pricing for profit (photography) joyvertz
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How to price for profit in photographyTRANSCRIPT
PROFITp r i c i n g y o u r p h o t o g r a p h y f o r
s i x l e s s o n s
l e a r n e d t h e h a r d w a y
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1 Find an hour of uninterrupted time
2 Grab a healthy snack and beverage of your choice
3 Print out this booklet
4 Plan to make notes in the allocated section
5 Have an open mind about pricing (it really is fun!)
6 Be willing to try new things
HOW TO USETHIS BOOK:
source: brian tracy
“If the first thing you do when you wake up in the morning is eat a live frog, then nothing worse can happen for the rest of the day!”
Brian Tracy says that your “frog” should be the most
difficult item on your things-to-do list, the one you’re
most likely to procrastinate on; because, if you eat that
first, it’ll give you energy and momentum for the rest of
the day. But, if you don’t...if you let him sit there on the
plate and stare at you while you do a hundred unimportant
things, it can drain your energy and you won’t even know it. H
WELCOME
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Pricing is a careful combination of formula and
demand. You must weigh the products that
all clients will want (i.e. Albums are great because
clients can get a lot of images in them!) with your
total costs it takes to create that product (COGS =
Cost of Goods Sold).
Many photographer fail to factor in the time they
spend into their work. YOU are the most valuable
cost of your product, and in order to be happy and
fulfilled with photography, earning an income is
important! Pay yourself first.
The only way to change the PRICE of your product is to:
1 Change the expense of the product.
2 Change the time spent on the product.
3 Change how much you pay yourself.
Reduce or increase product price based on these three things.
PRICING IS A FORMULA, NOT A GUESS
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When I began, I scoured the
internet and asked many other
people what they sold specific
products for. I grabbed numbers
that “sounded good” and that
I thought my clients would feel
comfortable paying. As I learned
more about profits and true costs
to do business, I realized that I
was not as profitable as I could
have been, nor was I paying myself
consistently. This caused issues at
home because my business took
me away from my family and
social obligations without the
payoff to make it worthwhile. I
used this opportunity to examine
all of the costs of doing business
and re-evaluated my prices to pay
myself first.
lesson one :
joy’s story
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This is probably one of the biggest mistakes I
see made often. Photographers collect pricing
from their competitors, analyze it and design their
price list to be a slightly better version of all of those
they collected. It is less important to be conscious of
what your competitors are doing all around you and
a better use of your efforts to worry about standing
out from the crowd.
IGNORE YOUR COMPETITORS’ PRICING
I did not know how to price. I
was so concerned with making
my clients love my work, that I
pushed the important business
aspects off to the side. I gathered
other photographers’ pricing
from the internet and used that
to create my own. I distinctly
remember having a $450 sale and
feeling elated! The price list I used
as inspiration had $450 as one of
the top packages-- so certainly
that is a good sale, right? I spent
a few hours carefully editing the
order and sending it to the lab.
My lab bill confirmation was for
$285. My heart sunk as I realized
that for $165 I just spent over 10
hours with one client. After taxes,
I was making minimum wage.
lesson t wo :
joy’s story
DO NOT COPY ANYONE ELSE’S. You do not even know if they are making a profit!
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It is extremely easy to offer a wide variety of products
because there are a lot of different options available
to us as photographers. Our labs and vendors
come out with amazing new products each year and
while I love to keep my product offering fresh and
contemporary, I add new products cautiously.
It does not make sense to offer every product
available to our clients because they will be
overwhelmed. Overwhelmed clients resort to
purchasing what they know. Most clients “know”
8x10’s and 5x7’s and will resort to ordering small
prints when they are confused.
It is also not wise to leave products on your printed
price list that are rarely sold. For example, we do
hand painted images at our studio which we sell
approximately 4-5 times per year as they are a higher
end item. We took up a significant amount of space
on our price list to explain and show something that
we rarely sold. Instead, we eliminated them from
our printed price list and still present them at their
viewing and ordering appointment. Removing more
unique and less popular items has greatly simplified
our price list. The benefit is that clients are more
easily able to navigate quickly through the products
and offerings we have.
BE CAREFUL OF YOUR PRODUCT OFFERING
I attended a large convention
with the excitement of a first-
time attendee and came back
with stacks of new products that
I immediately implemented. I
ordered samples of everything and
was convinced that ALL of my
clients would just fall in love with
all of the albums, acrylic, metal,
round, image blocks, notepads,
and different finishes just like I
did!
I presented the options to my
clients who were overwhelmed
and left ordering only gift prints
or small items because they
were confused and ordered the
products they were familiar with.
lesson three :
joy’s story
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We all get inquiries that call wanting something
drastically different than where you have set
up your business to go. Consider who your target
market is and if this aligns with your overall business
strategy.
Do not base doing sessions on whether or not it
could possibly have marketing benefits that will bring
in other sessions if it will not be profitable. Seldom
do referrals flock in the way a client may promise they
will. If they are not in your target market, chances are
their friends are not either.
When you have inquiries that want different types
of sessions or different ideas than what you can offer,
it is OK to say no to those clients.
Tactful Ways to Decline a Job:
1 My instincts tell me that I am not suitable for this
2 This is a great idea, but my heart says I’m not the
right person to get involved
3 I do not love this project, which means I’m
probably not the right person for it
IT’S OK TO SAY NO
My clients started to walk all over
me. Plain and simple. I was busy
all the time, but not making money
and not doing the shoots I really
enjoyed. It was draining and took
time away from what I did best. I
had such a need to be a “pleaser”
and make everyone happy that I
would absolutely shoot a 3 year
old birthday party on a Saturday
afternoon instead of taking my own
children to the zoo. Because I did
not know how to price my work
effectively, I was doing the work
for too low of a rate. I resented
my business. When I nailed the
formula for pricing my work (and
there IS a formula) I gained the
clarity I needed to say “no”
lesson f our :
joy’s story
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HOW TO SAY “NO” BY SAYING “YES” Clients can be hard! People are more savvy shoppers than ever, and it is easy to get tripped up when
a client asks for something that goes against your policies or won’t make sound business sense.
A very good technique to use when a client asks for changes, wants additional images, wants more than
what is included, wants a discount etc...Always say YES! It works every time. (Trust me!)
Here is how it works:
Client has an objection such as, “Can you give me a discount on these?”
To answer you always say something affirmative, followed by the condition that must be met to get what
they want. For example, “Absolutely! Our larger packages include a discount!”
Here are some examples:
Objection: Can you take out the tan lines, glass glare and change my shirt from black to white?
Answer: Absolutely. It will be approximately $60 for the additional retouching.
Objection: Can you take out the tan lines, glass glare and change my shirt from black to white for free?
Answer: Absolutely. Retouching that extends beyond the basics retouching is free with all prints 16x20 or
larger. If you need it on a smaller image, its just $60 per pose.
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KEEP IT SUPER SIMPLE
I tried to do too much. I tried to
offer too much, sell too much,
and thought my price list needed
to appeal to everyone. I had 15
(yes, really!) packages and clients
glossed over them because it was
just too much to read. 50% of
my sales left to “think about it”
because they were overwhelmed.
When clients left or felt confused,
my sales went down.
lesson f i v e :
joy’s storyYour clients should be able to at a glance get a
sense of the product line you offer and how they
can expect to spend. If you have outdated products
on your price list, remove them immediately and
reprint your price list.
Clients have one goal in mind. They want to get
the most amount of images and variety for the best
value. Having a confusing price list will overwhelm
clients. They will tend to tune out and “settle” for
what they do understand (usually small prints) instead
of what you really want them to purchase.
Proper price lists and orders that satisfy your needs
for profitability are one key to a happy, fulfilling
business in which you are valued.
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IS YOUR PRICELIST PROFITABLE?
YES NO
■ ■ I have more than 5 collections
■ ■ I have products listed that are rarely sold
■ ■ My pricelist is self printed on printer
■ ■ My clients are confused by prices sometimes
■ ■ My clients leave “to think about it”
■ ■ My prices are influenced by my competition
■ ■ I’m not sure how I came up with my pricing
■ ■ My sales averages are lower than my goal
■ ■ Clients get a big variety of images for less than my Happy Place Sale
■ ■ I feel undervalued / unappreciated at times
■ ■ I’m nervous to discuss price with clients
■ ■ My clients do not buy what I want them to
If you answered “yes” to any of these questions, then you need to take steps toward understanding how to price for profit.
checklist
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Your middle package will most likely be your
best seller (If you don’t give it all away in a lower
one). When you want to add additional packages,
take away from bottom, add to top because your
clients will gravitate toward the middle. Offer two
middle packages because often they will select the
higher of the two middle packages.
People gravitate to collections because it implies
a value and also is easy and convenient. People
assume it is a popular selection, which makes them
feel comfortable to make the investment, knowing
that other people have made the same choice.
Are your packages deeply discounted? They do
not need to be. Collections imply value, but it does
not have to mean a huge discount. “Value Meals”
at fast food restaurants have about a 3-5% discount.
Popcorn and Soda packages at the movies have
about a $0.50 discount on a $10-12 package. Many
places do not even offer any noticeable discount on
packages and they are merely there for convenience.
ENCOURAGE YOUR HAPPY PLACE SALES
In 2003, After I had my expenses
nailed down, I knew that for the
amount of money I wanted to
personally make that my happy
place sale needed to be $750
minimum at the time. This is the
minimum amount that I wanted to
make per session to cover expenses,
pay myself first and have a healthy
profitability level. I could not
understand why my average sale
was $200 under this and I dug into
the product mix I was offering. I
realized that my two most popular
products were collections-- both
priced under my happy place
amount. This means I was actually
encouraging and inviting clients to
spend less than I wanted them to
spend. I left thousands of dollars
on the table.
lesson s i x :
joy’s story
Tips on How to Find your Happy Place
Finding your Happy Place Sale is a process that requires some thought. You will need to know how
much in a month you need to bring in to cover any bills as well as pay yourself a salary.
Take this number and divide it by the amount of sessions you want to do in a month and that will
become your target number for your “Happy Place Sale”
Some of the expenses you will want to consider:
Do not forget Capital Expenses such as cameras, computers and lenses!
When I purchased my Nikon D3x for approximately $7000, I learned it would “last” for around 750
sessions on average. This means it “costs” me nearly $10 just to turn my camera on for a session (not
including CF cards, maintenance, cleaning etc..).
Lastly, don’t forget to pay yourself!
Postage
Donations
Entertainment
Rent
Legal Fees
Permits
Utilities
CC fees
Repairs / Maintenance
Props
Bank Fees
Insurance
Marketing
Misc Expenses
Mileage
Phone
Vehicle
Education
Internet
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WILL YOUR PRICELIST MAKE YOU HAPPY?
YES NO
■ ■ Does your pricelist allow
them to get a lot of variety and choices for little investment?
■ ■ Can a client buy lots of small prints for less than a large print?
■ ■ Do you sell what you want to sell the most?
■ ■ Are your most desired items in your packages than are below happy place?
■ ■ Are clients rewarded for
larger purchases?
■ ■ Are your most “in demand”
products ONLY in your
higher packages?
■ ■ Are there products you hate
selling in your most
popular options?
■ ■ Are your collections discounted deeply?
checklist
TIP: WHY NOT OFFER A DISCOUNT?
If it fits into your overall business
strategy to incentivize clients some way,
I would suggest a gift with purchase
instead of a discount. The perceived
value is the same, but the profitability
is more favorable.
For example: If a client has a $1000
purchase and you offer them a 15%
discount, they will write you a check
for $850. However, if you offer them
a gift with a value of $150 with their
purchase, the perceived discount is
the same at 15%. The difference is
that they will write you a check for
$1000. Even with the additional cost
of the $150 product you will still end
up with additional profit in your pocket
and your client still feels like they got a
wonderful value.
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YES NO
■ ■ I am easily frustrated by pricing my work
■ ■ I had several yes’s
checked on page 8
■ ■ I’m overwhelmed by pricing
■ ■ Numbers confuse me even though I understand concepts
■ ■ Pricing is my least favorite part of business
■ ■ I know I need to change my pricing
■ ■ I know my pricing is too low
My Happy Place Sale Is: $ _____________________
My biggest hurdle with pricing right now is:
____________________________________________
____________________________________________
____________________________________________
My biggest hurdle with my current price list is:
____________________________________________
____________________________________________
____________________________________________
My clients have given the following feedback on my price list and pricing:
____________________________________________
____________________________________________
____________________________________________
MY NEEDSchecklist
FREE STRATEGY SESSION CALLSIf by filling this out, you need to take steps toward understanding how to price for
profit, I offer {FREE} 1 on 1 Strategy Session calls. To find out if you qualify, fill out
the survey at: http://www.joyvertz.com/strategysession.
– important –
READ THIS IF YOU ARE PORTFOLIO BUILDING
This is the most exciting and best time. If I were going to go back in time, there are many things I would
have done differently (and lots of things I’m glad I did right from the start) but the best advice I have
if you are newer to the business is to market to your ideal end target market from the start.
Newer photographers feel their work is not “good enough” to charge full price and they enter a stage
of portfolio building where they offer discounted pricing. While it is a fantastic idea to practice and build
to get to the level you want to be at technically, the biggest mistake you can make is to offer very low
(often non-profitable!) prices that do not reflect your ideal target market.
Here is an example: You are a new photographer, offering “portfolio building” sessions for $75 just to
practice and grow your customer base. Your eventual target market is boutique high end, but you, being
new, cannot justify asking clients to invest $500-1500 on a session yet. (This is totally normal!) The problem
though is that, your portfolio building sessions are not your target market. Therefore you are spending
a year or more working and investing in a business (and your clients who are not in your target market
are referring other people to you-- likely also not in your target market). Before you know it, you have a
client base of people who are all expecting to spend $75-150 and your business has built itself smack in
the middle market. Your choice now is to adapt to this price point and trim some of the services you have
previously offered to now become profitable OR you can scrap your year of work and have to start over
building a new client base to match where your business goals would be.
Ugh! Is that you? No worries. Fix it, immediately! Right now, (like put down this booklet and start jotting
some notes!) start to develop your dream price list that will appeal to your dream client! Scary? Trust me..
this will work. Implement it now (like effective tomorrow!) and don’t look back.
Tip: If you are still portfolio building, give each person your dream price list, and a gift certificate valid
for a complimentary session plus $X print credit.
I would make this equal to approximately 2 1/2 small prints. Make it an amount vs. specific products
because this will give your clients the experience of being able to select what products they want. If they
want something over and above your gift certificate, they can pay regular prices for it. If they want only
what the gift certificate allows, by giving them something equal to a little more than 2 full prints, they are
likely to buy 3, as many people do not like to leave an ‘unused’ credit out there.
Remember: Portfolio building is not only about practicing. It’s also about building your business through
referrals. Make sure you do not spend your time building your portfolio with your non-ideal target market.
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fa c e b o o k : Joy Vertz i n sta g r a m : @joyvertz t w i t t e r : www.twitter.com/joyvertz e m a i l : [email protected]
PRODUCTS JOY LOVES
m i l l e r s www.millerslab.com p r o s e l e c t www.timeexposure.com
z e n f o l i o www.zenfolio.com (discount: r 2y - y r r - g e r ) l a r s o n www.larsonent.com s e n i o r s i g n i t e www.seniorsignite.com
h i - f i s o c i a l w e b www.hifisocialwebmarketing.com k at i e l o e r t s www.loertsdesign.com
Joy Vertz, has grown in 6 short years from a one-woman show in her basement to now running 2, thriving high end, boutique style studios
with a team of 7 employees. Joy is a business person with a firm grasp on the process of running a successful business.
If you are struggling with anything business related or just want to make more money, talk to Joy.
“The moment you make a mistake in pricing, you’re eating into your reputation or your profits.” - Katherine Payne