Line Item Pricing Revisited And Changing The Dialogue

by seanlow on November 30, 2017

A few weeks ago, I had the opportunity and deep pleasure of speaking to interior designers in Boston as part of Editor-at-Large’s Launch series.  I talked about pricing and client management as I have done in New York, Atlanta and Los Angeles several times before.  Everything centers around the idea that value and process drive price, not the other way around.  Of course, the difference between subjective and objective value is critical as is the difference between cost of production and the investment required for the designer to do his/her work.

Then we get to line-item pricing.  I say that it is irrelevant and inevitably there is a “what did he just say” moment.  And then just as inevitably there is the “nice in theory, but you do not know how it works in the real world.  My clients expect to see these prices and would NEVER accept me not showing them.”  To which I say, “if your clients expect you to dance the two-step while presenting to them, are you going to do that too?”

This is our leaping off point.  How do we upend traditions/practices/language that only serve to keep us stuck?  Yes, I talked a little about old terms that need to die in my last post, but this goes deeper.  This post is about retraining both how we speak as creative business owners and also retraining clients to come to have a different set of expectations that will define the value they are paying for.

I happened to watch Back To The Future Series for the 10,000th time over Thanksgiving and what struck me is that the series did not contemplate all that we live with today.  The second movie (not my fave) is based on a stolen sports almanac book.  Actual book. It contemplated that fax machines and paper communications would still exist as they did in 1988.  No email, texting, etc.  My kids love it because it is so silly to them that this would the future someone imagined thirty years ago.  So too with line-item pricing.

Whether or not creative business stops the practice of line-item pricing is far less important than contemplating its value in the creative process.  If you use line-item pricing to justify the value of what you are spending your client’s money on, you are tacitly (or not so tacitly) saying that each investment matters as does the relativity of the size of investment to others (how much was the couch relative to the dining room table, the flowers to the catering).  What you are not saying is to judge the design on its own merits, to define absolute value and relative value by another measure, something other than dollars.

Three things then: first, can you work to convince your clients that using dollars to define the value of design (absolute maybe, but certainly relative) is a VERY bad measuring stick of value; second, can you define what a better measuring stick is; and third, can you be the third person in so as to shift the entirety of creative business?

Of course, where I am heading here is to define the power of the idea, to improve not only presentation but the presentation process, to demonstrate how valuable what you envision is.  This means not just investing in better tools of communication like virtual reality, 3D floorplans, etc., but also in storytelling, presentation skills, expository writing, anything that will bring your vision to life.

Until clients are deeply comfortable with the totality of your vision we will never be able to lose the idea of dollars as the definition of value.  If clients cannot become fully immersed in the story you and your creative business wish to tell with your art, you will be left dinosaur tools like money, the fax machine, mood boards, basic floor plans and table set ups.  However, if clients can be immersed in the story of your vision we can find out ways to value how they feel about what they have experienced from your vision, the way they are asked in just about every other area of their lives today (emojis, likes, swipe left or right, etc.).  And with that definition can they say that they value what they are going to have to invest to get it?  Relativism would then come from the series of moments created not by the price of the couch versus the dining room table, but instead about how they feel about the relationship between the two (i.e., how that relationship makes them feel and the depth of that feeling as you, the artist, would intend).

The whole point is to expose line-item pricing as fundamentally limited as a measure of creative value and offer the alternative of feeling instead.  I am not about to try to convince artists who choose to use line-item pricing as their measuring stick to give it up.  They are happy in their limitations and likely daunted by the challenge of telling a better story.

The creative business owners I seek to change are those who are ready to do the work, to truly go to the next level, to go to the place where we do not need roads (last BTTF reference — could not resist).  It will not happen overnight.  Drip by drip by drip in every market until there are no more fax machines.

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