A business model is a written description of how a business makes money. It is a broad overview of how a business creates and delivers its products and/or services. It can be broken down by market segment, location, pricing, competition, strategy, and financial planning. Perhaps the most important part of a business model is the Customer Value Proposition - a strong customer value proposition means your product or service helps to solve a problem or provide a benefit. The CVP needs to be clearly described because of its importance in the framework of a business model (Bloomberg Business Week, February 7, 2009). Every photography business should have a written business model that utilizes all seven components; it will provide a road-map for its success.
Recently, the photography business model has evolved with the development of digital cameras and the internet. The sudden increase of new photographers entering the profession has also resulted in the transformation of the entire business. With more competition, prices have crept downwards; new strategies have emerged to keep a business afloat. Niche markets have emerged as a means to focus on a narrower segment of the population. Reaching out to customers has changed dramatically with the advent of social network marketing. The internet has changed the way photographers market. For example, snail mail is no longer the preferred method of contacting new clients. Digital cameras and Photoshop have spawned new, innovative products, which could not have been imagined twenty years ago. Along with the increased variety of novel products, the delivery of products themselves has also changed. The photography business once operating in a studio or retail location can now be successfully managed as a home studio, on location, at customers' homes, or as a hybrid. The changes in the photography business model are apparent in all seven components.
Perhaps the most profound effect on the photography business model has been the digital camera. The explosion of the availability of digital cameras to the masses has resulted in many new people joining the ranks of the professional photographer. As a result, the market has become highly saturated Just look in any area now and you will find dozens of photographers advertising their services. Added to this onslaught are the folks who have lost their jobs due to the recession, and have become overnight photographers. With more photographers spread out, it is more important now than ever to specialize and develop a USP. The adage "being everything to everyone" is no longer a viable business model. Diversification is still important; however, be sure that you still diversify to a degree so you can have multiple income streams. The key to being well-positioned in a photography business is to focus on creating value for a narrow audience and create unique, signature products for your market segment. Choosing a niche market will create more value and desire for a product line and ultimately more revenue. In summary, the digital camera has changed the photography business model from a general to a more specific market.
The internet has affected nearly all business, and the photography industry is no exception. First of all, the internet has changed how photographers communicate with customers. Everything from online scheduling to email marketing has drastically altered how photographers contact new clients. More traditional forms of marketing, are being replaced with social network marketing, emails, and websites. As the outdated mode of marketing becomes less effective, photographers need be educated on the new strategies of using the internet to get their word out. Becoming well-versed in internet communications using Facebook, Twitter, and blogs is a critical component of the new business model. Second, the internet has changed how products are delivered. Online previews are becoming more common in the photography industry. However, photographers should think very carefully about adopting this as a part of their business model. Forgoing the one- on-one contact of an intimate sales environment can dampen sales. Nonetheless, there are two schools of thought on this matter. One group believes they are saving time by having the sales process automated online and can therefore concentrate on what they do best - SHOOTING PHOTOS. The other group believes selling comes first and photography comes second. The emotional ambience that can captivate customers during a photography sales session, in which one uses numerous selling techniques, cannot be replicated on the internet. It has been proven that photographers who sell by projection make more money (PPA Benchmark Study 2006). The two foregoing examples illustrated aspects of the photography business model that have changed rapidly in recent years.
A photography business model can certainly vary, as each business has its own set of circumstances that will govern how their model should be established. What it ultimately comes down to, however, is how a person wants to run their business. Everyone wants to make money, but for some the passion of photography is the most important goal. Consequently, every business model can and should be different to reflect the personal inclinations of the photographer.