[Editor’s Note: This article was written by Vanessa Ferrer, owner of Merch Cat, and the second installment in her “Mastering Your Merch” series. Read part one, “Merch Basics” here. For a free 30-day trial of Merch Cat, head over to their site and use promo code TC2019!]

In the last segment of Master Your Merch, we covered ‘Merch Basics’. If you missed that, you can find it here. Once you’ve gotten the basics down, you’ll want to come up with a merch strategy. 

So what do we mean by merch strategy? We mean actually thinking about your merch from a business perspective, (instead of a last-minute afterthought the week before your tour/shows), in a pointed way, to actually try to maximize your merch income and profit.

Merch is an investment and should be treated as such. This requires coming up with an actionable plan to: 1.) Get the money back that you invested; and 2.) Make that money grow. If you play your cards right, you can be putting two to three times your investment and then some in your pocket.

Let’s do some quick math – invest $7, sell for $20 and put $13 in your pocket. You are getting back almost twice the money that you invested. Let’s say you sold 50 shirts. That’s a $350 investment, $1,000 in sales and an additional $650 in your pocket. Now we’re starting to talk about real money. That said, let’s get down to business.       

Laying Out A Merch Plan to Maximize Return On Investment (ROI)

Product Strategy 

What will you sell?

I like to say, “without artists, there is no music, and without fans, there is no music business”. I don’t think that needs further explanation, but without your fans you have no one to reach, market to, perform for, sell to, etc. Based on that simple concept, if you can figure out who your fans are, what they like, and what they want, you’ll be golden. Rule number one when it comes to merch is KYF (know your fans), so you can create a product line to suit them.

Things to consider:

What is the male to female ratio of your fan base?

What age are they? Are they young or old? Are they kids, teens, 20s, 30s, 40s, middle aged, baby boomers, seniors? All of the above? Are they casual or more sophisticated?

School age fans can’t wear profanity, sexually explicit designs, alcohol, tobacco or firearm images to school. Men typically won’t buy a shirt with photos of men on them. 

Ladies tend to go for more trendy and fashionable designs. An older crowd is likely to buy larger sizes than a younger crowd, and may be more conservative and shy away from edgier items like cropped shirts, distressed looking tops and neon or loud colors. So where can you find this info? In our previous segment we gave some insight on how to get this info. If you missed it, here are a few ways:

  • Use analytics from streaming services and TuneCore to see who is consuming your music.
  • Pay attention at shows! If you can’t, ask someone else to take notes for you. 
  • Use analytics from socials to see who is engaging with you/visiting your page.

Some quality products we love that you should be able to make and get a good return on without breaking the bank:

  • Bella &Canvas 3001/3001CVC Favorite Tee
  • Bella & Canvas 3650 Poly-Cotton Tee
  • Bella & Canvas 3413 Tri-Blend
  • Bella & Canvas 6003 Ladies Muscle Tank
  • Next Level Ladies Jersey Tank
  • Alternative Apparel Keeper/Keepsake
  • Gildan 64000
  • Yupoong Trucker Hat
  • Port & Co Draw String Bag
  • Q-Tees Jumbo Shopper Tote

Financial Strategy 

So now that you have our eye on some products, how much should you pay for merch? And how much should you sell it for?

We discussed the importance of quality in our previous segment, so don’t just go for the cheapest shirt you can find. If you do decide to make a low cost/low quality shirt, please do not pay more than $5 for that shirt, and please don’t try to sell it for more than $15.

If you are working within a certain budget, the key is finding the best quality product for your money, while keeping in mind the price point that you think you can sell it for. As a general rule, you should make sure that the price can sell an item for is at least twice what you’re spending on it. So following that rule, if the shirt you want to make is going to cost you $13, but you know your fan’s comfort zone is a $20 spend, you may want to rethink that shirt.

Not every fan has the same budget or spending appetite so ideally, you will want to have a few items at different price points so that every fan has something accessible to buy. This is where your merch product mix comes into play. By diversifying your merch product mix, you’re lowering your risk of leaving money on the table. While they may not want to buy that $20 shirt, maybe they will be ok with spending $10 or $15 on some other item. With the right product mix, you can offset lower cost items against higher cost items, and maximize your profit ability.

Using the above example, you have three higher cost items and two lower cost items. The higher cost items are being sold for almost 3x the cost, and the lower cost items are being sold for three and eight times the cost.

The lower cost and larger markup on the posters is helping to offset the higher cost and lower markup on the hats. You could raise the price on the hats to increase the return, but fans may not want to pay $30 for a hat. So adding the posters and backpacks to your product mix gives you the ability to also sell the hats and still make a return in the 200%, meaning you made back twice the money you invested.

To simplify, using this example, if you invested just under $600 in your merch and sold it all at the prices above, you would put $1,400 back in your pocket after covering the initial cost of the merch.

By creating a merch projection like this, you will be able to:

  • Determine if the merch you are planning to make is financially feasible.
  • Determine if you can get a good return on your investment.
  • Check in and see if the plan is working. If not, you can re-adjust pricing.
  • Measure the results against the original projections and hold yourself. accountable – i.e. if you only made $1,500 total because you gave away items, you’ll now be able to quantify those giveaways as $550.

A couple of years ago, we worked with the band Hollis Brown to help them overhaul their merch and come up with a better mix to accommodate their fans. After attending several shows, we assessed that fans were coming to the merch table to check it out, and many were leaving without buying anything. Money was being left on the table, simply because they didn’t have new/different items for their fans to buy. Because the bulk of their items were music, we suggested that they add a few more non-music items to the mix: 1.) To give those who already had all of the music something else to buy, and; 2.) To help them put more money in their pocket, vs. the record label who received a percent of their music sales.

Based on their fan base and the time of year, we collectively came up with this mix, and the band saw an uptick of about 20% on their tour that summer.

Tracking Inventory and Sales

Let’s move on to tracking your merch inventory and sales, particularly at shows.

Eighty-five percent or more of merch sales take place at the live show when your fans are emotionally engaged, so it is crucial that you take advantage of this opportunity to the best of your ability.  This means you should:

Take Credit Cards and Have Change

  • Many people do not carry cash these days. If they leave the line to go to the ATM machine, they may not come back, especially if there’s a line.
  • Square and PayPal Here readers are free.

Keep Track of Inventory

  • Have the items on hand that your fans want to buy – items, sizes & styles.
  • If you run out, you’ll be leaving money on the table.
  • Know what items are selling or not selling.

Know What You Sold At What Show

  • It helps prepare you for future shows. 
  • If you’re not getting paid or don’t have a guarantee, you may not want to return to that venue.

Think of a retail store that tried to run a business without tracking sales and inventory – that store wouldn’t be in business for long, now would it? Well this is your retail store and your business. Treat it as such.

Marketing Strategy 

Now that we’ve gotten all of that fun stuff out of the way, and you have your merch and your financial plan down, let’s get the sales going. How will you get your merch to your fans?

Well, to recap because we can’t stress it enough, use your shows as the primary platform and milk it for all you can! PROMOTE your merch from the stage. Let the crowd know you have a merch table, tell them where it is and when possible, tell them you will be there after the show and want to meet them. Offer Special deals at the merch table at shows – buy one get one half off, bundles, etc.

Offer exclusives/limited edition items or behind the scenes content. A 2013 Neilsen study showed that fans would spend $2.6B more a year if they had access to exclusives. We can only guess that the dollar amount has grown over the past few years. This is pretty easy to do. If you’re touring or have a web store, kick off a new season with items that will only be available for a couple of months or the length of your tour. If you’re on tour, create items specific to that tour or album you’re promoting, or if you want to get more personal, design a merch item that’s indicative of something that’s going on in the band’s world or specific to someone in the band.

Run contests with a call to action; empower your fans to be your brand ambassadors – i.e. “Post a picture with our merch using #merchbetter, win a meet and greet at next show.

Encourage and reward fan sharing both at shows and online when a purchase is made. Ask fans to share their latest merch purchase on socials and in their network with a special code or link for others to buy it, and if a purchase results because of that share, reward them with more merch, a special item, or a ticket to your next show.

Take advantage of FOMO (Fear Of Missing Out) and “Second Hand Reach” (Reaching people who couldn’t make it to the show, but are likely to engage on socials or perform an action during or after). You can do this by promoting your merch on socials the day of shows to let fans know about the merch they might be missing at show, and give them a way to buy it. You can also have someone post about your merch during the show to reach those who couldn’t make it and direct them to where they can buy it, whether it be your webstore, your Facebook or Instagram page, or via an app like our Merch Cat Fan, which lets fans buy merch in app at shows or from home, and pick up at the merch table or ship to home.

Get fans involved in your merch process by inviting feedback. Since your fans are the number one (and really only) consumer of your merch, doesn’t it make sense to ask them what they’d like to see on your next merch run? You may think they’d want a beanie, but maybe only a small number of fans actually wear beanies, and the majority would rather sport a trucker hat. Or maybe it’s the other way around. Inviting your fans to contribute to ideas will keep them engaged, and also up your chances of selling the merch they suggest.

We’ve covered a lot in these two segments with one goal in mind, and that’s to help you rock your merch business. Hopefully there’s been some clarity provided on all of the different pieces that make up the big merch picture. Most people who do it well, do it with intent, just like anything else. We know it’s a process, but the reward for doing merch successfully is more money for your next meal, your next tour, your next record, your next guitar or whatever else you choose to spend the profit on.


We definitely encourage you to reinvest some of that profit back into your merch business so you can continue to grow it and increase its earning potential. To assist in your merch journey, Merch Cat provides a platform with payment solutions, inventory management, a fan option and we also offer physical merch services. Now that you’ve been inspired and armed with some new tools and a better understanding, get out there and kill it! Check in and let us know how you’re doing – we’d love to hear your stories and see your merch. Feel free to email us at info@merchcat.com, or follow us on Instagram & Twitter – @merch_cat, or Facebook – @Merch Cat.

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