f ō t ō r a c l e | the oracle of photography

The AP reported this week that my favorite warehouse store, and probably yours too, Costco, is no longer carrying Coca-Cola products in its warehouse stores.  Hard to believe, but it’s true — no Coke on Costco shelves.  Costco made this decision because the chain can’t come to an agreement with the soft drink maker.  According to Costco, Coke isn’t being competitive with its pricing, and Costco — a brand that’s identified with value, wants to keep it’s prices low.  Costco is so committed to keeping prices low for it’s members, that it’s willing to risk its relationship with Coke, one of the largest and most powerful brands in the world.  Why would Costco do that?  Because Costco management knows that the strength of the Costco brand is built on giving it’s members optimum value.  Rather than weaken it’s brand, Costco knows that being loyal to its brand identity and customer base is critical in maintaining the leadership position it has within the marketplace.

We can look at Costco’s bold move and learn a a few very important lessons on branding and marketing our photography businesses:

1. Identify your clients
   Costco really knows its customers.  Costco has always been a “members only” club store that continually succeeds at meeting the needs and wants of its members.  As pro photographers, it’s just as important for us to understand the needs and wants of our target client base, and then provide a solution for them.  When we make our businesses truly about serving our clients’ wants and needs, we’ll see our businesses grow in record time.

2. Create value
   Benefit – Cost = Value (Benefit minus Cost equals Value)
   It’s no question that Costco is known for delivering value.  Just like Costco, we have to deliver value to our clients.  Value doesn’t necessarily equate to the lowest price, so please don’t confuse the two.  For the most part, Costco sells commodities – goods and services you can buy anywhere.  But if you can buy the same stuff down the street, why would you want to pay for an annual membership to Costco?  Because Costco delivers value with more than just lower prices.  Some of the added value at Costco is the larger sizes, the member services, and exclusive products that only they carry.  Costco knows what it’s members value.  Do you know what your clients value?  Do they value only price or do they value more?  Maybe they value award-winning images?  Full service attention?  Experience?  Personality?  High-quality albums?  It’s most important to identify what your clients value and then determine what benefits and, at what cost, you can deliver those benefits to them.  That’s what creates value.  Keep in mind that what your clients value are not necessarily what my clients value.  Part of identifying your clients’ values is to determine how uniquely you can provide benefits to them.  The more specific and unique the benefits you  provide, the greater your value will be to your cliens, and ultimately, the cost to hire you will increase in accordance to your value.

3. Be confident
   In order to negotiate so fiercely with Coca-Cola, Costco has to be confident in its position at the negotiating table.  Costco has about 57 millions members worldwide.  That’s a huge customer base that Costco is betting that Coca-Cola doesn’t want to loose, especially considering that Costco still carries Pepsi products.  Also consider that Costco carries a selective line of products — usually limiting the selection of any type of product to only one or two national brands and sometimes offering their well-respected house brand — Kirkland.  Costco has mastered the business of warehouse club sales, from the way it deals with vendors, employees, and members, it is a success in all accounts.  Like Costco, we need to also be confident in ourselves if we are to be successful in the photography business.  It’s not only important to be confident in creating fantastic photographs, it’s even more important to be confident in all areas of your business.  Do you have a solid contract?  Is your equipment reliable and do you have backups?  Are you insured?  Is your bookkeeping accurate and up-to-date?  Do you have positive referals from satisified clients?  Have you been published?  Do you have a strong network of wedding professionals to refer you?  The more of these things you can say yes to, the more confident you will become, and this type of confidence is important in creating and maintaining your brand identity.

So there you have it — three lessons we can learn from Costco in brand identity.  Now if I could only learn how walk out of Costco without wanting a slice of their killer pizza!