Monthly Archives: April 2014

Gimme! When a Client Wants a Discount…

DiscountAs a photographer, but really as any business person selling a custom product, I’ve had a lot of people asking me to do the work for less money. I was pretty bad dealing with it at first (being brittle about your pricing and taking any assaults on it personally is about as bad as it gets), but I got better over time. You can benefit from my years of anguish by taking a look at these five simple ideas:

1. Don’t take it personally

This first point is the most important. For artists in particular, who pour their heart and soul into their work, its very recipient’s attempt to discount it can feel like a betrayal, or at the very least like a personal or professional insult. But it couldn’t be further from the truth from your (prospective) client’s perspective. They wouldn’t be there talking to you if they didn’t already like your work. They aren’t questioning you or the work – their target is the price alone.

Bargaining is deeply ingrained in many cultures, and even in the Western world, we’re conditioned “never accept the first offer”, “it never hurts to ask”, “reach for the sky”, “don’t be a sucker”, and so on. Also, let’s face it, artisan prices are somewhat arbitrary and everyone knows it. (If yours aren’t, i.e. are based on costs, I would suggest taking a harder look at the work and to whom and how you market it.) So, asking for a discount may simply be a client’s way to assure themselves that the price is real and they aren’t getting a worse deal than the “next guy”.

2. Create choices

This is a tricky one, because if you advertise more than a handful of standard choices, you’ll confuse and drive away many customers. However, creating choices and options can be a powerful tool during the negotiations to bridge the gap between what the customer wants to spend and what you are prepared to deliver, while at the same time giving them a genuine impression that you respect their needs and are prepared to go beyond your standard offerings to satisfy them.

3. Provide elastic delivery

After everything above is said and done, there are situations when you still have a 5-10% gap left to close for the same exact service. You can close that gap simply by internalizing some of the specifics of “the same exact service”. After all, you are the one delivering it, so you hold all the cards. It can either be a surprise “free gift” that the recipients of this last discount do not get, or any other extra (so long as that doesn’t compromise the quality of your core offering). Whatever field of endeavor you pursue, you should be able to sit down and come up with 5-10% of elasticity, then keep it to yourself for just this purpose.

4. Walk away nicely

If none of the above could close the price gap, then the person may be a great customer, just not the customer for you. Perhaps you can do business in different circumstances in the future. The way I look at it is very simply:

A happy customer is better than a happy non-customer who is better than a non-happy non-customer who is better than a non-happy customer.
A happy customer is better than a happy non-customer who is better than an unhappy non-customer who is better than an unhappy customer.

If you are getting too many people outside of your price range, rethink how your business is presenting itself across all media, and how your services are positioned and advertised.

Bonus. Position your work as a luxury / status symbol

This is a strategy, not a tactic, to alleviate the price pressure. People want to pay money for luxury, because that’s what makes it luxury or, more precisely, a Veblen good. In your positioning, instead of emphasizing how much the customer gets for his or her money (which encourages bargaining), focus on the uniqueness or exclusivity of the work, including any objective and subjective differentiating factors that support its top-tier placement.

How to reach the right people and give them the right assurance, is a topic of a whole other post – that yours truly is yet to write. Seek large, thriving businesses and successful people in tight social groups.