There are so many of you who feel overwhelmed at times understanding social media. Think of it this way, social media is just a doorway. Done the right way, it's your access to meet hundreds of great people who share your passion as an artist and your frustrations as a business owner.
I called it a doorway, because that's all it is. The real fun comes when you step through that doorway and pick up the phone to talk to somebody you admire and if you're lucky, actually connect with them socially over lunch or dinner. Well, meet Bryan Caporicci.
I "met" Bryan when he asked me online if I'd be willing to do a podcast on Sprouting Photographer. That led to a phone conversation and yesterday, since he was on vacation just a short drive away, Sheila and I grabbed lunch with him. There's the most fun benefit of social media - being able to take it to the next level and start to build a friendship.
Bryan has written some outstanding posts on his own blog and one of them was about pricing. So, I asked him if he'd have an interest in sharing more of his thoughts here at SCU. Pricing is one of the biggest challenges and was the subject of a rant I did a couple of weeks ago.
Now, Bryan has given you some concrete tools to make sure you're on the right path. As Sal Cincotta said in his video on pricing, "...nothing can destroy a business faster than bad pricing!" Bryan should definitely be on your radar. Follow his blog at SproutingPhotographer.com.
Pricing is a topic that most photographers will cringe at the thought of. While it may not have the same appeal as the creative side of being a photographer, it is an inevitable and crucial part of running a photography business.
Often photographers will get into photography because of the love for the art and creativity, but unless we can get paid for our work, photography will be nothing more than a hobby for us. Making a sustainable living as a professional photographer is certainly a realistic possibility, but you need to make smart decisions along the way and set the foundation right. Pricing is a big part of that foundation.
Many photographers will set their prices hastily without putting real thought or attention into the reasons why they set those prices. This article, written exclusively for Skip here at Skip Cohen University is all about pricing and the influencing factors that you should consider when setting your prices.
There are five main factors that should influence your pricing. They are as follows:
- The quality of your photography and the finished products that you provide.
- Your perceived value as a photographer in your marketplace.
- How confident you are.
- What your competitors are charging.
- Your cost-of-goods.
When exploring these factors, it’s important to note that the first three (quality, perceived value, confidence) are intangible factors and are therefore subjective. The fourth factor (competition) is one that should also be taken with a grain of salt (more to come on that later). The best way to start, therefore, is by establishing a price based off of your cost-of-goods and then working through the other four factors to adjust your price if necessary.
Price Influencing Factor #1 (The Base): Cost-of-Goods
The only real measurable way to establish your pricing is by calculating based off of your cost-of-goods. Cost-of-Goods are the direct costs involved in producing a product or service, including material and labour costs. That last point is important – you must include labour (time) in your cost-of-goods calculations. Many photographers don’t factor in their time when establishing their pricing, and that is a sure way to not make a living with your photography business.
The mechanics of this discussion can get lengthy and tedious, and I have written entire articles around these mechanics:
- How to set your prices as a professional photographer – SproutingPhotographer.com
- Increasing Prices – SproutingPhotographer.com
- How to Price a Newborn Session – NewbornPhotography.com
If you’d like to know more about the how and why of this method, I suggest checking out some of the articles I linked above. You can also take advantage of the free tools and calculators that I have created over on SproutingPhotographer.com where you can plug in your own numbers to establish your own prices. The calculator links are as follows:
- What to Charge Calculator
- Pricing Calculator for an 8×10 Print
- Pricing Calculator for an Album
- Pricing Calculator for a Newborn Session
- Increasing Profit
Price Influencing Factor #2: Competition
As I mentioned earlier, you certainly don’t want to look at your competitors pricing and simply copy their fee structure, but you want to at least be aware of what other photographers in your area are charging. If the price that you arrived at after calculating your cost-of-goods is much higher than your competitors and you don’t think that your market will bear those prices, then you’ll need to do some adjusting. You need to be realistic with your pricing for your local area. The converse is true as well, if you arrive at a price after calculating based off of your cost-of-goods and your price is too low, then you may want to consider increasing your price to be more in line with your market.
Price Influencing Factor #3: Confidence
Your ability to sell yourself will largely dictate your success as a photographer in business. You need to be confident and sure of your pricing structure, and you need to present it in such a way that instills confidence in your client. If you don’t believe that what your selling is worth the price you’re charging, then why should they? While it is important to separate yourself from your prices, if you truly cannot get over the prices that you’ve arrived at after calculating your cost-of-goods, then you need to make adjustments. You need to believe in your own prices.
Price Influencing Factor #4: Perceived Value
The value that a client assigns to a product or service is directly related to the price that they are willing to pay for it. Perceived value for our photography can be established and influenced in various ways, such as:
- Word-of-mouth testimonials from past clients
- Web presence
- Our physical appearance
- Confidence and demeanour
- The quality of our photography
- How our products (albums, prints) look and feel
- Our customer service
As a general rule-of-thumb, if you create a higher perceived value for your photography and your products, then you can demand a higher price for those products and services. Therefore, if you want to create a higher perceived value, look to refine your products and services through the factors above, and then adjust your prices as necessary.
Price Influencing Factor #5: Quality
The quality and artistic measure of your work will have a healthy influence on how you can price your photography. If you are newer to photography and still learning, then you will want your prices to reflect that. Conversely, if you have been photographing for a while and are producing some of the finest work in your market, then you will want that to be reflected in your prices.
Your Prices, Your Way
It’s clear to see now the subjective and flexible nature of most of these factors (quality, perceived value, confidence, competition). It bears repeating that the only real measurable and repeatable way to establish pricing is by going based off of your cost-of-goods. Start there, and then you can use these other four subjective factors to adjust your prices to a point where both you and your clients will be happy.
Illustration Credit: © waldemarus - Fotolia.com