Tuesday, February 2, 2016

Quoting a Job Without Project Details

The more commercial work I do, the more I find commercial clients who basically want me to give them a price without giving me any information about their project and how much time, effort, and detail it will take.  Trying to elicit more details out of those clients before sharing any pricing only results in responses about 40% of the time, which means the other 60% want to know something about price before they will even engage in a conversation about the project.  While this is frustrating from a creative and budgeting perspective, I've found a couple ways to open the door without committing to a bad price....

Provide An Average Client Range
By telling the client that average projects tend to range anywhere from $$$$-$$$$, they can immediately know if their budget falls in your client averages based on what they're requesting.  Even if it's a huge range from hundreds to thousands, it's amazing how just providing any number range can keep the conversation moving forward so that the client feels more comfortable expressing their project details.

Provide Quotes From Previous Projects
Providing samples of previous quotes can help a client better understand what level they fall in.  This would be similar to having an established price list, but provide more detailed examples of what can be included or eliminated from a quote.  Ideally, you'll be able to provide 3 solid examples from previous jobs you've completed.
Client A: Four hours of on-location photography with highly specialized studio lighting, stylist, makeup artist, and models with delivery of 10 retouched images for print advertising in a major magazine: $$$$$
Client B: Two hours of on-location photography with simple studio lighting to create headshots for 5 executives for an annual report with a delivery of 5 images: $$$$.
Client C: Full day of photography in studio with specialty lighting for commercial website and packaging use: $$$$

Provide A Low & High Estimate
If you think you have a good sense of what the job will be without a bunch of detail, you can provide a low and high estimate to help the client understand more about their needs.  It's a way of providing a soft quoted estimate with plenty of negotiating room.
Budget Option: 2 hours on location, 2 images delivered with option to purchase more $$$
Luxury Option: 8 hours on location, 8 images delivered with option to purchase more $$$$$

If you've had clients fall through the cracks because you weren't able to provide something they could begin to work with, try one of these approaches instead and see if it helps to improve your follow-through with new inquiries.


Anne Ruthmann is a professional photographer in New York City. With over 10 years of success as a full-time photographer in weddings, portraits, editorial, and now architecture and interiors, she spends any extra time she has helping others find smart solutions to business problems.  Stay in touch on Instagram, Twitter or Facebook.

Tuesday, January 19, 2016

How to Announce Price Increases

As you evaluate your income and expenses from the last year, it's a great time to evaluate any pricing changes you may want to make for the year ahead.  Did you find that you put much more work into a certain product or service than you're being compensated for?  Did your suppliers increase their prices or change their product line?  Do you plan to add new services or products that will increase your overhead?  Do you need to invest more in packaging,  equipment, education, or marketing?

Whatever the reason for increasing prices, it's often one of the big struggles for small businesses who rely on retaining old clients while attracting new ones.  Most businesses find that their costs and/or prices have to increase year to year in order to stay sustainable and keep up with new market demands.  When businesses don't account for growth in their overhead, product, or service, they end up shortchanging their ability to continue serving clients well into the future.

Based on the many times I've had to change my pricing due to moving to a new market with new overhead costs, as well as helping other photographers who've needed to make changes to their pricing, I've found three strategies that help make it easier to move from one price point to the next without too much shock to an existing or recurring client base.

1. Same Rate, Different Offering
The easiest change you can make to a price list is to keep your rates the same, but redefine your offerings at each price point to more accurately reflect the time and cost that goes into creating that service and product at that price point.  The example below is for a portrait photographer who needs to move from providing too many images and giving everything away, to an offering that will allow for additional images to be purchased in order to account for the many hours they spend in post-production and retouching but hadn't been accounting for in their previous pricing model.
Example:  $250 Portrait Shoot
Before: Includes 2 hours on location, proofs online, all high resolution images
After: Up to 1 hour on location, proofs online, 2 high resolution images (additional images $75/ea)

2. Drop The Smallest Option, Add A Bigger Option
If you've presented your prices in a tiered packaging format that offers 3-5 package options, this method helps establish a new lowest price and highest price for your client offerings and makes it possible to take a big leap in price jumps from one year to the next.  This is ideal for businesses who started out too low to be sustainable and need to make a big move forward from year to year until they reach sustainability.  Since most clients tend to fall in the middle of package offerings, very few people end up booking at the bottom and top ends and generally move themselves into the middle.  When you take something that used to fall in the middle and make it a baseline package, you open up the opportunity for new clients to see a new middle ground while old clients still see a package number they're familiar with.
Example: 
Before:
Package A: $1500 Shooting only, everything else a la carte
Package B: $2900 Shooting + some things included
Package C: $3800 Shooting + more things included
After:
Package B: $2900 Shooting only, everything else a la carte
Package C: $3800 Shooting + some things included
Package D: $4700 Shooting + more things included

3. Baby Steps
People who've been in business for a long time and have very established recurring client bases, sales packages, and a good understanding of their time and cost invested generally only need to adjust prices slightly year by year as needed without much change to their offerings.  The idea is that smaller changes each year are less alarming to regular clients than dramatic changes.  They may even do this without any announcement or fanfare, just making small adjustments as needed.  As clients become comfortable with new prices year to year, the changes don't feel so dramatic that they are suddenly out of budget from one year to the next.
Example:
Before: $425 hourly rate
After: $475 hourly rate


"Should I let my clients know?"

  • YES, IF.... you have a lot of recurring clients who need to build your service into their budget.
  • NO, IF.... your client turn over is high and you're constantly serving new clients each year.

"How do I tell them?"
When you're ready to put your new pricing into effect, make it a positive announcement and share any growth you've experienced over the last year as well as any ways that you've improved your service through education or received recognition through awards or publication.  People love working with businesses that are growing and it's far more attractive to stick with someone who is on an upswing in their business than someone who characterizes changes in terms of how costs are weighing down their business.  If you don't have any exciting growth, awards, or improvements to share, you can just serve up a short and simple gratitude sandwich like the example below....

Example: "We want to take this opportunity to thank you so much for your support and business over this last year.  We've attached a new rate sheet for your reference and are happy to answer any questions you have.  We love working with you and look forward to working with you even more in the year ahead!"


Anne Ruthmann is a professional photographer in New York City. With over 10 years of success as a full-time photographer in weddings, portraits, editorial, and now architecture and interiors, she spends any extra time she has helping others find smart solutions to business problems.  Stay in touch on Instagram, Twitter or Facebook.

Thursday, November 12, 2015

Standing Behind Our Value

I had quite a few challenges to pricing some projects with clients over the last couple weeks.  Prospects and even existing clients were pressing especially hard to try and get me to bring my prices under their budgets while still getting everything they wanted without any compromises on their end.  In some cases, they really couldn't afford to work with a professional, but were trying to find someone who would do a professional job for a non-professional price.  They pulled a lot of stops out of the negotiating bucket:
  • asking me to defend why I price things the way I do
  • saying that someone else prices the same thing much lower
  • talking about how great the exposure will be and how many other clients it will lead to
  • suggesting that a great price on this project will mean more future business together
  • telling me that the project doesn't require as much time/effort as I know it will
  • building a package discount and then trying to remove individual items at full price
  • threatening that they'll take their business elsewhere if I can't give them the price they want

When I was inexperienced and without the deep knowledge of how much time and expense goes into everything I create, these tactics may have made me feel insecure of myself and made me question my own value.  Due to experience and wisdom, these hard bargain strategies don't work on me anymore and I can spot them coming from a mile away.  I also know that the client who tends to use them up front is often a red flag for more issues down the road.  The tactics aren't new and they aren't going away anytime soon.  Not everyone can afford to work with a professional, and that's OK.  The problem is not that clients do these things, but that creative professionals blame clients for devaluing our work or industry.

The fact is, clients don't devalue our work, we do.


We devalue our work every time we don't stand up for our own prices.  We devalue our work when we agree to work for the same price "someone else" charges even when we have no idea who that someone else is or what the situation was.  We devalue our work when we accept exposure as sufficient payment even when we know it's something that should be paid for.  We devalue our work when we begin client relationships with an intro bargain, but then don't ask for more or don't raise our prices to fit our changing market, or professional advancement, or additional experience.  We devalue our work when we let clients tell us how much time or effort something should take, rather than defending our knowledge of the work we put in.  We devalue our work when we allow clients to get away with bad math rather than calling them on their errors.  We devalue our work when we take on projects because we feel desperate or threatened, rather than defending our value and holding space for better clients to come along.

Expect to be questioned about your value.  Expect to be compared.  Expect to be asked to work for free.  Expect to be lied to.  Expect to play hard ball.  Expect that sometimes you have to walk away in order to defend your value.  If you expect these things to happen, than you will only be pleasantly surprised on the occasions when they don't happen.

The difference between creatives with similar styles who charge more or less is often based on how they defend their value.  The $10,000 creative doesn't necessarily create better or more magical work for $10K, they simply won't do the work for less than that and are willing to take whatever risks, gambles, or other income streams are necessary in order to holdfast to that particular valuing of their work.  I'm not saying the market will pay whatever people feel like charging (though some people still debate that), I'm simply saying that our value is ultimately defined by how much we value our own work and are willing to stand behind our worth.  The funny thing is, the more comfortable we are with defending our worth, the more others tend to value it as well.

Anne Ruthmann is a professional photographer in New York City. With over 10 years of success as a full-time photographer in weddings, portraits, editorial, and now architecture and interiors, she spends any extra time she has helping others find smart solutions to business problems. Stay in touch on Instagram, Twitter or Facebook.

Wednesday, September 30, 2015

Are You Creating Buyer Confusion?

I've had several experiences lately where the way a business moved me through their sales process actually invited me to reconsider my choice after I decided on what I was going to buy.  These weren't like considering add-ons or compliments to increase the sale of my purchase, which would be a bonus purchase strategy, but rather, considering completely different products and brands which made me question my initial choice.  The buyer experience was one of confusion and distraction, rather than confidence and readiness.

Example 1: Sharing Information in a Public Sharing Platform 
I was invited by a service provider to view a price list on issu.com, an online magazine layout solution.  When I got to the bottom of the price list, the platform invited me to look at other service provider price lists for the same service!  So, even if I was sold on my first choice, now I was being given many other choices to take me into the rabbit hole of comparison and being completely taken away from my original intent of working with a specific service provider.  Make sure that how you're sharing your information with clients who are ready to make a decision isn't a place that invites them to compare other services.

Example 2: Showing 5 More Options for The Same Item
I was searching for a pair of boots on Zappos.com and when I made my decision and was ready to check out.  I was then given a side bar during my check out to look at 5 more types of black boots that didn't initially come up in my first searches.  Now, instead of checking out, I was spending more time debating my initial purchase instead of actually checking out with my purchase.  While it increased my time on the site to look at more variety, it delayed my purchasing decision and made me question what else I might have missed.  I almost didn't buy the boots I was ready to buy because I was taken down the rabbit hole of distraction.  In the photography world, this might be like showing several different flush mount album providers at the same price point and creating client decision distraction, rather than picking the best one for your workflow and business and only making the client decisions about what kind of cover it should have.

Example 3: Showing Products That Aren't Available
Isn't it the worst when you get to a restaurant and see a special or a dish you really like, only to have a server tell you it's no longer available?  Doh!!  Now we're beginning our experience with a disappointment about what's not available and doubting how many other things may not actually be available.  Make sure that any visual or price list you offer a client is current with the actual products you sell.  Trust is a huge factor in feeling good about a purchasing decision and it's important to make sure our offerings build trust rather than undermine it.

What Can You Improve?
Now that I've shared several distracting sales experiences, take a moment to consider the full sales experience your client has with your products and your services.  Are are you building confidence or confusion?  How can you improve the experience for the client?



Anne Ruthmann is a professional photographer in New York City. With over 10 years of success as a full-time photographer in weddings, portraits, editorial, and now architecture and interiors, she spends any extra time she has helping others find smart solutions to business problems.  Stay in touch on Instagram, Twitter or Facebook.

Tuesday, September 1, 2015

Thumbtack Bidding & Closing Strategies

Whenever a new service enters the market, there's going to be a learning curve for testing it out, seeing what it's good for and what it isn't good for.  If you haven't heard of Thumbtack before from my previous post on Where to Find Freelance Work, it's a newer bidding system designed to connect service professionals with people looking for services.

Who It Attracts:
People who search the web for service professionals are usually doing so to research information about hiring someone or because they don't have any referrals from trusted sources.  When you consider the person who uses the web to find services, they also may not have hired a service professional before and are starting their search online with services like Thumbtack.  They may have no idea what to expect or how the process works.  Much like ranking at the top of Google, you'll need to sort through a lot of inquiries that may be duds in order to find the ones that become awesome clients who share your work and create more referrals.

If a potential client finds their way to Thumbtack, they can get bids from 5 different "professionals" by making one request in the budget range that they *think* is appropriate and that they can afford.  It's far more effective than trying to search Google because it's a localized result and takes much less time to hear from multiple professionals. This is not to say that they will receive qualified responses if their request seems unreasonable, but there are quite a few pros employing strategies to bring a budget request on board and turn it into a more appropriate professional fee.  I can honestly say that I've used it successfully to find some really wonderful clients, and I think it's a great new service, but it does have a learning curve, which is what I'd like to help you understand before you start using it.

What To Expect:
Based on the info above, you can expect that a lot of people using the service for the first time don't actually know what a professional service should cost.  They aren't awful people and they aren't trying to undercut a professional living.  Thumbtack generally asks for a budget, and if the client doesn't know any better, they may default to the lowest possible option.  This doesn't mean they will choose the lowest bid once they see their options, it simply means they haven't been educated about the differences between low budget and appropriate budget services, and Thumbtack may be their first introduction to the differences between a low-priced service and a professionally priced one.

What The Pro Sees:
The professional sees a new request in their email, on the website, or in their smart phone app with a set of details predetermined by Thumbtack. The professional uses the request information to determine if the job is worth bidding on or not.  The pro pays a fee to make their bid based on a point system, which is similar to what you'd pay if you were using other internet lead services like Google Ad Words or Facebook Ads to secure a new client.  The service is constantly growing and changing, so if you think a request item needs to be added to the service, it's best to suggest it to them.  If they get enough suggestions, than they will be able to add it to the system.

The Bidding Process:
Thumbtack delivers the first 5 bids made by professionals to a client request without regard to relevance, bidded price, or other factors.  Their goal is to deliver service professionals and bids as quickly as possible to the client to help them make a decision quickly.  If the client fails to look at their bids for 48 hours, all bid credits are refunded to the professional bidders.  Once you've made a bid, you then have an opportunity to provide additional information through the Thumbtack messaging system, which keeps most of the client's information anonymous unless the client has provided the info to the bidders.  Clients have the option to get more information before hiring a professional as well, and if they decide to hire someone, they are also prompted to leave a review of that professional's service, which becomes part of the professionals profile.

Tips for Bidding:
Before you begin bidding, create a profile and just sit back for a week and see how many requests come in at different price points and what the categories are- this will help you get a sense of what's happening in your market and what the initial expectations are. As tempting as it would be to bid on everything right away, save yourself some money and get to know what kind of requests are coming in first.  I would also suggest going into Thumbtack knowing that your first bunch of bids are going to be learning experiences rather than paying clients.  It may take you 10-20 bids before you really start to learn what bids will actually pan out into clients who will communicate with you and hire you.  If you feel like you have plenty of business already, than don't waste your time with this system.  It's designed for people who are hungry for more work and can respond quickly to a text message or email notification.  That being said, here are a few suggestions for making the most of your bids:

  1. Create A Specialty Portfolio- If you only want new portrait leads from Thumbtack, set up your profile to focus on that.  If you only want commercial leads, set up your profile for that.  This service works best when you focus tightly on what kind of new clients you want, so make sure you've tailored your Thumbtack profile to reflect that type of work and only selected that niche to receive requests for.  The more relevant the bids are to begin with, the higher chances you'll have of finding the right clients.  People who are seeking portrait work but have portfolios that feature products and vice versa are only confusing the buyer.
  2. Evaluate The Detail of The Bid- At first I couldn't tell which bids were serious or not, but over time I started to notice that serious clients provided more detail in their requests than the clients who never followed up.  This isn't a 100% accurate measure of a serious client, which is why you need to spend a couple weeks just looking at a lot of the requests that come in before you start actually making bids.
  3. Respond Immediately- Once you're ready to start bidding, you have to be lightening fast for some of the service categories.  Portraits and Commercial photography in NYC can receive 5 bids from professionals within 60 seconds.  If you aren't hungry for work and ready to bid, you'll probably find yourself shut out of a lot of opportunities.  That being said, you can increase your chances of seeing requests by setting up text alerts to your phone- just make sure you have an unlimited text plan before doing so.
  4. Choose A Smart Bidding Strategy- You can bid on requests with a fixed price, price per hour, or by saying you need more info.  I would say your best strategy is to give an estimated price up front and then simply explain what that includes in your message, rather than giving no price and saying you need more info.  If you think the request is really a $900 job and they've set their budget to $500, you could use the hourly system to bid $300/hr and suggest that it will be a 3 hour job and provide some additional education.  That way it may at first look like it's under budget, but with the appropriate detail and education of the client, you can walk them into a more appropriate budget for the job.  Likewise, if you think it's a serious client and want to come within their bid range even if it's lower than you'd normally take, you can bid at $500 but then limit the deliverables, the post-production process, or the time for the shoot to help keep it within what's affordable for you and your overhead.  Again, it's better to give a number to open the dialogue, than to provide no number at all.
  5. Ask A Question To Open Dialogue- I generally know how serious a person is about their request if they respond to a critical question included in the quote.  Questions like, what would like to do with the images after you've receive them?  Will you need a stylist or make-up artist, or will you be doing your own styling? A client who isn't serious, simply will not answer the question or provide any response.  A client who is serious will often engage in a dialogue with you and provide more details.  Unfortunately you won't know this until after you've made a bid, but it does give you insight into whether the client will actually move forward or not with the bids they've received.
  6. Follow-Up After Bidding- If 48 hours have passed and you haven't received a response or confirmation of being hired or the request being closed, follow up and ask if they need more information before making a decision.  Offer your email and phone number in case it's easier to have a conversation off of Thumbtack.  Occasionally, following up even a week or two after the request has resulted in a new client.  Some people are making requests as admins or virtual assistants for someone else and need to get approvals or share information before they can move further with a bid.  Following-up shows that you're serious, professional, and willing to help.
  7. Never Lose Your Cool- If you are being "ghosted", meaning that a potential client has suddenly stopped responding, never write back in frustration or anger.  Just be cool if their plans have changed or they ended up going with another option.  Your cool is part of your professionalism and without it, you're taking the whole thing way too personally and expecting way too much out of people who may be exploring a service for the very first time.

Tips for Closing The Sale:
Because these clients have elected to search for a service online, the more you can move the process forward online, the more likely you are to close the sale.  If you can provide an online quote, an online contract, and an online payment option, you're far more likely to close the sale in a timely manner than if you require these clients to take extra steps offline like having an in-person meeting first.

It's also important to remember the client level of skepticism with hiring someone online rather than from a friend or trusted source- so asking for full payment up front may also make it difficult to close the sale.  However, you may be able to ask for a small deposit up front to pay for the travel arrangements or equipment rental to serve the client, but since you are not a trusted service yet, you will be more likely to close the sale with a quote and a contract that allows for payment to be due at the time the service is provided, but before final delivery of the product.  With all clients, I would suggest not providing final delivery of the finished or high resolution product until you've received full payment.

Have more questions?  Leave a comment and I'll do my best to answer them!

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