I’m so glad that Diane has finally posted my interview over at CraftyPod, because I’ve had so many post ideas revolving around the idea of the pro-am craft community that I’ve been just bursting to share.
10,000 hours is a reference to an idea in Malcolm Gladwell’s book Outliers, that to become great at something requires 10,000 hours. At around 20 hours a week, this works out to roughly 10 years to reach your 10,000 hours. (Though it can be accelerated. Gladwell uses the example of the Beatles, who played in nightclubs for 8 hours a day for four years on the road to becoming the Beatles we all know and love.)
I was really struck by this for a number of reasons, not least of which is that I realized that a decade has passed since I started studying jewelry and metalsmithing. I am tantalizingly close to my 10,000 hours, and I can attest to the fact that I’ve recently felt like my skills have progressed to a new level.
But more so, I was struck by this theory that prices are low because makers are gaining their 10,000 hours in public. If you work from the theory that crafters should be paid well for their time and skill, then it would make sense that those who are less skilled (or who have put in less time honing those skills) would be paid less. (Of course, this doesn’t account for the other I thing I think we should be paid well for, our creative vision. But that’s an argument for another post.)
Sometimes I forget that my prices started out much lower than they are now. But I had the luxury of trying to sell my work at a much less public format – student jewelry sales in graduate school. I was much closer to my 10,000 hours before I started selling my work on Etsy or in more public forums.
But if this argument can serve as a rationalization for much of the low pricing on Etsy, then the question still remains, how does someone who has put in their 10,000 hours or beyond (and is thus pricing accordingly) fit into a marketplace where most of the prices are significantly lower? And how do you communicate the value of this increased skill to the customer?
Etsy as business incubator
To answer the first question, I want to expand on an idea I brought up in the pro-am podcast. As your business grows, at some point Etsy may no longer fit your needs. And if that becomes the case, you are under no contractual obligation to stay on Etsy. You can always close your Etsy shop and move onto a different e-commerce venue. (Most likely something tied more directly to your own URL and branded exclusively for your business.)
But I know this idea can seem scary, especially for someone who has had much initial success on Etsy. Even if you feel no sense of gratitude towards Etsy as a company, you probably feel very indebted to your Etsy fans who have helped make your business a success. You might also feel a sense of community that you worry will be lost if you make a solo leap into the giant, unprotected world of e-commerce.
But instead of feeling like your Etsy shop is a permanent fixture, what if we started recognizing Etsy for what it does really well. And what Etsy does well is serve as an incubator for craft businesses.
According to Wikipedia, business incubators are:
“programs designed to accelerate the successful development of entrepreneurial companies through an array of business support resources and services, developed and orchestrated by incubator management and offered both in the incubator and through its network of contacts.”
Sounds a lot like Etsy to me.
Etsy serves as this amazing platform for anyone in the early stages of building a crafts business. Not only do they provide a low-cost entry point into the marketplace, but they also provide tools to help sellers develop their skills.
But here is where Etsy diverges from the traditional business incubator format. In an incubator, once a business matures beyond a certain point, they graduate from the incubator. They move on.
In the podcast, Diane asked me how I thought Etsy could better serve both professionals and amateurs, and at the time we recorded that interview, I said that I didn’t think they could. I believed there was a certain point where Etsy would no longer meet the needs of a maker’s business. And at that point the maker should move on.
But perhaps this doesn’t have to be the case. What if Etsy continued with the incubator idea, but created a kind-of halfway house between Etsy as business incubator and the big, scary e-commerce world? A new Etsy. (With a different name, different branding, and a slightly different business model.)
Customers who were looking for the lowest prices could shop the original Etsy for work from early-stage businesses. But those who were looking for products made with a higher degree of skill, a more mature design sense, or a more developed brand image could shop this new Etsy.
So maybe this is a pipe dream. (Or maybe I just gave someone a really great idea for a new business. You’re welcome.) But while we’re waiting for Etsy (or anyone else) to create this new solution for us, we can still shift our own mindset about Etsy.
What if you started viewing Etsy as an incubator for your business? What if you put a plan in place to graduate beyond Etsy once your business reaches a certain level. What if those of us running craft businesses stopped viewing Etsy as a long term solution and started viewing it as a launch pad?
Pricing from am to pro
The other important point to take from all of this is that as your skill level increases, so should your prices. Which brings us back to the question, how do you justify this price increase to your customers?
And I think the answer is that you don’t.
At least not so overtly.
Ideally, as you move towards 10,000 hours of learning your craft, you are also developing two other aspects of your business – your creative voice and your brand. Unfortunately, most of us live in a society that no longer places a high value on skill. And while I think it’s important to advocate for this to change, it’s also not a strong foundation for a marketing strategy.
But time and time again, we’ve seen how both a designer’s creative voice and the branding of a company can compel customers to buy. As you move through your 10,000 hours, you should also be developing your design skills, refining your brand, and ideally developing a posse of loyal customers who will follow you wherever you go. Rise in skill, design, and brand should all lead to a rise in demand for your products, which will allow you to raise prices accordingly.
But this only further reinforces my point that we should treat Etsy as an incubator to move away from as your business develops. First, while Etsy does give you options for customization, it doesn’t let you showcase a full-brand strategy. You are an Etsy shop first, your brand second.
The second reason to move off Etsy as your prices rise is that Etsy will always be filled with a nearly endless supply of cheap, low-skilled products. Because Etsy functions very well as an incubator. It’s the place where people set-up when they are at the start of their 10,000 hours. And because increase in skill is difficult to communicate on a computer screen, and because you can’t build a complete brand identity on Etsy, you are left competing on that other variable – price. And did you really start your business with the goal of becoming the Wal-Mart of the craft community?
Side note: I was browsing Supermarket the other day and was struck by the sheer absence of prices on category and designer pages. In fact, it’s not until you get to a product’s main page that you see the price. Contrast this with Etsy, where prices are featured everywhere you look, practically begging you to comparison shop by price.
Yes, perhaps everyone getting their 10,000 hours in the public marketplace provides challenges for all of us. (Particularly when it comes to price and public perception.) But instead of viewing these challenges as stumbling blocks, we should view them as opportunities. By using Etsy as a launch pad (not a lifelong commitment) and creating a strategy where price rises in conjunction with skill, voice, and branding, you should be able to create a thriving business by the time you’ve reached your 10,000 hours.
If you’re interested in learning more about pricing your products, I’m running an online workshop on Tuesday all about pricing for profit.