(A wonderful perspective and advice for our community.)


PRESIDENT’S LETTER

It’s Just Business

Several recent threads on ASMP’s on-line forums have dealt with photographers’ frustration with client negotiations. Clients were proposing budgets below and terms beyond what the photographers considered fair. Photographers lamented that clients continually refused to see the value in what they provide.
The general response was “just say no” to these deals and “seek out better clients who understand the value and will pay for it.” There is some wisdom to this approach, but it hits a roadblock when you take into account that there are only a finite number of quality oriented blue chip clients willing to pay top dollar.
Photographers tend to price their individual services in a fairly narrow range. “This is my price for one day of production and the rights granted.” Or worse, they say, “This is my day rate”. They set their price and rights package to represent what they feel is a fair value. It may well be so, but value is a perception shaped by largely by the marketplace.
For many years value and budgets for certain projects were reasonably stable. Many photographers would turn to resources like fotoQuote to see what the “going rate” was for specific usage and adjust for their local market and production costs. But in the past ten years the marketplace has changed. Clients now have many more options for obtaining images, the number and types of uses have exploded in the digital environment, the economy has been a disaster and there are far more image makers vying for fewer assignments. This has greatly affected the market along with the buyer’s perspective of value, driving fees down.

I had been suffering the same problems and was losing job after job. About $40,000 worth of estimates went south in the first four months of 2010. (It was work that all went to other photographers.) Clearly, it was time to re-examine my business model. I had a number of in-depth conversations with my clients. They made it abundantly clear that they loved my images and wanted to work with me, but felt I was too expensive or there were issues with rights. Even with my emphasis on quality, production values, service and follow up, they could not justify the same value I perceived. My pricing and policies had taken me out of the marketplace entirely. And these were the blue chip companies in my market.
Losing almost every estimate that came my way, I began to experiment with
lowering my fees a small amount and broadening my usage rights. I know lowering fees or broadening rights will seem like heresy, caving in and selling out to many photographers. Trust me; it was very difficult to do on an emotional level.
However, the results were startling. Even after the dismal start, my gross sales for 2011 went up 85 percent over 2010. (And January 2012 will nearly double January 2011!) Interestingly, the average total billed per project has actually increased, even with the nominal fee reduction. I have put myself back into the market. Clients could now justify the value, even if I was often still more expensive than my competition. And, because of my flexibility over pricing and usage rights I was the person in the room when the client decided to make the job bigger and add video or additional stills to the job. What did this billing increase mean in practical terms? In the past few months, I was able to pay down more than $30,000 in long term debt and build a cash reserve that will carry me for nearly nine months.

My new mindset is, “It’s just business”. I now evaluate projects, budgets and rights requests and ask myself, “Can I do this project at a profit that will sustain my business?” No dogma or blind adherence to some perceived standard, just a flexible approach to meeting client needs and running a profitable business.

--James Cavanaugh President, ASMP cavanaugh@asmp.org



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