When it comes to price, everything we think we know is an illusion. Consumers assume that paying handsomely for something magically increases the product’s quality. We can acknowledge that there is a logical fallacy in this thinking. By understanding perceived value and the nature of the psychological construct, photographers can climb into the mind of a consumer, reflect on their marketing practices, and transform their new understanding into increased revenue.
What Is Perceived Value?
Every time we consider purchasing something, we engage in a subtle, internal debate comparing a product’s retail price with the value we feel the product has. But in this debate, value is not established by the item’s actual cost. While we are largely unaware of the production costs associated with the products we buy, we do have an internal gauge for how much products are worth to us. This is perceived value. The arbitrary value of a good or service is assigned by a consumer’s individual opinion and rarely has anything to do with the actual monetary value of the product. Perceived value is established by a product’s potential ability to fulfill a consumer’s need or provide satisfaction.
Consumers spend money on products and expect value in return. However, a higher price tag does not necessarily mean that a product is better than the range of similar items. A higher price tag doesn't mean that the item has value. But, a higher retail price does mean that consumers will assume that the product has significantly more value than the cheaper alternatives.
As photographers, we are quite aware of how different clients shop. We interact with different types of photography consumers and realize that some of our clients will always take the cheap route. These particular clients will only contract our services if they are "on sale." As creators, these discount clients are to be avoided.
Thankfully, not all consumers are budget-minded. In fact, the lower the price of an item, the lower the value associated with the product or service. For many consumers, a low price is a warning that signifies the product is of little worth. Ideal consumers tend to stay away from items with a low perceived value.
Business-minded photographers understand their ideal client’s mind and actively pursue ways to cultivate greater amounts of perceived value associated with their service.These savvy photographers realize that consumer utility, the amount of satisfaction their product brings, can be almost identical to their competitors. While the products that photographers create have similar production costs, consumers are willing to pay much higher prices for the work of photographers who have higher perceived value. Through various marketing techniques, often performed over time, photographers can increase the perceived value associated with their brand, allowing them to establish higher rates.
Four Ways to Increase Perceived Value
In a recent article, I gave five reasons to raise your photography prices. Another reason to raise your photography rates is that a higher rate increases the perceived value of your service. In the mind of the consumer, greater hourly, package, and project rates directly relate to the perceived quality of the product. Even if you are yet to have name recognition in the photography business, having higher rates elevates you.
Photographers should be wary of unwarranted price increases. There are many articles that help photographers determine when exactly is the appropriate time for a price increase. Remember that clients also use comparative analysis when deciding on a photographer. Before raising your prices through the roof, ensure that you can deliver a worthy product.
Testimonials, especially from clients who represent your target market, are a powerful marketing tool. Publicly displaying testimonials increases consumer confidence and relates that your photographic service is of the highest quality. With this in mind, the perceived value of your services skyrockets. If others can’t live without your product, the rest of the world will feel that having your photos will fulfill their needs and bring them happiness.
I often see photographers working against the concept of scarcity. If you are a photographer with few bookings, never post a calendar showing how open you actually are or publicly declare that you can accommodate a shoot at any time. You might as well tell the world that nobody ever books you.
The economic principle of scarcity can be applied to increase the the perceived value of your photography brand. When something is in short supply, its value increases (as does its price). To increase your value, convey to your clients that your services are in high demand and that you have a shortage of time. Augmenting the way you present your availability can yield a significant increases in perceived value.
Rebranding is a major step for a photographer. Crafting a new image and brand identity can take a lot of mental energy and a significant chunk out of your wallet. Moreover, branding can make or break a photographer. But, if you have outgrown your current brand or your target market has shifted, it might be time for a fresh start.
As you redesign your brand, pay careful attention to how you present your work and who you are as a photographer. Does your logo font look chic or are you using an outdated script? How about website design? Is your format and presentation outdated? Increase the value associated with your new brand by making strategic branding and design decisions based on sound principles and market research.
Major brands strive to understand the psychological processes that influence consumers. Corporate strategists acknowledge the power of perceived value and adjust their marketing and product presentation accordingly. If the largest corporations in the world pay attention perceived value, why wouldn’t you?
An active push to increase the perceived value of your work isn’t trickery or an attempt to pull the wool over your client’s eyes. Understanding perceived value is simply a response to the consumer mind and allows us to look at our business practices carefully. Increasing your value as a photographer is one of the best ways to set yourself apart from the competition and earn more income as a photographer.