When I saw this recent post strike a nerve, it motivated me to share this post from my man Ramit Sethi on charging what you’re worth.
Today he’s back by popular demand to share a simple one-two approach to setting your prices and upping your earning potential.
Pencils ready? Okay, take it away Ramit.
I recently asked a photographer how she came up with her pricing. She said, “Well… I researched my competition and found that they had similar services, so I charged what they were charging.”
Does that sound familiar? Or worse, do you know people who charge less to “undercut” the competition or “get more business?
Here’s the problem with using “me-too” pricing: You’re signaling to your potential clients that you’re the same as everyone else. Why would they choose you when they can always find someone else charging $10 less?
How can some photographers charge 5x, 10x, even 100x what others do? Are they 100x more talented? Do they have 100x more experience? 100x better equipment?
No! The reason they can charge more is simple: Of course they’re good, but good isn’t enough. They’ve learned to position their services as a premium product. Today, I’ll show you how you can, too.
Step 1: Think like your client
Start by asking yourself, “What are my client’s top 3 problems? What are their concerns when hiring a photographer?” The equipment you use probably isn’t in their top 100 problems.
Clients care about themselves and their problems. By taking the time to make your proposal client-focused, you’re already ahead of 90% of your competition.
In an 90-minute interview I did with Chase, we cover tons of examples on how to use this idea. See the 24:00 minute mark where I share exactly how to “read their mind” using a simple technique you can do in the next 5 minutes.
Once you’re in your client’s head and can address their burning needs, price becomes a mere triviality.
THIS is how some creative people can charge 2x, 5x, even 20x what others charge. Yes, they’ve honed their skills, but being good isn’t enough. They know how to focus on their clients, not just their equipment.
Step 2: Use these words to say “no” to low-value clients
One key is learning how to be confident in your own value. Part of getting paid more is believing you’re actually worth more and saying NO to low-paying jobs. Sometimes, we feel grateful for ANY job, especially when we love what we do. This leads to accepting less than you know you’re worth.
The truth is, you’ll get more clients and better clients who respect and value what you do if you’re confident and stick to your rates. Check out this tested word-for-word script to see what I mean:
CLIENT: “What’s your hourly rate?”
YOU: “I’ve actually changed my business so I only do weekly engagements now. This helps me deliver more in-depth results (for example, helping a recent client do ____). The rate for that is $X per week, and that includes A, B, and C.”
CLIENT: “Can’t we just get you for a few hours?”
YOU: “Unfortunately not. I’d love to help but I focus on high-value projects, and those typically take a minimum of a week to understand and execute. The good news is I’ve never had a client who wasn’t happy with the results, even if they originally wanted me for just a few hours. And based on everything you’ve told me, we definitely have more than enough work to keep ourselves busy during that timeframe. The potential upside of Project X is very large.”
CLIENT: “OK, fine. Um… could you do $Y per week instead?”
YOU: “I typically don’t discount my rates except in special cases. If $Y is your budget, I’d be willing do it only if we were to remove either B or C from the project scope. Which would you prefer?”
CLIENT: “Never mind, we can do $X.”
YOU: “Great! I’ll follow up with you soon with next steps.”
Do you see what happened there? Many of us fear we’ll scare away clients by charging premium prices. In fact, low prices are a bigger red flag in your clients mind. Sticking to your higher rate communicates that you’re more valuable than the competition, so the client will lean toward hiring you.
You can even add value to your current clients while raising your rates. The key is to create a win-win situation for you and the client.
Check out this video on how to raise your rates and thrill the client, including a word-for-word script you can use when telling your client about the new rate. You’ll learn:
- 1:00 — The 3 things you must tell your clients about a rate change
- 2:07 — How to get clients excited about the upcoming changes (even if it includes a rate increase)
- 2:30 — A simple way to ensure your clients love you, even if you have to part ways
So how did a graphic designer convince me to pay more? Instead of focusing on design-specific concerns like typography and alignment, he nailed my primary concerns as a client. Click here to find out exactly what those were in an interview I did on pricing here.
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For more information and help with negotiating your rates and navigating the ins and outs of creative business, check out Ramit’s CreativeLive course, Money + Business For Creatives. Make sure also to check out Ted Leonhardt‘s course on Negotiation for Creatives, Ann Rea‘s course Make Money Making Art, and CreativeLive’s entire catalog of business courses for creatives.
Is this applicable to weddings? Cause I shoot quite a bit of those and I’m about at the top of the market in my area. I’d love to make some more so I can focus on my passion and quit my day job.
This is really good article. I have witnessed it myself when i started in this field where I couldn’t sell myself properly but one production company who sold me in 10x rate. If it’s possible for him it’s possible for me. It’s just lack of guidance. But fortunately client reach to you based on your portfolio which peaked their interest towards you. Rest is all in your strong communication and negotiation skill. Now I am 10x confident in what I do, and i can sell myself even 10x more than that production company. But I do it very occasionally since am in a full time job myself. With all that said, below are the key to get paid more:
1. RIGHT Client. I can’t insist enough on this part. Dont waste your energy to low pay clients. As Ramit says “Say NO”. It’s better that way. Because even if you accept that job and deliver your best -all they do is only complaint. Reason is “You” who lost your value when you accepted this job, and they are going to try to get more out of you. Later you will realize you are doing more than what you were paid for, and you would end up leaving a disappointment on both parties. So it’s a lose-lose situation.
2. Say YES: to everything they ask for within your field. Because every work / project is different. You should have the ability to learn it yourself and deliver it. For that you need 100% Confidence. Without it, you can’t. As it was pointed out “Client can smell fear”
3. Learn SEO: Market yourself through google organic SERP. Tons and Tons of tutorials exist in youtube. Spend your time learning the skill you need to market yourself. If nobody knows you, then you dont have a reach to highly paid clients but only local neighborhood.
4. Connect with Local Ad/Production Companies: Even if you cant’ sell yourself, if your work is really good, nobody will hesitate to partner with you and will absolutely try to market you. This happened to me many times. I created a niche to myself to stand out from others. Although that’s not what I wanted to market. But I used it to connect to the right people and to show off “to me everything is possible”.
5. there is more.. am sure the above will get you started and be successful already.
When I started I literally didn’t even have a head or tail and infact I couldnt’ even pronounce Photography to US accent me being from India. But I broke all that. Every one in this world is reachable (thanks to internet). So I never hesitated to reach out to the best people in the world and learn from them. Now I am a commercial photographer, have made ads, music videos, built websites, became a seo certified, make diy furnitures, -and i believe i can do just about “ANYTHING” as long as i have that confidence and most importantly “willingness”.
Hope this helps. Chase Thanks for the opportunity to write this detailed comment and I hope this gets published and it helps if someone really had patient enough to read till here.
Hariharan
Hi, Chase!
This is some brilliant stuff and I’ve signed up where I could and watched a lot of Ramit’s stuff. It really is a mind-blaster right there!
Looking back on things, I was able to charge more then the competition before when I was asked to put together a website for a client simply because I’ve done my homework, identifying what was wrong or broken with the previous site as well as explaining to the client that I offer an extraordinary service with him in mind every step of the way. Pricing yourself as a premium product and doing the homework helps tons, so I’ll be definitely using Ramit’s advice!
Thanks for sharing, Chase!
Good one.. I was about to punish a client for being a idiot ..But the way he says means i need to communicate yes i should notbe a extractor ..This is a good tric you have said good one rammit ..Future billionaire .
This is amazing, great advice for those just starting out…and those that have been running their business for years!