Although this article talks about pricing of a physical product, I think the concepts discussed apply very well to creative industries, especially photography. As the author indicates, pricing based on value and raising your prices for higher value items is not only reasonable, it’s arguably the most rational thing you can do in today’s business environment.
Most importantly, note the list of reasons why people don’t implement such a system successfully. How many of those reasons have we all heard, over and over, in our industry? Especially the old saw about customers setting the prices…
As I was saying yesterday over drinks with some photo friends, we are at an incredible cusp in the history of creative-based businesses. The power that used to be in the hands of publishers and other middlemen is up for grabs. That’s why there are bullying clients more–because they are scared as they lose the control they used to have. Now is the time when creatives could grab that power, once and for all, but it means rejecting rights-grabbing contracts and/or giving work away (via CC licenses or otherwise). One way to take this power and to wield it fairly is to use a variable pricing system–usage pricing in our case–as this article suggests.
Crystal clear- and useful. Thank you.