Love it when clients want the same price as last time....arggh

[Hank Davidson]

Think of the services you purchase, such as a mechanic. If your mechanic gave you a discounted rate back in 2011, then honored the same as a favor in May, then recently gave you full price, how would you feel?

That would be great Mike, but we can't compare most other services to ours. We are independent contractors. We get to tailor our tools, labor and operating costs as we see fit. There are huge monetary variances between us.

*Multi-op vs. Single
*Subscription Services (Wedding Wire, Music, etc.) vs. Self Sufficiency and A La Carte
*Varying Insurance Rates and Coverages
*Cost of Living / Lifestyle
*High-end Gear vs. Modest
*Lighting Packages / Add-Ons vs None
*Distance / Travel Expenses

The lists goes on and on. The thought of standardizing this business is ludicrous. For every variety of DJ out there comes a client. It's not reasonable or intelligent for any of us to blame one another or clients for what's impeding our own successes. Ricky had every right to stick to his guns. Whether or not it was a bad decision, remains to be seen. However, kicking dirt and pointing fingers doesn't serve anyone.

 

[DJ Ricky B]

I agree with some of the others, it is not so much about raising your rates, it's about the time frame. a $200+ jump in 4 months is steep. You also seem to be comparing your business to other types of business their model does not apply to you. A DJ business is not a sandwich shop, not a car dealership, and definitely not Wedding Wire (please don't adopt their business practices). These business have tons more clients and perspective clients than a mobile DJ Service.
Here is a similar story, about 5 years I charged a local organization only $350 for a 4 hour Christmas party. The next 2 years I gave them the same rate, simply because they were repeat customers. At this time I was getting a minimum of $500 for new Christmas Parties. 2 years ago when they contacted me I explained to them that I had increased my rates, But since they were repeat customers and I valued their business ans they were very pleased with my services we came to the agreement that for their next event the total would be $425 and the following year (this year) it would be $500. I also told them I would add dance floor lighting at no additional charge (it takes about 5 -10 more minuted to setup). I doubt I will go up on them again for years to come event if my rates go up for new clients.

Speaking of adding in equipment to help increase the perceived value in the higher price...I did offer this client a free low lying effect fog machine with the higher rate. After all it is a Halloween party. The add on didn't phase her. I think I could have offered an entire up lighting package included as well, and she still would have said "That's too much...thanks though".

 

[ittigger]

That would be great Mike, but we can't compare most other services to ours. We are independent contractors. We get to tailor our tools, labor and operating costs as we see fit. There are huge monetary variances between us.

I agree .. it was an analogy, using nothing more than the price (and raise in price) as the center of discussion. Likewise, that mechanic shop may or may not continue to stay busy because they raised their rates. Where I am, a few mechanic shops have gone under by raising their rates.

 

[DJ Ricky B]

With only 6 weeks to go, your odds of booking something now are getting exponentially slimmer by the day.
This is one of the few times I would be a fan of the "bird in hand" mentality.

How much money are you going to leave on the table if you don't book it at all?
And if your brother is willing to do it for the same old rate, assuming you are on a percentage split with him why would you not be making anything at all for handling the booking?

The reason I am not making anything at all is because in May it was a last minute gig booked like maybe 3 weeks out, and he was still open. I told him that last time she had a discounted rate of $335, and she wants that rate. He was fine with the rate at $335 to do it, but that was $335 to him. I booked him as a courtesy to get him a booking at the time, and she got the price she wanted.

 

[IceBurghDJ]

You could charge her more - explain as you did it's a more in-demand date. But people don't like being told that....

it would go down better if you said 'i've raised rates since your last booking and our october rates are higher due to increased demand. So your price is $(215 higher) but since you're a good customer I'll meet you in themiddle, it's only $100 more"

I hear complaints from venue managers about DJs (and at times others) that bail on a client becuause they got a higher paying gig. I get wanting to make mo money, but there is a line where 'greedy' takes over.

the other thing I hear all the time is about businesses that offer dicounts nd deals to get new customers but won't do a damned thing for a long time loyal customer.

 

[Proformance]

Ricky, stop pointing at everyone else as examples of what determines your DJ rates. You are not an auto mechanic, not a car dealer, and not a sub shop. You are offering a service that is an entirely OPTIONAL luxury for most of the buyers out there. Your ability to set a worthwhile price has nothing to do with cost of goods, or supply and demand. The supply is over-whelming and the demand has no basis in need.

The only factors that support your pricing are: how you treat people and your consistent ability to deliver the results desired. This is not a math problem it is a communication and public relations issue.

 

[Proformance]

The reason I am not making anything at all is because in May it was a last minute gig booked like maybe 3 weeks out, and he was still open. I told him that last time she had a discounted rate of $335, and she wants that rate. He was fine with the rate at $335 to do it, but that was $335 to him. I booked him as a courtesy to get him a booking at the time, and she got the price she wanted.

The rule of agency is: "Pay yourself first."

If you represent the booking then the client belongs to you and when a customer calls you should already know that the first $xxx of whatever you quote is going directly into your pocket. For a friend of mine who does a lot of multiple bookings that's $1,000 per gig before he even asks the DJ how much he's willing to accept. If the DJ is willing to work for $400 then the client gets quoted nothing less than $1,400. Perhaps more if the client is willing to pay more.

It is your brother's responsibility to set his own price, and yours to pay your self. The customer has no responsibility to be generous to either of you - you must speak for your own best interest.

If you are a talent agent then your responsibility is to your brother and the client belongs to him not you. It would be his responsibility to set a rate and your job to sign the customer at a price no higher than that necessary to get what your brother wants and pay your previously agreed compensation.

 

[Scott Hanna]

If I paid $335 for something in May, just like I did a few years ago, I would not want to pay $550 in October.

Regardless of your intentions, you trained her to believe what your dj service is worth. With a little research, she can probably find a few other Djs with similar prices. Yours may be better, but she's only comparing prices at this point.

That is very typical of what most people would do when told of a substantial cost increase.

I try to be as accommodating as possible for repeat customers. I would gradually increase their rate.

I also don't work for free unless there was a very good reason. If no available dj wasn't willing to accept less to get the gig, then I'd probably have to polity decline.

Just last Saturday, we did a vow renewal. 40 people, 4-7. They were looking for the most cost effective package, willing to strip out just about anything to save money. The dj I had available lived about 5 minutes from the venue. We did it for $395. Compact, computer and mic.

 

[DJ TJ]

The reason I am not making anything at all is because in May it was a last minute gig booked like maybe 3 weeks out, and he was still open. I told him that last time she had a discounted rate of $335, and she wants that rate. He was fine with the rate at $335 to do it, but that was $335 to him. I booked him as a courtesy to get him a booking at the time, and she got the price she wanted.

Ok, so now the truth comes out. It was a near last minute gig (read poor planning on her part), and you still gave her the same rate from 4 years ago?

You had the chance to increase the rate for the may gig but you didn't, so you are the one who set the precedent by giving a substantial discount to the unorganized last minute client who didn't deserve it just because she gave you business once 4 years ago and now she's become the problem that you created.

If you didn't increase it for the May gig after 4 years then why do you think she shouldn't expect the same rate after only 5 months later?

Why are you ranting about a problem that you created all on your own?

 

[steve149]

Why are you ranting about a problem that you created all on your own?

C'mon .. that's half of our programming here ...

 

[IceBurghDJ]

if I didn't create problems I'd have nothing to do most of the time. and more money!

 

[Proformance]

Regardless of your intentions, you trained her to believe what your dj service is worth.

I don't accept that proposition at all. If people were making that kind of direct connection then how could I be working with such varied rates to the same customers over and over? In fact, some of my customers don't even know the cost until after the event when I invoice them. Value is a possession of the buyer not the seller.

Many years ago, I had a similar customer who had paid (guessing) $300 for a DJ. When she called for the same event a year later I gave her the same price but, also mentioned that our rates had increased substantially in the intervening year. Her contract itemized the DJ along with a discount to arrive at her continued price of $300. She called back to complain about the new prices despite the fact that it had no impact on her at all. In fact, despite being given exactly what she had expected - in protest, she went and hired someone else anyway!

This example, along with experience in many negotiations over the years has taught me that value is a property owned by the buyer not the seller. The reason the woman above balked at a number that had no affect on her purchase is because it represents a transfer of power by shifting the role of assessor from the customer to the seller. The psychology of that perception alone trumps even a $0.00 cost increase.

It is important to allow to the customer to retain control of the problem they are trying to solve and to assess their own value of the underlying need. (i.e. You will never succeed by valuing their need - you can only assess your inventory of possible solutions and admit that mismatches are always possible.) Your quotations should be a staircase that customers can willingly choose to climb, rather than a qualifying obstacle or wall they must scale. There will always be situations in which a customer is unable to make even that first step but, you must begin with the proposition that they are worthy of your advice and attention, nonetheless.

In that spirit, when I encounter people who's need dictates a $200 DJ I admit that I'm not equipped to produce that solution but, I will tell them where to look and how to find a good DJ for that price. NEVER would I suggest that what they want is not available or that they are in any way unworthy of quality.

 

[rickryan.com]

Ricky, I'm on the fence between saying you did the wrong thing and thinking you did the right thing. I think one thing's for certain, 8 times out of 10 you're going to lose that client for any further repeat biz. I've done the same thing and I think it basically comes down to a choice; do you value the repeat client or the open slot (where you can put a higher-paying client in)? I'm assuming you were putting a sub on that job anyway so it likely makes sense to just pitch the current price and let the chips fall where they may. Still, I can't help but think that it might have been a good strategy to pitch your rate then come back with a $100, "this time only" discount and see if you couldn't nudge them north a bit. Repeat clients are hard to come by (at least for me) and they definitely do hold value, especially if they book on non-prime dates sometimes.

Good discussion.

 

[rickryan.com]

In that spirit, when I encounter people who's need dictates a $200 DJ I admit that I'm not equipped to produce that solution but, I will tell them where to look and how to find a good DJ for that price. NEVER would I suggest that what they want is not available or that they are in any way unworthy of quality.

I fail to see any wisdom in assisting a prospect to find a bottom-feeder DJ. First off, it's my belief that the $200 guys will mess up an event more than they'll help. When confronted with that kind of budget my advice is that they rent a sound system and use a laptop. I believe you're doing them a disservice by giving them hopes that they'll get something for nothing (or very near it).

 

[Scott Hanna]

I don't accept that proposition at all. If people were making that kind of direct connection then how could I be working with such varied rates to the same customers over and over? In fact, some of my customers don't even know the cost until after the event when I invoice them. Value is a possession of the buyer not the seller.

Many years ago, I had a similar customer who had paid (guessing) $300 for a DJ. When she called for the same event a year later I gave her the same price but, also mentioned that our rates had increased substantially in the intervening year. Her contract itemized the DJ along with a discount to arrive at her continued price of $300. She called back to complain about the new prices despite the fact that it had no impact on her at all. In fact, despite being given exactly what she had expected - in protest, she went and hired someone else anyway!

You could be offering them different services or service levels to the exact same customers, that's how. But I believe, just like your example in the 2nd paragraph above, if someone gets told the service is much more for the exact same service than it was previously, odds are they will complain or go elsewhere.

Don't believe me? Take one on those customers that you invoice after the fact, and charge them significantly more FOR THE EXACT SAME SERVICES that you did previously and see how happy they are about it.

It sounds like you've built a trust with them that you will bill them according to the services you've provided. It will vary based on the services provided, not on a whim decision to raise prices or remove discounts.

 

[Hank Davidson]

... if someone gets told the service is much more for the exact same service than it was previously, odds are they will complain or go elsewhere.

Right... and here's what I think the reason is. (weddings aside)

Most people have a preconceived idea of what a particular product or service is worth (to them). For example: Most people would buy a candy bar at the common outlets for around .60 - 1.oo without batting an eye. If you tried to sell them the exact same thing for twice+ the price, they would likely not buy it. It wouldn't matter how much you tried to convince them it was worth more. They simply will never justify it.

It's the same for us. The average person just doesn't value the music coming from a laptop in the corner of the room all that much. Right or wrong, like or not, that's the way it is.

I went to a ballgame recently and there were guys outside the park selling bottles of brand-name water out of coolers for $2 (legally). The same water inside the park was $8. The park allows you to bring unopened water into the park. Needless to say, these guys sold every last bottle. Are the people that bought them "cheapskates"? Are the guys selling them "bottom feeders"? No, they're reasonable people seizing an opportunity for making reasonable transactions.

There was still plenty of water sold inside the park.

 

[dunlopj]

The average person just doesn't value the music coming from a laptop in the corner of the room all that much. Right or wrong, like or not, that's the way it is.

And therin lies the most difficult issue we face. Technology is the major cause of this.

Fifteen years ago, just before digital music became widely used in this industry, our value and perception of what we do was on a much higher plane.

Feel free to discuss...or disagree.

 

[DJ Ricky B]

I am going to wait it out. If I can't get my bro booked

Right... and here's what I think the reason is. (weddings aside)

Most people have a preconceived idea of what a particular product or service is worth (to them). For example: Most people would buy a candy bar at the common outlets for around .60 - 1.oo without batting an eye. If you tried to sell them the exact same thing for twice+ the price, they would likely not buy it. It wouldn't matter how much you tried to convince them it was worth more. They simply will never justify it.

It's the same for us. The average person just doesn't value the music coming from a laptop in the corner of the room all that much. Right or wrong, like or not, that's the way it is.

I went to a ballgame recently and there were guys outside the park selling bottles of brand-name water out of coolers for $2 (legally). The same water inside the park was $8. The park allows you to bring unopened water into the park. Needless to say, these guys sold every last bottle. Are the people that bought them "cheapskates"? Are the guys selling them "bottom feeders"? No, they're reasonable people seizing an opportunity for making reasonable transactions.

There was still plenty of water sold inside the park.

You are comparing bottled water to bottled water. Yes, $2 is reasonable, and $8 is taking advantage of the customer simply because they are in a stadium.

Mcdonalds has a double cheese burger with small fries deal for $2.50. However, TGI Fridays sells a Jack Daniels Bacon Cheese burger with fries for $11.99 now. ...I would rather go to TGI Fridays and pay $11.99 for their burger over patronizing Mcdonalds and spend $2.50. Am I being un reasonable with my money because I want to eat a nicer burger, and not pay for and eat crappy food?

Sure, some guy can go and do this Halloween party with a laptop and a pair of book shelf speakers, and easily charge much less than a professional DJ who is charging a professional rate. However, the result and experience with both varying services will be very different.

Many people are satisfied with eating Mcdonalds their entire life. However, others want a greater taste bud experience. ....The same holds true for DJs. Many clients are fine with the Mcdees level of service. If the client wants to pay a dude to show up with a laptop, and book shelf speakers and play illegally downloaded music from the windows media player all night...then so be it. However, if they want a professional DJ who will provide a better service, and result in a better experience, then it will cost more.


There are people out there who only prefer to stay at the Hilton, or Four Seasons when they travel out there. They wouldn't be caught sleeping in a motel 6, or budget inn.

If the Hilton is charging $399 a night, and you go and get a quote from the Motel 6 at $69 for the night, was the Hilton being unreasonable?

How about the Holiday Inn? ...They quoted $159 for the night. Are they asking too much since you can get the Motel 6 for $69?

 

[steve149]

And therin lies the most difficult issue we face. Technology is the major cause of this.

Fifteen years ago, just before digital music became widely used in this industry, our value and perception of what we do was on a much higher plane.

Feel free to discuss...or disagree.

No disagreement .. the reality has changed. Used to be a PC cost $3000 .. and that was in 1982 dollars .. Who ponies up $10,000 (today's dollars) for a monochrome PC now?

 

[rickryan.com]

And therin lies the most difficult issue we face. Technology is the major cause of this.

Fifteen years ago, just before digital music became widely used in this industry, our value and perception of what we do was on a much higher plane.

Feel free to discuss...or disagree.

I don't see it as our perceived value changing. I see it as the game changing. Demand for solid professionals, who can make an event stellar is just as high as it ever was, but you won't get it for just bringing in a pair of speakers and playing a bunch of tunes. To have that higher perceived value we need to bring new tools and new approaches that will have guests in awe of something new, something exciting. Or, you could just be that mouse that sits around wondering where his cheese got moved to.