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    The Problem With Competing On Price Alone

    John Melley - Monday, February 18, 2013

    I recently wrote a post: Are Your Low Voice Over Rates Your Own Fault? that generated a lot of comments here, several emails to me personally and also when it appeared on Voice Over Xtra.com.

    Several readers lamented that a lot of Voice Over has fallen into "Commodity" thinking. Since it generated so much interest and people wanted me to expand on this subject, I thought it required a follow up post.

    A lot of what I'm about to share may make people uncomfortable, but if we as an industry are going to have a chance at being compensated well for our talents, then we need to see our business in a larger context and as part of the overall economy.

    I'm probably about to kick over the beehive on this, but people want my opinion so here goes ...

    Here It Comes:

    Some of the Pay to Play sites, (some where it really is all about 'How low can you go') and other "talent" sites for various skills; have really done us all a disservice.

    But to be honest, it's part of a bigger problem affecting more than just those in creative endeavors. I believe it's one reason why the unemployment rate is still very high and why it will stay there for a long time until something changes.

    In my opinion, we're at a place in our country's history where a lot of people want their cake and eat it too. We want to be able to buy our products for next to nothing at Big Box Stores. And at the same time we want to have retirement plans and health care and a high standard of living.

    All nice things to have.

    A fair amount of those things are enforced through employer mandates which add to costs. (Yes, I'm dancing on the edge of politics, but it's reality.)

    Normally these costs are passed on to consumers. All businesses factor what its costs are in establishing prices for their products and services and to turn a profit, or they go out of business.

    The Model Is Not Sustainable:

    The problem is a lot of people don't want to pay the price for things that it takes to support the standard of living we all want. So to reduce costs, businesses get them made/performed elsewhere, or get people to agree to perform those services at "commodity" prices.

    At the same time, people HOWL when jobs are shipped overseas (necessary) to keep costs down so they can charge the prices people want to pay.

    I can say this from the firsthand experience of my family having owned a retail greeting card/social printing business for many years. (It's been closed for more than a decade now.) Try finding an independent Card store, or an independent Men's Clothing Store. They're rare.

    Bookstore? Music Store? These independent stores were the businesses that provided jobs that supported families, paid their mortgages, food bills and sent the kids to school. Now people are working 2 or 3 minimum wage jobs 7 days a week. That's what happens when price drives everything.

    Technology gave us a broad selection and choice, but what drove everyone initially was price. It worked. But I'd argue we lost something with it.

    It's an interesting dichotomy.

    We're All Guilty:

    How many of us have shopped at a low price retailer where "Low Prices" is the main marketing point? How many of us belong to a "Discount Club"?

    I'm not saying saving money isn't important, but it's almost an obsession with our culture. And that's why most people/businesses compete on price and that's not good. People forget there are factors besides price that people use to make their buying decisions. The recession has accelerated this.

    Low price providers and high price providers have all done well. The businesses left in the middle have been cleared out or have been the sector most affected.

    Entire businesses are created by aggregating talent pools and getting each of us to compete against each other - which is fine - but when we only compete on price and nothing else, that's where the problem starts.

    You Can Still Prosper:

    On the flip side, I've found through targeted marketing and some strategic planning you can still work with people who value your talents and will pay you what you would like to earn.

    It's about finding the right "WHO" to work with and positioning yourself in such a way as they see you as the expert and "go-to" person for the products and services you provide.
    But all of what I mentioned about targeting, etc. would be simpler if we weren't fighting a "mindset" of "cheaper is better."

    I welcome your thoughts.

     

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