I hired a guy to paint my house.  “I’d like it green,” I said.  “Green?”  “Green.”  He painted it green. Then I realized that when I had been telling him to paint it green, I really meant blue.  So I asked him to paint it again for me – this time, blue.  “Blue?”  “Definitely blue.”

“And by the way, you aren’t going to charge me for this revision, are you?”


A Problem Well Stated Is Half Solved

It was only a few years ago that I got my first request for a Mulligan.  It went something like this:
“How much will it cost to do this spot over?” 
“The same thing it cost to do it the first time.” 
“What?!  But Dave X. gives us free revisions.” 
“Free revisions?!  How much is he charging you for the first session?”
“Five hundred dollars.”  (I think my rate then was a little over $250.) 
“So Dave gives you two bites at the apple for $500, and I give you two bites at the apple for about $500.  What’s the problem?”

The problem, as I see it, is threefold:  By giving free/cheap do-overs, Dave is:
1) Hiding the price of the revision by shifting it to the first session, thus
2) Giving the wrong incentive to the client, and even
3) Giving everyone the impression that his charges are arbitrary.

Getting What You Pay For, Paying For What You Get

When I built my studio, I hired a contractor.  But before any hammering began, I needed him to give me a price so that I could get a loan.  But a price for what?  A price to build a certain structure according to very specific plans.  The blueprints were signed and dated by me.  Any changes after our agreement (and there were a few) would cause an adjustment in the price.  That seems equitable, doesn’t it?

When advertising agencies create campaigns for clients, they get official “approvals” at different stages.  (If our companies aren’t doing this, why not?) 

For any business I know of, the price quoted is based on a specific item to be made; client sign-offs are the usual order of business; and the client accepts the fact that he will pay more if he makes the job more difficult. 

Here is a brief statement of my policy, which I have lived by (and sometimes died by) since 1989 when I started Colors Audio:

If I make a mistake, I fix it.  No whining, no negotiating - I make it right, and with apologies.
If my client (or your client) makes a mistake or changes his mind, that party pays for the correction.

Or: The person who made the mess, cleans it up.


Binging At the Boo-Boo Buffet

The second problem with “free” revisions is worse: it teaches the client that changes do not carry a cost.  “There is no free lunch” – except at DaveCo.  Amazingly, under Dave’s system the customer forks over more per spot when he has his act together; he pays for a revision even when he doesn’t need one.  Like a patron of an “all you can eat” restaurant, he only gets his money’s worth by eating more than he normally would – that is, by creating useless work.  We have now set up a business model in which the clients’ interests are exactly opposite ours. 

Oops.

Yes, revisions are sometimes necessary.  But many times they could have been avoided – and would have been avoided if the client understood that he would feel some financial “pain” for not getting his ducks in a row before starting production.  “We learn by our mistakes” because our mistakes have consequences. 


Value – What A Concept

Perhaps worst, and most subtle, of the dangers of “free” or cheap re-work is that it sends the message that we are just pulling these prices out of thin air.  We can charge $1,000 on Monday for the same job we magically will do for free on Tuesday.  What is the real worth of such an effort?  It’s arbitrary.

Cost vs. Value

Some people marvel at the salary of a closing pitcher in the major leagues.  “That there ole boy jess came out’n threw four pitches ‘n’ made twunny thousen dollers.  Why, that’s 5 thousen dollers a throw!”  (This is supposed to be a moral argument: how can he justify charging so much, for so little work?).

Those folks don’t seem to get around to asking why the team is willing to pay him $5,000 per pitch when there are plenty of others who would do the same work for far less.

If that pitcher wins or saves the game, and keeps doing that most days, he will help create fan interest in the team.  More people will come to the games, and listen on the radio and watch on TV.  This creates income for not only the team, but for the guys hawking hot dogs and beer in the stands – even the teen parking cars.  It creates revenue to pay the new girl at the TV station in Podunkville airing the games.  It fattens the wallet of someone working in the “team shop” in the mall. 

If the good guys make the playoffs, our pitcher will have helped create a windfall for local hotels, restaurants, taxi drivers, and the entire local economy.  In short, the value of that pitcher’s performance is felt far and wide, and is actually much greater that his seemingly-outrageous paycheck.

A Candid Question:

How do we educate our clients as to the value of what we do for them?  (Tooting our own horns may be necessary).  Please think with me about that, and share your feedback.

In The Race to the Bottom, Forfeit

Someone may object that offering freebies will get us more work.  My response is that, yes, if we have to do everything twice for the same price as once, I guess we all can have more “work,” though maybe it’s more of a “hobby” at that point. 

My business objective is not to do more and more work for less and less money.  My objective – and your company’s objective – should be to do more work at a higher value, and therefore at a higher price.  Everyone starts at the bottom, but let’s not stay there if we can help it.  If your dream is to work your tail off for 30 years in order to finally be able to compete with the guy shooting “Complete Wedding Videos for $50,” that dream just might be a nightmare.

In Conclusion

I suppose it’s inevitable that misunderstandings should arise now and then about how services are priced.  Regardless of whether you agree with my position, I hope you believe that I haven’t adopted it in order to plunder the defenseless villagers.  The policy is based on my admittedly feeble grasp of economics, business, incentives and human nature; as well as on the traditions of the audio industry.  Your mileage may vary.

Thanks for reading and considering. 

Dan Popp
Colors Audio
April, 2008

P.S. June, 2008: Here is an excellent podcast aimed at eager voice actors, with a similar message.