Pricing Your Photography
How to price your photography services and grow into your perfect price point. A photographer’s pricing should be as comfortable to them as their equipment. Your business and pricing should grow with your skill level, talent and experience. Being timid to ask for your price tells you much about where you are as a professional photographer.
Recently I took part in a research study group for a well known photography portfolio website provider. One of the fellow photographers during the session brought up a common question that distracts almost all photographers during their first years as a professional. The single biggest business problem is how much to charge for your photography work.
Although the answer can be complex depending on the size of your operation, there is an easy and simple thought process to setting your photography pricing. Prices should always remain dynamic for many reasons. No two photography gigs are ever alike. The logistics of each event will always be different and thus a new challenge to price properly. Think of your price as two elements: a baseline and a premium. Your baseline will always serve as your starting point…
Photography Pricing – Baseline Calculations
Photography as a business endeavor must follow fundamental financial practices to be sustainable. You must cover your costs at the absolute minimum. The first and most critical step, calculate all your overhead for any particular service or product. This includes employees, assistants, gas, rentals, and other expendables you may need on your assignment.
First develop an organized workflow and delivery specifications that you can replicate and control for each service or product. Calculate the minimum number of hours you need from the time you begin service on the assignment when you arrive or your client arrives, to when you finish the last edit on your final photographs. Assign an hourly charge for your own labor –if you have an office or studio that you lease, factor in your daily or hourly payments– add up all your external costs, count up it all up and you have your baseline.
Establish a baseline for each and every photography product or service that you offer. This will help you get your sales material organized, and make it easier to negotiate and present offers to potential clients.
This baseline is your bare minimum to offer that product or service in the scope of a professional photography business. Keeping costs lower and developing an efficient system from start to finish is key. You now have an idea as to what you’ll be paying out of your own pocket to offer this particular service.
Beginner’s Note: This is critical information for beginners who are struggling with pricing ‘special’ work for friends and family. This is a very important stage for beginners to get past. Your baseline should give you confidence to ask for this cost from anyone since it would be unfair for you to not only do something for “free,” but have to pay out of your own pocket (and time) to provide them a service. Quantifying your losses on any particular service can be surprisingly helpful to your peace of mind!
Photography Pricing – Profits and Premiums
The second stage to setting your pricing is your profit, or premium. Only charging baseline costs will not keep you in business. Most unsuccessful photography businesses usually fail due to not giving this enough consideration (along with a good marketing plan.) If you’re only covering your business costs, you’re still not making any money to pay your own personal bills so you can live, eat and survive!
So, how much profit should you be making? There are two major points that need to be discussed here to help you configure your profit to add to your baseline, and come to your final pricing.
Local Competitive Prices
Research as many of the photographers in your local market as you realistically can. Compare their prices and arrange them in a list from most expensive to lease expensive for similar products and services you offer. This will give you a good idea of the current local pricing that is being offered and where your offerings might fit in. Now with your baseline in mind, you can see the relative profits you would make offering similar pricing as your competitors.
Be aware of falling into the trap of comparing your prices with the local amateurs, hobbyists and students who are advertising cheap, bargain pricing in exchange for experience. This doesn’t mean you shouldn’t give discounted rates to select people if it benefits you, but keep your baseline in mind to avoid losing money and wasting your time.
A critical point needs to made here about the negative effect on industry wide pricing when too many vendors start positioning their rates to match amateur prices. Customers may see that trend and the line between professional and amateur gets skewed in their mind. They can no longer differentiate the skill/experience level and assume that professionals that charge higher are overpriced. This is the biggest hurdle when competing in the low to mid range market.
Photographer’s Talent Premium
How does your work honestly compare to your peers’ in your market? This is where pricing can be simplified and satisfied by taking an objective look at your skill level and what you offer your client. The better we are, the higher the profit we can justifiably charge our clients. This is the Talent Premium.
What goes into a Talent Premium? Skill first, then experience. Experience by itself is not necessarily indicative of talent. A photographer can have hundreds or thousands of gigs under their belt, but never attain a high Talent Premium. Doing small, simple assignments might never test your skills, equipment and creativity. This is where the vast majority of professional photographers reside, and there is nothing wrong with that if it is working for them. Continuous education, practice and refinement of your skills will elevate your work and your Talent Premium.
At the top of this range you’ll find the fine art, artistic and creative photography professionals. They take less gigs because the setup and post-production of their work take longer and thus their schedules can only take on a more limited number of clients. By default they must charge higher to cover their baseline (usually more equipment, assistants, and labor intensive.) Additionally, their higher skill level, being less common, can justifiably demand more on the open market. The work speaks for itself.
If you look at the highest charging photographers worldwide, generally their work is exemplary, outstanding and impeccable. They have great experience in their photography style and workflow, and know how to handle most situations in their service line with relative comfort and ease. Customers seek them out for their style and gladly pay their Talent Premium, most times upwards of $15,000 per wedding, for example.
In contrast, you can run successful lower pricing if you operate a highly efficient studio portrait business by keeping your costs low and having a strategic volume business. The premium for such run-of-the-mill portrait work is very low, but having a tight baseline can ensure good profits and revenue.
This illustrates the importance of having different pricing models (baseline and premium) for all the types of products and services you offer. This can also be a very strategic marketing tool to offer a wide range of pricing to cater to all levels of photography clients.
A Final Pricing Test…
When you ask “what should I charge for my work?”, you are effectively asking: “what am I worth?” and this can be troublesome since we all think we are worth a lot, even when just starting out! Starting fairly and raising your prices through your Talent Premium is a more confident way to grow into your best prices.
Ask a better question to yourself: “what honest price am I absolutely comfortable charging for my service?” This forces you to consider everything we just talked about and come up with a bottom-line price that will most times be honest and fair.
Try the following test to see if you have come up with an honest price… (these are not trick questions!)
1. Are you 100% comfortable quoting this price, without fear or timidity, to anyone?
You will feel shy or insecure about charging too high a price for your skill level or experience. Your customer will feel that as well. Honesty in pricing is communicated non-verbally.
2. Are you 100% confident in delivering your services at this price, without reservation?
During your assignment, all things being normal, you know you will get the job done to your standard and to your price. Unfortunate situations do occur, but you know how to recover and still deliver what is promised at your price point.
3. Are you happy to take on all assignments that come in at this price?
Your happiness matters, too! If you are at a more experienced level at your current price and find yourself muttering under your breath every time you’re booked, maybe it’s time to raise your price. If you’re not happy taking on the assignment in the first place, it will usually show in the level of your work. When you make sure to take care of yourself, you can look forward to your next gig and feel good about being compensated correctly for your efforts.
If you answered a confident ‘Yes’ to these three questions, your pricing is likely at a nice, harmonious point with where you are as a professional photographer. The next step to success is marketing! But we’ll save that discussion for another day…