Kirk Russell, 3Lenses.com

The photographic industry is in the midst of a serious growth crisis. Even before the housing crisis, recession, and market crash, studios were booking fewer appointments, and clients seemed to be more price-sensitive.

Old-school solutions such as advertising more promotions or new flavor-of-the-month fads such as displaying images on boutique, graphic-enhanced web site and brochures, or using pretty delivery boxes won’t attract people who find most of today’s portrait studios outdated, unresponsive, and over-priced.

There is a parallel between today’s photo industry and the current housing market and auto industry. Luckily, we can learn from them and consequently avoid a similar fate.

Here’s the comparisons:

PROBLEM: Home sellers acted as though home values would continue to rise indefinitely. And builders overdeveloped in an attempt to anticipate demand.

Likewise, many photographers raised prices year after year with little regard to what consumers would pay. As a result, amateurs began taking advantage of this opportunity to enter the market with comparable (based on consumer perception) photography, at lower prices. In many areas of the country the market is “over-developed” with more photographers than demand requires. Studios particularly susceptible to new competitors are those serving niche markets.

SOLUTION: Now is the time to increase, not decrease your marketing efforts. In order to increase the gap between you and your low-priced competitors you must do one or both of the following:

1. Introduce new (really, REALLY new) products, and change the old-school studio model experience for your clients. To attract a significant number of clients you may need to do almost the opposite of what you’re doing now, otherwise not enough people will notice, and minor changes will be easy for competitors to quickly imitate.
2. Dramatically raising or lowering your pricing is very risky. So to compete with lower-priced studios, or to increase marketshare, add a new “department” within your studio that offers a standard level of creativity, with fewer products at lower prices. If you’re priced substantially higher than most competitors you may be viewed as over-priced.

PROBLEM: Many first-time home buyers joined in the optimistic buying frenzy only to discover that they didn’t really understand the complex mortgage instruments that fueled the frenzy and often resulted in very bad outcomes as interest rates rose and market values dropped.

Likewise, few photographers started their businesses with extensive management, sales, or marketing experience. When there was less competition and a strong economy, simple studio imitation could compensate for their inexperience. But now, when consumers have more alternatives they have become more price-sensitive. This demands a thoughtful and precise response to new market conditions.

SOLUTION: Because not enough people can distinguish the quality of your photography from your competitors your focus must now be on creating a unique message. Then, using new marketing tools get that message into the minds of potential clients in your market area. At the same time, perform a complete analysis of your pricing and management to maximize your profits. Just raising prices or verifying that your cost-plus formulas are correct won’t be the answer this time. Like any other successful retailer, you must price yourself by market (senior, families, weddings, etc.) and for the buyer types you hope to attract.

PROBLEM: US auto makers didn’t take the lead in producing dependable cars that Americans could drive well over 100,000 miles. No amount of marketing or “education” could convince enough Americans to buy the gas-guzzling, repair-prone, short-lived cars produced by Detroit over the fuel efficient, dependable foreign cars. As a result US auto makers fell behind their competitors.

Similarly, portrait studios have maintained their businesses for decades, without introducing significant innovation. The experience photographers provide to clients and the products they offer haven’t changed much in the last twenty years.

Meanwhile, consumers have been enjoying the digital age for years, expecting new products and the convenience technology offers. This discrepancy between what traditional studios offered, and a rapidly changing marketplace, provided an ideal opportunity for advanced amateur photographers to enter the marketplace. These newly-turned pro photographers, who have grown up in the digital age, have embraced a whole new studio model. These savvy photographers offer new products including digital images, and a streamlined service that includes one-visit service and finished products delivered in days, rather than weeks.

SOLUTION: Motivated photographers will take quick and decisive action and prosper. Remember, every crisis also presents opportunity, but only if you act.

If you’re not getting consistent referral business it’s because in part, your photography, products, and services aren’t generating the buzz this new marketplace demands. Now, more than ever, is an excellent time for an Extreme Studio Makeover. Regardless of what you have planned, taking action to sustain your business should come first. Learning from the lessons of Detroit and the recent housing bubble means taking decisive action rather than blindly following hackneyed industry notions.

Fortunately, you don’t have to create the solutions yourself. The tools 3 LENSES offers will help those who have the drive and the desire to succeed. We know of no more powerful investment. The only thing you’ll regret is not taking control sooner.

“You want to be greedy when others are fearful. You want to be fearful when others are greedy. It’s that simple.” – Warren Buffett

To paraphrase an old saying, there are three types of photographers:
• those who make things happen
• those who watch things happen
• and those who just wonder what happened
Which are you?

Tags: business, marketing, marketing in tough times

permalink |

This entry was posted on Tuesday, July 6th, 2010 at 10:29 pm and is filed under business, education, marketing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.