“Raise Your Prices!”
It’s the most often heard advice to new professional photographers, and for good reason!
Starting out, (and even later in our professional career) it’s common to undervalue ourselves, and question our self-worth. As a result, we almost never charge what we really should.
To make a livable profit, creatives always need to be alert to opportunities to increase the value of what they offer.
But, there are some times when raising prices may not be the smartest thing to do.
Do NOT raise your prices:
- When your current offerings or presentation don’t match the price.
- To arbitrarily charge a wealthy client more for the same product.
- When your ideal clients can’t afford it.
Let’s break these reasons down, and in the next post we’ll consider what we can do to overcome these obstacles to raising prices.
1. When your current offerings or presentation don’t match the price.
I use a lot of food analogies, bear with me.
Let’s say you go to a fast food drive-through and order a burger for two dollars. Your expectations are probably set pretty low, and that’s okay! You’ll probably get exactly what you expected, for two bucks. Simple. Tasty. Wrapped in paper. Nothing spectacular.
Now, let’s say you visit a classy restaurant, sit down, and order the “Deluxe Burger” for $20. You’re excited! You rightly expect this burger to be ten times better. After all, it costs ten times more!
So how would you feel when this classy restaurant finally brings you your order, and it’s the exact same two-dollar burger? In the same paper-wrapper!
You would probably feel cheated, and rightly so. For the price paid, you expected to receive a more elevated experience and a much higher-quality product. It’s not that the burger they served you wasn’t tasty; It just wasn’t good enough to justify the ten-fold jump in price.
If your skill and presentation does not match the price you’re asking for, it creates a notable discrepancy in value.
Clients create instant expectations based on price alone, and if you don’t deliver what they expected to receive at that price point, they will walk away feeling cheated.
2. To charge a wealthy client more for the same product.
The definition of “wealthy” varies from one community to another, but let’s be clear: This is the client that (you assume) has a lot more money than your regular clients.
I’ve had this conversation with some fellow creatives before, and sometimes this justification comes up:
- I’ve lowered prices in the past to allow a poorer, but good-hearted client to afford my services.
- So why shouldn’t I charge the rich client more, since they’re easily able to afford it? Isn’t it the same thing?
This might seem like equal treatment for some, but I couldn’t do this in good conscience. It’s a question of moral principles, and the decision may have far-reaching consequences.
- The decision to lower a price for a deserving good-hearted client is based on love and kindness.
- The decision to arbitrarily charge a rich client more for the same product is based on greed and selfishness.
Soapbox time: Transparency is more important than ever, and the success of modern business is highly dependent on the decisions that a company makes in favor of their clients, or in favor of their own pockets.
- Dealing honestly and fairly with your clients increases overall satisfaction and trust, leading to positive referrals. Referrals lead to new client attraction, and guarantee future business longevity.
- Dealing dishonestly creates short term gains, but destroys your professional credibility. This leads to zero client referrals.
What’s worse than zero referrals? Publicly unfavorable referrals.
Think of the repercussions of a greedy decision becoming public knowledge. When a client feels cheated, they will find ways to get revenge on social media. Wealthy or not, your clients have access to an amazing variety of social platforms that they can use to praise or shame your business.
And community opinions definitely matter:
- When’s the last time you bought something online that was rated less than 3-Stars by the community?
- When’s the last time you decided to eat at a restaurant that was rated 2-Stars by the community?
Restaurants, products, and entire companies rise and fall according to public opinion. So, if you’re thinking of raising your prices before you send your rates to a wealthy client, it had better be a permanent increase that applies equally and fairly to all customers going forward.
Now, does this mean you should never make more money from a wealthy client?
Of course not! A wealthy client is an obvious opportunity to earn more; You just can’t sell them a $2 burger for $20 and expect them to rave about it.
In the next post, we’ll discuss how to offer them a $50 Burger. That is, real value that they will gladly pay a premium for.
3. When your ideal clients can’t afford it.
If you get ten inquiries and they all end up choosing someone cheaper, that’s OK. They were not your ideal clients.
When you pride yourself on a unique style and top-tier experience, your work will automatically command a higher price. Higher prices usually don’t please the general, mass market, bargain-shopping clients.
SO DON’T let fear of general rejection keep you from raising prices when justified.
BUT DO think twice about raising prices when your ideal clients can’t afford it.
The key words here are Ideal and Can’t:
- Ideal: This is the client that loves your work with a passion! They love your personality, your style, everything! They are fully confident that you would be the absolute BEST choice to document the day in your trademark style. You’re more than “good enough”, you’re the ideal photographer for them. And that kind of excitement plays a big part in making them an ideal client for you.
- Can’t: Maybe you’ve recently raised your prices past the reasonable point, but you don’t know it yet. This client loves you so much, and explores all their financial options to afford this new price point, but they just. can’t.
BURGER TIME! Last time, I promise.
Let’s say you live in a town where the average burger sells for $8. You make one of the best burgers in town, and you sell them for $20.
The general populace may not give your expensive burger a second thought, but the real, hardcore burger lovers (your ideal clients) are willing to spend more than double the average price for what you make, because they love you and your product.
Now let’s say you decide to charge $100 a burger. Your ideal clients would really love to be able to afford it. But it’s just not possible or reasonable for them to drop that much on a burger, no matter how good it is. They just. can’t.
Your ideal clients are the lifeblood of your business. Raising prices above what the general public will pay is good! It separates you from the bargain crowd. But, don’t raise your prices so high that even your ideal clients can’t afford to work with you.
How Far is Too Far?
Here’s a non-burger example: Apple took a gamble on the iPhone X, raising the entry price to $1000.
Although the general public might think twice about dropping that kind of money on a phone, Apple’s ideal customers were still eager to pay the new price, and Apple shipped 29 million units last December.
But what if they had priced it at $2000?
Even Apple’s most loyal clients would balk. So, when raising your prices, ask yourself, “How far is too far?”
Conclusion: DO raise your prices!
I don’t want you to finish this article thinking that it’s never a good idea to raise prices. There are very good reasons to raise prices when you turn these examples on their heads:
DO raise your prices:
- When your current offerings or presentation match a higher price.
- When offering a wealthy client more value and options for their investment.
- When your ideal clients can still afford it.
We’ll talk about how you can do all three of these things in the next article!
We mentioned that an ideal client is super excited about you, but might have trouble affording your services.
I know what you’re thinking, “Well, ideally, shouldn’t my client be able to afford my regular prices without a problem?”
That’s true. The perfect, 100% ideal client would be crazy about you AND have the financial ability to afford your premium-priced services. But let’s face it, the world isn’t perfect. These clients are rare.
If you’re a successful creative, you will more often need to choose between working with:
- A client that loves you and your work but has trouble affording it.
- A client that isn’t all that excited about you, but can afford it easily.
Which would you choose?
In the long run, sustainable growth is supported by clients that love you with a contagious excitement that spreads to new like-minded clients. Those new clients in turn, may love you AND be able to afford your work more easily. Your chance of finding those 100% ideal clients goes up!
It’s far more effective than targeting clients that can easily afford your services, but don’t really care about your work any differently than the next photographer. They may be able to pay your fee, but aren’t likely to refer you with any enthusiasm.
Of course, you can’t just arbitrarily lower prices every time an ideal client can’t afford it. You need to eat! What’s a professional photographer to do? We’ll talk about this in our next article.