ASLU 082: Budget and Hybrid Pricing Models for Your Creative Business

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In Part 2 of a 2 part series on pricing models for creatives and their businesses, Melissa and Heather talk about budget (or “everyday” or “value”) and hybrid pricing models for both creative services and physical products. Team that up with last week’s episode on premium pricing models and you wind up with three very viable pricing models to choose from for your business. Which will be best for you?

As we mentioned last week, if there are two topics guaranteed to draw a lot of listeners to a podcast episode it’s pricing and mindset issues. And seeing as so much of pricing gets tangled up with mindset, is it any wonder both topics are so popular?

Pricing is an ongoing challenge for small businesses and big businesses alike and spoiler alert:

The challenge never goes away.

That’s right - whether it’s your first year in business or your 30th year in business, pricing is always something to be revisited and evaluated. There’s technology, the price of raw materials, labour costs, your expertise and experience, exchange rates and, good old inflation. They all fluctuate which means pricing is forever changing even if your financial needs don’t. And we’re not even talking about lifestyle wants or needs, being able to give back, or building wealth (gasp… yes… female creatives and artists are allowed and able to build wealth!!). If you want to have money you need to get comfortable with pricing your work appropriately.

And so this week and last week we’re talking about different pricing models, how they work and which one is right for you. Today, we’re focusing on budget pricing and hybrid (a mix between premium and budget) pricing models for both services (design, photography, commissioned work) as well as physical products (finished artworks, jewellery, candles, books, etc) and digital products (also books, music, digital artwork, stock photographs etc).

This Episode Is For…

  • anyone debating a change to how they price their products and services.

  • anyone tired of working 40+ hour weeks but still struggling to pay the bills with their business.

  • anyone who knows they're pricing their products and services too low but they're not sure how to raise them without frightening off customers and clients

  • anyone who wants to make sure their work is accessible to clients and customers with smaller budgets

NOTE: in this episode we are assuming you already have the nuts and bolts of pricing down and that you are pricing your work to be profitable. If you are not doing this, you need to work on this first and foremost and we’ll link to other pricing episodes below in the resources section at the end of the post.

If you just want the links to the resources mentioned in this episode, scroll down to the bottom.

Listen To the Episode

Here’s a to this week’s episode. You can also listen via the player below or on your favourite podcast app (Apple Podcasts, Spotify, Google Podcasts, Amazon Music, Stitcher, and more). Just search for And She Looked Up!

In This Episode We Talk About

In this episode we talk about:

  • budget or “everyday” or value based pricing models

  • hybrid pricing models that offer two or more tiers of service or products that encompass both premium and budget conscious pricing

  • what budget pricing is (and isn’t)

  • value pricing does not mean you have to sacrifice profit (you should never sacrifice profit!)

  • budget pricing usually means lower price points than you would have in a premium model so you need to make up for that with a higher volume of sales

  • packaging and bundling products or services into preset options (with no substitutions!)

  • lowering the cost of your raw materials

  • productizing services to be able to serve a larger number of people easily and increase your sales volume

  • customer acquisition to make those higher sales volume numbers

  • the digital download and print on demand market niche

  • multiple revenue streams

  • what a hybrid pricing model is

  • finding ways to use your catalogue of work in multiple ways at different price points: the original is the premium price point, the t-shirt is the mid range price point and the sticker is the value based price point

  • can you license your work?

  • looking to musicians and bands and how they leverage hybrid pricing models in multiple ways (a stadium concert is a prime example of a hybrid model)

  • knowing your audience and identifying your 1000 true fans (see the resources for more info on the 1000 true fans concept)

  • offering tiered services with differing levels of personalisation or customization or access to you

  • creating sub brands within your brand that can serve very different customers or clients

communicate

Mentioned in this episode

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Podcast EpisodeMelissa Hartfielsmall business, pricing, S3aComment