business, learnings

Pay What You Want vs Fixed Price

Norden Farm in Maidenhead where I volunteer

I volunteer regularly at a local arts centre and recently when I was stewarding for a jazz gig, as we were going for a break, the leader of the band announced that they had a few CDs of their music to give away and patrons could pick one up as they left and pay whatever they felt like. As I stood by the door, I watched as nearly every single patron pick up a copy and drop more than just a few coins (many in notes). So much so  that I am certain the band shifted more copies and made more than what they’d have if they had charged a fixed price.

The duty manager endorsed my view when she said that each time the patrons were offered a chance to pay what they wished to, the band always g0t paid more. She’d seen it happen several times in Edinburgh during the Fringe, at theatres which were free to enter but charged to exit. And invariably, the acts made more at the door than they would have at the box office.

And barely 24 hours after this incident something else happened. I was at a networking event, when someone who was very interested in what I had to offer asked me how much I charged. And upon hearing my response, a third party who had been listening to our conversation said, ‘I lost interest the second you mentioned your prices’ (charming!). His response had me wondering, not for the first time, if this kind of a reaction to prices was something that was unique to the arts and businesses working in the arts. And if this was how people reacted to other lines of work – say, trades, finances, law – as well.

I am tempted to do an experiment. What if, for a limited period, I told clients that they could pay what they wanted in return for a questionnaire that explored the reasoning for their payment? The results could be interesting. Or would I just be shooting myself in the foot (and the purse)? What do you think?