How Do You Compete With The Run-And-Gun and Drive-by Shooters?

February 18th, 2015

WillWorkForFoodDerek recently asked this question:

I saw an ad on craigslist for this site (intentionally omited) that hires freelance contractors to photograph properties for pennies (10 exterior photos for $15, 3  exterior photos for $9). I see that their target audience is banks and others who have REO properties, but was curious if this happens in other areas of real estate? If so, are Realtors using this as a base to gauge competitive prices?

Yes, to varying degrees this kind low-ball pricing goes on throughout the real estate photography business. It’s a fact of life! These kinds of operations are in very market. Just yesterday, I saw a national company offering 30 HDR photos for $69. And this is the price the company collects from the Realtor client. The photographer typically gets around $30 and there’s someone doing the post-processing that gets a few dollars too. If the participants did the arithmetic they’d realize only the national company is making money because they doing this pricing on a massive scale.

Yes, to varying degrees these operations affect what Realtors expect to pay. Moreover, these companies are not going away anytime soon. They exist because there are people out there that are willing to participate. Given that they are a fact of life, how do you deal with this kind of pricing?

  1. Understand your expenses: Carefully track your expenses and clearly understand what it costs you to show up and do a shoot. Many people doing these cheap shoots are not making money! So before you reduce your prices or sign up for any contract shooting understand the arithmetic clearly.
  2. Understand your competition: Know specifically what you are competing against and figure out what you need to do to be better than the competition. This could be additional add-on products or just the way you do things. This will take some research, but it is well worth the effort.
  3. Know your market: All markets are not the same. After spending most of my life in Seattle where great real estate photography is expected and the norm I moved back to the sleepy little town where I grew up (Salem, OR). The market for real estate photography here in Salem is very different than Seattle. Very few agents use it and an upper-end home is $500K.
  4. Make better photos: If your work is significanly better than the cheap guys, you create a class of work that doesn’t even compete with them. Scott’s analogy in his comment below is that Mario Batali doesn’t compete with Mickey D’s because his food is in a completely different class.
  5. Provide great customer service: Customer service is a huge factor to clients and most of those companies that do cheap photography have poor customer service. Good customer service could be being easily available, delivering fast, being flexible and easy to work with. Find out what customer service means to your clients and do it well.
  6. Do great marketing: Make sure potential clients know why they should hire you over the cheap guys. This means dedicating a website to explaining and promoting your products and services. Simply and clearly explain your services and give examples. Then, use the website to do targeted marketing to people that are potential clients.

These days market forces are pressing everyone to be more efficient and deliver more for less. But there are more ways to compete in the real estate photography business than price. Find a better way to compete than just reducing your price. The fact is there is plenty of successful real estate photography businesses charging far above these cut-rate prices. Here are just a couple of examples here and here.

 

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26 Responses to “How Do You Compete With The Run-And-Gun and Drive-by Shooters?”

  • Larry great topic that Derek brings up. I recently read this article on this very topic and it had some very salient points.

    For me, I provide a super product and provide excellent customer service. I put 100% in every project I photograph. I listen to what my customers need etc.

    There will always be someone that can do something cheaper, but also customers that will appreciate a job well done and be willing to pay for it.

    I hope this helps others and would love to hear more feedback.

    http://www.substance151.com/news-insights/articles-presentations/article/combating-commoditization-professional-services%20

    Warmly,

    Ethan

  • Great topic. I don’t compete!

  • I recently signed up with one of these companies to learn their ways as I will be moving from this market soon and there was no point in trying to gain my own clients as I will be leaving soon… I went in with the mindset of it being a paid internship to learn as much as possible; ASAP. From the sound of it they have people working for them that have been employed there for years. I don’t know how those people can justify the cost vs. expense. Within the few weeks I have been working, I can say that it’ll be a loss in the long run if I was counting the $ only. However, the experiences and knowledge I have gained are priceless in my opinion.

    Needless to say, most all of the agents are not happy with the product they receive. I have heard complaint after complaint. (These are high end top 1% Agents that I am working with…) I am in a very, very busy market and see this as a good sign for all of us that are (or will be) independent contractors soon. Within a few months I have had nearly all of the agents I work with request me. I have learned a lot and will use this in my future endeavours. Now if only I could learn their processing techniques…

  • Just this week I received a call from a potential new client. She had received my name from another agent in her office, who I shoot for regularly. She explained that she had a 4600 sq ft property on 15 acres that she needed photos and a short video for. She asked for a quote, which I gave her. She gasped, saying “I’ve never paid more than $99 for photos!”. She then paused and said, “I don’t know what to do. I just found out my regular guy went out of business 6 months ago.”

    That told me everything I needed to know. Anyone who needs 6 months to find out their regular shooter went out of business probably won’t be a real client — certainly not listing a property once every six months. And trying to make a living at these rates won’t work out for anyone, long term.

  • I don’t compete on price. I’m confident that I am providing good value for what I charge.

    I’ve had a couple of agents mention the large marketing companies that have very low rates. When I ask them about service and image quality, they tell me that it’s up and down. Most of this is due to not working with the same photographer more than a couple of times. The agents seem to put up with this since they are also getting Ken Burns slide shows, aka: a virtual tour and a flyer layout. The ones that don’t acknowledge that starting with crappy photography makes the rest of the stuff worse, I stay away from. Price will probably be the only metric they will ever consider and I can’t be bothered to be constantly telling them that I won’t drop my rates.

    I’ll have to start saving the job listings for RE photo jobs from these big companies. I have to laugh when they quote a rate per home that is far below minimum wage unless you run and gun, require the photographer to provide a certain level of gear and don’t require any experience. There is also the requirement to provide them with blanket permission to run your credit, background and driving records and also mandate that you submit to drug testing within X hours of being asked. All of this without guaranteeing any work. I wonder if they are making some nice side money selling personal data. I didn’t see any assurances that they would keep the data private.

    @Tyler – You should tell the agent that she was getting a screaming deal at $99 and that rate was so low it’s no wonder that her last photographer went out of business. I also agree that if it’s been 6 months since she’s hired a photographer, she isn’t doing enough business to matter. Lots of agents in my area seem to use RE as a hobby to get out of the house.

  • I would add one more item to Larry’s list: know your market. In fact, i think all the other items on the list don’t matter much unless you know your market and your target clientele.

    As for competing, most of us compete in some way. However, it seems to me that, the more you have something special to offer, the less you will need to compete on price.

  • I live in Denmark, and worked for a real estate photo company for 1 year. They started off paying ok but then took on these ‘outside only’ photo shoots. They would pay 12 USD per job. The homes were normally bank repossesions so the home owners would not be happy with you taking photos. Then the company took on a new business stratagy……. Stop paying the photographers, make excuses about ‘checks in the post’ and so on. Then just not paying at all, working there way through photographers. Yes, I now work for myself, directly with agents. 🙂

  • Thanks so much Larry (and all commenters) for the information about this!

    I have yet to fully dive into RE Photography, I’m hoping to relocate into a new market soon and have been following Larry’s and Scott’s ebooks to educate myself in both the business and practice of this industry.

    I’m almost half tempted to follow Ike’s lead and sign on just to get some fast practical experience and get my name in front of more agents, but the flip side is that I know it would hurt me in the long run as agents would equate my name with that cheap rate and that’s a hole I cannot afford to dig out of just starting out.

    Anyway, all the research and education will continue until I’m actually IN my target market and can truly dedicate myself into the practice!

    Thanks again!

  • How in the world does Spielberg compete with the makers of Naken Gun? 🙂

  • Good topic. Again. I have only been in this branch of photography for a few years. Much learning of the new market as opposed to advertising work. I quickly realized I had to chop my daily fees by 65%. And I think not because my work was not valued but because of the budgets available due to the commissions the agents had to work with. So I quickly started specializing in high end properties only that presented more difficulty for those who either take their own photos with their smart phones of tablets or the flash and dash budget photo businesses. Many of the properties are difficult to photograph even for a trained professional and depend on experienced problem solving tools that only training and experience can provide.

    So while I had to recognize the limits of budgets and learn what realtors want, I also did not sacrifice on quality or dedication to good work and what it takes to achieve it. As I learned at photography school decades ago “Do you want it fast and cheap or do you want it right?” As one testimonial from a client says “Peter’s photography sells houses faster, better and at higher closing prices.” And isn’t that what this is about? That and providing agents proof of how well they are representing the property to the owner and can use as their advertising to gain more. My best agents tell me that what they spend on advertising their listings is 50% to sell the houses and 50% to gain more owners to list with them. You can’t do that with half assed photography.

  • I quit trying to compete on price; it’s a losing battle. I offer what I want to offer, charge what I need to charge, and have a nice following of agents and offices that value my work regardless of cost (within reason). I have also refocused my efforts toward architectural, using real estate work as a supplement. This has been a huge relief in stress, and a significant boost in income, all without overworking myself.

  • Larry, I think you’ve left off the single most important thing that allows you to “compete” with the run-and-gun photographer: MAKE BETTER PICTURES.

    But just backing up a step, I don’t accept the premise that one must compete with the $99/shoot people in the first place. You don’t see Applebee’s getting upset because McDonald’s moves in across the street, and you don’t see Ruths Chris Steakhouse getting nervous when Applebee’s moves in, either. And Mario Batali doesn’t worry about ANYONE else opening up near his restaurants — because he’s unique. His food isn’t served anywhere else.

    A real estate agent who works with one of the “tour” companies and is shocked at paying $200 for photos is NEVER going to be my client, unless there’s a real sea change in their way of doing business. So as far as I’m concerned, that agent, and that photography company don’t even exist. They are “McDonald’s” to my “Mario Batali”. They don’t want me, and I sure as hell don’t want them.

    But to go back to my original point: If you are in fact operating in the same market segment as the run-and-gun photographers, and you want to get out (a.k.a “move up”) then you’re going to need to make better photos. It’s really as simple as that. And there really are people who can see the difference (and will pay for it) between what you’re producing right now and what a better photographer is producing. Because if your pictures look just like “the other guy’s” (and you may need to go get an honest, un-biased opinion on that) then you’re in the same situation they are: there’s really nothing a photographer can do in half an hour on location that a real estate agent can’t do for themselves, for free (or for the price of a Canon Rebel Xt and a cheap lens). All you (and the run-and-gunners) can do is try to run faster, drive further, squeeze more shoots into a day and get the price down even lower. What a disaster that business model is!

    So don’t play that game in the first place. Become Applebee’s (or Ruths Chris, or shoot the moon and become Molto Mario).

  • @Tyler Raymond, if she just now found out that her guy went out of business 6 months ago, that means she hasn’t gotten a listing in over 6 months. That’s why she’s broke and tries to haggle the price. I focus my marketing to agents that have at least 6 listings a year so they can afford the price. Those agents are successful because they have vendors they trust on their team, very little chance they’ll ever go with a run-and-gun vendor.

  • Great advice not to try and compete.

    To add a little, if you ever have to have the conversation (you will, it will start with “I really like your pictures but company X is doing it for only $99) then do some homework in your area and flip the question on them. There will be a company either on the web or a discount brokerage that is listing homes for 3%, or some other small portion of what agents normally charge. Don’t do it in a vindictive manner, but ask them to think about it this way. You’re thinking of selling your house and you need an agent. Brokerage X will do it for 3%, would they consider working for that?

    You already know what there reaction will be. That makes a great segue into the fact they aren’t buying 30 photos (my MLS), instead they are buying your experience and image quality, that you are the photographer and processor and are accessible to make sure they are happy, and they are buying a better future portfolio with better images.

    Photography is a fairly new business for me. I’ve been a broker for a lot longer, and they are dealing with the same problems from discount brokerages. If you can relate that to them they will better appreciate your value proposition, because they know how much more valuable they are then the discount brokerages. The ones that don’t get it are misers and you’ll do yourself a favor in the long run by not chasing them.

  • I’ve never competed on price and as a result this will likely be my last year shooting real estate because of it… Onward and upward.

  • @Scott – Excellent point! Several others also said, “don’t compete.” You are right make better pictures is important enough to be a separate point. I like the restaurant analogy because it makes this easy to understand that MacDonald’s doesn’t compete with Mario Batali.

    @David – Yes I think you are right. Know your market is essential. To use Scott’s restaurant analogy, here is Salem, OR we only have MacDonald’s and Applebee’s… no Ruth Chris Steakhouse or Mario Batali’s because the demand for great restaurants doesn’t exist here. To eat at Mario Batali’s I have to drive 60 miles north to Portland. The market for real estate photography is very different here in Salem too… very different than Seattle or Portland.

  • Just to clarify, I’m not leaving shooting real estate because I didn’t compete on price… I’m leaving it behind because I’ve transitioned into shooting exclusively for designers, hospitality and commercial advertising clients, etc.

  • I think that all established RE photographers can agree that when we started out, these bottom feeders bothered us and made some of us pause to reflect on whether our business model would survive these types of bait and switch companies. It’s hard to argue that your product and service will excel above the others when you are just starting out and have no history, let alone a stable of clients that rely on you for service.

    The fact is that you always have someone thinking they can do what a pro does for pennies on the dollar (just look at all the camera gear sold to newbie agents). You should be comforted by the fact that NONE of these companies have survived and the turn over rate is the same as RE agents in a office, all thinking there is a quick easy buck to be made in the business.

    The fact is that your product should outshine the competition, your service be honest, fair, consistent and your relationships with your agents/clients strong. This takes time and experience….something that cannot be bought.

  • If the first thing an agent says to me is to ask how much I charge, I normally do not want to work with them. Countless times I’ve been asked to reshoot listings that they had photographed by a cheaper photographer. I am in the Houston market, mainly in the Clear Lake area south of Houston, and because I offer such high quality photos, I have more work than I can handle. I do not feel I am in competition with the “run and gun” photographers because we offer different products. I want clients who value my artistic and technical ability to convey the emotion of a space. It takes time to develop these relationships, but I feel like if you offer a superior product along with excellent service, your business will flourish.

  • Here’s the answer for the question, “How Do You Compete With The Run-And-Gun and Drive-by Shooters?”

    Don’t.

    As Scott Hargis mentioned a few weeks back – the goal of photography for realtors is (or should be) marketing, always trying to net the higher end clients. Just as we are trying to get higher end clientele also.

    Running and gunning will (usually) produce poor quality images. As photographers, we need to market that the images we provide is a direct reflection to the marketing of realtors. People will understand this concept as they don’t want to be associated with crap.

  • @Barry

    I hope you’ll still post your pictures on the PFRE Flickr page even if they no longer qualify as real estate. You’ve developed a killer technique!

  • How about a higher cost for the photos and only get paid if and when the property sells. As a real estate agent, you only get paid for a sale when a person buys the property. It sound like agents take all the risk, but everybody else wants to get paid.

  • As a real estate agent you get paid when someone buys the house…because your job is to sell homes. Do your job and you get paid. Pretty simple. As a photographer my job is to create photographs. I do my job and expect to get paid for it when I’m done. Pretty simple.

  • Dave’s logic suggests that the painter, plumber, electrician, carpenter, landscaper, etc. etc. that work on the home, rely on the RE agent’s skill level for their compensation……

    Who made the agent King? If they do their job right, they get paid handsomely, if they don’t then maybe they should find another line of work.

  • Just something to think about when others might have a lower asking price. Another thing to remember is that the RE agent does not sell every home and often spends many hours and never gets paid.

  • I have two companies, one for video and photography, and one for real estate appraisals. Poor quality MLS photos hinder appraisers’ work in developing appraisals for properties, as they rely on the photos of comparable sales for indicators of quality and condition. I can’t advocate for the use of my photography company (I never mention it) when speaking with agents to gather information for an appraisal, but I can certainly explain the role that quality photos play in the greater picture of aiding appraisers’ understanding of a market.

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