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How to Price NFT Art: A Pricing Strategy Guide for Beginners
NFTs are sweeping the digital world, and it’s not too late for beginners to get in on the action. Making (minting) NFT artwork is one thing, but pricing it correctly is another ball game. However, determining the cost of the non-fungible tokens is similar to pricing fine art in real life — you have to understand how to price NFT art.
Key Factors that Influence the Pricing of NFT Art
You have to consider many factors when evaluating pieces in the traditional art world, and the same goes for tokens in the NFT space. Below are the top considerations you must consider before assigning a price to your NFT masterpieces.
• #1: Demand and Association
Knowing the value of your NFT is to understand the demand, and the association of your NFT artwork can also influence the cost. The NFT market is about appreciating unique tokens of various types, but it’s also about the audience. Think about who you are marketing to and the demand within that demographic, and align yourself with people who support your cause.
NFTs sell better if they have utility. Many artists use their creations for fundraising or raising awareness for certain causes, with charities being a big one. What are your NFT artworks associated with? If you have a good cause, it will attract the attention of other NFT supporters, collectors, and other artists.
The more eyes you have on your project, the more likely people will want to buy your non-fungible token. Many artists think it’s about the art when it comes to selling NFTs. While it definitely is a consideration, the demand for the type of NFT it is (which we will cover in the next section) and the association or cause linked to your collection are just as important.
• #2: Type of NFT Art
The price of NFTs is also heavily influenced by their type. Let’s take NBA Top Shot, for example. NBA Top Shot NFTs were selling for hundreds of thousands and more at one point, and that’s because of the association (the NBA) and the type of artwork it is, which is collectible moments in time of your favorite players.
It doesn’t always have to be 2D randomly generated artwork, it can also be 3D rendered pieces, photographs, videos, and even land in a virtual world (metaverse). Some sell for higher prices than others.
• #3: Purpose of Your NFT
We talked about the cause of an NFT collection, but now we dive a bit deeper into the purpose of the artwork. The cause of the collection is the overall goal of what the proceeds are going to, such as a charity of your choice. The purpose of the NFT is slightly different, and it refers to what perks it can give your NFT community.
For example, you can sell your NFT championing a worthy cause and assign utility to each piece. Bored Ape Yacht Club (BAYC) is an example of an NFT that can give its holders access to exclusive events. You can follow in their footsteps and offer access to closed events or think of other creative ideas for your NFT item, such as monthly draws, raffles, discounts for items, and more.
• #4: Investment Price (Materials, Software, Etc.)
No one wants to take a loss when they sell their NFTs, and no one should. You want to price the art high enough to cover your initial investment price, including the materials you use, the software, hired professionals such as designers, and the incurred fees.
Thinking about what you will need to create your NFT is a good starting point. Some artists may be technologically literate and can create everything independently, while others require help. Think about the money you need to invest in your project before it gets off the ground.
The next step is to consider the minting cost. How much does it cost to mint your NFT? Then, there are also the gas fees to think about, the platform fee, and other fees associated with listing your creation. To crunch numbers, you will have to think about the platform and blockchain technology to build on before setting the minimum price per piece.
• #5: Crypto Market
You don’t have to be a crypto aficionado to get in on the NFT market, but to be successful, we suggest familiarizing yourself with cryptocurrency. The blockchain ecosystem you choose will affect the price because of the gas fees (transaction fees). For example, Ethereum is famously expensive due to the traffic and demand, but a different chain such as Cardano or Solana is cheaper.
Each chain has its native currency (ETH for Ethereum, ADA for Cardano, and SOL for Solana), and the value will rise and fall with the market, which will affect your NFT price.
Expert Tips on How to Price Your NFT Art
Now that you know what influences the cost of NFT collections, the next step is understanding pricing strategies. We have a few guidelines on how to price NFT art.
• Tip #1: Understand How NFTs Work
What is the process of creating, listing, and selling NFTS? Look into how people can pay for them, how they are sold, what the buyers are looking for, and what creates value for other projects. Do independent research and understand how non-fungible tokens work before minting your first NFT.
• Tip #2: Understand the Market Fluctuations
Cryptocurrency is quite a volatile market, as many collectors will know. Don’t be afraid of the ups and downs, and try not to think about the value of your NFTs in fiat (real-world currency), and think of it in Eth, ADA, SOL, or whichever native currency you are working with. It can be hard to do but just remember that the market fluctuates.
• Tip #3: Demand for Renowned vs. Emerging NFT Artists
Don’t be discouraged if you are a new artist. The community isn’t always looking for mega-star artists and their pieces. Rare artworks, ones with a significant cause, and pieces with creative utilities can catapult your collection above other artists’. Think of the crypto and NFT community as a level playing field. You are not competing with a famous artist in the real world because their popularity doesn’t directly translate into the NFT world.
Yes, their fame, in reality, can give them more exposure, but when it comes down to it, the artwork speaks for itself. A tip we have for new artists is to go low. Just because you have a lower price now, it doesn’t mean you can’t raise the prices later on. You’re someone new in the space without any transaction history, and no one knows who you are.
• Tip #4: Check the Rarity of Your NFT
The rarity of your NFT depends on the editions. Do you have 1:1, which are unique NFT pieces with only one version of each, or do you have 10, 20, or 100 editions? Of course, the 1:1 pieces are more valuable than the more common ones.
If you’re unsure what you want to do, don’t be afraid to look around on different platforms and see what is working and what sells. A great resource are sites where you can see vital stats of collections, what they’re worth, and figure out the long-term value of your NFTs.
Read more: How to Check the Rarity of an NFT
• Tip #5: Categorize
We discussed the various types of NFT categories, so categorize your collection. You can target one group of buyers or separate your collection into different sections and speak to a wider range of buyers. A great example is Yummi Universe, a very cute NFT collection that splits its collection into various series and rarities. Of course, the common ones are more affordable, and the ultra-rare ones are priced higher.
• Tip #6: Identify Your Floor Price
Unfortunately, there are many more artists than collectors, so it’s very easy to price yourself out of the competition if you aren’t careful. Big sales and more money are not the only indicators of success. As we suggested above, listing a low floor price is the way to go (especially if you are new) because you can always increase it in the future.
It’s a bad idea to list a high floor price without any history in the crypto space. Remember to consider what your holders get with the NFT (such as exclusive access to the next drop or special event), the rarity, and the category, which is among what we listed above to land on a reasonable price.
Read more: NFT Floor Price
• Tip #7: Create Value
A large part of what determines the value of an NFT is the exposure and hype around it. You can create value by making a mark in the community, reaching out to others, pumping your collection, and making connections. Collecting NFTs is no longer just about appreciating art or using it as a flex, but people are genuinely invested in the cause behind it.
Create even more value for your collection by adding cool functions. You can leverage gamification, use unlockables, and give exclusive access to a physical print version of your NFT, merch, and discounts.
• Tip #8: Identify the Best Platform to Sell
You must first pick your blockchain before identifying the different platforms to sell your pieces. If you choose Ethereum, then we suggest using OpenSea. The Nifty Gateway NFT marketplace is also another good option. Make sure you have a crypto wallet that is compatible with the marketplace of your choice, such as the MetaMask Wallet.
There are so many NFT marketplaces to choose from, so take your time and shop around. Compare the prices, explore the platform, and find one you’re comfortable with because no one platform suits all.
• Tip #9: Connect With Potential Buyers
We mentioned that creating hype around your project, making yourself accessible, and building relationships with potential buyers will only incentivize them to purchase your NFTs. It will also help establish you in the space if you’re new. Twitter and Discord are giant platforms to use in the NFT world.
You can also list your NFT on sites like NFT Drops for more exposure online.
• Tip #10: Wait and See
Patience is a virtue, which is also true when evaluating and selling your NFTs. It’s important to look at different marketplaces before listing because if you pick an NFT marketplace with stiff competition and you list yours at high prices, then it’s very likely that you will be waiting for a long time. List low because you can always raise your artwork to a higher price later on. Don’t rush the process; be patient while waiting for your first sale.
FAQ
• What is the average price of NFT art?
The average price of NFT art is around a few hundred dollars. However, there are many that are much lower and others that far exceed it. The news only reports big sales that exceed hundreds of thousands or millions of dollars, but in reality, NFTs can sell for much lower.
• How can I sell NFT art for free?
You can sell an NFT for free if you use lazy minting. Lazy minting offloads the cost of creating the NFT to the buyer, but you may still incur platform and transaction fees depending on your chosen blockchain and NFT marketplace.
Conclusion
Make sure to list the original price of your NFT high enough so it covers your costs, but not too high that you take yourself out of the competition. The NFT niche operates on a lot of trust because rug pulls often happen. Lower prices are less threatening for potential investors, who can help you slowly build your credibility in the community.
