To see where this all started, check out my post from Tuesday: Student Loan Servicing Site #FAIL. My complaints from that post seem so...quaint...now.

Short story--the colossal failure of the federal government's student loan servicing site migration to myedaccount.com has gone from an annoyance to a serious concern for people's finances and private personal--and financial--information.

One Tuesday morning, I blogged a rant about the poor communication, site inoperability, and customer service runaround I encountered while attempting to pay off my student loans.  Here's my followup.

I am rarely an "issues" person, the kind you see tweeting a play-by-play of the latest scandal or inequity. I'm generally more of a shake-my-head-and-move-on kind of gal.  This time, though, I can't let it go.

Maybe it's that my several years in the web industry cause me to find this kind of incompetence and disregard for users offensive.

Or maybe it's that, in the face of an almost eerie silence from the media, I feel like someone has to document this mess for posterity.

Or maybe it's simply that this all started with me happily going to the old student loan servicing URL ready to submit a big chunk of cash to pay off the last of my student loans...and was robbed of that giddy moment by people who pretty clearly don't give a damn.

Maybe I'm just procrastinating.

Whatever the reason, every time I think, "That was may last tweet on this," I get pulled back in. (Inexplicably, I have gained more new followers than usual during my repetitive angsty tweetfest on this.)

During the past couple of days, this matter has played out like some sad comedy of errors. It would seem that, quite literally, every possible thing has been done wrong:

1. The worst of it are claims that personal financial information has been pushed to strangers' accounts (here, here and here). The exposed information allegedly includes names, account numbers, payment dates and amounts, and bank information.
2. Many people are reporting inaccurate payment records flagging accounts as past due, when bank records confirm payments were made on time.
3. Automatic payments are delayed, with no communication, sending many of us (myself included) frantically checking bank records and trying to access accounts. (Mine showed up in my checking account yesterday, 5 days late.)
4. Borrowers are unable to access tax information or deferment/forebearance applications.
5. Some borrowers, in a panic over missing automatic payments have sent checks in, only to see the automatic payments go through shortly thereafter.
6. The only communications regarding this matter have been a vague "we're working on getting the site up, sorry for the inconvenience" blog post from the Department of Education, and tweets from Nelnet representatives asserting that it's not their fault and we should call ACS.
7. Calling ACS has, for many (including myself) yielded only recordings that calls cannot be completed and to try again later.
8. Intensive searching of the internet uncovered prior communications with more information about the then-pending migration.  This information, however, was found only on the site for financial aid professionals, and indicated that a communications campaign in September would be alerting borrowers of interruptions to automatic payment.  Suffice to say, such campaign never happened...and this kind of detailed information was never sent out to borrowers.
9. Site messages, when present at all, have been conflicting.  At the moment, the homepage blames high site traffic for the trouble, while the account management login page says the site is undergoing maintenance. 

I would encourage you to visit the Department of Education's blog post. The comment thread is full of stories from borrowers who range from annoyed to panicking over their credit scores, to appalled at service and security breaches, to fearful of their immediate financial situation.

The migration of a critical system for hundreds of thousands, if not millions, of users has been handled like an Intro to Websites class project and accompanied by almost no communication.

Some of us are angry, some are legitimately afraid of the fallout.  All of us want to know how this happened and who is to be held accountable.

Anyone?

Just what do I think I'm worth?

One of the things I learned quickly upon starting Paper Swan Photography was that figuring out what to charge--and what to provide--is one of the most difficult parts of the job.  When I first started, like so many others, I simply took whatever I could get--or worked for free--and was (truly) grateful for the opportunity.

Now I am in another place altogether.  I'm not a world-famous 'rock star' photographer, but I'm not a baby anymore either.  In this middle ground, where so many of us reside, there is, it turns out, absolutely no standardization in pricing.  None. Zero. Zilch.

So I study the art and science of pricing...I eagerly absorb the advice of the rock star scions--those established, respected, well-known photogs who have discovered the secrets to success and offer up their advice and example.  I come away from their inspiring seminars and pricing guides thinking, "Hey, there really is a big value to what I do...I can make money doing this!"

Then I look at the other side, and encounter discussion boards full of low-cost shooters and brides irate from what they regard as price gouging in wedding photography...closing my tabs I think, "Is that really all it's worth?"

Clearly, pricing cannot be set on the advice of others.  Surely, techniques, psychology and considerations can be learned from the rock stars, but their pricing and clientele are well outside my reach at this stage. Pleasing the bargain-hunting couples, though I completely understand their reasons, is similarly impractical.  

I'm in the middle...not aiming for riches, but unwilling to work at a loss.  My fellow photographers occupying this place run a wide gamut of pricing, packages, styles, and experience; finding a median is, for all intents and purposes, impossible.

So I take a breath, pour some wine, and open Excel.

Where did I put that secret formula?

For a few minutes, I stare at my blank spreadsheet.  Ummm...okay.

The first run at creating something useful is to log and total my personal expenses.  Try to account for everything--knowing full well I'm going to miss stuff--add a multiplier for taxes and, voila, there's my minimum annual profit.  Divide by a target number of weddings per year, and there's my minimum average profit.  Fabulous.

That doesn't get me to prices, though. 

Next I try to hit a target hourly rate.  This is where I see just how many hours a wedding takes me--from initial consultations, to retouching, to album design, to file management...and oh yeah, shooting.  Wow...really?

I take all those hours, multiply by my target rate, and get another minimum profit per wedding.  This one is somewhat higher. Hmmmm.

Still not at package prices.

So now I have some high-level ideas as to what I need to make on a shoot.  Let's revisit those packages...some of the thoughts in my head:

• What is actually important to my target couples?
• Where do I really want to spend my time?
• What can I include that gives my couples a lot of value, but also makes me some money?
• How can I make it easy to choose?
• How can I create packages that result in the right mix, getting me to my targets?

Thinking on these questions, I create four packages...simple enough to reduce the work required to make a decision, but comprehensive enough to deliver lots of value and reduce hassles.  Some key decisions:

• Include the digital negatives.  Conventional wisdom says photographers should keep the negatives (aka, high resolution files) sacred and sell prints; historically, print sales have subsidized shooting prices, and photographers dread their work ending up printed poorly.  I've struggled with this from the start.  Reality check: I don't really want to spend my time selling prints. I want to take pictures. Also, digital is a way of life now...the Facebook share has for many couples replaced the gift print.
• Remove all 'or's.  My old packages (still posted as of this writing) include a couple either/or options.  My sense is that couples are already making a million decisions...it probably isn't helpful to add another one.  Reality check: Too many choices are paralyzing. Let's make this easier.
• Kill print credits.  I've always included print credits or packages in my offerings.  I really, really, really want my couples to get nice prints of some of their pictures; that so many photos today reside only on hard drives and Facebook saddens me.  Data is so ephemeral.  Reality check: Even with credits, it can take a long time for couples to choose prints.  A really, really long time.
• Keep hours unlimited.  This is a big one for me. I initially tried setting hours allocations (8 hours, 10 hours, etc.), but in practice stayed for the whole thing anyway.  Reality check: May as well make it official. Besides, who wants to negotiate extra costs with someone on their wedding day??
• Always include an engagement session.  They're fun, they let me get to know the couple, the couple gets used to having my camera follow them around, and a couple prints are a nice touch at the reception.  Reality check: Don't be silly, just include them!!

Okay, packages created. There's four of them. No idea what they'll be called, but I know there's four, and I (think I) know what's in them. Progress!

So now, a la carte listing, assigning retail value, hours, and materials costs.  What's the point of this?  It establishes the line item retail value...what I have to charge to account for the higher risk associated with cherry-picked products and services and make sure the margins are okay if that's all someone orders.  It also establishes that the goodies in packages aren't just bonuses...they have value and costs of their own (for both of us).

Now I add up the line-item retail for my packages. Zoinks! Yeah. Nope, definitely cannot charge that!!!

From there, it's tinkering.  How far can I discount my packages and still make the targets I came up with earlier?  And, yes, how can I make more profitable packages appealing and worthwhile to my clients?

Now we have prices!! Victory!!!

Epilogue

Sadly, I realize a couple days later that I have accounted for my variable costs, but not my fixed operating overhead.  Back to the spreadsheet...

Why did I tell you all this?

• I like projecting my inner monologue through my keyboard.
• I know there are many others in the same boat, and they should know they aren't alone.
• It's always interesting (to me at least) to see what's in other people's heads as they are making tough decisions.  I hope to show you more of it.
• I confess, I worry that people will see my prices as excessive.  By being transparent about my thought process, my hope is that even if someone feels they are too high, they will understand that it's not some sort of moneygrab.  There's a really, really good reason they are set where they are.

Final thought...I really, really wish I could incorporate more perspective on client value into this model. I hate vendor-centric pricing; for the moment, however, that's what I have to work with.

Enough about me, what about you?

 How do you set your prices (whatever business you may be in)?  And do you find this kind of blog post interesting/entertaining/useful?

Talk to me!! :)