A great price is only defined by the great value behind it.
It's easy to think that all people want are low prices. Afterall, isn't that what retail empire Walmart was built on?! On the surface it may seem as though the low prices and large selection of Walmart were what kept small town American businesses from being able to compete with the retail giant that took over rural towns, but Walmart was built on giving people the MOST VALUE for the lowest price. Rather than change their business strategies so that they were no longer competing on value, small mom & pop shops across the country gave up hope and closed up shop far too quickly instead of reinventing their business to meet the shopping needs that Walmart was unable to provide.
Ultimately, there are two kinds of shoppers. Those looking for a great value, and those who are looking for great quality. Both shoppers are looking to get the best product for their money- but one is focused on the numbers while the other is focused on aesthetics. I consider myself to fall somewhere in the middle and I'm going to be adventurous and say that many people feel similarly. Sometimes I'm shopping to get the best value for my money (like with gas), while other times I'm shopping to get the highest quality product (like with makeup), even if it means I have to spend a little more money than the value side of my brain is willing to justify. This also leads me to the question - does anyone buy mid-grade gas?!
My shopping decisions are dependent on what I value in life, and how those priorities fit with my pocketbook and my lifestyle. This is why the same person who spends $5,000 on their wedding flowers may only want to spend $2,000 on their wedding photographer. Obviously photographing those amazing flowers is not nearly as important as having the amazing flowers to impress the guests on the wedding day. With the same token, this is also why someone who has a simple outdoor ceremony with only a few guests and a cocktail reception will spend $5,000 of their ambitiously small $10,000 wedding budget on the best photographer they can possibly find- because they want to make sure every moment of their precious and intimate celebration is preserved in the most beautiful way. We cannot change what people prioritize in their lives, we can only hope to attract the people who value the same things we do, which is why we need to make it clear in our pricing and branding as to what shoppers we are hoping to attract.
I need to cut off any notions that simply having a higher or lower price will define your market. It is the VALUE and QUALITY of what is being offered that is MORE IMPORTANT than the price alone.
If someone's service or quality sucks and their price is high, they can still have a very high value! (Huh?!) If they pad their packages with tons of products with a high perceived value, they can completely devalue the photographic work, but still command a high price for the quantity and quality of the products included, despite the quality missing in the photographic work. This is how some photographers who don't have the greatest quality can demand a high price, because they've padded their packages with lots of valuable products that make the savviest of bargain hunters want to spend more than they had initially budgeted. These bargain hunters like to know they get a lot of "stuff" for their money, because to the person shopping on value alone, the products and perceived value of those products are more important and more valuable than the quality of the work. If someone has crappy work or horrible service and offers no added value by way of products but still commands a high price, than their value is very low and will not appeal to the bargain shopper.... unless they drop their price to where their perceived value becomes higher. Last thought on value from a good friend, Sergio who had reminded me that "expensive" is merely a word to describe a perception that the value is not worth the price, and that perhaps if someone says we are too "expensive", it is simply that we are not providing enough value in our products or services for that person to justify the cost to them, based on their values. Is this making sense yet?
Quality is not quite as easy to measure as value because it isn't defined by numbers alone, which also makes it slightly more difficult to shop for online when you have so many different options to choose from and one of the only ways to sort them out is by price (as is the case on many wedding planning websites). Quality is an intangible and often difficult to define element of a product or service. Yet, somehow we know quality when we experience it. Take a moment to reflect on the brands that you associate with high quality and think about what they all have in common? ...
You may have come up with common traits such as: memorable branding, higher than average prices, beautiful aesthetics, durability and longevity, great service, trusted reputation, etc. Is it possible to "fake" these things? Perhaps you could have a high price, memorable branding, and beautiful aesthetics.. but how about great service, trusted reputation, and longevity? Certainly, some things simply cannot be faked. The difficulty in a service industry such as photography and a short customer cycle such as weddings, is communicating those intangible qualities up front. This is why word of mouth is so important for a service based business, because people who are looking for those high quality intangibles will often seek the advice and recommendation of others in order to find the trusted vendor who has great service ALONG with beautiful work. People who are shopping for quality are not using price as a filter- they are looking for something that trusted and reliable, and they are willing to pay more for these qualities, knowing that they will be taken care of. This is why someone who comes highly recommended is often in greater demand than someone who simply has beautiful work.
I didn't include this third category in the title, because most of the population can fall into the value vs. quality shopping mentality. However, when a product or service is truly unique and customized in a way that cannot be mass-produced (or is at least perceived as not being mass produced), there is a niche market of buyers who will search for uniqueness before all other factors are considered. We are moving from an age of mass production and capturing large markets, to an age of personalized products that sell to fewer people in lots of different markets (for more info, read: The Long Tail, Small Is The New Big, and Microtrends.) You no longer just buy a box of kleenex, you buy a pocket sized packet to carry with you, or the kind with lotion so that it doesn't hurt your skin, or the kind with a decorative box so that it blends into your decor. What used to be a quick fix of caffeine in the morning, has become a definition of who you are as a person- soy chai latte extra hot in my travel mug please! (lactose intolerant eco-nerd who takes too long to drink her tea). Personalized products and customization allow us to define who we are through the things we buy, and some people are willing to pay a lot more just to get something that no one else can or will have. This is why some products and services can survive on sheer exclusivity- because it makes them unique (even if their work isn't actually very unique in and of itself). If only X number of a certain car can be made each year, and only X number of people can actually afford that car to begin with, it's a car that makes a statement about who you are. Be careful of this placement in the market... because only ONE product or service can be the "most exclusive"... and frankly, they often have to find other sources of income to fill the income gaps that come with the high price tag and risk that comes with exclusivity. There also aren't nearly as many people willing to pay a lot of money for something just for its exclusivity... especially not when they can find something that is very unique and of high quality for lesser money, so keep that in mind.
In summary, know who you're selling to and what is important to that customer. Do they feel good knowing they got a lot for their money, or do they feel good knowing that they are getting trusted quality? How can you bring these selling points to the forefront when you meet with clients or present your business on your website? How does this affect the way you market your business? How does it affect what products and services you provide for your clients? When you take time to really think about and answer these questions for your business, you put yourself in the drivers seat and are able to make clearer, more informed decisions- which in turn, should lead you to greater success. ;-)
also posted on DWF 1/30/08
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