New report about pricing........

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Ken Petersen

Account Closed
I have close to 10 years into this line of work, Ron. I feel I have maybe another 10 to 15 left before I stop entertaining weddings. That also means I have 10 to 15 years to set a foundation for exposing what’s wrong in the “here-and-nows” and pointing these obvious things out.

Accepting them takes letting go.

If it takes a big ol’ general whop across the entire breadth of DJs to stop for one second and take notice that they who speak the loudest generally speak the most wrong. Good. At least everyone else stopped for a moment to regroup.

It is that collection of books that has shown me that DJs are blindly pecking around for answers – and have been doing so for 35+ years. It is that collection of books that will reward me with parchments in May of this year. Making it the most relevant and timely education that is being dedicated back to this line of work. I would like to be able to tell my grandkids I helped someone succeed. Or even have someone near to me say thank you for moving the MDJ community one-step closer to becoming a real line of work.

I see a splintered, care-free group of business owners - people whose one-sided successes are based on the "ego" (ergo: "id, ego, super-ego” not snotty attitude type ego). I also see a teeny-tiny cross-section of the Mobile DJ world actually starting to look beyond their own comfort zones for stimuli. What is painful to bear witness to is that I also see a population of collective voices that do, try, restrict, thwart, discredit, bog-down, and gum-up “business growth and potential business maturity.” In 35+ years, mobile DJs still cannot stake a reputable claim in anything that is a legitimate measure of growth.


I do see that the springboard is getting more and more defined to launch us, as a whole, forward the more time is spent critically looking inward. The problem belongs to everyone as to why we bicker. We have 35,000+ established DJs that cannot even begin to agree upon the simple thing we all sell. And there are even less of those that can come to grips by wrapping their brains around a phrase that pays, to change. I am not trying to position myself to lead, but rather be a qualified voice that those who choose to lead can call upon for input.

Hutt, nice observation. Those are 1936 prints. The first chapter of “Win Friends…” is titled “If You Want To Gather Honey, Don’t Kick the Beehive.” How many attempts to gather honey have been met by numerous chatboard members running up behind the honey gatherer and kicking the beehive?
 

DJ Dr. Drax

Active Member
Discounting is actually the WORST thing one can do in a slow or recessionary market. It is really the LAST thing that you should do, but all too often it is the first thing that people do. Why? PANIC.

They have no business plan actually in writing, So they are VERY unprepared, & FEAR sets in & turns to PANIC. So they are subject to the whims of fancy & temporary market forces either real or imagined. Without a plan you are nothing more than a leaf in the wind to be blown hither & yon. With a plan you are a well rooted tree capable of bending in the strong winds without being uprooted or blown over.

Surviving recession without bleeding excessively takes skill & discipline. It takes a plan & following that plan.

I would suggest that anyone considering discounting or cutting your prices, really, really rethink that as long term it will harm your market positioning far longer than a temporary slow down ever will.

There are very solid, sound ways to deal with recessions & slow downs. Cutting your price is the LAST step one should take.
 

Ken Petersen

Account Closed
DJ Dr. Drax said:
There are very solid, sound ways to deal with recessions & slow downs. Cutting your price is the LAST step one should take.
Here is a "give-back":

One of the FIRST steps in a economic downturn is to increase or, at the bare minimum, maintain current promotional endeavours.

Yes...

Advertise more. Advertise deeper. Advertise clearer.
 

DJ Dr. Drax

Active Member
Well stated. Clarity defines expertise. Specialized Expertise is ALWAYS in demand.

Discounting only erodes profits, Most MDJ's are not even making a profit, rather they are just managing a cash flow game. So if your discounting you might well be better off staying at home if your don't really know your business plan & know the loss point. You could actually be losing money.

Recessions are excellent opportunities for leadership, not for cowardice. Holding your ground & being able to bear or sustain it will clearly show who the market leaders are & who are struggling to find bait.

Recessions are beaten not by discounting or stimulus checks, but by good ol fashioned conservativism. Your business plan should be already telling you the answers to recession with out reducing your rates.
 

FlyingDJDan

Don't Care About Titles
All that education and your just a DJ?
And we wonder why the client wants to barter???

Why not barter, ask for discounts, and go with cheap!

We don't respect ourselves. Why should anyone else?

Could someone please explain if discounting is the right thing to do in an economic slowdown or why no other costs to me are???

Gas???
Utilities???
House payment???
Food costs???
Insurance???
Education???
Medical???

Electronics, furniture, and other like items shown in the video that started this thread are entirely different to us. They already have LARGE profit margins built in.

My business costs are going up, so are my prices. I am still getting bookings.
 

Goodknightdj

Word of Web (WOW) DJ
DJ Dr. Drax said:
Discounting is actually the WORST thing one can do in a slow or recessionary market. It is really the LAST thing that you should do, but all too often it is the first thing that people do. Why? PANIC.
I always discount. It is called negotiating. I am not panicking because there's no need to.

DJ Dr. Drax said:
They have no business plan actually in writing, So they are VERY unprepared, & FEAR sets in & turns to PANIC. So they are subject to the whims of fancy & temporary market forces either real or imagined. Without a plan you are nothing more than a leaf in the wind to be blown hither & yon. With a plan you are a well rooted tree capable of bending in the strong winds without being uprooted or blown over.
I have always had a business plan. It includes discounts. I call it negotiation. You see, I'd rather have an event than an open date. I know my bottom line and how much I want to make and everything above that is fluff that I can cut.

I don't tell my prospective clients that they can cut certain things out of their event to afford me. If it doesn't violate my cost of production, which includes a fair profit margin, I negotiate a price with them.

DJ Dr. Drax said:
Surviving recession without bleeding excessively takes skill & discipline. It takes a plan & following that plan.
I have a plan. I follow the plan. It includes discounts.

DJ Dr. Drax said:
I would suggest that anyone considering discounting or cutting your prices, really, really rethink that as long term it will harm your market positioning far longer than a temporary slow down ever will.
Unless you include discounts as part of your plan. Everything in life is negotiable.

DJ Dr. Drax said:
There are very solid, sound ways to deal with recessions & slow downs. Cutting your price is the LAST step one should take.
Right, stand your ground and work less, or even not at all.
 

Goodknightdj

Word of Web (WOW) DJ
Ken Petersen said:
One of the FIRST steps in an economic downturn is to increase or, at the bare minimum, maintain current promotional endeavors
And yes, Ken just said it for all that have ears to hear.

He doesn't really know what he said but I'll explain it.

Discounts and negotiation are promotional endeavors!

Sing it from the high places, negotiate with your prospective clients.

Oh, and BTW, all spelling errors corrected by me by copying the text into Word, running spell check, and copying it back.
 

BBBuffalo

Active Member
Now if you ALWAYS discount, doesn't that mean that you just artificially list a higher price and that your discounted price is your real price?
 

Goodknightdj

Word of Web (WOW) DJ
Okay, who hasn't walked into a proaudio store and asked for a discount?

Does that lower the worth of the item?

So, you buy the item and it performs well. What is the likelihood that you will go back to that store in the future?

Why is that any different than offering a discount or negotiating for your DJ service?
 
M

Mark Beecher

Guest
I will discount and I don't advertise. I guess I'm a loser.
 

DJ J Mac

Member
I still don't understand why folks on this forum can't let people run their business how they want to. I agree with Goodknightdj, discounts are nothing more than promotional pricing, which if one really and truly knows their business and their bottom line, they can use this tool to their advantage.

Drax, I understand that you are quite knowledgable, but what exactly qualifies you to be an economic guru that knows all about every single market in the country?

Even with a discounted gig, if you're making a profit, then that's money in the bank. You also never know what may come out of a gig, a steady gig, several good leads. Sometimes it pays to do a discounted gig, even if its only some extra cash in the bank.
 

Goodknightdj

Word of Web (WOW) DJ
Jeff said:
Sorry Tom, I don't get it?!?!
Sorry Jeff, but if you can't grasp the concept that everything in life is negotiable then I can't help you.

Maybe this will help...

A few years back my wife and I were in Tetuan, Morocco. We visited the place where the Barbours made rugs and they produced some very beautiful rugs.

Well, after they showed us how they make rugs, they gathered us all together in a room and began bringing rugs in. They were of all sizes and designs. Some plain and some with beautiful artwork.

Well, there was one that my wife and I liked. It was the perfect size and coloring for our formal living room. We figured that it would be expensive but we decided to play the game anyway.

So, one Barbour gentleman took my wife and I into a room with the rug and we negotiated. He wrote a price down on a piece of paper and I wrote a price down. His was high and mine was low but mine was significantly below my high mark. His high figure really wasn't that far above my high mark.

We repeated the process. I went a little higher and he went a little lower. Now his high mark was below mine. We probably could have gone one more round and I could have brought it down more but we were both happy.

I bought the rug.
 

BBBuffalo

Active Member
Goodknightdj said:
Why is that any different than offering a discount or negotiating for your DJ service?
Because a thing is mass produced and each one is essentially identical.

Unless you are an identical twin, there's only 1 of you.

Nobody else can offer what you offer.

If you were arrested and wrongly accused of murder, but there was a lot of evidence against you and you had no alibi, would you rather have the services of a recent law school grad, or the likes of Johnny RIP Cochran and the dream team?

You would want the very best possible.

Maybe your child needed a life saving delicate operation. Do you want someone with little or no experience or the surgeon who has done it hundreds of times with an outstaning track record?

The difference is the results.

A product. Lets say a Martin Mac 250 is the same and will provide the same results regardless of where you buy it.

BUT, that being said, unless you know what you need to, it would be worth paying a slightly higher price to get the expertise of a pro to help you with it.
 

Goodknightdj

Word of Web (WOW) DJ
Now visit the post I made about the rug. The rugs are not mass produced. They are all unique works. They are considered art. Yet the Barbours are willing to negotiate to sell this product.

As was said, our product is unique each time. And yes, it is considered art. But many of us are not willing to negotiate.

Maybe it is just a cultural difference. Maybe our culture needs to re-learn some lessons.

In the original post it was indicated that negotiatiing was the norm in stores until the 1870's (I think) when stores started going to fixed prices.

So, old things are new again. How much would a culture shift really hurt?
 

DJ Ron Auger

Account Closed
Ladies and Gentlemen, can we have a nice big hand for Ken! =D> =D> =D>

How will this industry continue on with it's meager existence without the intellectual drive of Ken. How will our networking groups continue to grow without his guidance.

I've been in this business for over 20 years. I started out small but by watching people closely, learning from those I trust, and networking with others who care, I have grown quite nicely. Ken, you just don't seem to fit in any of those three catagories.

In your world I'm sure you think you are doing a noble thing. I'm sure somebody will be there to pat you on the back when you're through. But with the way you started off this post as usual I'm sure the line will be a short one.

That's the one thing about giving someone a Whop, You better be prepared to duck.


Tom: Again you make good sense. As good as anyone thinks they are, there is always someone better right around the corner. You price by what you feel if right not by what someone thinks you should, just so they can feel better about themselves. I will say I don't drop my prices or negotiate but then again my prices aren't anywhere close that someone would have to ask me that. I just quote my price that is relevant to their event. If that's not acceptable then I assist them in finding someone who will fit their needs.


Quote:
All that education and your just a DJ?


And we wonder why the client wants to barter???
If you're not a DJ then what are you? The client wants to barter because the economy and the market dictates it. Allowing it to happen is entirely up to you. You want to change that? Quit complaining to a small tiny group of people who aren't even in competition with you or who have no effect on your business. Gather together those who are in your area and share this information, make them see the light. Then report back to us and tell us how you made out. I do it every month. The only problem is we still only have a small tiny amount of the DJ who want to listen, learn, and grow.

But yes, I'm sorry to say you are just a DJ. You are not a physiologist, you are not a marketing major, you are not an engineer. You are a DJ. Learn to be the best DJ you can but be proud of who you are. If you're not proud of being a DJ then go be one of those other professionals, they make more money anyway.
 

Jeff

New Member
What it comes down to is some HAVE to discount where some don't...Discounting would be mt last resort. If you create a compelling message and then back it up with massive value you don't have to drop your price to get the gig. You also have to get this message out to the people who are your target market.

Its pretty obvious that many have no clue how to market. Maybe a little education as opposed to preaching the virtue of excepting less just to work...of course your proving your value to the market is less if you are always dropping your price.

Some will never get it.........don't quit your day job.

Jeff
www.theDJSolution.com
 

bb

Well-Known Member
Great post Jeff.

For the Better DJ... DJ Rate Alert!
If you have value, service and skills above the averge DJ shouldn't your rate be higher than the norm in your area. If not, the perception is you are still average.

Stay in the pack or reach new heights, the choice is yours.
 

Goodknightdj

Word of Web (WOW) DJ
Jeff:

I don't always negotiate by my price is always negotiable and I do tell prospects that.

Most of the time they will go with the quote because they see the value from the interview; however, there are times when folks will say that they like what they hear but cannot afford the price tag. In that case I take them at their word and begin the negotiation process.

Let's look at a hypothetical situation.

Let's say each standard wedding costs me $400. Let's say I want to make a 50% profit margin on that so that means my absolute bottom line is $600. To maximize possible profit, I double that so my price is $1,200.

Jean and Jim have an interview with me. I have them excited all the way through till they see the price tag. They deflate and tell me that they just can't afford $1,200.

Further discussion with them reveals that they can afford $1,000. We settle on that.

I've now made my expenses, my profit margin, and $400 above the profit margin. They're happy and so am I.
 
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