pricing

Topic of conversation

Why do people shop at dollar stores? Is it for the customer service, the wonderful store ambience or the quality of the products? It’s only because of the prices.

Why do people buy coffee at Starbucks? Is it for the customer service, the wonderful store ambience or the quality of the products? It’s certainly not because of the prices.

Consumers choose to shop at a particular store for a variety of reasons and price is not often the primary motivator. Instead, customers search for the best value for their money. Value is always in the eye of the buyer, not the seller.
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Reach For The Top

That Sears, Walmart and some grocery stores have portrait studios should be of no concern to commercial photographers. The fact that these stores do family portraits for as little as $7.99 and business portraits for $29.95 is meaningless.

Don’t worry about it.

These cheap photo stores are not your competition, unless you’re trying to do $7.99 children’s portraits and $29.95 business portraits.

Don’t worry that some other photographer charges $35/hour or that they give away all pictures and copyrights for $199. Unless you’re trying to run your business into the ground, this photographer is not your competition.

Your competition is the photographer who charges more than you because they have what you want.

Always compete up not down.

 

Added April 2013: Sears and Walmart portrait studios shut down.

 

Split Decision

Commercial photographers are sometimes asked if two (or more) customers split the cost of the photography licensing fee, can they both use the pictures?

For example, when a photographer is hired by a hotel to produce pictures of some newly decorated rooms, can the interior designer also use the pictures if the designer splits the cost of the photography with the hotel?

The answer is “no”.
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All the toppings

Way back in my teenage years, I worked part-time at a take-out pizza store. Customers would sometimes say, “Give me a large pizza with everything on it.”

When I’d reply, “Okay, that’ll be $26.00” (or whatever the price was), the customer would gasp and quickly change to, “Just make it pepperoni and mushrooms.”

Wants and needs can be quite different when a price tag is attached.

What do you need?

A corporate photography customer recently asked for some photos of their Toronto office. The pictures were to be used on their web site and printed in a brochure. The company sent a list describing the ten pictures they wanted.

I sent a quote for about $2,800.

The customer e-mailed back and was quite shocked at the price. Why is it so expensive?
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Business Balance

Before a company tries to save a few dollars on its corporate photography by buying cheap stock pictures or by hiring the lowest-priced commercial photographer, that business should remember this:

There is hardly anything in the world that someone cannot make a little worse and sell a little more cheaply. The people who consider price alone are that person’s lawful prey.

It is unwise to pay too much but it is worse to pay too little. When you pay too much, you lose a little money, that is all. When you pay too little, you sometimes lose everything because the thing you bought was incapable of doing the thing it was bought to do.

The common law of business balance prohibits paying a little and getting a lot. It cannot be done. If you deal with the lowest bidder, it is well to add something for the risk you run. And if you do that, you will have enough to pay for something better.

– often attributed to 19th-century social critic John Ruskin, an advocate for economic reform and social change.

 

Usage and Licensing Fees

The fee for commercial photography is based on two things: production value (creative fee) and usage (licensing fee). Any production expenses are in addition to this.

One point of the previous post was to show how production value affects the creative fee. High-end camera gear, lots of lighting equipment, and lots of time spent creating a picture, will usually result in a more expensive photo.

The second factor determining the overall fee is photo usage. This usage is a combination of four things: how many pictures will be used, how the photos will be used (media), where the images will be used (location) and when the pictures will be used (time).
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Sticker Shock

Hotel Client: What?! You want $1,500 just for some pictures of our chef?!

Photographer: What do you think the job is worth?

Client: Maybe $250.

Photographer: Okay, for $250, I’ll come by your hotel sometime in the next couple of weeks whenever I have some spare time. When I’m there, hand me your cell phone and I’ll take a few pictures with it. You pay me $250 and the job is done. How does that sound?

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