The TLP Network

Sharing the Hate, Spreading the Pain: On I’d Buy That for a Dollar

by on Nov.01, 2007, under Articles, Sharing the Hate

Last week we touched on the impact of people having less disposable income on their ability to afford to show up to an event. The next direct impact is on their ability to buy your merch at a show.

Merch accounts for most of the profit for a band at a show. They can easily double or triple a decent venue payout through the selling of merchandise. The profit margin on merch is generally high for an independent band, and national bands use their merch sales to get from point A to point B.

For the sake of argument, we will assume that your band has CDs, Clothes, Posters, Stickers, and some other form of disposable utility device for sale at each show. What is a disposable utility device? That device is something people use often and need to replace frequently such as a lighter, a pen, a can/bottle coozie, etc. We will also assume for the sake of argument that your band has a mailing list, or actually pays attention to ‘views per friends’ on one of those promoting whore engines.

When you sell merchandise at a show, you technically set up a small corner shop, and are a vendor of commercial goods. There are several economic factors you should take into account when setting up your shop for the event:

What is the age of the audience?
What is the price of admission?

These three questions all dictate the amount of disposable income a person will have at a show. Your band, the other bands, and the establishment are in competition for that disposable income form the audience members.

To get people over to your merch table, offer them something free for signing a mailing list. Make it known and visible that something is free for signing the mailing list. This item is called a ‘lost leader.’ The ‘lost leader’ is money you lose on the front end (by giving them something free) to gain back later on the back end (by selling them another product with a larger profit margin).

Since you will use the information on the mailing list as described in other articles, they are paying with personal information for a sticker or an EP. The two song EP is more effective than a sticker for signing a mailing list if you are a band, since people walk away with your music. The personal information is used to get them out to more shows.

Another technique to get people over to the merch table is have the band hover around the merch table immediately after your set. People talking to you as you break down, should be talking to you at a merch table. If they say they loved your set, sell them something. Most of the time you can easily guilt a person into buying a disposable utility item or a CD because they loved your set and want to support your band.

Let one person from the band man the merch table while the others break down. Alternate this person each show, so everyone gets a break from breaking down after a set. Plus, as members become free after breaking down, they join the merch table.

You will sell the most right after your set. People just saw you, and are excited. At this point, you should send one band member around with a stack of CDs and they should try to sell people in the venue that are not near the merch table.

What about pricing?

We will assume that your local cash machine either spits out $20s at most people with the rare machine spitting out $50. Before heading out people typically visit the ATM, or check how much money they have in their wallet or purse. Many adults will visit a cash machine and withdraw $40 to $50. Many parents will give their child $20 and send them into a venue directly from the vehicle since they went to the cash machine earlier in the day.

For the below to pan out successfully assume each adult has $40, and each child has $20. If a couple shows up, assume the combined child has $10, and the adult has $30.

What is the price of admission goes along with how much money did each person spend to get through the door. Since younger audience members have less money on them, and no access to more money setting your prices accordingly pay off big.

For example, there is a $7 cover charge at the door. With people getting change from the door itself each person has $3 or $13 on them instantly from a $20. Do you have something for sale for $3? If so, you could try to sell an EP to them for $3, offer them a full length and a shirt for $13. People are unsure what to do with change, and they will spend that money very quickly to get rid of it.

In a bar, they usually have a beer tub set up by the door featuring a drink that costs just under the change they received from the door leaving a dollar for a tip. If the cover is $5, which is easiest on the door person to make change, then you can sell a merch item for $5 knowing that they either have $5 or $15 on them instantly. Yes, you can charge more money when the cover charge is lower, because people have more money on them.

A great tactic to sell merch at the end of the night is lower your prices. As long as you sell the merch for more than you paid for it, you are getting more material out there to people. If they did not buy your CD all night at $5, and it’s the end of the night, they probably do not have $5 left on them to spend. However, if when talking with them, try selling the CD to them for $2 or $3. Since you probably paid under one dollar for them, you still realize a profit. Plus, if the person is walking out the door, you may never see them again to sell them a CD at the ‘next one.’

Another great tactic is to have, but not advertise that you have a credit card machine handy. More experienced bands, and traveling bands usually have access to Visa/Mastercard machines and can swipe cards using a reader and a wi-fi connection. You do not advertise the fact you take credit cards, because people will often say they only have credit cards as an excuse to not buy merch. At this point, you say you not only accept credit cards, but would like to know what they would like to buy.

If you think this technique is shady, they should not have lied to you in the first place and used a credit card machine as an excuse not to buy merch. People here end up buying a CD and a shirt in order to not look like a liar, and the machine pays for itself very quickly.

If you think any of these techniques are shady take into account the following:

Pick 1 popular domestic beer:

What is the price of the domestic beer at the last three places you played? (Geographic pricing)
What is the price of the domestic beer during happy hour? (Incentive to show up early)
What is the price of the domestic beer in a bucket? (Buying in bulk)
What is the price of the domestic beer during you show? (Peak Buying Time)
What is the price of the domestic beer when it is on special? (Turning Over Old Merch)

Are these prices all the same? I highly doubt it, and your prices should change as well.

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