Economic Theory on How Much to Charge for Wedding Photography

[Bean]

What I'm trying to discuss here is the market is driving by supply and demand. If there is an abundance of supply providing cheap services, and if there is a demand for them, there'll always be people undercutting prices to get the job.

Unless a strong Photographers' Union or Photographers' Association is formed to demand for a minimum wage, grossly low fees are here to stay. :dunno:

 

[Bean]

Originally posted by Jed
Actually, to be honest, you shouldn't even shoot for friends, not as the only photographer.

The responsible way to pick up experience is as a second photographer or assisting a seasoned professional. That way you get the chance to shoot and learn without the added burden of possibly messing things up if the pictures don't turn out right.

Jed, I agree with you on this. In fact, I agree with most of you regarding providing services online for free just for the learning experience.

On the other hand, sometimes it's hard to find 'lobang' to assist a seasoned professional for a wedding.

I have an experience a few months back when my friend asked me to help cover his wedding. I told him I never took wedding before and suggested that he hire a professional while I could help out as a back-up. However, he commented that he never thought of getting a photographer in the first place, and that the only photos he will have will be the photos taken using P&S by his relatives.

The reason why he asked me is because he knew I love photography and wanted to give me a chance to try. He is also confident that I will definately take better photographs than his relatives. A win-win situation for both of us.

 

[ckiang]

Originally posted by Snowcrash


Er... don't be offended ok... if 3 x $300 wedding = $900!!! only.

Oops. :embrass: But you get the idea.

Regards
CK

 

[ckiang]

Originally posted by Bean
Jed, I agree with you on this. In fact, I agree with most of you regarding providing services online for free just for the learning experience.

On the other hand, sometimes it's hard to find 'lobang' to assist a seasoned professional for a wedding.

I have an experience a few months back when my friend asked me to help cover his wedding. I told him I never took wedding before and suggested that he hire a professional while I could help out as a back-up. However, he commented that he never thought of getting a photographer in the first place, and that the only photos he will have will be the photos taken using P&S by his relatives.

The reason why he asked me is because he knew I love photography and wanted to give me a chance to try. He is also confident that I will definately take better photographs than his relatives. A win-win situation for both of us.

Well, of coz, if he has the confidence in you, and you are confident of delivering, then go ahead. But of course, he must have the expectations right.

Regards
CK

 

[SNAG]

Originally posted by Bean

What I'm trying to discuss here is the market is driving by supply and demand. If there is an abundance of supply providing cheap services, and if there is a demand for them, there'll always be people undercutting prices to get the job.

Unless a strong Photographers' Union or Photographers' Association is formed to demand for a minimum wage, grossly low fees are here to stay. :dunno:

Hmm, seriously, what can we classify the photography market under what market structure?
Oligopoly?
I think more of a monopolistic competitive market...

Just what I think...
Many sellers (in terms of selling their services) and relatively a lot of buyers... (in terms of couples), (in general) homogenous products and services.....

Anyway, these services still can be differentiated (in terms of photography skills and services), so I think there are different markets to cater for.

There will be people who are willing to pay a bomb for photoshoots, there will be people who strive with the motto "Ai Pi Ai Chi" - want cheap and good.....

So what I think is that those people who want "ai pi ai chi" will go for those "budget" photoshoots....

:dunno:

 

[binbeto]

I guess most of those started out will charge low or a niminal amount... As one is not very experience, he won't dare to charge same rate as those seasoned one...

As long as your skill is good, people will pay as long as they feel it's worth the $$.

Abt the theory , you charged low, you have to continue to chrage low.. I dun quite agreed. Dun tell me you charge the client the same amt as you charged them when you 1st started? Or, for a matter of fact, 2 years ago?

Once you feel or your custmer feel that you technique has improved. You will adjust the rate according..

For those asking for free "services", beware... How can you blame someone totally for things he did for free? If the photos came out bad or not to your desire, you can't blame much on the photographer.

If someone give you free lens, will you said that how come got fungus one?

IMHO, different rate will attract diff clients.. Will David copperfiled be jobless if everyone else provide free magic show? I guess not.

 

[Klause]

Wah. Wai, where u get that quote from? I forgot when I post that already. heheheheh.

Umm.. to clarify what i mean by those words(which I forgot when I posted it), I like to assure you guys that what i'm referring is that I will attend the wedding, shoot for fun for the couple, and maybe give them a few shots that they like to thanks them for inviting me or letting me shoot them ;p

I'm not referring to do fullpackage/professional wedding photo for them. I just a treating it as a hobby and it will be real fun for them to be my model rather than client.

So don't get me wrong that I'm breaking the market or something like tat. Just wanna learn something ;p

Cheers =) ;p

p.s: and they SURE HAVE TO GET A PHOTOGRAPHER .. hehehehe.. cos my failure rate is WAY too high and they probably have to get remarried if I'm their only photographer there

 

[kh_drew]

Originally posted by Klause
I like to assure you guys that what i'm referring is that I will attend the wedding, shoot for fun for the couple, and maybe give them a few shots that they like to thanks them for inviting me or letting me shoot them ;p

sorry to butt in this thread but found it interesting

I'll just share some of my own limited experience in wedding photography. Actually it started out quite by accident, in similar vein to Klause. I was invited to be a "brother" for one of my friend's wedding so I asked him if I could shoot some candids for fun. Bear in mind that he had already hired the services of a pro. To cut a long story short, I gave him a few prints and he really liked them. He showed them to some of his single friends and I got called subsequently by some of these friends whom he showed the photos to. Initially I turned down these folks but was sufficiently interested in shooting such events. So when I found out that a friend's friend was shooting weddings as a pro, I thickened my skin to ask him if I could tag along as an assistant to learn. Surprisingly he was very happy to have someone along. Of course I didn't get paid but it was the experience that counted. The next shoot that I went to was a clan association dinner that one of my friend attended and that time I was the "official photographer" and got paid around $500+ for 3 hours' work. It was a totally new experience and I learnt lots of new things like how to persuade people to pose around the dinner table, etc etc.

I would say that the process of getting more assignments is like a positive feedback loop, where the more shoots I did, the more my work would be seen by friend's friends and hence more offers came in. But at the end of the, I never lost sight of the fact that I'm just a hobbist. That's very important to me personally because I have a day job and other responsiblities, so if I forsee that an assignment will eat into my main line, I will turn it down no matter how attractive the offer is. Another thing is that I always let the people know that I'm not a full-time coz I believe in transparency. Many times I get couples attempting to use my part-time status as a bargaining chip but I agree that it's important not to spoil market for others who may be doing this for a living so my response would be to ask them to look for "cheap" rates somewhere else.

Well, that's that

andrew

 

[StreetShooter]

My wedding was about (omigosh!) nine and a half years ago. We decided on Studio 8 because we liked the type of photos "Tommy" took. Bought a package at what I considered then to be an exorbitant price - $1200 just for studio and outdoor shots. But we were happy with the results.

The wedding itself we had another professional photographer cover the event. He took mainly the documentary group shots.

My wife's cousin, very much into photography then, took the shots we liked best: the candids.

By the way, Studio 8 is still around: http://www.studio8.com.sg/

 

[Mokole]

First off, I agree that there is a fixed demand for wedding photographers, and the supply is ever increasing (i.e. there are few barriers to entry, anyone with a camera and some idea how to use it can take wedding pictures).

However, the product that photographers are selling are their services, there is little differentiation in our services. The client most of the time will not be interested in the equipment used, and will expect a reasonable standard of service. Once that is established, the rest is rather moot.

Hence, photographers can only produce enough to satisfy a little of the total market demand, and they produce a more or less identical product or service. This would be closer to a perfect competition model.

Before you go into protests, it should be noted that real world models rarely fit 100% into any model and there will be exceptions such as the real pros with their own studios and other such firms who *really* diffrentiate their end product.

 

[Mokole]

This means is that each of the photographers faces his own demand and supply curve. The market has an equilibrium price, and this is the maximum they can charge and have their product bought. How much the supply is not a matter I wish to delve into.

Students of economics know that this equilibrium price is not necessarily the price that is charged in the real world. People may include opportunity costs or they may charge less for reasons of their own.

The point I am building up to, is that each photographer will make some level of economic profit. This is the total profit after factoring all costs including opportunity costs.

There are then 3 possible scenarios.

1.) Firms make positive economic profit. Which will attract other firms into the market to "cash in" on a quick buck.

2.) Firms make zero economic profit, which means the market is stable.

3.) Firms make a negative economic profit, which will result in the weaker firms closing down and packing up.

 

[Mokole]

Note that even when firms make a negative economic profit, the firm can still be making a positive accounting profit. It just means that the photographer isn't fully compensated for his time and effort.

The current situation which is described in earlier posts suggests that the firms in the market are experiencing a negative economic profit. This cannot be a long term equilibrium.

Sooner or later these people who are under-charging their clients will lose interest as they find better things to spend their time on, or other get rich quick schemes to cash in on. When this happens, the market supply will decrease and as cheap or free services are nowhere to be found the people wanting such services will either pay a higher price or find some sober relative with a disposable camera.

The best you people can do is stick by your guns and not go into a "price war" with those who undercut. We can expect them to bail in the long run, and there is little damage they can do if enough people stick by their prices.

 

[SNAG]

Originally posted by Mokole
First off, I agree that there is a fixed demand for wedding photographers

Hi there...
Sorry to barge in, but I don't quite get this point....

IMHO, I think that the demand for wedding photoshoots is rather stable, as there would bound to be fluctuations (both up or down) in those "auspicious times" - 8th month, or in those "unauspicious times" - 7th month perhaps?

Could you clarify on this?
:dunno:
Thanks!

 

[erwinx]

Originally posted by SNAG


Hi there...
Sorry to barge in, but I don't quite get this point....

IMHO, I think that the demand for wedding photoshoots is rather stable, as there would bound to be fluctuations (both up or down) in those "auspicious times" - 8th month, or in those "unauspicious times" - 7th month perhaps?

Could you clarify on this?
:dunno:
Thanks!

the cost you're offering the wedding photography services for doesn't affect the number of people who are going to get married? (assumes that every wedding has a photographer)

 

[jude]

hmm... just had a paper on econs on this...... wat i think is the situation now is having third-degree price discrimination in the photography industry where different groups of people are charged differently. Of course, for this to happen we (photographers) are the monopoly and the different groups of people are facing their own demand curve. we as monopoly have our own marginal cost and for profit maximisation to occur we must equate the different groups's marginal revenue to our marginal cost. this will give us a price(different for different group) higher than perfect competition industry( which is the case now, even those that charge low are making positive economic profits) and output(different for different group) is lower than perfect competition market. In Economics, we always try to find the most efficient situation and perfect competition is the efficient situation. Welfare which is computed by the addition of consumer surplus and producer surplus is at the maximum in perfect competiiton. note that it is welfare that is maximised and not either PS or CS is maximised. As a monopoly, we charged higher price and PS is > CS so we are gaining much of the CS slice (minus away some deadweight loss) However, charging a price that high we are pricing ourselves out of reach. For example, our price is $50 at profit max but someone whose reserve price is $49 will be price out of the market. So that is where third-degree price discrimination comes in. It cut out output inefficency and significantly improve the welfare of the industry. So, in our case the situation now is the BEST. we can't get perfect competition(unrealistic) monopoly(unachievable, imagine ckiang getting all the client ,j/k ) there is really nothing to complain about now unless those of u who complain of other photographers undercutting u wish to supply to those lower-end consumers.


well,
just my half cent worth of economics theories :embrass:

 

[SNAG]

Originally posted by jude
hmm... just had a paper on econs on this...... wat i think is the situation now is having third-degree price discrimination in the photography industry where different groups of people are charged differently. Of course, for this to happen we (photographers) are the monopoly and the different groups of people are facing their own demand curve. we as monopoly have our own marginal cost and for profit maximisation to occur we must equate the different groups's marginal revenue to our marginal cost. this will give us a price(different for different group) higher than perfect competition industry( which is the case now, even those that charge low are making positive economic profits) and output(different for different group) is lower than perfect competition market. In Economics, we always try to find the most efficient situation and perfect competition is the efficient situation. Welfare which is computed by the addition of consumer surplus and producer surplus is at the maximum in perfect competiiton. note that it is welfare that is maximised and not either PS or CS is maximised. As a monopoly, we charged higher price and PS is > CS so we are gaining much of the CS slice (minus away some deadweight loss) However, charging a price that high we are pricing ourselves out of reach. For example, our price is $50 at profit max but someone whose reserve price is $49 will be price out of the market. So that is where third-degree price discrimination comes in. It cut out output inefficency and significantly improve the welfare of the industry. So, in our case the situation now is the BEST. we can't get perfect competition(unrealistic) monopoly(unachievable, imagine ckiang getting all the client ,j/k ) there is really nothing to complain about now unless those of u who complain of other photographers undercutting u wish to supply to those lower-end consumers.


well,
just my half cent worth of economics theories :embrass:

Woah...
Just took your A levels econs today?
If you had > me too!!!
How was it? You may want to PM me...
Why are you classifying photographers as monopoly?

Just to ask, can we classify the market demand as monopoly? I thought monopoly is when a single party dominates the whole market due to he/she being the sole provider of that particular good/service?
Anyway, monopoly >

erm, if i'm not wrong, 3rd degree price discrimination is when the monopolist sets a higher price in the market with more inelastic demand.....

what you are saying sounds more like 1st/2nd degree price discrimination (sorry, gotta check my notes )
What you are writing sounds more like sticky price > oligopoly....

 

[Mokole]

To suggest that all photographers act as a monopoly would mean there are barriers to entry into this field, and all the photographers share a single marginal revenue and marginal cost cruve resulting in long term positive economic profits.

This isn't really the case is it?

There may be differences in price, but I think it is more likely a case of people charging below the equilibrium price as a perfectly competitive firm would in times of economic loss rather than price discrimination.

Price discrimination would suggest capturing the consumer surplus, and if that was the case I think there won't be complaints about people "driving the price down" in the first place.

 

[SNAG]

Originally posted by Mokole
To suggest that all photographers act as a monopoly would mean there are barriers to entry into this field, and all the photographers share a single marginal revenue and marginal cost cruve resulting in long term positive economic profits.

This isn't really the case is it?

There may be differences in price, but I think it is more likely a case of people charging below the equilibrium price as a perfectly competitive firm would in times of economic loss rather than price discrimination.

Price discrimination would suggest capturing the consumer surplus, and if that was the case I think there won't be complaints about people "driving the price down" in the first place.

You have a point there...
A photographer has relatively low variable cost (the costs of the film + developing), since the fixed cost (the camera equipment) is already there.... even without any production (shooting photos)

And to a photographer, besides the variable cost of the film + developing, maybe another one would be the time and effort spent into the photoshoot (but that's kinda intangible)...
So he/she would be able to charge a lower price, as long he/she can cover at least his/her variable costs right?

This analysis is getting interesting...

 

[mervlam]

just curious. what's your job, Mokole?

That's a very good analysis you got there. By the way, are you asking that photography service is a monopolistic competitive market?

Or rather, does it fit better into the perfect competition model where photographers are price takers?

 

[mervlam]

Originally posted by erwinx


the cost you're offering the wedding photography services for doesn't affect the number of people who are going to get married? (assumes that every wedding has a photographer)

Rather, I think, the cost of wedding photography services affects the number of people who wants to hire a professional wedding photographer for their wedding photos. ;p