Pricing Tip: How (and When) to Trust Your Instincts

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I can’t stop listening to the podcast/interview on pricing design and other work for creative professionals that I did recently with Michael e. Stern, time lapse filmmaker and corporate portrait photographer.

Construction Time Lapse Reel from Michael e. Stern on Vimeo.

You can just hear the self-respect dripping from his voice as he shares pricing wisdom gleaned over 36 years as an “artist” running a successful business.

In our conversation, he shares what he calls his “3 Pricing Drivers” – instinct, emotion and numbers.

Here’s an edited excerpt from our conversation about how to learn to trust your instincts:

Q: How do you price your work?

A: When a call or an email comes in, I listen to the scope of work. As I’m writing down notes and listening to what they say, my instinct already has a number in mind. It turns out that number is almost always correct, within 10% give or take.

I think that works for me because of the rules that I live by: I have true self love. I don’t put myself in harm’s way, I get plenty of rest, I eat well, I care for myself, I don’t do things that are going to hurt me, I care about what happens to me.

I have been able to access that little voice in my head, the little birdy, the little thing that goes off when something is right or wrong, your conscience, if you want to call it that. I’ve proven to myself that I can trust listening to that voice in my head. I’ve had enough experiences where, when the warning bells go off and I’ve acted in the way that the warning bell guides me, the outcome has been right. I trust my instincts that I will come up with the right number.

Q: But what if you find yourself underpricing and coming up with the wrong numbers? How do you develop the instinct for pricing right?

A: When you meet somebody you almost instantly know, within 30 seconds, “I like that person or I don’t.” That’s your little birdy going off.

There are lots of little clues that you have to spend the time on and focus inward and understand how you respond to certain situations and certain people. And that reaction is the little voice in your head, and you have to learn to trust it. So you put yourself in situations where that birdy pops up and you act.

I think creatives are tuned in to that little voice otherwise, how else do we make our artwork? How else do we write, produce, direct, sing, emote, act, make pictures? It’s all about how we internally process the world and spit it out for people to see, and comment, enjoy or be annoyed, whatever the reaction is.

Q: But what if you tell yourself: “I’m just not good at business.”

A: Well it’s true; we’re not good at business. We have to learn it, just like the devotion to the craft. That same devotion has to be applied to the business aspects. Not in a huge way, take it a little bit at a time.

How do I make a budget? Or even simpler, break it down: what does it cost me to do a photo shoot? What does it cost me to write this copy? What does it cost me to make this illustration? Break it down into little itty baby steps.

When I was learning about saving and investing, and putting together my retirement package as a self-employed person, I would read stories in the paper. What is a bond? What is equity? What does all that mean? For me it was a process as well. I know what I don’t know, and so I have to learn it. You just have to spend the time figuring that stuff out and understanding, and eventually you realize, “Oh my god! I’m a little smarter today than I was yesterday about this.”

And you’ve got to give yourself a little pat on the back and understand, “I know nothing about this, I have to learn it.” Just start learning. If you don’t, the world is going to pass you by at light speed.

So if it’s too much for you, then you have to find a job somewhere where someone takes care of you. But if you want to work for yourself, you just have to bite the bullet and start learning the stuff, and start reading about it.

Read the rest and find out more about his other 2 pricing drivers, emotion and numbers, on the Marketing Mix Blog. And listen to the podcast here and on iTunes.

And check out Michael’s web site: http://www.buildabetterphotograph.com/

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