Back when the pandemic hit, my wife and I were eager to take advantage of all of the time we were spending at home by exercising, so like thousands of other people, we purchased a Peloton bike and started exercising a lot. As a mountain climber and backpacker who typically carries over fifteen pounds of gear into the backcountry, I saw the Peloton as a great investment to ensure I stayed in excellent shape for my adventures. The bike itself cost us a pretty penny (you can now get one for $1,445), and the service requires a $44/mo plus tax subscription to their classes. From a business perspective, their model is incredibly smart and offers people who are serious about getting in and staying in physical shape a very good product to help you solve that problem. After-all, the best way to think about anything you spend money on is to consider what problems it solves for you or how it makes your life easier.
How Peloton Lost a Sale
Fast forward to 2023 - my wife doesn't really enjoy riding the Peloton as much as me, but she still uses the app to do strength training; and, she has become interested in buying a treadmill to help her stay in shape. As loyal subscribers since 2020, we've given the company over $1,000 of our hard-earned money to help us with our exercise goals, despite the fact that there have been months where neither of us used the service. For me, Peloton has been a great way to stay active in the winter and to continue my goals to get stronger. So that's why this past weekend's encounter with their help desk was particularly strange and why I think it is a perfect illustration of how not to price your "work." Since my wife was interested in picking up a treadmill, we began researching different treadmills, knowing that Peloton had their own version (albeit quite expensive).
We landed on either wanting to get the Peloton Tread, which would have cost us over $3,000, or to get an equally capable treadmill from Nordictrack for $2,000 less. The catch with the Nordictrack would be that she would have to use another subscription app, iFIT, to have a similar experience as she'd have on the Peloton. Since we were already familiar with the Peloton experience and ecosystem, we figured that might just be the best choice even though the cost was higher; however, we figured as existing customers and long-time subscribers, surely they would have a discount for us on their treadmill. So I did what any smart husband would do and reached out to their customer support to ask if they had any such discount. I gave the customer service representative all of the buying signals you'd dream to get as someone selling something - I indicated that I was about to hit the buy button and that I was hoping there was a discount for loyal customers. To my dismay, no such discount existed.
So we went back to the drawing board to research alternatives with a clearer mind and more objective perspective having been shutdown by the Peloton representative. My wife found a perfectly good alternative treadmill from Nordictrack that cost far less, and even if she were to subscribe to their app, it would take us FOUR years to account for the price difference between the Nordictrack and the Peloton.
The Lesson for Photographers Selling Art or Services
Hopefully at some point in your photography career you will develop and establish a loyal customer-base, whether you provide a service or sell goods. Returning customers are so much easier to maintain and sell to than marketing to new customers because they have already had a good experience with you and your brand and know what they are getting. As such, when your returning customer gives you the indication that they are interested in buying more goods or services from you, you should pay attention. In the case of Peloton, what makes this lesson even more poignant is that they have a subscription service that they are getting monthly payments for. This means their existing customer base is an amazing target to sell additional goods and services because they are already bought into the ecosystem. It is my opinion that Peloton has it in their best financial interest to discount their equipment as much as feasible, knowing that their subscription service is needed to use it effectively, and there's nothing more incredible than a consistent income stream like a subscription service. Imagine if cable companies charged you $1,000 for the cable box - it would deter new users from subscribing (as if cable companies need any more hurdles to gain and keep customers), and it would all but ensure their financial demise.
Pay Attention to Buying Signals
First and foremost, it is absolutely crucial that photographers understand what the buying signals are from their customers. They include questions and statements such as:
- How can I pay you?
- Do you accept credit cards?
- Do you offer any discounts?
- How is your artwork shipped?
- Can I ask you some more questions about your services?
When you hear these statements and questions from your customers, there's a very high likelihood that they have already determined that your goods and services are in their price range and they are just looking for confirmation from you, the seller. Spending time to care for your customer when these questions are raised is an important step to closing the sale and for creating a positive customer relationship.
If you're looking for more tips on selling your photography artwork and services, I highly recommend the podcast I recorded with Nikki Rausch.
On Discounts and Photography Art & Services
Now obviously I'm not suggesting that we all race to the bottom to offer our customers the best discount possible here. I also do not know what it costs Peloton to manufacture their treadmill; however, I have a strong suspicion that it is far less than what they sell it for and that they probably internally understand the value of their subscriber base. That is why I found this interaction so fascinating. What I am suggesting is that when you have an established customer who gives you a signal that they are ready to buy your product, it probably makes sense to make it happen within reason. I know not everyone would agree with me that providing discounts is a good idea; however, I bet if Peloton even offered me a meager 5% or 10% discount, we would have pulled the trigger on their treadmill knowing it would have a less steep learning curve and we could stay within their ecosystem. By rebuffing my request for a discount, Peloton cooled my buying signal and lost out on a sale. By the way, if you want to join me on Peloton, it would be cool to have you join me! My Peloton user name is MattPaynePhoto.
Have you had a similar interaction with your customers or as a buyer? I'd love to hear about your thoughts in the comments!