Should You Ever Cut Pricing Deals with Your Prospects or Clients?

How many of you are old enough to remember Wimpy from the Popeye cartoons?

We interrupt our regularly scheduled blogs posts for this special article. What would you do if a client sent you this email?

“Hi, our budget is $2000 below your pricing, but you will get tons of referrals from our wedding guests. If you give discount, I will sign right now.”

This was an email shared on a forum by a colleague. Naturally, people had a field day with it. All sorts of fun responses were suggested.

As professional creatives we love it when colleagues share emails likes this. First, for the person sharing it, it provides an outlet to let off steam. It feels insulting and demeaning when clients (or prospective clients) ask you to significantly drop your rates. Everything in you wants to write back and say “ARE YOU OUT OF YOUR VULCAN MIND?! Do you KNOW how much time I put into these things? Do you know how many hours I’ve lost with MY family putting up with the crazy shenanigans documenting the events of OTHER people’s families? Do you know how many fights I’ve had with my spouse over late nights working trying to get everything done? Do you think Canon just GAVE me this camera and all these lenses with the pretty red line? Have you seen how much it costs to put a kid through college these days?” I could go on, but you get my drift.

The other benefit from sharing experiences like this is genuine help and suggestions from your fellow colleagues who’ve been in similar situations. They range the gamut from serious replies based on sage advice, to wild and crazy replies born out of things we all WISHED we could say, but know it would be wise not to say.

In my nearly ten years of being in this business (and 20+ in the business world in general), I’ve been in this situation lots of times. I’ve posted my frustrations on many a forum and have had many a response. I’ve made mistakes and I’ve made some pretty good choices. Here are a few nuggets I’ve learned along the way.

  • Stay calm. I love proverbs 29:11 “A fool gives full vent to his anger, but a wise man keeps himself under control.” Depending on the state of mind you’re in when you receive such a missive, you may be inclined to shoot off a reply that, although may not be as bold as the one I wrote above, nonetheless may be unprofessional and snarky. If you need to write it just to get it out of your system, do it (but don’t send it). Whatever you do, keep a level head and don’t let the immediate emotion take over.
  • Be compassionate. Keep in mind that you’re dealing with a human being on the other end. Someone who is trying to survive in this wacky economy just like the rest of us. (Naturally, if the person on the other end is someone having their wedding at the Ritz Carlton with 200+ guests, screw ’em. – Just kidding!🙂 ) In my experience, when I get requests like this, it’s because the people I’m dealing with really are having financial difficulties. Maybe it’s a non-profit with limited funds. Or in our photography business Teen Identity, it’s often a parent who loves my wife’s work and the programs we’ve created to raise the self esteem of teen girls. Most of the time I can find it in my heart to come up with some way to make a deal work, but it starts with me truly caring about the person as a person, and not just looking at them as a possible gig.
  • Honor your brand. Whatever choice you end up making, it needs to be one that is consistent with your brand. If you cater to a high-end clientele, a straight-out discout just for discount’s sake may not be the best way to go.
  • Be creative. You are a professional “creative.” So live up to your title. It’s okay to come up with creative ways in which a client can pay you and you still honor your brand.
  • Don’t burn bridges. Ultimately you may not be able to work with a prospect. However you leave the conversation/email exchange, leave the door open for possible work or referrals. Maybe this person can’t hire, but maybe their friend can. Maybe this company doesn’t have the budget now, but maybe they’ll get a round of VC funding next year and have tons of money to invest. How you handle their request now may determine if they ever come back to you or send other business your way.
  • Make it easy for people to pay you. I’ll never forget advice I heard “the Godfather of Wedding Films” John Goolsby once give: “Make it easy for clients to pay you.” If you normally get half your fee up front and half a week before the gig, consider breaking it up into four payments instead of two. Offer all major credit cards. If a prospect does want to give you money and pay you what you’re worth, don’t make is such a pain.
  • Value is more than just money. Value can be recognized in more ways than just dollars, euros, pounds or yen (I apologize if I left out your country’s mode of currency. My U.S. education has limited my knowledge of international monetary verbiage. But you get the idea). Time is also a factor that can add value and be used when speaking with a client. It may be worth it to you to offer a referral reward (don’t call it a “discount”) if a prospect refers a certain amount of business to you in a specified time. In some cases the value of time may be worth charging for. You may charge more for a job if they require it turned around in a shorter period of time. Other forms of value could be: exposure opportunities, trade of services, barter for equipment, etc.
  • It’s okay to say “No”. If you’ve exhausted all of the possible options, realize it’s okay to say “no.” Don’t feel compelled to give too much a way, or give a discount just for the sake of landing the gig.

These are hard economic times, and people are looking for every way possible to save a buck or a schilling. (Aren’t there times when you try to get the best deal you can?) If you’re wise and compassionate, you’ll make the right choices for your business, without hurting the prospects for future business.

How have you handled these kind of requests in the past? Do you ever cut deals?

11 thoughts on “Should You Ever Cut Pricing Deals with Your Prospects or Clients?

  1. Ron, good post.

    I haven’t seen other responses yet to this situation, so I am probably saying things others have already, but if not, here are a few of my comments.

    Have you also considered replying with, “OK, for $2,000 less, what part of the day would you like me to eliminate? (ie..the wedding couple getting ready, the dance portion of the reception, etc). Or, we can use only 2 cameras instead of 3.

    Also, the final production will be a 2 minute highlight video (instead of 4 or 5) with a shorter feature film.

    In other words, if they want to pay you less, then turn it back on them in terms of what they can live without. Usually people will then say, hey, i want all of that. Well, then the answer is simple, pay me for it.

    It’s all about Value. The old business equation of “Value = Benefit – Cost” holds true here to. If they can’t see the many benefits you bring (ie lenses with the red lines, years of experience in capturing the moment, etc) then they will not appreciate the Value you bring, and as the old story goes “you will get what you pay for”.

    I recently had one of these situations too, and I simply said, “no, I can’t do it for that price”.

    I have bee in the business world for 30+ years (enterprise software) and am now gradually working my way into the film business, and in both cases, one of the best feelings is to “walk from a deal”. Some of the best deals I have closed over the years are the ones I walked from.

    Cheers!

    1. Awesome advice Clint. That’s actually a really good point too. Some people feel like they have to stick with there official “packages.” Obviously, if you’re in the event business and it’s a popular day, you may not want to give it up to a lower paying gig, but if that’s not the case, or if it’s a day that you know won’t get booked (e.g. a week from the time the prospect cals your), then offer a reduced custom package.

      Thanks for sharing.

  2. I would say be flexible when you run a business.

    I learnt in my past 7 years in the event video biz that I need to have some flexibility. If I am lack of gig, I could always custom quote a package to fit the 2,000 amount. I dun have to give everything but may include just the essential. I use to be very firm and at the end I found out that i have less gigs and I don’t have enough to pay the bills.

    I believe everyone’s market is different and so is the stage of their business. Importantly, we must not short change ourself no matter which stage or market we are at.

  3. I completely agree. These are people on the other end of the negotiation. These people are spending tens of thousands of dollar on a one day event… that’s not an easy thing for most people to swallow. Compassion, patience, and understanding go a long way.

    Most of what we do in the sales process is educate people. This is an opportunity to educate the potential client. How would they know that this isn’t cool? So much of what is ‘out there’ tells them that they need to try to haggle their wedding vendors. Be patient and use the opportunity to talk about the value that your service brings.

    I don’t think discounts should ever be offered ‘just to make the sale’. It’s better to throw in something (a freebie) than it is to discount your services. Discounting is only devaluing the work you do.

    Love what you say about being flexible about payment… spreading out payments is a great option!

    Lastly, be careful where you air your grievances. Negativity breeds negativity and people will steer clear of your energy. With social media, you never know who’s watching. I’m always hesitant to refer a wedding pro who talks badly about their clients, regardless of whether the pro or the client are in the right.

    Great post, Ron!

    1. Always love getting your input Michelle. thanks. As you so correctly pointed, so many other sources tell people to haggle and negotiate. It’s up to us to educate in patience.

      Thanks.

  4. For us, it’s depended on who your target clientele is. We aim for upper tax bracket incomes, so we normally don’t worry about haggling. Our branding is “high-end wedding cinematography”, so we can’t be “The Negotiators” ala Priceline, or we’ll be perceived as a lower quality service. When you target budget minded brides, it’s a totally different story and you’ll have to assume the bartering. That’s been my experience. Once in a while we’ll bless close friends with little to nothing if there isn’t any major action going on.

    Unfortunately, you’ll get someone who knows someone who knows you and they’ll ask for a big favor. In these cases, I have to put a clamp on it and give them ideas for raising the money for my services (asking relatives, etc., payment plan, etc) I have bills to pay, mouths to feed and a roof to keep over our heads just like everyone else and that’s the reality of it.

    It all ebbs and flows with who your target clients are and what they’re willing to pay. You can’t walk into a Lamborghini dealership with $20,000 and expect a Lamborghini. There’s the Toyota dealership down the street for that. It’s not a new exotic car, but at least it’s a car.🙂

  5. So here is my full story: the groom is one of friends of my dear couple (who are so great to us) who led us to at least 10 different weddings. this groom was one of them. the package he wants was $2500 more expensive than their budget. First, I turned him away saying “I want to be fair to all other couple who pays full amount” plus more reasons why we can’t simply meet their budget.
    He thanked me for explaining, and told me he would be always our fan.
    So after reading Ron’s (and others’) comment, I decided to email him back, explaining about our payment plan (which I didn’t include on 1st email), and possibly referral reward program for 2 years after booking (1yr after booking plus 1 yr after their wedding), I would credit $100 per couple. I thought it seemed fair. Anything more than $100 seems too much for me as I have family to feed, and wedding films are our only income.
    Because of your blog post (and help from others in forum), I could thing more wisely and tried not to “burn the bridge”. After all, this couple is in the circle with my other couple (who got us many weddings). He also has music production company (very, very new), and could lead to future gig.

    1. Thanks for sharing your story JJ. You didn’t have to “out” yourself as the person I mentioned.🙂 But I’m glad the advice you got from everyone helped. I think it’s a smart idea to keep the lines of communication open. You never know.

  6. Great Post. The ‘Dont Burn Bridges’ aspect is huge too I think. I always tell people that can’t afford me to send me work of other lower-cost videographers they find and I’ll help them find the best talented one. I feel like this is reaching out a hand, but also gives you the chance to see any up and comers in the area.

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