When the real estate market was hot in 2005, everyone and their grandmas were real estate agents. It got so competitive that real estate agents offered to sell homes for as low as 4% from the conventional 6%.
WOW! To put this into perspective, 2% difference from a $400k home is $8k (33% in discount). Eventually, it got so competitive that many people exited the industry. Now, if you ask to pay a 4% commission, real estate agents will laugh at you. Prices and rates returned to normal (equilibrium).
In the photography industry, lots of newcomers enter the industry. But why don’t the price and rate return to equilibrium? Instead, veteran photographers are forced to discount and discount and discount …
Brace yourself. This is a long post. But it applies to all industries.
In reality, this phenomenon is not very surprising if one is adept in basic microeconomics and understands a form of game theory called, “prisoner’s dilemma.”
The bottom line is that low-priced photographers will continue to rise in income and volume, while high-priced photographers will continue to decline in income and volume. Of course, there are outliers – those whom are well-branded.
Below is the explanation for this occurrence. You should read on if you want to be successful.
For the sake of consistency, pretend that you are a wedding photographer. I know that my readers are diverse, but the strategies are applicable to everyone in every industry.
Microeconomics – Supply and Demand
You might have seen the following graph in high school or college. It can look daunting, but I will explain each item. Below is a supply-demand graph for the photo industry.
First, look at P1 and Q1.
- P1 stands for Initial Price
- Q1 stands for Initial Quantity
Where P1 and Q1 meet is the equilibrium point, which means that the optimal number and price of transactions between producers (you) and consumers (clients) happen there. For example, pretend that the sweet spot is $4,000 per wedding for 50% of the market of brides.
Charge above the $4,000 sweet spot and you will see a decline in demand. Charge below the $4,000 sweet spot and you will see so much demand that it’d be silly not to charge more.
However, due to reduction in barriers to entry, more photographers enter the market.
- No more dark rooms – learning curve reduced with instant feedback with LCD previews
- No more costly camera equipment – cameras get cheaper and better
- No education required – do you need a diploma to shoot photography?
This easy-to-do trade had a Malthusian explosion in photographers – 1 leads to 2, 2 leads to 4, 4 leads to 8, … Therefore, the shift in the supply curve (increase in photographers) causes a reduction in optimal price.
Here’s the skinny – Pretend that there’s a pie (number of weddings to shoot). That pie is not going to get any bigger (number of weddings are not going to increase). However, the number of people that wants a piece of that pie is increasing, which means that everyone gets a smaller slice (smaller profits).
More people. Same size pie. Smaller slices.
Increase in Technology
Additionally, an increase in technology allows for a producer (you) to be more efficient. With faster computers, quick Photoshop Actions and Lightroom Presets, you could now, let’s pretend, produce or process twice the number of weddings as in the past!
So, instead of only allowed to handle, let’s say, 20 weddings, you now can handle 40 weddings. This shifts the supply curve more to the right, reducing the optimal price charged.
Here’s the skinny again: Technology makes more efficient people. Same size pie. Even smaller slices.
No One Truly Exits the Industry
Prices will fluctuate lower and lower for expensive photographers and prices will fluctuate higher and higher for cheap photographers until equilibrium is met. When it gets to a point where the small profits don’t make sense, producers (you) will exit the industry. That is the point of diminishing returns.
However, because it’s so easy to maintain a photography business, many photographers won’t really “exit.” I mean, how hard is it to maintain a photography business? Generally speaking, have a website, gear and business cards. Am I missing anything?
With that being the case, equilibrium will always remain low because even full-time photographers will never truly exit and more part-time photographers will continue to enter. Who isn’t willing to sacrifice half a dozen weekends out of the year to make a few grand per shoot?
Prisoner’s Dilemma
Prisoner’s dilemma is a game that provides insight into why people fail to cooperate, even if cooperation would benefit everyone.
Examine this example.
You and John got caught for a crime, but there wasn’t enough evidence to convict you two for a serious felony, so the cops try to get one of you two to confess.
They separate you two and offer you each a “deal.” If you confess and John does not, you walk away free and John goes to prison for 30 years. If you stay silent and John confesses, John walks away free and you go to prison for 30 years. If you both confess, you and John each serve 8 years in prison.
If you both stay silent and do not confess, you both go to prison for 1 year because there was not enough evidence to convict you two for a serious felony.
What will you do?
These are your options:
- If you stay silent, you could get 1 year in prison or 30 years in prison
- If you confess, you could get 0 years in prison or 8 years in prison
The dominant strategy is the best strategy regardless of the strategies chosen by the other players (or John). In this case, the best strategy is to confess. It’s the best choice regardless of what John says, even though it would be most beneficial to cooperatively stay silent.
In the case of the photography industry. The only way for prices and profits to remain high is if everyone cooperatively keeps their prices up. However, someone will always use the dominant strategy and offer clients a slightly discounted rate to get the business.
This undermines the collective effort. As a response, someone else will discount to get more business. And someone else will discount too. And eventually, the optimal [and realistic lower] price is reached.
If you like and follow politics, think OPEC and oil oligopolies.
What to Do?
If you’ve read this far, then good for you. The first step is to stay abreast on trends and educate yourself in … everything. Reading my blog is education in marketing and business.
To be honest, there is no simple answer. Everyone’s situations are different. However, there are items that you could work on.
- Diversification – This is risky, but doable. I know of a number of photographers that shoot all sorts of crafts, but united under one brand – a self-brand (e.g., Lawrence Chan brand) – rather than a specific craft (e.g., only weddings). In the end, anyone can say “I only shoot weddings” too, but no one can say, “I am like Lawrence Chan,” except insert your name in lieu of mine.
- Branding – A well-branded company does not compromise. For example, Apple does not discount their products and people, including myself, thank them for taking our money. So, solidify your brand.
- Pricing – Your prices need to be flexible to the changing climate of the industry. Got to adapt as you go.
- Amalgamation – Photography is an extremely valuable skill and easily adaptable. It is not a bad idea to combine this skill with another career choice. For example, you could be a real estate agent with the best dang house photos or a fashion writer with the most stunning portraits.
The Art Center College of Design’s Photography and Imaging “received the largest number of applicants … in its 83-year history. [L]ong tradition of integrating photography with other design disciplines, … applying creative solutions to social impact problems.
–Future of Digital Photography
Anyone could be a better XYZ photographer, but no one can be a better you.
Always leverage your resources and tools. Maximize your efforts. Always think critically. Question everything.
Hope that was insightful. If you have any questions, comment below. I’ll answer them at my earliest convenience.
Your friend,
Lawrence Chan
P.S. The idea for this blog post came from Zack Arias – photo industry thought leader. A little over a month ago, I read a blog post from from him that discussed a photographer’s dilemma, which I believe to be the case for many veteran shooters.
Hi Zack,
If your business experience[d] the following sales losses, would you say it’s time to close the doors? The numbers are [as follows]:
- This year – sales down 25%
- Last year – sales down 60%
- Year before that – sales down 25%
- Year before that – sales down 12%
Basically four years of large sales losses. Prior to all [of] those losses, I [steadily climbed]. So, is it time to shut it down and move on to something else? Or, what would you do to recover from these losses?
-Anonymous
I want to commend the photographer who was brave enough to acknowledge this observation. Having the foresight to see the need to change and adapt is critical in success. I also want to thank Zack for his efforts in the photo industry. Without his Q/A publication, I might not have understood the scope of the issue at hand. Thanks!
P.P.S. Some lovely notes from readers of my psychology to pricing and packaging e-book.
P.P.P.S. I had to eat a pie just to make the photo above. Can you see how much I sacrifice in order to demonstrate a point? 😛
Comment below your favorite pie or dessert. My favorite dessert is french fries. Yes, you heard correct. Not sweet. SALTY.
TOFURIOUS 
If I had to pick a sweet dessert, it would be a Chinese dessert called, “dan tat,” which is an egg tart with a flaky crust. Mm …
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I want that dessert!! It sounds DELISH!!
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Hey Lawrence,
I don’t know how you do it but you always seem to be in line with my thoughts regarding business. Your article is well-timed, insightful and also a kick in the pants that I needed to GET TO IT ALREADY on some areas where I’ve been slacking. So thanks, as always, for being a source of inspiration. 🙂
What kind of pie was it? Cherry?
Oh, and re: fave dessert… I’m with you on the french fries – only they need to be dipped in a chocolate shake. Yums. 😉
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Glad the article was helpful and insightful!
Cherry, indeed. It was surprisingly good. I usually get apple, but the market ran out. Mm … milk shakes……. yum.
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I looooove french fries! But I could never turn down a plain, box-mix brownie, no icing or powdered sugar. Or ice cream. Or cobbler of any kind. Or homemade chocolate chip cookies. I have a dessert problem…
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Ah, brownies … me too. I love the crispy corners mostly. I could go for some now …
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An eye opener! So, do I further reduce my prices? ; ) I’ll wait…
My favorite dessert: tau fu fa
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Haha reduction of prices is circumstantial. There are some people who charge a lot, but get fewer customers. And that’s okay. Just got to find that niche.
Interesting choice in dessert. 😛
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Great post! Sort of depressing.
The only option I see for myself at this point is making sure my brand is rock-solid. I look forward to the upcoming “off season” to work on the business a little bit.
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I know 😦 I’m sorry. I don’t normally post non-happy things, but I felt that this was something I needed to share. Business-y stuff. On the bright side, you’re one step ahead compared to those whom have not read this post!
Keep going, Kelly!
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It’s okay. I forgive you. 🙂
And… ice cream, all the way.
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I took part in an ill-advised pie eating competition so sadly, the look, smell and sheer thought of pie sickens me. Lesson here – do participate in pie eating contests.
As for “Have a website, gear and business cards. Am I missing anything?” – yep. Insurance and other fixed costs. I have a business car lease, cell phone for business … thankfully no overhead for a brick and mortar store. But I get what you’re saying, most of the newbies aren’t going to have that overhead coming in.
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Oh my. Next time, I’ll post brownies. It’s just that a pie was always used in math class to show division.
Yeah, most part-time photographers maintain a pretty lean business; barebones in fact. But they survive.
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A well-written and extremely accurate article. If you frequent any photography forum, you will inevitably come across at least one thread where photographers are belly-aching about the state of the photography industry. Although it is surely a concern for anyone who makes a living through photography, the proposed solution usually amounts to demanding that the amateurs and novices stop “giving away” their photography. “If they don’t raise their price, how can I stay competitive?!” Any economist can tell you how silly that line of reasoning is.
As this article points out, the truth is that the supply of photographers is just much, much larger than it was just 10 years ago. Those photographers who want to stand their ground and are waiting for the competition to adjust their prices to a 10 year old model will simply price themselves out of the market. The game has changed.
In addition there is a supply that did not exist only a few short years ago – the supply of what I would call “adequate” photography. Adequate photography is low quality photographs; possibly a bit better than snapshots, but not what you’d expect from a professional. And the truth is that a market exists for this. I have spoken with many couples who were planning on having a relative shoot some snapshots at their wedding, or planned on leaving throw-away cameras on each table to let the guests take photo simply because they could not afford a professional phtographer. But instead they found a student/amateur who was willing to take photos for a huge discount, if not entirely free. Although these customers represent a slice of the pie, they are also making the pie larger than it was a few years ago. In other words, there are certainly more photographers, but there are also more customers as well; not every customer who chooses a cheap/free photographer is a customer that the professional photographer has lost.
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Thanks, Tony. I agree with you about the new segment of “adequate” photography. As the word is defined, “it’s good enough!” I appreciate your acuity and input!
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Just saw that there are 5 billion cell phone activations out of 7 billion people on earth, with 1.75 billion new camera phones sold in a year. Cell phone cameras and instant sharing of images via social media (Instagram, Pinterest, Facebook) are the game changers. Five years ago, the phone cam quality was so bad it wasn’t a serious competitor to your DSLR. That has changed. Camera phones held by every person is your competition and is shaping consumer behavior. Consumers are used to seeing an image for a few seconds on a phone screen and scrolling through dozens quickly. There are billions of images uploaded daily just from cell phone cameras. The quantity of pictures supplied is massive, the quality standards keep going lower (a fuzzy selfie can get many likes) therefore the price/value to the consumer of a digital image is seen as “free” (or nearly free). Fewer and fewer consumers want anything printed, so a previous source of profit margin is shrinking as well.
In order to stay ahead, I believe that today’s pro photographer must stand out with something distinctive (senior pics that are fun to take, HDR, time lapse, macro, product, real estate, or some specialty that a regular person can’t create on a cell phone with Snapseed and Diptic. Pros have a delay in posting in order to process the images, while amateurs are posting during the event. You must find something that is worth the wait. Find the exceptions to the rule. Downward pressure on pricing is inevitable, so I recommend that adding a utility value or experience that others can’t match or can’t match well.
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Those are some dizzying numbers, but absolutely true.
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What you have described is basic economic theory as it relates to a generic or commodity good. Maybe I am being overly optimistic, but I like to think of photography as producing something more than a generic product/good–i.e. art.
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You can, James. Art is subjective. Just got to find the niche of customers that appreciate art. For the general population, or even the entire population, no one knows what art truly is because it is always changing.
In fact, it’s the same for all industries. There are utility purses that simply carry things (e.g., regular purse) and there are luxury purses that make a statement (e.g., LV purse that resemble “travel” or TOMS shoes that represent “philanthropy”).
The hard part is for an uneducated consumer (client) to know the difference. So, it is the job of the producer (photographer) to brand that difference clearly. Whether the producer can do so is what will distinguish the service as commodity from luxury.
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The problem with this viewpoint (art vs. commodity) is that every photographer shares it which in turn makes the service generic. You can argue that through intelligent branding and service niching you can stay above the masses but every other photographer also shares this same argument. So you are still competing in an exponentially expanding industry with multitudes of people striving for top tier positioning. Why fight an uphill and exhausting battle when there are far better options available?
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While true, Jared, can consumers really tell the difference between art and commodity? There is some art that really make an emotional impact. And there are some that befuddles the viewer.
I’ll paste what I wrote as another comment:
This same argument can be applied to all industries. There are utility purses that simply carry things (e.g., regular purse) and there are luxury purses that make a statement (e.g., LV purse that resemble “travel” or TOMS shoes that represent “philanthropy”).
The hard part is for an uneducated consumer (client) to know the difference. So, it is the job of the producer (photographer) to brand that difference clearly. Whether the producer can do so is what will distinguish the service as commodity from luxury.
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Not true, Jared. It is not what the photographer perceives, but what the customer perceives that determines whether something is generic or unique. What sets great art apart from generic products is the fact that not everyone can produce great works of art (at least in the minds of consumers). Sure, there are lots of people out there taking pictures, just as there are lots of people out there producting “art” in other media. In the case of other media, this has been the case for hundreds, if not thousands, of years. Yet, despite the fact that the non-photographic art market has supposedly been “saturated” for centuries, folks still enter the competition and do very well. Not all, or even most, but enough to attract a steady stream of new competitors. The challenge is to fine tune your marketing efforts to identify and capture the clients who value your work as art.
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I agree that it is in the perception of the viewer and not the producer. Where this is different though, as to Lawrences point about Louis Vuitton’s niche marketing efforts, LV does not have 200,000+ competitors. The point is there are a finite set of niche’s available for wedding photographers to focus on. This inevitably leads to many choosing the same niche. It is true that no one can replicate “you” into their own offering, but they can come darn close at a fraction of the cost. I make a very good living as a wedding photographer so Im not being a curmudgeon. I have just realized my vision has to go beyond this career which I feel most wedding photographers do not spend enough time reflecting on until its too late.
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Interesting thought Jared. I am curious what the “better options” available are that you are referring to but not mentioning by name?
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Yes,
It’s a little bit depressing reading these words from you, a leader in this industry. I’ve been in this marketing for 5 years only and things are going well, but i think It’s time to have a backup plan…
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I only wrote this because I truly care about the photography industry, especially my friends who are photographers. This shift started in 2009, but it’s only been prevalent recently. Of course, this could be different in different geographical regions.
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Favorite dessert is probably brownies.. but who am I kidding, really? I love anything chocolate.
Thanks for the eye-opening info!
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Haha. Me too, Carrie. Dark chocolate for me.
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Very good post Lawrence, this is thought provoking. I agree that united we can be stronger. Thanks for this analysis.
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Thanks, Esenam!
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Great post! I always knew why undervaluing your work hurt the entire industry, but didn’t think of it in this way. and, ice cream! PS – Nice call to action, I probably wouldn’t have commented otherwise.
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Alas, the concept of oligopoly (sort of a monopoly) only works is if there were a select number of producers. And all of the producers made an agreement to fix the prices. However, to maintain that is hard when there are thousands of photographers.
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Thanks for taking the time to write this- things that need to be thought about for those of us in the industry for awhile-
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Always a pleasure, Kenny. Hope all is well, my friend.
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Reading your post won’t necessarily make you successful – it may help you understand the markets better though. What you describe is simple supply and demand economics.
The outliers you mention may have significant marketing costs – this eats into time/energy/resources – ROI? “Maximize your efforts”? Again, ROI?
As far as efficiency, there are still only so many Saturdays and weekends for family photography, and weather/seasons will cut into this time too. How many family portraits are shot at 3pm on a Weds? People who can afford family portraits often work, this leaves Sat/Sun. This creates a competition with your wedding schedule or the need to learn (quality) lighting for evening sessions.
You are right! Cameras have gotten cheaper (they don’t last as long), making equipment costs more expensive over the long haul. The education required may not be formal, but experience is required. How many (uneducated) Steve Jobs, and Bill Gates did the world produce? The well experienced pro may have the advantage – if they can communicate this well, and if their market will bear these costs. The lesser photographer may have to compete with lesser rates and more time/energy/services, reducing ROI.
Yes, people will exit the industry when/if something better (ROI) comes along.
Are you (personally) shooting the same number of weddings you did 5 years ago?
Yes, what you are missing are the upgrades to stay in the business. Cameras change and wear out quickly. Marketing still requires a ton of time. 6 weekends a year = how much cost (time & energy) to market services (including all meetings, those that book, those that don’t, those that keep calling for more details, those that insist on location meetings….), cost of upgrade to new 5DMIIIs, etc. Or, don’t do all this and maybe you have to drop $1K -$1.5K off your rates. So that few grand per shoot may now be more like $300.+ dollars after covering time and expenses. Keeping up with technology also requires more time and energy and outlay (ROI?, again). Cut too many corners and there goes the quality of service (reputation).
The difficulty with the prisoner’s dilemma analogy to photography are the subjective aspects of the business: image style, personality, image of business (known as “brand”). These are not equal, and each potential client doesn’t see them equally either. So it’s not quite that simple.(Not a one size fits all product). Though the nethive may be changing our sense of diversity and identity too.
btw – Apple compromises all the time on their product quality (they used to be a better company). Fashion creatives may be bigger slaves than other photographers – often obsessively willingly so 😉
The good news, as the economy improves, more people may have more discretionary income to spend on important events (weddings, etc.).
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Oh, Scott … I think we will have interesting conversations over tea in the near future. I look forward to them.
I always appreciate your perspective. Cheers, mate.
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Thanks for the kick in the rear that I needed. It’s so hard sometimes to keep going when sometimes you have clients who love your work, but prefer to go with the cheaper photographer instead due to price. Sometimes I think that I should lower my prices to get more work, but then I have to keep telling myself that more work means time away from my little girl, which means I need to be compensated accordingly for not being with her. It’s hard, but I am still trying.
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I know what you mean, Linda. This is a question of opportunity cost.
Sometimes, it’s difficult to put a price tag on the warm moments you share with your daughter. While you might be willing to trade some time for photo jobs, there is a threshold at which your relationship with her would be jeopardized.
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Great photographers do not loose business; they inherit the lost business of not so great photographers.
“It’s all about the Image”
(btw, I’m not saying I’m a great photographer)
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Yeah. Image and branding go hand in hand. That facade, so to speak, is critical in every industry.
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Lawrence
I would have never thought of Prisoners’ Dilemma as an illustration, but it SO fits.
Overall a great read.
However, allow me to throw in this. Iphone 5c IS Apple’s version of discounting. They are making a lower priced and lower quality product. Actually a similar scenario is when photographers offer “junior” shooters at a lower rate, basically using their brand and getting a cut of their interns/younger associates work but investing in bigger marketing.
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Thanks, Serge! It’s not obvious, but Prisoner’s Dilemma applies.
I, personally, think that “associate shooters” is a great idea. It allows you to widen your reach, just as Apple did with the iPhone C, which you were spot on. But to widen a reach is not the same as discount.
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While I mostly agree that the vast influx of photographers has damaged the fees of many once-successful photographers, and that cell phones and cheap digital cameras have lowered the standard of photography which everyone is willing to accept (look at this crap dark photo of my food….isn’t it great?), I think there is a flip side as well. We don’t all have to head in a downward direction. And I think this applies to more than just photography.
In a world with too much data, and too many voices and choices, we need someone (not Google) to tell us what is good. Or we need to see quickly and clearly why someone is good FOR US.
Having an independent authority say you are good is only part of the battle. You still have to reach the right clients with the right message. You need an elevator pitch, not a full blown speech. This is part branding, part specialization. When you tell the 40 year old just engaged woman in the elevator that you are a photographer, what is the first question she asks? What kind? What do you shoot? If the answer is “everything” than go ahead and lump yourself with all the other photographers out there…..that woman in the elevator will call his or her friend who is a photographer before he/she calls you. But if your answer is: “I photograph second weddings for chic, sophisticated brides who know exactly what they want”…..then there is a chance you will get the call BEFORE the friend because your message speaks to her directly.
Here are the things that I think will save photographers and their falling fees:
1. Specialization/Real differentiation of either your style or your service or both (see the Team-X/Jeff Jochum motto: “Anyone can copy what you do, no one can copy who you are”). I would argue that specialization, more than diversification will save photographers. When you do one specific thing well, you can own that market. Otherwise, take a number.
2. Branding (which has to happen AFTER you figure out what makes you truly unique/special). If you don’t know exactly why you are special, then a purple logo on a snazzy new website won’t do you any good.
3. Publicity (supplied by the endless blogs and magazines that devour photography they don’t like to pay for) Fortunately or unfortunately, people believe that if you are published, you must be good/better. But advertising is the opposite of this. Advertising make you look desperate. Editorial makes you look desired.
4. Finally, a solid network of private high end clients who are anti-publicity and internet, and will pay a premium to maintain that privacy, if you are an expert at what you do. They tend to be incredibly loyal, since privacy is becoming more and more rare in our world of public image sharing.
I am very curious to see what happens with Sue Bryce and her pricing as thousands upon thousands of her followers try to shoot in the “Sue Bryce style”. Does that make her stronger and more unique (she’s the original and can charge a premium)? Or does it devalue the look of her work because now everyone is doing it and it doesn’t seem as special? Ditto Jose Villa, Elizabeth Messina and all the others with very distinct styles and thousands of followers/emulators. Is what they do sustainable? Can it grow or is there a limit?
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Very true words, Tanya. In regards to the educators, again, it’s a question of supply-demand.
If there are enough people looking for a specific service (demand), and not enough suppliers to supply them (supply), then the demand will remain strong. When it gets to a point where there are enough generic versions, prices will inevitably go down.
This is sort of like brand name vs. generic drugs. The moment the patent expires, generic drug makers (e.g., Target) come in. The name brand has to reduce its price by a little bit, but not so much to compete directly with the generic drug.
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Interesting article Lawrence. I have your book and always enjoy your post and your fascination with food. My Favorite dessert is fried bananas with coconut ice cream. I find it interesting that you recommend diversification. So what happened to being specialized and focusing on a specific niche?
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Thanks, Kim.
Specialization is still important. However, remember that specialization can be a specific brand and not limited to a certain product or service.
Apple – Think Different
Virgin – Fun
Starbucks – Community
Apple, for example, makes more than just computers. It makes phones, tablets, TV devices, apps, etc. However, it is united under one brand – think different.
Since most photographers (or small businesses) have trouble with such clear branding, it is recommended that he/she focuses on a specific craft. That makes marketing and branding easier.
However, in the long run, it’s not sustainable because anyone could be an XYZ (e.g., modern) photographer. The truest of all boutique brands is … yourself. No one can be a better you. Now, put that into words and run with it! 😀
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Everything is in flux in today’s world. We are living at an amazing time when change is faster and more exponential than ever. So for those who can’t keep up, it may be frustrating or sad. But for those that can, it’s very exciting – because new opportunities show themselves all the time.
As business owners, we have to recognize those opportunities, and think outside of the box. Like you said, a real estate agent who takes their own HDR photos may have that unique edge that will make their business a lot more profitable than a regular real estate agent, or a regular photographer. And sometimes you may see an opportunity that is completely unrelated to photography, but where you can apply other skills you learned while running a photography business.
I think this ability to adapt, to learn quickly, and to take risks without fear, is the biggest advantage you can have in today’s ever-changing world.
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Very true, Euvie. The moment something becomes ubiquitous, it loses its shine. Got to change things up!
Stay nimble! 🙂
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So helpful, Lawrence! It’s a bleak outlook, really, but I also can’t complain too much because the reason I initially got into wedding photography is because those barriers have been lessened. If the need to process film in a darkroom was still mandatory and the luxury of LCD taken away, I’m not sure I would’ve made the transition. So I guess I’m one of the newbies who are “ruining it for the rest of the class.” But I remain optimistic that there is also talent that’s required for being a successful photographer and that talent will determine who is able to make this a full-time career. If that makes sense. 🙂
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To be honest, I got into the industry for the same reason. As long as you maintain a strongly defined brand with sustainable barriers, the demand will be there. The luxury industry proves that everyday.
Who needs $1k Christian Louboutin shoes, anyway? Apparently, many people. That red … so desirable.
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This had my economics senses tingling, and I’ve been preaching thinking outside of the box to everyone I know that’s in this industry. One tog I know became a blogger with awesome photos. She makes more doing that. There are lots of options out there, and when can you not use a good example image for something?
One thing I missed was something that is a must. Your brand must = your quality. Nobody wants to pay more just because you have a fancy logo. If your customer service stinks, or your clients don’t see the value, it just isn’t going to happen for you either.
With that being said, the higher volume lower cost studio that I keep hearing doesn’t work is starting to sound nicer all the time.
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Haha I love your thinking. “[W]hen can you not use a good example image for something?” Exactly. Love being a photographer. I have the best looking Facebook newsfeed.
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Oh, and apple pie. Most definitely apple pie.
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I really like the article Lawrence. So if the pie can’t get bigger, what if we get a taller pie!! 😉
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LOL omg, Regis. You crack me up. I guess, we could just go to Marie Calendar’s and get another one if you’re still hungry.
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Lawrence –
First time reader here. Found this posted by another photographer on a local Chicago FB group of independent professional photographers.
Although I appreciate the mathematics of your theory, I feel there are too many variables that you’ve chosen to overlook. Unfortunately some of your points are generalized. You seem to be okay with telling your readers that details do not matter? And right now details matter more than ever in this industry.
But even more to the point: was there no room in the equation for quality? You talk about quantity, but absolutely nothing of the quality of anything – the craft, service, imagery, approach.
I’ll do my best to keep this succinct, as I’m busy prepping for 2 weddings this weekend. Only 2 of 39 weddings my business has booked this year. Did I mention this is only my second year running a full-time wedding photography business? In August 2011 when I opened my virtual doors I was asking $1500 per wedding and booked 31 weddings. Without making any massive changes to my website or galleries, I’m booking more weddings, averaging $4,000 sales for 2014.
The only reason for this success (I say this lightly, knowing 2 years isn’t much in the long haul)? Education. What about organizations like Creative Live? WPPI workshops, PDN PhotoPlus? And these are the big photography education venues, the ones most people should be aware of. The smaller workshops, with 10-15 attendees are where the magic really happen.
So when you say “No education required – do you need a diploma to shoot photography?”, I feel you’re really missing one of the main fluxes in the entire photography industry: education does matter in our industry, at least if you want to sell something valuable and be successful. The crux is that the mainstream measurement of education – a scholarly diploma, certificate, etc – are no measure of your success, and they do not guarantee jobs in this industry.
But these new forms of education through workshops – sharing incredibly valuable information over the internet and in person – are the gem to success in our industry.
I realize that you are speaking in terms of the reduction of barriers for new photographers entering the market. But I can’t see this as a future threat to someone who stays abreast of the times. I cannot imagine how many people pursue one thing or another (entry) in this world, to utterly fail by being distracted by 100,000 other options we have to measure temporary success.
Commitment, time, ingenuity, progression, heart. These are things that are missing from your discussion, and they are more valuable then ever in our industry, especially the wedding photography industry. You do know that we are in an industry of emotion? Ah, of course some brides don’t realize that photography is an emotional product that they’ll be looking at for 30, 40, 50 years from now – but as professionals – successful artists – it may become our duty to educate not only ourselves, but our clients, too!
Thanks for stirring an interesting discussion!
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That’s really amazing, Ben! For such a short time in business and so much success, that is commendable.
I never said that education does not help. In fact, I cited its importance in the last paragraph. Don’t get that confused with diploma / certificate. I did say that a diploma is not a barrier. That’s completely different. Think about doctors. No one can just jump in and be a doctor. Conversely, someone within a short time can become a successful photographer.
Of course, there is a degree of margin of error in all analysis. This is not across the board. There are some markets in the world that are not affected because of competing interests or lack of.
Examining your case at a glance, your ability to increase your price and book so many weddings could be (not definitively) because you are below equilibrium. Keep increasing your prices and you will eventually price yourself out. That … is economics. Just to exaggerate, if you eventually charged $1MM for a wedding, it’s unlikely someone will hire you. Get my point?
Like you said though, education is critical. More importantly, the application of education is critical. With knowledge and execution, one can brand better, shoot better, … better. But this sort of goes in circle to more eaters and same size pie.
Bottom line, keep doing what you are doing. I love your passion for photography. I’m cheering for ya!
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Lawrence – thank you. And you know, I do commend you for mentioning education, briefly, at the very end. I wonder how many people actually let that one-liner sink it, because it’s so important. I originally credited you for this in my original edit, but then deleted it on a whim. Maybe the most simple points are the most important here.
I just believe the greater message you’re bringing up involves something of scare tactics, which might be my main frustration with the way you present the dilemma – you know, it’s like duh, isn’t this the classic case of the “shoot & burners”? But I believe the (really) greater message here is this: to succeed in our industry you gotta a) know it’s the right industry for you to be in, then b) you must…simply must…be a part of the larger conversation of what is going on, and then act wisely from that conversation.
So thank you again for stirring a good discussion for many of us. What I’m enjoying the most is this sub discussion in the comments section. So great to hear other people’s stories.
Ultimately, I believe, what the community would really benefit from is a discussion that examines the hard questions, then presents some real solutions. For all the photo education that we’re surrounded by, it’s actually pretty sad how much of it doesn’t focus on what really makes people successful in this industry. You begin the problem solving at the end of your article, but I believe the only real solution you offer to the serious artist here is Branding. And that can be a dangerous solution if your brand is strong but your images weak. So what if we broke down that solution to some serious winning points: A brand that involves customer service, letting go of ego, catering to the client more than the craft, reading the manual (seriously), knowing your equipment, becoming a better person, self-knowledge, selflessness, etc etc.
Anyway, I’ll keep on rambling if I don’t stop myself. Thanks for the personal attention to all the comments down here….glad I came across your site.
Ben
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Hey Ben,
Before I respond, I’d like to thank you for your contribution!
I agree with you that education is necessary. That is actually the entire goal of my site, lectures at WPPI, PPA, etc. However, this post is the precursor to education.
The first step to change is acknowledgement that change needs to be initiated. To be honest, this paradigm shift started in 2009. I saw it then. I wrote about it now, four years later. If I wrote it then, it would have no impact because people were complacent. Now that the tides are beginning to turn, as illustrated with Zack Arias’ post, I decided to share a bit of dry business-economics.
I do not seek to scare people. I hope to bring this to the attention of those whom I care about. This is actually the first time I wrote something remotely close to negative. My site is usually about positive inspiration. It’s just a shame that we meet on such a basis 😛
See you around,
Lawrence
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Well, to be honest, I just saw your profile picture with a retro cat blazing out of your jacket, and I have to say – no matter the ongoing discussion of professionalism here, I’m a fan of who you must be deep down 😉
Ben
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Heh heh retro cats + lightning bolts + sunglasses … yep, that sums it up.
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To be technical, according to law of free markets, long-run profits all go to zero for all industries. Economics is all theory and long-run gets debated all the time between purist and rationalists.
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I agree. Photography, not affected by government or outside factors (e.g., civil unrest or turmoil), abides by the law of free markets. As that rule goes, the industry is moving towards zero profit; not all people, but many.
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Great post my friend!
The simply reality to NOT just surviving, but THRIVING in the climate we are in with this industry can be deceivingly simple. In an economy that has shifted from quality based (40’s, 50’s and even the 60’s), to service based (70’s, 80’s early 90’s) to what we are now in, which is an EXPERIENCE based economy, all we have to do is give people what they already have PROVEN they want to pay for. A great experience. When you deliver that in your business, the price for YOUR service goes up. (That is why Apple and Starbucks are billion dollar businesses – because they make you FEEL a certain way when you interact with their product).
The entertainment industry is the biggest industry in the world for a reason. People will pay a premium to feel a certain way. People will pay even more to feel important and to feel loved which is man’s two deepest needs.
PHOTOGRAPHER: Make your business about making people’s lives better and profits will naturally rise. Making a profit should NEVER be the focus, but the natural by-product of helping others.
“People make purchasing decisions based on their emotional connection to a product or service.” Jack Trout, 22 Immutable Laws of Marketing.
-Zach
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You’re right, Zach. The experience-based model is what drives consumers to act. And social media amplifies our emotional endorsement (or lack of) towards brands.
Miss you and Jody. Can’t wait to hang again hopefully soon.
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Miss you too my friend! Can’t wait to connect sometime soon! Maybe you might make a trip to Nashville and meet baby Gray after he is born? 🙂
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I’ll definitely try. How is it in Nashville in December? 🙂 That might be the earliest that I could leave my obligations. I’d love to see baby Gray. With you two as parents, he’s got to be a handsome ladykiller.
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Lawrence…you totally rock! Great post:) Hope you guys are doing well!
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JESSICA!!! Julie and I are doing well. Thanks for asking! Hope you and Michael are doing well too!
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Terrible article.
Sounds smart… But that’s all it really does… Sound.
Specialization for the win.
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Haha thanks for the loads of specificity. Anyway, haven’t met you, but I’d love to hear from you in 3-5 years. Keep me posted.
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well, it’s almost been a year. things are going well.
curious, what’s your forecast for my response to you in another 2-5 years? why does that make a difference to what I said?
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That’s great, Tim!
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too funny… was having dinner/drinks with Regis (well, coffee too) and I was pissing and moaning about this and that and catching up about industry stuff, and he mentioned you guys are good friend – and basically, that I shouldn’t be an ass.
Needless to say, hopefully someday we cross paths in person. I’ll have to buy the first and maybe second round of drinks.
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No ill feelings, Tim. I welcome the different view … and drink 😉 Have a good one!
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Hi Lawrence,
So are you saying that there has been no like increase in demand for photographers in this situation? I would have to disagree here. The increase in demand would set a higher equil point on your graph than the P2Q2.
And another point, is an increase in supply a bad thing? If anything, it makes the market more competitive and provides the consumer with greater choice. Quality products will always stand out in a flooded market.
JF
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Hey Jason,
There are nuances in this analysis, but it’s based on geographical locations. For example, US experienced what we call the “Baby Boom” generation, where there was an influx in the population. When this generation starts to partner up, then yes, there is an influx. But the general population is steadily growing, while the the photography population is exploding.
Also true about wider range of choices and better quality through competition. But that benefits consumers, not producers. I’m speaking for producers right now. But totally! I believe in a free market society. However, as the law of free market goes, long-run profits move towards zero. That’s when producers will exit the industry, so that profit ramps up again. But then, the cycle repeats.
Good stuff JF,
Lawrence
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Good article Lawrence! Speaks the truth of what’s been going on in the industry, and sometimes the truth hurts.
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Didn’t mean for it to hurt, Jeff. Just trying to watch out for my photo friends of what is to come in the near future
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LOL, am I the only photographer who has been saying exactly this, since like, 2007?
Lawrence, thank you for explaining things so clearly and logically. It is great to see actual business terminology and models that confirm what I have been seeing and predicting for many years now.
The bottom line is that there is no magical way to “save” the industry and keep your business afloat just by banding together and all charging more or something. You can talk about education and talent and quality work until you are blue in the face, but while you are spending your time ranting on the internet, another photographer is out there with their camera practicing, and getting better than us both. And when they realize how much hard work it is and “bail out”, three or four more will step in to fill their shoes.
Thus, our industry is headed in a mostly part-time direction. This is inescapable. The “digital revolution” is just as momentous as the industrial revolution, if not moreso. But hey, the music industry survived the iPod and iTunes and Napster, right?
Will there always be room in the photo biz for full-time careers? Absolutely, in fact with population growth there is probably more room in the middle and upper sections of the photo industry today than there was 10-20 years ago. So don’t get your hopes down and assume that things will dry up 100%. If you work hard and posess talen / skill, you can succeed. But make no mistake, being an entrepreneur during a technological revolution will not be easy. The sheer number of photographers in total who are willing to shoot a wedding or a portrait session has indeed grown exponentially over the past 10 years, since the first DSLRs started hitting the market by the millions.
So quite honestly, these days I do encourage people to keep their day job, or find a new one if they’re feeling too frustrated with the photo industry these days… In fact quit your whining about how your 9-5 white collar / blue collar job is “sucking your will to live” …while you spend your Christmas bonus on a new lens, and plan your next photo adventure to Africa or New Zealand. Chances are, you have it a LOT better than most full-time photographers out there who can barely afford healthcare and put their kids through college. I’ve worked for 30 hrs straight on numerous occasions, so shut up about how your boss asked you to work late the other day. 😉
😛
=Matt=
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Haha oh, Matt. I miss you. Haven’t seen you for a while. I have not gone out to meet-ups. And I’m not even sure if you do.
Anyway, I like your pragmatic approach. I concur with everything you said. 🙂 I realized the shift in 2009, a little later than you. But I kept my mouth shut because no one would probably listen. Love how you keep it [really] real.
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Too many assumptions. Here is just one example:
You say that photographers never leave the market. This is patently not true (and even if the photographer doesn’t leave the market the market will leave them very quickly if their knowledge and equipment does not remain at least reasonably current).
This fact alone completely changes the output of your (very generic) model.
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Well, I did not mean it literally. Got to catch my use of poetic license.
If a photographer is too old to carry so much gear or a school bus of them dies in an accident, it surely reduces the number. That’s … unless photographers are immortal and adamant about shooting for life (or even when dead) 😛 FYI, that was an exaggeration too.
However, it does not change the fact that the number of clients remains the same, while the number of those entering the market is an exponential amount (or “Malthusian explosion” according to the post). It’s a Zero-Sum Game.
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We also need to keep in mind the fact that fewer people get married each year. Marriage used to be a given – now being single is no longer indicative of being a pariah and is not necessary for a woman to survive.
In fact, I was speaking with a young intern recently who said that, among her friends, not only do they not think about getting married, they actively DO NOT WANT to get married, after seeing the mess made by their parents and grandparents. Thank god for Prop 8 which will give gay couples the same opportunity to be as unhappily married as everyone else (as a comedian said)
Anyway, thought this elephant in the room should also be included in the metrics.
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Great observation, Beth. You are absolutely right about this new perspective. On this same note, you must also consider the high divorce rate, thus high remarriage rate. 🙂 Without parameters, we cannot make conclusive arguments.
What I illustrated above is a generalization more in terms of supply, not demand.
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I hear what you’re saying and the increase in ‘pro photographers’ has been trending for quite a while. I think ultimately your argument is flawed. Though you do consider branding – which would include the experience created for clients, you do not consider experience and the quality of photography.
Yes I know you mentioned quality in your supply/demand graph. But ultimately the influx of photographers into the industry doesn’t phase me because comparing me to them is an apples/oranges situation.
Yes. Cameras are getting smarter. But they aren’t as smart as I am.
I can look at a situation where a groom is jumping on a hotel room bed and know that I need to crank the ISO, use a faster wide angle lens, and faster shutter speed to get the shot. Manual control is a must if you want to master your craft.
In teaching within my industry over the last few years I’ve noticed that even photographers who I would consider ‘professional’ still have a lot of room to grow.
No, there is not a diploma that says you can now practice as a professional photographer. So what does it take to be a pro? Everything! More than just CF cards, a nice camera and business cards. You need to have a complete presence. You need to be a salesperson, finance, IT guy, marketing guru, etc.
I could go on… but I won’t… disagree with me? Love to hear your thoughts.
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Good points, Brian. All of them are valid granted that clients could tell the difference between “apples and oranges.”
Most inexperienced clients cannot tell just as how I cannot tell the difference between good and great wine or good and great coffee. I could discern terrible wine or coffee, but when it comes to esoteric items, the margin of difference is slim.
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Thank you for writing this article and hosting this discussion. I think that some of the newbie photographers would be willing to charge more, if they knew what they should charge. When I started, I put together a package and then chose a price that I thought was right. I ran into another photographer who was candid with me and told me that I was undercharging. I did some research and found a pricing guide for photographers, outlining the costs and how to determine how much time I spent on each client. It was remarkably helpful. Now, 4 years later, I am priced more in line with my competition.
I have been in forums or on message boards or whatever, where newbies will ask, “How much should I charge?” Most of the photographers are hesitant to answer this question. They will downplay the actual amount and instead cite a list of costs or say something generic like, “It really depends on your area…” I was lucky and found some helpful and established photographers in my area to talk to.
Maybe a grass-roots revolution to educate the newbies in electronic forums or in person when you see them at vendor fairs would help, too…is that a bad idea?
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this all sounds fine and dandy as economic theory, but in reality, there’s something missing. It’s called quality and relationship with clients (the most valuable asset). I know from experience in my studio none of this is true. For those who compete on “price alone” maybe so. Others remain out of this loop. It’s like saying you have an auto keyboard with many sounds…= death of live music….fact is, there’s always room to market quality (music, photos, pies….whatever….)Rob
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It would be great to see a similar analysis for art photography prices, which are usually based on a per-item price rather than a client service fee or set of priced packages.
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Great thoughtful analysis of a challenging supply and demand situation. Thanks for sharing!
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