Bookings are drying up. Photographers getting ghosted. Inflation rates are high. News agencies chattering about slumps and recessions. Lots of photographers are asking themselves if they should reduce prices to kickstart some activity. Even those with very low prices to begin with, which even if still generates some dollars, represents greater financial loss. What to do?

Pricing strategy is a complex issue. There is not only marketing or business strategy but psychological strategy at play as well as emotional characteristics. Price is not a simple thing. They may look like numbers, but us photographers are intimately and acutely aware of how terrifying those numbers can be, because they touch our deepest vulnerabilities. Thus, making decisions about pricing can be very difficult. The truth is, a price is a gift because it enables us to give our services freely and fully with our hearts, and a gift for clients because they get the results of that.

We can indeed implement pricing strategies during particular times to cause change in our business. A special offer in off-season time can generate some activity, and a price raise can benefit us twofold during a busy time - if we stay at the same booking rate then we make more, or if it reduces booking rates then you regain your time, lower stress and can serve existing clients to the fullest, and still make what you were making before. No business is set in concrete and as a business owner you must be mindful of what elements you’re working with to make the best decisions. That said, many don’t know the true conditions in which they work (i.e. seeing other photographers on FB is not an indicator of general market conditions or average prices of photography in your area) and also don’t know the true conditions of their finances. When you don’t know the numbers you work with, then adjusting numbers just makes things more difficult as you can put yourself into even more dire financial straits than before trying discounts to drum up business. Pricing strategy requires financial literacy first. When you’re empowered with that knowledge, then you can make strategic choices that may in short term cause a financial loss but trigger a longer-term gain. Most photographers lower price and there is no gain, just attempts to recover.

The flaw with the knee-jerk reaction of photographers reducing prices

The fundamental flaw of considering price reduction in a sluggish economy is the assumption that price is the issue of why people aren’t booking. One might think that price matters more when the economy dampens, but another thing that might be true is that people aren't looking for low prices, but good value for their dollar. And a low price can reflect lower value, the same way we assume that the stuff we buy at the Dollar store isn't top of the line stuff. So you could actually hurt your business and reputation more by simply reducing price.

I tell this story a lot because it's such a good one. During the Great Depression (much worse economy than now!) cereal giant Post cut back on expenses and advertising to save money, thinking people won't be buying cereal when the economy is bad. Kellogg's did the opposite and doubled their ad spend. And introduced Rice Krispies. These many years later, they remain the market leader and Post has never been able to regain the number one position.

The lesson is 2-fold. Post made an assumption that people wouldn't buy in the economic conditions and they were wrong - people enjoyed the "small luxury" of a cheerful bowl of cereal as something to enjoy during hard times. The other lesson is that reducing their spend left a vacant advertising market, so even though Kellogg's doubled their ad spend, they doubled it in an emptier space and so their ads were the only ones seen and they went a lot further!

The hidden cost of price reduction for photographers

Because price-reduction seems to be the go-to first knee-jerk reaction, many other photographers will do the exact same, placing yourself smack into the middle of the saturated market competing on price and it can be much harder to book. It’s like driving straight into a traffic jam knowing full well there is one and knowing you’ll be stuck; a photography traffic jam of lower-priced photographers who are also then also stuck with low revenue. I don’t need to be any kind of expert to predict that this is not a place that any of us want to be in; harder to book and then bringing in less dollars when you do. Does it still sound like a good idea to you?

Often if you don’t know what to do, then doing the opposite is an option. When everyone zigs, you zag. Like Kellogg’s did.

If many photographers are reducing price and cutting back (like Post), then you have a wider open market where your marketing could have much greater reach. Couple that with messaging around good value for people’s dollars (note that is NOT the same things as low price) and that's where you might see an uptick.

Marketing for photographers is more critical when things get tough

It's easy to cut price. We can go and take a zero off right now; instantly. It’s not as easy to figure out how to appeal to people even during difficult times. But it’s a worthwhile exercise regardless of market conditions because knowing how to sell on value has rich rewards not only in bringing in new business but in repeat business and the creation of client champions that also help bring new business. If people seek value for their money, then marketing is what solves that rather than pricing.

Three things to consider when pricing for photographers in a sluggish market:

What tier of the market are you in? If in the lowest market, cutting prices can get you really close to the zero/ free mark as there is very little room to go down too low. In this case, you should consider jumping a market tier rather reducing price. Start with profiling a different client who is willing to pay to receive a higher level of care and service. If you don’t know where to start with adding value, check out my Little Luxuries Handbook that has 10 low to no-cost and very quick ways to infuse luxury-like and value-adding elements into your business. You are zagging, raising value for dollar, when everyone is zigging, driving straight into a traffic jam and bringing in less money for it. A little more effort but worthwhile if you can maintain current price or even raise price.
How do you want your business to be perceived? When we lower price, we send a message to ourselves and to the world. The meaning of the word discount is not only to reduce the cost of something, but also to dismiss something as unworthy or as not credible. Such as hearing news and discounting it as fake news. If we discount ourselves without a strategically considered offer, then it may dismiss us as an option to a client of a low-cost, low-value service, rather than what a business discount actually is supposed to do — trigger an influx of business. If you want to educate yourself on value-building offers rather than discounts, consider a private educational call with me.
What are others doing? There is a danger of basing your marketing upon erroneous research, such as taking the activity you see on Facebook as an industry truth or trend. But if you are seeing an avalanche of all sorts of discounts popping up in your feed, in groups, or in your local area then that’s less market research and more that you are being alerted to a traffic jam. And what do we usually do when we know of a traffic jam in advance? We don’t drive straight into it, right? We’ll refer to GPS or maps for alternates, change our time of departure, or change our plans altogether. Seeing others doing it, especially in droves, isn’t a signal that you should do the same (because you think since so many are doing it that they have it right - they don’t! They are just going out of business faster than you) but a signal that they are less aware of the dangers of price-cutting. But you’re here and have seen this article and know that there is a better way - to zag. Think about how hard it may be when ten dozen and five more are priced at exactly the same reduced price you are considering. Competition just got fiercer and the prize at the finish line is lower for all of you! Then it may get to a boxing match of reducing price even further, raising time and raising number of images — and all of it can be done by your competition too — until you’re out of options and out of income.

Read this blog to help you with education of creating added-value in your business, and establishing healthy pricing and healthy mindset in order to get you through this slump and beyond. While there is no magic insta-pill, the most magical pill I can offer you is to learn marketing. Do it by using the free resources here, or by finding a relevant paid product that may cost you a bit of money but set you up for making more money. If you considered discounting just one session by $10, that same outlay can buy my website handy guide which has some great ways to attract more people to your site which can result in bookings. Isn’t that a better pricing strategy?