| DamageX |
01-23-2006 04:20 PM |
Designer economics, here's how it works (re: good, cheap & fast)
Alright, there was a thread by LadyMischief the other day where some designers kept arguing that cheap is not necessarily bad. I'd like to argue that, in most cases, it is. Either that or the designer is dumber than a brick. Which isn't exactly a good alternative.
So let's pose the following situation. You have one REALLY cheap designer doing REALLY great designs. The guy busts his ass and knocks them out super fast. All his clients are extremely satisfied with the work he does. Some clients will be selfish and will not recommend him to any other people, in hopes that he'll always have time for them. Some will be less selfish and help the guy get some more business, by recommending him in designer request threads. We've seen those and we've seen recommendations. Which will result in more clients for the kick-ass, super-fast designer, which in turn will give him more testimonials and get the wheel spinning getting him even more clients. This cycle works in an accelarating manner, pretty much like any sort of viral marketing does. So before you know it, the super-fast, kick-ass, dirt-cheap designer is booked solid and has his hands full.
At this point he may implement some sort of scheduling (if he wants to keep a constant waiting time for all clients), while perhaps keeping his prices the same. This will split his client base into different types, those who can wait for a design, and those who can't (or don't want to). Additionally, those who won't wait will be split into two additional categories. The first one will approach the designer offering him a premium on his list prices, in return for letting them cut in front of the line. The second one will look elsewhere for designs, also paying a premium (compared with our case designer's prices).
Now, our designer is busting his ass for peanuts, but all of a sudden he's in such a high demand with buyers that they're throwing more money his way. He realizes his work is off the hook and he realizes that he'll keep enjoying a steady influx of clients, thanks to the quality he provides. How stupid do you think he'll need to be, in order to keep his prices at the same level? I'd say dumber than a brick. He will, without much consideration, raise his prices, because he'll work just as much, but for more money. Furthermore, he'll keep raising them till the point where he still enjoys a fairly steady influx of orders, but no more people bothering him on ICQ every day about when he'll be available to take on their order, for peanuts.
Bottom line? A good designer may be cheap, temporarily. But a cheap designer can't be good, if he stays cheap. There's enough business in this industry to go around to all designers. The smart ones will choose their target segments and work towards higher revenue, providing quality and fast turnaround. The ones that keep using low pricing as a strategy to compete are either not very good or not very bright. Or even both. Otherwise, being good AND cheap simply defies logic and simple demand and supply theory.
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