Thursday, June 14, 2012

Why Brand Consultants Have To Charge A Lot

Photo by me.
 
Books are free if you go to the library. A framed picture of books costs more. Which one is more valuable?
 
Apples are healthy. They're twice as expensive at the convenience store as at the grocery store. More if you get the organic kind. Which one is most valuable?

I can buy a glass bowl for the apples at the thrift store for $3. Or pay $20 at Target. More if I go to Macy's, Bloomingdale's, or an out-of-the-way boutique in an expensive area destined for shoppers.

Which one, which one? How much would this photo, a photo I took myself, cost if you had to pay Getty Images for the privilege?

Someone paid $120 million for Edvard Munch's painting "The Scream" just this May. You could make that same pose, photograph it and Photoshop it with a cheap mobile app. Would it not be comparable?

We value things the more they visibly cost us. Anyone can have a child, and parent's can't get fired, right? So it is common, sadly, for even "good" parents to ignore the kids for the Blackberry - because jobs outside the home pay money.

Like that famous song "The Cat's In The Cradle," we pay the price for that ignoring way down the road.

How much to charge, and how much should be charged, is a paradox for consultants, including brand brand consultants.
  • On the one hand there is pressure to charge very little - due to competition, the availability of free advice, and frankly (yes, it's true) the desire to help. 
  • On the other, obviously, nobody works for free and the consultant is there to make as much money as possible in the least amount of time. So they build up a brand name and then charge "what the market will bear," e.g. as much as possible.
Yet aside from the livelihood factor (the rational economic reason) there is a more fundamental issue with respect to price from the customer side: People only value things that cost them dearly.

Many people only drink water that's bottled. Follow diets they pay for. Exercise where they've bought a membership. And in just the same way they change behavior when the cost of the advice is $250 an hour or more.

Makes one wonder what kind of an economy we could have if we committed to sharing.

Think about it - have a good day - and good luck!

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