    Marianne

  • Martinrosskerr

    Yup, well said. I sell my CDs for $20 at most venues, (with big discounts for multiple CDs). At student events or when I'm street performing, the price is $10. This is the strategy I've arrived at after quite a bit of experimentation. It also keeps things simple with change. OIn the past I've done 'pay what you like', but I find this sometimes reduces sales, because some people aren't sure what is appropriate to pay, and therefore hesitate.

    • Yes, and with street performing many people are probably inclined to throw you some money as a tip anyways, so if you price it at $10, you must be attracting a bunch of folks who say to themselves, "Well, I was going to give 'em a couple bucks anyways. Might as well just throw down $10 and get the CD!"

  • Dewaynespaw

    The only thing I can say is be very careful about changing prices. Someone buys a CD at one show for $15.00 and they come to another show at a later date and you are selling the same CD for $10.00, they may be asking for some money back.

    • I’ve done exactly that, but I am aware of the issue, so what I do is advertise the show as “fan appreciation night” or somesuch, so that the $10 is viewed as a special deal…also, once a guy did exactly that, brought the CD with him and asked me about the price change. I immediately gave him $5 back and exclaimed, Gee you didn’t get this autographed? I grabbed it from him and signed it, just acted totally friendly, no questions asked. He bought a different CD as well and I bet I got some favorable buzz from that… Sometimes artists identify so closely with their physical product that they forget it’s all a form of value exchange, not a vote up or down on their artistic worth every transaction!!

  • Ryan Nagy

    This seems like an incredibly obvious strategy but I must say, that I had not considered it. Though I am not a "band" per se and do not sell music, I do sell education mp3's on my own website and on Amazon, iTunes and elsewhere (thanks to CD Baby). I initially thought the digital distribution would cannibalize the sales on my own website (where I charge more) but that has not been the case – at least not yet.

    • There's a lot to be said for convenience, and if someone is searching for you and your website is the first site to appear in the Google results, and if you have a store set up on your website, many folks will be apt to just buy direct from you even if you charge more. Good that you give them that option.

  • Sounds perfect. $8-10 bucks.

  • Though you'll probably have to part with a few for $5 if that is all the drunk at the end of the night has in his wallet and he really wants a disc.

  • Woah. Good trick. I like jokingly stating a "suggested retail price" that is above what you'd hope to get paid. Then if you get half, it's probably fair price!

  • Shari

    I constantly grapple with CD pricing. And I DO adjust from setting to setting. Lately I’ve been joking that the “Suggested List Price” is $20, but folks can pay what they’re comfortable with . Seems that 90% of folks pay $20 and a few $15. But I add that it’s important to me that they take the music home if they want it, and that money not get in the way of them being able to do that. I agree that $20 is indeed a premium, and they do get and autograph and lots of yakking with me if they want it. Buying a CD is always a gamble for an audience member, so you can only hope they get years of pleasure out of it. But hey….what do you all think…is it time to go down to $15?

  • one thing that works well lately is bundling the CD with T-Shirt since people perceive the value of a T-Shirt as more than music. We may sell a CD for $10 and Tshirt for $15 but if you get Tshirt+CD, it’s only $20. In people’s minds, then they’re only paying $5 for a CD instead of $10. If we’re doing a headlining show, we’ll often sell our CDs at $12 but do a 2 for $20 deal. Most people have a $20 in their wallet. If we’re doing a show with multiple artists, we’ll try to see what the others are pricing their merch at and try to match or beat the pricing.

  • Nanotear

    A lot of times, variable merch prices are not the fault of the band, but the fault of greedy venues/promoters that take a % tax of merch from the band. And this cost gets passed onto the consumer. Still, even in this situation, you are supporting the band better by paying a little extra and buying from them direct.

    Folks who go to Best Buy looking for the best deal on an album are not doing the band any favors. If you want a record, buy it. That’s what makes “Name Your Own Price” scenarios so awesome.

  • Angela Russ-Ayon

    I always discount my $15 children’s CDs to between $10 and $12 at conferences, where I present workshops. Or, I offer a “2-fer” deal like 2 for $20. But for bulk orders, when selling my product, I have gone down to as low as $4 each for 1000 units for non-profit agencies. The key is, get the sale. If you aren’t making money on even a $4 CD, you are using the wrong replication house.

  • Phil Di Leo

    What would you say a ten song album should be sold for in a bar where the band is merely providing entertainment. We usually sell our albums for about 8 dollars a piece at normal shows.

  • Dinah D of The Kerplunks

    Hey all~ this is definitely interesting! The Kerplunks are 4-piece Canadian Children’s Entertainment Band. We have been very fortunate to have loyal fans who support us and our merch prices. Often the album is “on special” at a gig..and it’s more to buy it online. This is another carrot that will attract people to your merch table. A sale! Announce it if you’d like, it’s always nice to hear there’s a sale happening..and it does make people buy them! Luckily, kids music hasn’t taken as bad of a support hit as adult music has. Second idea that works well for us is….have a dance contest with a CD as the reward. The people who do not win will want one, and the winner will come to your merch table to see what else is there. Good luck everyone!

  • Christa Mason

    I got introduced to CD Baby as a music artist, but I’ve applied the marekting concepts to my business representing artists. When I sell hand-cut glass, etc by local artists, the same concept totally applies. I’ve been struggling a bit with it – but remember on Amazon and iTunes if you’re buying a physical CD you have to pay shipping. I might have one artist’s work on our online store at $30 (customer will probagly pay $8 – $10 in shipping costs, then in a low-end farmer’s market for $35, in a high end boutique show or store for $40 or $45. In America, time is money. My store in one high end location is paying $5000 a month rent; she’s spending $2000 a month or so in advertising; she takes 50%; naturally the price is higher becaue their are more costs involved. If the customers living in her area want to drive half way across town (gas cost) or keep track of the shows we are attending, usually not in her area, they will get it cheaper priced, but are they really saving money? Also, educate your customers. Once lady (made me mad) slipped up to me and whispered to me infront of a store we were promoting in, “I can get this cheaper if I just went through you, can’t I?” I asked her, “Forgive me, but don’t you like to get paid for you work?” (She said she was a teacher.) These people are working for us promoting our art. No, you can’t get it cheaper just through me and I wouldn’t want to do that to these people.”

    People who gripe about what other companies are making need to be sure they know the costs involved first. Unless they’ve worked there and run the other people’s business, there’s a good chance those other companies have costs we don’t know about (24-7 customer service, for example) – so yes, the price can vary. I loved much of the input and found this post really informative. Thanks!

  • Mestizo Management

    I’ve learned to be competitive with The Homecoming’s merch prices. My theory is to keep prices low and sell more, then to have higher prices and risk selling less. The band’s merch prices stay the same at all shows, even when there is a house fee as much as 20%. Keep in mind, The Homecoming’s target audience are pre-teen and teen girls, a group that will buy anything, but might not have a lot of money. So, when a new fan has a choice to buy a $20 t-shirt from the headlining band or a shirt and a CD bundle from The Homecoming for only $15, we normally get the sale. I use the industry standard of getting $1 or merch sales for every 1 person who watched the show. So, if 200 people see The Homecoming perform, than I expect to sell at least $200 in merch. That’s sometimes difficult to do when you’re new to the venue or area and when you’re performing with many other bands. The “cheaper” items actually have the highest profit margins – stickers, buttons, posters, bracelets. Even though I’ve seen other bands sell them as much as $5 each, The Homecoming sells posters for only $1, which is a 65% profit when they only cost $.35 each. We sell bracelets for $3 each, which is another 65% profit margin with a cost of just over $1 each. I believe the fair price for a CD is no more than $1 per song – so a 10 song CD should be sold for no more than $10.

  • fantod

    I’ll often do “volume pricing” where if someone wants more than one or one each of different titles, there’s a discount. I also generally charge a bit less at a gig as a thank you for spending the bread to come to the gig.

  • Fin

    Great thing to think about. I have found it really hard to break the £10 barrier. One way we found to get round it was to do one CD for £12, Two for £20. I was always amazed at how honest customers were about paying for one CD. I have never seen anyone team up with another person in the queue to cash in on the 2 for £20 deal!

    In the US and Canada we played on the exclusive import (which was true I suppose) and charged $20 per CD then we did 2 for $35 and 3 for $50… however we were the only people you could buy our CDs.

    The worst, and I guess this is another topic entirely, was the amount of venues and festivals taking an overlarge cut of sales. We once had to sell our CD at $25+tax to break even.

    • Wow. That is ridiculous that festivals want to cut in on your sales that dramatically.

  • More often than not we charge a dollar a song on a CD as a standard price. I am in a couple of different groups that were set on a $12 to $15 price point and were not selling CD's. I suggested at certain shows to mention a sale price of $10 for a specific event and see how it goes. Sure enough we started moving merchandise.

    Another option for artists that we are fully taking advantage of is the digital download features. We have regular CD's for 2 or 3 releases and then we bought download cards of the Last Live EP release. The actual CD goes for $5 and the download card goes for $3 to suit the budget and keep consistent on pricing.

    We have also been offering a FREE download card for a $5 cover at a show in a new town or venue so we can make people feel justified at spending money to see a band that have never heard of. Price point on the cards is under a dollar and we feel it is worth sharing the music at this point in our career to get the work out there and hopefully build on the market for the next CD.

    Another thing we have been trying with the cards is a free download card for signing the mailing list to get people to the merch table and get their info. That has actually led to more CD sales since we have been trying it. And again it adds to our contacts for future releases.

    The new release went straight to digital download sticker. This helps promote the band and keep cost low for merchandise. 5 tunes, $5 and a new sticker comes with the music. Again around a dollar or so to produce and stickers were almost more expensive without the music so this, we felt was a win win. Only issue was not being able to add the web site address to the sticker, but we still like the over all idea and people are responding well too.

    T-shirts are hard because we pay extra for really soft material and it costs us about $8-10 a shirt so we almost have to keep the $20 price range $15 the lowest and we feel it out, like this article is saying about the audience and what kind o fshow it is.

    Sorry for rambling, but really enjoyed this write up and wanted to respond.

    Thank you – Dean

  • Chris

    Sometimes I don’t even bother to get the CDs out as I am too tired. Then people come and ask which is a good sign. You don’t want to be seen trying to ram them down their throats. But the trick is often once you hook one punter then others come. If I feel like it I will give one say to the first to come and dance, that is if nobody is dancing. It’s horses for courses, but hey why am I giving my secrets away to a land where we are forbidden to play by your angst risen immigration services? Chris jagger.

  • Homeland Security must protect us from perpetual British Invasions!

  • Good advice, especially about the cheaper items with larger profit margins. Thanks.

  • Exactly. The disc itself might not cost much, but the time investment, intellectual property, creativity, recording time, producer/engineer fees, mastering, artwork and layout all add up. It seems like folks only consider the actual replication/duplication costs when they think about what a CD is "worth."

  • Do you announce from the stage that your album is on sale at a special price available only at shows? Or do you display that info at the merch booth?

  • Dcote9

    Wow… You guys should try playing in Brooklyn, no one buys shit! I end up giving away CD’s and our Vinyl!!!! Cause I’d rather them leave with a The Sweet Ones CD than not.. with the hope that it at least it gets on their computer! When we tour I do usually end up selling CD’s, but I always Bundle them together 2 for 10. Or if the show sucks, we just spit Beer all over them and throw our CD’s at them!!! hahaha But over all some good comments!
    I’ve heard a trick to..SPOTIFY. Pays.. you get payed per plays on Spotifly..

    Long Live Junk ROck!

  • Sculptsher

    I have never officially “dropped” the prices of my CD’s, but what I often do is tell people $10 for my 10 song CD, or what ever you would like to pay. Once or twice I have received less than $10, but often I receive more or even double. Beauty is in the ear of the beholder

  • Fantastic article! Thanks! We are releasing our new album next week. We are blessed to have many fans. When people come to the show with little to no money, I have generally put aside 20 or so burned CDs of 5 songs from our many albums. It costs me a few pennies to put together and folks walk away with the knowledge that I understand. I also encourage people to record the shows and share the music they record. I really enjoyed how the Dead made an entire family on the concept of sharing the weatlh. These days it can cost a person 15 in gas just to come see a local show.

  • Andrew Lorien

    I run a little jazz club, and i tour Australia and Europe with bands, and my policy is always : set the price high, and always be generous. In a new place, find out what a CD/Tshirt/whatever is worth. Write a sign saying the highest price any of the locals thinks is reasonable. Then, when you’re talking to people at the desk, just take a bit off every time. “it’s 20 dollars full price, but you can have the concession price if you need to buy dinner as well”. “yes, it’s 15 euro, but because you were a great dancer you can have it for 12”. “a CD + TShirt would be 250 Krone, but if you promise to wear the Tshirt for the rest of the festival you can have them both for 200”.
    You’d be surprised how often the buyer says “oh no, it was so great, i’ll pay the full price”

  • That’s a great tip. Thanks for sharing.

    @ChrisRobley