Note: the 2017 edition is available here. (Each version has unique information)
One of the hardest things to do in business is price your product or service. Photography is no different. You want your price to be high enough to make a profit and low enough to avoid scaring away prospective customers.
Here is the bottom line: You can’t win if you play the lowest-price game. You can’t beat free and stay in business. Friends with cameras, cell phones and free stock photography are going to win every time if you don’t have something better to offer.
Even Getty Images changed their business model and gave up fighting the millions of small battles that were draining their resources. They couldn’t stop people from wanting free photography and using their images without permission. So, Getty now gives 35 million of their images away free. Why? They hope spreading their brand name around with the free imagery will increase the odds that people who see value in their photographs will buy them. Big companies can’t compete with free; neither can you.
What can you do?
Now that you realize you can’t win the race at the bottom, turn around, look up, and start racing to the top. The first thing to do is raise your prices.
How much should you charge for your photographs in 2014? More than 2013, because your expenses went up. To figure how much you should charge, add up all your expenses using the NPPA calculator. How much is your equipment, rent, insurance, props, books, education, and everything else you spend money on related to your business. Next, add how much you wish to make in 2014 to the total. Then divide the total by how many jobs or days you worked last year. If you don’t know, divide by 50. If your business is new, I recommend you divide by 25. Chances are when you look at the amount of money you need to make to stay in business, it will shock you. It should.
Many photographers love photography and want to make money from their craft. Unfortunately, many creative people don’t like business and try to ignore the fact they are in business. If you are trying to make money from your photography, you are in business. I like to make pricing simple, so I use per-image pricing.
In the digital, age per-image pricing makes more sense than on-location day rates. Pre-production and the time it takes to create a good photograph is much less today. Although pre production is less, many photographers find post-production work to be time-consuming. Many photographers are not considering this valuable time as part of their pricing system. I’ve created a simple tool to help you calculate quickly how much you should charge per image based on a few criteria. The criteria I used are: production level (How much does it cost to run your business or complete assignments?); number of photographs created for purchase; and the planned photo use. I designed this calculator more for corporate, commercial and advertising photography. That doesn’t mean you can’t find a good combination with this calculator for use with family or retail photography. The calculator also has options to add expenses into your per-image price.
Here is my best example of why per-image pricing is better. You receive a call from a company that needs new photographs for their website. They want you to take 10 images at their facility. Lets say you quote a $1,500 day rate and $500 expenses for a total of $2,000. First, you know they will choke at a photographer being paid $1, 500 for a signal day. Most clients don’t realize that photographers often don’t work every day, have unseen expenses, and spend more time on post-production work.
Nonetheless they agree with your rate and you go on site. You do a great job and complete the assignment at 1:30p.m. The client loves the photographs. Unfortunately, there is a problem. They don’t feel they should pay you for a full day since you finished at 1:30 p.m. You can tell them that you reserved the whole day for them and it’s in the contract. It doesn’t matter, they feel screwed.
Maybe you did work a full day, efficiently completing 15 images. Your client is happy, which is wonderful. Sadly, you receive no financial reward for your additional good work if you stick to your day rate.
This brings us to the advantages of per-image pricing. Rather than quoting $1,500 for your fee and $500 for expenses, you simply tell the client you will charge $200 per selected photograph. You have now placed the value on the photograph and not your time. If you finish at 1:30 p.m., everyone is happy and no rates need to be adjusted. If you create more images than expected, the client may buy the additional images.
This system is one of they ways I stay in business in such a competitive industry. I let prospects know that I’m the low-risk photographer. Prospects want low risk and they often make price the vehicle for lowering the risk of hiring a photographer. I place the risk on me rather than diminishing the value of my photography (outside of fixed expenses such as models and stylists). I let them know if they don’t like any of my images they don’t have to pay for them. I often suggest that may be the case with my competition. I have confidence in my photography and I know that in many cases clients will by more images, not less.
Yes, sometimes it does happen. I have to expect that if I put the risk on me, I will sometimes lose. If something goes wrong, I have the confidence to ask if we can reshoot some of the images. If not, I move on, because the time I lost on that assignment has been made up a long time ago from other clients purchasing additional images. Clients will come back months or even years later asking to purchase photographs from previous assignments. It always feels like free money.
What type of photography is served best by per-image pricing? I use it for corporate portraits, products, food, architecture and interiors. I like to offer a first image rate and then offer a lower rate if they buy more images. For example, I may offer $250 for the first image and $175 for each additional image (local use). Often when I calculate my averages I’m making a $2,500 to $3,500 day rate for local use. That is not bad for Detroit. I’ve charged more than $2,000 per image and made as much as $5,400 for a couple of hours of work. I’m not talking about national clients. No complaints from the client because they are in control. The client does not have to buy more images than their budget will allow.
Day and hourly rates do work for events because you can’t get out early for being more efficient. With that said, I have used this system for family portraits and weddings with success. If you do use it, be sure you have confidence that you are going to generate a lot of high-quality images.
The key to selling per-image pricing is placing the value on the image and not your time. People want lower prices, because it is lower risk. More importantly, if you show that the client is in control of the budget and using you is the least risky proposition, you will win new clients.
Some people just want cheap photography. I hear it all the time; photographers tell me their prospects are disrespectful, beat them up on price, insist on day rates and want all the rights. Why do you want a client like that?
The problem with those clients is that they are not loyal and will leave you for the next lower-priced photographer. Even worse, they will refer you to other people who need cheap photographers. (This is experience talking.) When they really need a high-quality photographer do you think they are going to call on the cheap photographer? Are you kidding? Their job is on the line. They are going to pay top dollar to the photographer who charges so much you wonder how they stay in business.
Over 90 percent of my business are per-image pricing contracts. It’s not hard to sell the concept to prospects if you frame it properly. We share the benefits with them: the low risk; we ignore time and keep working until the job is done right; the client is in control of the budget; I only get paid if I do an awesome job; and they will only go over budget if they feel the value of the additional images are worth it.
You can’t be average
Just because your friends and family tell you that you have a good eye doesn’t mean people will pay you for your photography. We are in the heyday of photography. Photos are everywhere. Unfortunately, being able to create an in-focus, well-exposed and nicely composed photograph is not enough for a photography career. You need more.
If you are going to charge more than other photographers, you can’t just be another photographer with basic skills. You need to offer something exceptional. You need an And. Something to combine (what I call the combination code) with your photography that sets you apart. For some photographers it’s video, writing, technology, or a post-production style. Maybe you are like me and have good business and marketing sense. Honestly, learning to sell per-image pricing has helped to separate me from the competition and earn more clients.
Write out a list of things that separates you from the competition. Let me give you a hint of what they are not. You can’t be the lowest price. Low-price systems are for mass markets and you are only one person. You can have great customer service, but you can’t use it as the foundation of your marketing. Only customers can tout your great service, not you. No one cares how long you have been in business. So, what are the skills you can add to your business that will add value in the eyes of your prospects and make the average competition irrelevant?
Here are some the things that have worked for me through the years:
Wear a suit: For a long time I was the photographer everyone knew who wore a suit. Photographers laughed, but corporate clients knew I would fit in and not embarrass them. I actually wore a suit through a steel mill early in my career.
Speed: I can get in and out of a corporate office to take a professional headshot in 25 minutes. Executives are busy and my clients love it.
Per-Image Pricing: I’m the low-risk photographer.
Work flow: I have a system that makes it easy for clients to view, select and receive their images. I use the Lightroom website maker for client image viewing and Photoshelter for photo delivery.
Lighting: I get lighting. I keep it simple and make adjustments quickly. This makes me effective on location and in the studio. This skill often translates in to new high value business.
Social Media: I’ve been online for a long time. In 2007 I began combining photography and social media to develop my name, which made it easier for good prospects to find me. This alone kept my photography career going during tough times in Detroit.
Photo cards: I always keep portfolio photo cards with me to show my work. You never know when you will discover an opportunity. Business cards are OK, but portfolio cards stand out. You can say you’re a photographer, but until prospects really see what you do, their imagination will ruin your opportunity. Before social media, 4×6 portfolio cards were a big part of my photography business growth.
Easy to work with: Although I don’t market this concept, it really does make a difference. People have a lot of photography choices. I like to make it easy to do business, refer me and hire me again. I use some good business practices to make this possible.
The above combinations have worked for me in varying degrees through the years. Some are still part of my business plan today, while others have taken a back seat, such as wearing a suit. I do suggest that many of the combinations on my list will not work for you. Today you need to offer some serious differences, much more than in the past. For many photographers the right combination allows them to charge what they are worth. It’s always about supply and demand. If few photographers offer the same combination as you, the pressure for lower prices from the competition lessens.
Business is hard. If you are still trying to justify why you need to lower your prices, you will remain a part-time photographer depending on other sources of income to survive. Most likely you will just be out of business soon. Don’t get me wrong. I have a good career in photography, but I still have other sources of income through consulting, writing books, teaching and speaking. Chances are, if you are going to make photography a successful part of your career, you need to combine it with something else.
I know you want me to tell you how much to charge. It honestly depends on your expenses and location. New York photographers must charge more than Indiana photographers, in most cases. Use the per-image pricing calculator. Place the number of images on 1 (not one hour), select local usage and find the production level that best matches your needs. How to do this is explained on the calculator page, too.
Talk to other photographers. Get a gauge of what the top photographers are charging in your area and compete at a higher level. In the Detroit area I know that for local use $150-$400 per image is common. At the same time, there are photographers who charge $50 and give the client the CD with all the images. I also know a few Detroit photographers who charge $10,000 a day and keep busy.
Pricing your photography in 2014 means you can’t be realistic. Being realistic means you should do photography for free because anyone can find cheap or free photography. There is little reason for someone to pay for you to take photographs. So, all you have left is to ignore reality, ignore what everyone else is doing, and price your photography based on your needs, expenses and the income you believe you deserve.