Richard Gottlieb

A visit to the upside down world
January 29, 2008

This past Saturday, while on a walk around Manhattan, I passed through a crowed of people entering what was billed as “The Outsider Art Show.”  For those of you unfamiliar with “Outsider Art,” it is work done by untrained artists who do not see themselves as artists.  Their work can, however, have significant artistic value.  It seems it can also have significant monetary value.

So, I stopped my walk and thought to myself, “I write a column called ‘Outside of the Toy Box’ so maybe there is something here that will speak to me.”  Well, there was.  Not the art, although I did see much that really was appealing.  What struck me was how arbitrary the notion of value really is. 

Let me explain:  As I walked the aisles, I saw works of art that varied greatly, at least to me, in their attraction and perceived skill.  Now let me do a little due diligence here and state that I took a drawing course at the Art Student’s League last year and learned primarily that I had no talent.  Having said this, I still have a sense for what I like and don’t like and there was work at the show that I found to be beyond primitive.  In my eyes, it was just plain bad. 

Still, something that I thought was great looking might sell for $4,000 while something I found terrible was priced at $140,000.  Before you laugh, let me state emphatically that people were lining up to buy these works of art.

Coming out of the consumer products universe where every item has its “perceived value” and where many buyers reduce products to the commodity level, it was a jolt to be in a universe where value was so arbitrary. 

I finished my walk by visiting Bed, Bath and Beyond where I bought some kitchen gadgets that were safely back in the world of “perceived value.”

So, what to make of all of this? Does it tell us anything or is it just a parallel universe?

Here is what I think.  I think with prices rising and a greater sensibility in the industry to the danger of lowest cost at any cost, it may be time to rethink the overarching wisdom of “perceived value.”

After all, perceived by whom?  If you are catering to the mass market and you want to sell as many as you can than you better pay attention to that industry’s concept of “perceived value” which is what retail buyers think is the value that a majority of shoppers place on a product.

Maybe, however, some retailers and manufacturers may want to look for business outside of the mode or the mean or the median or whatever you want to call that place where most people go.  Maybe there is business to be had where the rest of the population lives; Out in those areas that tend to not be statistically interesting to main stream operators.

Way out there in what we might call the statistical sticks may lie a class of shoppers who are far more elastic in what they are willing to pay;  Who may pay more, much more, for what is beautiful in their own eyes.  Who see value in what speaks to their ethics and values.   If you want to go after these consumers then you may want to think in terms of basing your selling price on a more elastic sense of what people will pay.  Your targeted customer base is fewer in number but may pay lots, and I mean lots, more. 

This business model won’t get you into the mass market but it may fit snugly into certain parts of the toy specialty and gift markets.    It may not make you a millionaire but it may make you financially comfortable or short of that fulfilled in some other meaningful way.  It’s something to think about.

Posted by Richard Gottlieb on January 29, 2008 | Comments (0)