pricing

Magic Act

Some photographers charge more, other photographers charge less, and some photographers undercharge and effectively work for nothing. But I’ve never heard of a photographer who overcharges or gouges customers.

A fellow corporate photographer recently wondered what he should tell potential clients who point out that another photographer charges much less than he does. Perhaps this might help:

Photographers are not economic magicians. When a photographer charges less, it means the customer is getting less. There’s no way around it. Maybe it’s less quality, maybe less service, maybe less experience. But it’s always less. The customer has to decide if they’re willing to settle for less.

If the pictures are not important then it might be okay to take a chance with low-priced photography. But smart companies know to always avoid risk because cheap can sometimes be too expensive.

My photography business doesn’t settle for less, (which is why I buy only premium cameras, lenses, computers, software, etc.), and I refuse to offer less because my customers are important.

I want my customers to succeed in their business marketing and I want my pictures to play a part in that success. I don’t cut corners and give customers less because that would only undermine their business goals.

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$900 Headshot

Many professional photographers do business headshots. A quick web search shows:

• One Toronto photographer charges $29 for business headshots. One wonders why he even bothers to charge anything at all. In the end, $29 is the same as $0 to his business.

 

• Another Toronto photographer, who claims 18 years in the business, charges $60 for headshots – cash only, please. Many of the sample photos on his site were stolen from other photographers. Using Google, it’s easy to trace the pictures back to the original sites. In this case, buyer beware.

 

• A Toronto-area photographer, charges $1,000 for “unlimited” business headshots. The fine print says that, for $1,000, he will come to your office and shoot as many portraits as you want in three hours.

This guy claims that he once did 84 headshots in three hours. He goes on to brag on his web site: “that’s one headshot every two minutes!” If you do the math, that’s about $12 per portrait.

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Make Me An Offer I Can Refuse

Earlier today, I received an offer to photograph a sports event next month. A US photography company is seeking a few photographers to cover an all-day athletic event. The photographers just take pictures and no editing is required. Does this sound like a good assignment?

The job pays $225.

Does this still sound like a good assignment?
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Three Little Rules

A recent book, The Three Rules (link to PDF), written by Michael Raynor and Mumtaz Ahmed confirms that competing on price is not a successful business strategy.

The two business authors spent five years studying more than 25,000 companies, in hundreds of industries, covering a 45-year span. They narrowed down the list of companies to 344. These were companies whose long-term success was not due to luck but rather to specific business decisions.

They found that these companies did three things in common from which the authors formulated their three rules for how successful companies think:
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How Not To Run A Photo Business

Many photographers struggle with their pricing. This is normal. The best way for a photographer to establish their business is to understand how their business operates. They also should learn how any business operates.

A photographer learns to price according to *their* location, *their* business plans and *their* market positioning. This takes time and effort and mistakes will be made along the way.

And then there are photographers who like to take shortcuts.

Pretend Professional

I got a phone call today from someone claiming to be an office manager. She said they needed some business portraits. She asked how much I charged, how the pictures would be shot, whether I use softboxes or umbrellas, what type of backgrounds are best, how the photos are selected, what amount of retouching I do, and how the pictures would be delivered. After I answered all her questions, she suddenly hung up.
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Fear Photography

As a photographer, which would you prefer: lots of low-paying customers or only a few high-paying customers? For example:

Photographer A shoots three business portraits every week at $100 each. His annual gross revenue is 3 X $100 X 52 = $15,600.

Photographer B does only one business portrait every other week at $600. Her annual gross is 1 x $600 x 26 = $15,600.

Which is better: low price with high volume or high price with low volume?
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There’s No Money in Cheap

Some photographers still insist on pricing below cost or competing only on price. In the race to the bottom, these photographers will always win, or lose, depending on how you look at it.

If a photographer sells very cheaply or works for free, hoping that customers will one day agree to pay much more or that a huge volume of work will magically appear, then this photographer will be greatly mistaken.

On April 6th, CPI Corp., the company that owned and operated all of the Sears portrait studios and about 20% of the Walmart portrait studios, in the USA, shut down its US operations. Its Canadian in-store studios are, so far, unaffected.

CPI, (in)famous for its dirt cheap portraits and free prints, was ….. (wait for it) ….. losing too much money. It owes about US$174.8 million. Creditors gave the company until April 6th to repay US$98.5 million. So CPI is a winner in the race to the bottom!
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