Would-be pro photographers, I have some very important advice for you: Do not compete on price. Stay away from bargain-hunters. Just do NOT do it!
I am saying that this is important advice for several reasons:
- If you compete on price, there will always be someone cheaper than you. It’s a race to the bottom.
- Price hunters take an inordinate amount of your time and are disloyal: the moment someone else is cheaper, there they go.
- Your value proposition is wrong – competing on price says “I am not worth much”. You should be selling a premium product! After all, everyone can take snaps by clicking an iPhone, You can do better. You know the rule of thirds. You have good glass. You know how to do post. You know flash (*). And you need to make that very clear. Low pricing does not achieve that: rather, it achieves the opposite.
- You will drive away the best customers – those who want a premium product. These are the customers you really want, and they do not go to Sears for photos.
- You will go bankrupt. Do the math: say you do a portrait shoot. What are you going to spend both in terms of immediate cost (your travel cost, your camera, your batteries, your parking fees) and time (preparing, getting there, shooting, driving back, unpacking, downloading, post work, sending to client, discussing with client, invoicing, follow up)? When you do a little spreadsheet that contains all this, yes, it’s a lot more than you think. Take your bill; subtract immediate cost; then divide the remainder of the money over the hours spent and you will see that you work for minimum wage or less. You cannot build a business that way.
Aha, I hear you say, “but Michael, others in my market are cheaper, so everyone goes to them!”
Oh? I can buy an Acer PC laptop for $300, or I can buy the Macbook I am typing this on for $2,000. I did the latter, and so do many others. Guess who makes more money, Apple or Acer? I bet that in your market too, Apple sells laptops. There are no markets where everyone only buys Acers. In a market where there’s a McDonalds (i.e. everywhere), there are still expensive restaurants. Always keep that in mind. You are a bistro, not a McDonalds.
The secret is that people really want the Apple laptop or the expensive steak au poivre. Once your client really wants what you are selling, they will pay what you want them to pay.
So – make sure that:
- You do the math. If you are selling below cost, you will go bankrupt. Or you are subsidizing a hobby. Not good.
- You dare to ask for premium prices. Asking for real money takes confidence, courage, even. It is a natural impulse to say “oh, I don’t want to insult people by asking too much”. But resist that urge: You are worth the price. You don’t do iPhone snaps. You know your stuff. Your hours are worth something. You offer value.
- You profile yourself well. You should exude quality, from A to Z. Apple takes enormous care when designing the boxes. The web site. The cables. The boxes for the cables. Yes, even the damn boxes for the cables are a work of art! It’s not just “Apple makes better laptops”. For all I know, Lenovo also makes great laptops. But Apple gives you a great, quality experience from the start to the box. And you should do the same – your entire business, every touch point with the client should be a great experience. Be a pro! No gmail email addresses. No cheap printing. No husband answering the phone with “oh yeah, right, well my wife’s not in right now, she’s gone to the doctor for her checkup, one of those woman things”. (**)
My location sitting fee is $335. That is what I charge to turn up and take pictures for an hour. The photos are extra. I am pretty sure there are people who do this for less, but I do not care; in fact, I shall increase it soon. I want to be Apple, not Acer.