How I Survived a 25% Price Increase (So Far)

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How I Survived a 25% Price Increase (So Far)

It was a long time coming. And I was terrified. As a small business owner, we have a hard time believing we are worth every penny (Amazon aff link to a good book to motivate you). We feel the need to help people, which results in low pricing and discounted services. The time will come when you need to raise your prices and you’ll need to come up with a plan to get your clients on board.

Why Increase Prices

I hadn’t changed the pricing of my services since the inception of my business in 2010. I built my client base off that pricing structure, and it wasn’t until I got busier that I realized I needed to start charging more. I was driving more, to further locations, and I was shooting more homes per day than I really wanted to.

My Idea of a Real Estate Photography Business

Everyone has their own idea of what their business should be. Some photographers want to build up their business and hire other photographers. Maybe some day they’ll be able to get out of working IN their business and instead focus on working ON their business. Other photographers (like myself) enjoy running the business and handling all aspects of it, and aren’t looking to expand by way of staff/employees.

I know of some extremely focused and energized real estate photographers. They may schedule 6-10 shoots per day, and be making a killing in this industry. That’s not me. I am more focused on having a smaller client base that allows me to do other things instead of shooting and editing shoots all day. (I workout 5 days a week, I work on this website, I network with stagers and attend events, I work on other projects, etc.) I simply can’t devote all of my energy to real estate photography, or I won’t be able to provide the level of service and attention to my clients.

With that said, I limit my days to 3-4 shoots max. Will I do 5 here and there? Sure. But when clients call to schedule, I’ll first try to book them on a less busy day before I throw so many shoots into a single day. Also because I limit my number of daily shoots, I am only able to work with a smaller client base. A bigger client base would result in me over-booking myself and I would be booked too far in advance. I appreciate being able to get to shoots quickly when clients call, instead of making them wait two weeks.

Raising Prices Online

The very first thing that I did was raise my prices on my website. To my knowledge, my current client base never goes to my pricing page. They have no reason to. They wouldn’t see the new prices (and even if they did, they weren’t paying them!) but new clients who find me online would expect to pay the new increased rate. Honestly, I was shocked that new clients continued to call. I’m one of the highest priced real estate photographers in my market, yet Realtors were still interested in my services. I thought for sure that agents would balk at my new pricing and stop calling.

Raising prices online is a very easy first step toward increasing your rates. You don’t have to confront any of your existing clients, something I was extremely nervous about doing. When new clients call and don’t blink an eye about your pricing, it gives you confidence that you are worth what you are asking.

Breaking the News

I milked my new website prices for longer than I needed to. I went a year with new prices online before I updated my current client base to my new rates. But the positive thing about doing this, is it gave me plenty of time to add new clients at the new rate so when I did convert my existing clients, it wouldn’t be a big hit if some of them stopped using me.

When it came time to bring my previous clients up to speed, I opted to give them a month’s notice. I created an email that would be used as a template to my agents, while adding personal touches so it wasn’t completely automated. I sent the new pricing email only to clients who had used me in the past year. Here’s an example:

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Hi <client first name>!

THANK YOU for trusting me with your marketing media for properties and your real estate business. Starting <day/date> when we shot <address of first property we worked on together>, we have since worked together on <# of shoots> shoots/transactions and I truly value your repeat business with me!

Running 4 years strong, I am grateful for the success of my business. In order to continue to provide the level of service and availability expected of me, I am transitioning all clients who are serviced with my 2010 rates, to my current pricing structure that has been posted to my website as of June 2013.

The following rates will be effective July 1, 2014:

Photos
$159+tax ($172.12, was previously $135.31)

I look forward to a continued successful business relationship. I enjoy being a “boutique real estate photography company” by limiting my client base and being a direct extension and representation of YOU. Providing outstanding service by always being on time and delivering high-quality media has always been my goal for a smooth and reliable selling process for your sellers. The result is a listing that stands out and grabs the attention of buyers for the maximum potential of a sale.

Thank You

If I was sending the email to a client who uses me for video, I stated the new video pricing as well. (Video pricing went up 25% for one product, and 35% for another video product I offer.) You can see at the beginning how I let them know how long they had been working with me, what the first property was that we shot, and how many total shoots we had done to date. I think this shows I care about our continued relationship, instead of sending just a generic email with no personalization at all.

The Death Threats

As you can imagine, every email that came through on my phone that day had me anxiously viewing it to see the negative feedback from my clients. Who was going to leave? Who was going to get mad? To my surprise, nobody. In fact, of all of my clients, only four of them even responded! One client said congratulations on the success. One Realtor said thanks for the update, you are the ONLY photographer I will ever use and I appreciate you. One great client wrote back saying they’ll continue to use me for upper-end listings but they may not be able to use me on the lower $100k listings.

The last response came from my biggest client, the one I was most worried about. They are a team and do over $90 million in transactions per year. They were surprised with the percentage increase, and were hesitant because they set budgets and expectations for the year and doing a price increase mid-year wouldn’t be beneficial to them. Sensing their uncertainty, I was quick to offer a continuance of the old rate through 2014, with the new rate starting 2015. They were accepting of that and appreciated me working with them. They are my biggest client after all, and waiting another 6 months is not going to kill me!

A Month On New Pricing

As of this post, it has been a month since I raised my pricing. So far none of my regular clients have stopped using me, and they all have used me with the new rate. There are some Realtors who only use me once or twice a year and they may not return. Those are the agents that do little business so they are probably price shopping and will switch to someone cheaper. I’m not for everyone and everyone isn’t for me, so that’s perfectly acceptable!

Clarity and Motivation

I invite you to take a look at the book Worth Every Penny that I mentioned at the top of this post. It focuses on running a boutique business that offers a level of service and personal touch that a “big-box” brand cannot touch. It’s great ammo to arm you against the national real estate photography companies competing against you, or even the bigger real estate photography companies in your area that hire multiple photographers. It really helps drive home that you are offering value that is worth your charge, and you ARE worth it.

Disclaimer: I believe in transparency and have no issues sharing my pricing, what it was before, and what it is now. However keep in mind that every market is different, every situation is different. Base your pricing off what YOU need to be successful. I realize my pricing may be lower than what someone else needs to be successful in another market due to cost of living, needs, etc.

What I’ve Been Up To

 

By | 2017-07-20T00:54:18+00:00 August 13th, 2014|How To|16 Comments

16 Comments

  1. Karen O August 13, 2014 at 8:25 pm - Reply

    Thank you for sharing this and your experience. YOU are worth every penny and I speak that from experience and wanting your services for all my projects too.

    • Lance Selgo August 13, 2014 at 8:27 pm - Reply

      Thanks for reading Karen! 🙂

  2. Caroline August 13, 2014 at 8:36 pm - Reply

    Thanks for the article and inspiration. It gives me confidence to move forward. And thanks for the book recommendation. I’m definitely going to purchase it. Cheers, Caroline

    • Lance Selgo August 13, 2014 at 10:26 pm - Reply

      Good to hear Caroline! It’s tough acing value on ourselves and we question if raising prices is really the way to go. Be strong, know you are worth it, and take it one step at a time.

      Good luck!

  3. Neal Smith August 14, 2014 at 6:00 am - Reply

    Great article Lance! I was planning an increase at the one year mark of my first paid shoot (this December 15th). Great information above on helping me make that happen the right way.

    • Lance Selgo August 15, 2014 at 7:10 am - Reply

      Good luck Neal – glad you found my experience helpful!

  4. Kyle August 14, 2014 at 10:45 am - Reply

    Hi Lance, great article! I am absorbing your website one or two articles a week and has been more valuable to me than any book I’ve read thus far. I did a similar price increase (although without the nice touch) and was surprised to have only one reaction. He seemed shocked but then hired me again a month later! I’m a big fan so keep it coming please 🙂

    • Lance Selgo August 15, 2014 at 7:12 am - Reply

      Exactly Kyle! And the agent I mentioned here who said they may not be able to use me for all of their listings – they continue to hire me so I haven’t seen any decline in agents requesting services. If you look at the big picture, the increase was what… $40? Although that’s significant from a percentage standpoint (25%), it’s really insignificant in comparison to Realtor commissions in my opinion. Especially on more expensive properties.

  5. Robert Boerner August 14, 2014 at 11:59 pm - Reply

    Hello Lance,
    It’s always nice to read your articles. I too did a rather major price increase not too long ago. I made the mistake of charging too little initially and had to raise my rates about 75% to have it make sense for me to continue. To my surprise, I didn’t lose much business. I am in a market of run-n-gun discount shooters and, like you, prefer to work with agents who notice consistency, customer service, and professionalism. I wish you the best and appreciate the insight you share with us! Keep it coming!
    Robert Boerner
    San Diego

    • Lance Selgo August 15, 2014 at 7:18 am - Reply

      Great to hear Robert! I know someone in Florida who went from less than $100 per shoot, to now charging $250, all in a couple of years. Your clients will recognize your professionalism and customer service and the good ones will stick around to pay for it. Additionally by raising your rates you will attract new clients who want to pay for great service. At less than $100, some agents might dismiss you as a potential vendor simply because they think you are too cheap! Glad to hear about your success and that you are enjoying the info here!

  6. Chuck Holden March 14, 2015 at 9:45 am - Reply

    Hi Lance
    Love how you have made time to help others in your industry. I have been shooting homes full time now for about 2 years. I used to do it part time for a few agents and didnt charge much. Now I am actually overwhelmed with orders and am shooting 7-9 homes per day (too many), Im really afraid of losing my passion and quality by always being under the gun from appt to appt. This article just caught my eye on FB this morning and I happen to be in that position right now.
    Im a bit nervous about bumping up my prices, but not as nervous as it makes me to tell a client I cant get to them until 10-14 days from now.
    I am very blessed to have so many want my services, and I am not as good as you 🙂
    Thanks again and I look forward to more of your tips
    Chuck

    • Lance Selgo March 16, 2015 at 1:36 pm - Reply

      Hi Chuck!

      I have followed you on FB for quite some time, I see all of the homes you post! Your comment is spot on about having to tell agents to wait 10-14 days. Nothing is more uncomfortable than an agent requesting a shoot and us not being able to get there for a week or two! You may lose a few agents due to the price increase, but you will continue to get new clients who will value you. Those that are lost will be replaced!

      Good luck in raising your prices – we are extremely valuable to agents and deserve to be paid for our time. It’s also important that we don’t get so busy that our quality and customer service does lack, because we need to make sure we continue to provide outstanding service to those agents that expect the best from us.

  7. Jarek July 10, 2015 at 5:53 pm - Reply

    hey Lance!
    I’ve found your channel on youtube a few days ago and can’t stop watching your videos!!! I really appreciate your knowledge you share with your fans!
    I’m am digital designer but for last 15 years photographer as well 😉 , recently i want to back to the photography and I was thinking about real estate photography here in Dublin (IRL)
    Real estate market here is completely different if you compare with US. For know I’m researching internet and market here to get better picture about it.

    Thanks again for all your effort and time! all the best!

    cheers
    Jarek

    • Lance Selgo July 10, 2015 at 7:55 pm - Reply

      Glad you found the site and thanks for the kind words! Wishing you all the best!

  8. Victoria February 3, 2016 at 1:37 pm - Reply

    I really appreciate all the information you’ve shared on this website. This information is so helpful to a new up and coming real estate photographer. Thanks!

    • Lance Selgo February 3, 2016 at 11:19 pm - Reply

      You’re welcome Victoria – glad you found the site!

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