Wednesday, February 11, 2009

Marketing Art: "Don't put all your eggs in one basket"

"Not much room for weeds"
The Long Border at Great Dixter
8" x 10", coloured pencil on Arches HP

copyright Katherine Tyrrell

When it comes to managing risk, the recommended strategy is diversification. This essentially is the same as the approach advocated by the old English proverb "don't put all your eggs in one basket".

To my mind it's always been a great piece of advice for managing different aspects of your life never mind your financial portfolio or where you should place your art when you're trying to market it. For example, don't give up all your old friends just because you have a new best friend! It's also absolutely amazing how many people forget or ignore this piece of advice - and then lose everything. Such as the people who placed all their money with one bank or Bernie Madoff.

So what does "Don't put all your eggs in one basket" mean in terms of marketing and selling art?

Here's my thoughts. Feel free to add your own thoughts at the end.

What diversification means

Diversification actually has two meanings and I'll explain both briefly
  • FINANCE - Diversification in a financial sense is about managing your risk. The idea is that you reduce risk by spreading your assets around into different savings and investment options. That way the chances of all those options 'going wrong' all at the same time are minimised.
  • MARKETING STRATEGY - Diversification is when you are trying to increase your income and profitability by increasing market share. You can do this either by by expanding into a new marketplace with existing products or you try get a bigger share within your existing marketplace with a new product.
The post focuses primarily on how to diversify to manage risks in terms of the places you market and sell your art so that you can maintain your level of income from sales of your art and hopefully increase your profitability.

Identify the risks

Here's some of the risks which are very real for artists trying to market their art. Remember companies don't tend to announce they're experiencing cash flow problems and there's a very high probability that you may get very little notice of the need to take immediate action.
  • your Bricks and mortar gallery shuts up shop - overnight - with your artwork inside.
  • if you sell from your website - your ISP host may go bust (with very little notice).
  • Another gallery owner is getting very bad at returning your calls. You visit and find they can't find your art and yet don't have a cheque for a sale - and then they deny they ever had your art in the first place.
  • your blogging webware company folds with very little notice
  • the site where you archive your reference photos closes the site and puts up an apology.
  • your online gallery gets into financial trouble, isn't paying its bills and their ISP pulls the plug on the website
  • your online store puts its fees up and becomes too expensive to use any more
Can I emphasise that none of these are unlikely. They're a normal part of the art business. I see blog posts and forum posts about these things happening to peope all the time. The point about the recession is that they are now all likely to happen much more often.

If I've left out any of the common problems which can occur in terms of dealings with third parties I'm sure somebody out there will remind me what that is! ;)

How can you manage risk when marketing art?

In a recession, your normal level of risk is increased. You've seen the major retail names which have already gone into administration.

It's critical to keep in mind that sound businesses are now going bust. Others are taking precautions to maintain income and/or cut costs and that sometimes means offloading unprofitable operations.

Businesses which are still generating income but haven't been quite so good managing their cashflow with a view to risk are now struggling to get credit. They assumed they would be able to get credit or roll over existing credit (just like they've always done before) because business was good and now they find they can't get any credit at all. No part of the economy is exempt - and you can't assume that the places you currently retail your art will still be here in 12 months time. Many B&M galleries have already closed.

Here are some practical suggestions for how you can manage your risks when marketing your art
  • Marketing/selling via one site only
    • this is a classic "all eggs in one basket" approach. It doesn't really matter what sort of site it is - if it disappears so do all your sales. So what's your back up plan for if this particular site disappears overnight?
    • Reduce your risk by identifying additional ways of marketing your work and third parties who you're happy to work with.
    • At a minimum have a website and/or a blog set up - even if you don't use them to sell your art on a regular basis.
    • Consider selling one type of art online and a different type of art through a gallery (eg small works online and larger works in a gallery)
  • Marketing/Selling via your own website
    • Do you have a copy of the content of your website?
    • Do you know what you'd do if your ISP disappeared? Have you checked out alternatives?
    • Do you have a copy of the code for your website?
    • Do you have a folder for all your web images of the artwork on your website? TIP: Get a screen dump of each gallery page and print it out.
  • Marketing/Selling via your own blog
    • Do you have a back-up blog? (One which you could switch to overnight if need be)
    • If not, have you worked out which company you would switch to and why?
    • Do you have a copy of the full html code for your template - including all your links and code for the widgets you use and/or PayPal buttons?
    • Do you email yourself copies of your blog posts? (These could be used to resurrect important posts from an old blog if need be)
  • Selling via a B&M Gallery - it's not unusual at the moment for business to be less good than usual. However the issues which must be addressed concern if a gallery folds completely
    • ALWAYS have written consignment notes for all artwork placed with a gallery - signed and dated as having been received by the gallery
    • If you're selling through galleries, try and be in more than one gallery. Ideally you want to be four or five in different parts of the country.
    • Do you visit on a regular basis to check out how your artwork is doing and what the state of play is with the business. (For example, what are sales like generally? Are the walls different every time you visit?)
    • Do you know how to contact the gallery owner other than at the business address?
    • If your main gallery folds have you worked out how that impacts on your income and paying bills?
    • If you want to get your work in to more galleries, do you know what each gallery's policy is on how close another gallery can be where you also show your work?
    • Do you have a list of new galleries to try? (Remember galleries will also be anxious to find new gallery artists who have a good track record of sales!)
  • Selling via an online site charging listing and sales fees (eg auctions, online stores) or membership fees (eg gallery sites)
    • Have you checked out the traffic that each site gets? (See links to the "resources for artists" at the end of this post to see traffic charts). If you're with a site which doesn't get much traffic have you tried one of the sites which gets more traffic for the sort of art you do
    • Does the site make it easy for people to find your work? (If it doesn't why do you use that site?)
    • Do you get statistics for the traffic that your gallery and/or individual images get? How do you know whether any potential buyers are visiting your work?
    • Does the site represent an expense or does it make you a profit?
    • Do you know how people who make a profit achieve this? Is it because they paint better pictures or work harder at getting people to the site to buy their art (or both)?
    • If you're not in profit after a year are you taking action to increase the chances of making money in subsequent years? (Do you drive traffic to it via your blog or website. Do you have links to your site in your blog sidebar or forum signature?)
    • Do you know what site you would switch to if fees increased to a level which made it unprofitable for you?
    • Do you have a note of which site you would switch to if your current site closed down?
  • Reference photos
    • Never ever archive all your photos on just one site. Assume your hard disc will do its version of the crunch and your favourite photo website goes bust. Do you have your reference photos backed up on to CDs or DVDs or Blu-Ray Disc?
    • Keep alternative websites for photo storage under review - fees go up and sites can (and do) disappear at very short notice.
  • Communicating with past purchasers/current clients
    • Work out how you'd tell your regular clients where your work can now be found if you need to move your sales base at short notice
    • Download a list of all your email subscribers. If you need need to shift sites you can write to them to tell you where you can now be found and how it's really easy to subscribe to the new site..........
I hope this provides some food for thought. Next time you fire up your computer why don't you spend 10 minutes checking out alternative sites or galleries?

Do leave a comment if you have any more useful suggestions for diversification and managing risks.

What changes have you made since it was clear the recession was not going to be short-lived?

The title of the drawing is something I heard somebody saying when I was sketching the Long Border at Great Dixter last summer. See my sketchbook blog post The Long Border at Great Dixter which tells you a lot more about the garden - as does my information site Great Dixter - a great garden
. Christopher Lloyd who designed the garden certainly didn't believe in only growing one type of flower!



Anna T. said...

What a great and timely post! Much food for thought! Where is that link to check out website traffic? Thanks!

Katherine Tyrrell said...

It was rather timely given announcements in the UK about the recession! I didn't know that was coming....

Anna - The links are at the end of the post - visit any of the resources for artists sites and you'll see charts about the relative traffic of different third party websites

Anonymous said...

It is stimulating to see such a wel though our comprehensive coverage of such a sensitive subject. I like the way you have looked the problem in the eye,as it were. I will ruminate on the issues in more detail when I wake but I can tell ylou right now, they applyto amy other arts busineses as well!

Thanks from

Neil McPherson Germany

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