Have you heard the phrase 'race to the bottom'?

In commercial photography terms, that's where bidders compete with each other, quickly lowering their prices until they all end up at 'the bottom'. (Think of it like a reverse eBay auction, with bidders offering lower and lower prices for the auctioned items until the auction is won by the lowest bidder.)

What's the bottom?

Somewhere you definitely don't want to be in this industry.

And the crazy thing is, in commercial photography you can create your ownrace to the bottom, even without the presence of another photographer bidding on a job.

You do this by arbitrarily lowering your prices, simply because a client asked you to.

This creates an endless spiral, where each time they give you feedback on your estimate they ask you to lower it more, and you continue to do so, because you want/need the job.

Then when the client hires you again, and they refer you out to other companies, the cycle will continue, and it's very hard to get out of.

This brings me to my #1 pricing tip:

Pricing Tip #1: Never arbitrarily lower your prices.

If you lower the prices on an estimate after you send it to a client and get their feedback, (and you will, as this is standard practice!), decide what service/feature/inclusion you can remove in order to accommodate the client's budget.

Some ideas:

Find a lower-priced up-and-coming caterer
Do your own digitech work
Use real people talent instead of pro models
Include fewer images/reduce the # of shots licensed (this usually produces the biggest drop in the bottom line price)
Remove a location
Spread out the cost of the photos over several years
Use your own studio/garage/spare bedroom/living room
Use a student hair and makeup artist

These are just a few ideas of how you can lower pricing while reducing the value to the client.

With the constant downward pressure on pricing in commercial work, the more skilled you are at brainstorming estimate changes the more sustainable the work will be for you in the long run.

For More information on Real Estate photography & media visit: www.MarkJacobsProductions.com

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