AH Photography Groupon

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Wanna see an example of a HUGE Groupon Mistake?

Breakdown of her Groupon deal

  • Giving away 15 Digital Images - She will get no add on sales after the session. None. We gave only three away and get no add on sales for most of them.
  • Delivering Digital images on Disc - There is a cost to the time that you spend pulling those images from a session, burning a disc and preparing it. Plus the discs cost something. Each delivery will probably take her about 15-30 minutes. Add that to the travel, shooting, scheduling and editing times and she has about 3+ hours PER CLIENT.
  • Online Galleries - Furthering the fact that she will make no add-on sales, she is going to upload images to an online gallery.

She sold 589 Groupons. She will make $20,320 total. A lot of you might be going, “wow, $20,320 is a ton of cash.” Let’s take a closer look, however.

Assumptions @ 589 Groupon Sales

  • Average 2 hours per client when you consider travel, shooting, communicating via phone or email, loading images to DVD and web, archiving images.
  • 40-hour work week = Full Time

If she averaged 2 hours per client, then she will have to work for 1,178 hours for her Groupon clients. In a month, there are 4.2 weeks on average @ 40 hours per week. Divide 1,178 by 40 and you get 29 1/2 weeks. 29 and 1/2 weeks divided by 4.2 weeks = SEVEN MONTHS FULL TIME.

$20,320 divided by seven months = $2,902 per month which averages out to be $34,834 per year. How many of you have salaries higher than that at a normal job?

More Assumptions - Cost of Automobile/Fuel/Maintenance - $1,632 Cost

  • Fuel = $2.50 per gallon
  • An average of 10 miles each way to meet clients (20 miles round trip)
  • Average of 20 miles per gallon for the typical vehicle

Thus, she will use one gallon per client. One gallon ($2.50) x 589 clients = $1,472.50

AND a total of 11,780 miles on her car. Hopefully it is not a lease. If she followed the recommendation of changing oil every 3,000 miles, then that would be four oil changes @ $40 or $160.

Equipment wear and tear assumptions $680-960

  • Average number of digital photos taken in an hour long family shoot (this is based on our averages with our Groupon clients over the course of the last year) 100
  • Canon camera body has a usable life of 100,000 shutter releases
  • Nikon camera body has a usable life of 150,000 shutter releases

With an average number of images taken, she will take 58,900 photos. That is roughly 60% of the usable life of a Canon camera. At a cost of about $1,600 for a Canon camera body, that cost would equal
$960

The Nikon cost would be about $680

Storage Costs - $100-200

  • 58,900 Photos taken at 20MB per Raw photo - 1,178,000MB or just over 1,000 GB
  • 58,900 photos conveted to jpgs at 10MB each - 589,000 or 589 GB

That is 1.6 Terabytes or about 2-3 hard drives worth of storage to hold the photos for the clients. Some photographers will delete them from their drives after delivery, so this cost could be negated.

Total Costs - On the low end - $2,450

Take the total Groupon income and reduce it by the costs and you get $17,870. Divide that amount by our seven full time months from the above math and you get $2,552 per month or $30,634 annually.

18 thoughts on “AH Photography Groupon”

  1. Ok… So what exactly is your beef with me??? Why do you feel it necessary to cut me down and say that I made a HUGE mistake. You do not know me, you do not know my business model, you do not know my circumstances and you certainly do not know my experience with Groupon.

    Reply ↓

    • I don’t have a beef with you. I don’t care whose name was on that Groupon deal. John Smith, AH, or my own. Doesn’t matter. Your case study is a mathematical example. You are correct. I don’t know you. You are incorrect. I do know your business model quite well. I also know your Groupon experience well because I read your deal and we ran our own Groupon last year.

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      • You may not have made a profit from selling on Groupon but I have ALREADY (only 2 weeks in) made over $XXXX in additional sales. You may think you know everything and that you are the “God” of knowing what is right for other photographers but please, please do not try to ruin my reputation or make me look dumb because you were unable to do well on Groupon. I can say that it is not the right choice for everyone BUT it WAS the right choice for me.

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        • You are incorrect. We made a profit on Groupon. I am merely trying to get photographers all over the country to MAXIMIZE their profits by structuring their Groupon deals in a way which will give them the most revenues for the least amount of effort.

          There is nothing in my case study of your Groupon that would “ruin your reputation” or make you “look dumb.” I would love to see all photographers, including you, make the most money possible on Groupon. It is a wonderful opportunity if structured correctly. Your deal was structured incorrectly. You will make money, but you could have created much more revenue for your studio.

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          • There will be a certain percentage of people who will not come back and there will be a percentage who will. Its all about how you run your business and generating referrals. I would take it that you don’t get many referrals because of how negative you are about photography. It seems to me that you are in the business only to make money not because you love it or because you actually care about the people you are photographing.

          • After one year of experience with Groupon, the vast majority of people will not come back to you at your full prices. We have asked several Groupon holders who said that they would just wait for the next Groupon rather than paying the full price of a local photographer. Since many photographers are willing to give away the farm in every city, those clients have a good chance of picking up another portrait session for a lower amount. Thus, your percentage of repeat clients will be very low unfortunately.

            Again, you are incorrect about the amount of referrals we generate. Our studio far exceeds the benchmark averages of other studios based on the standards of the Professional Photographers of America (PPA). If you refer to their benchmark survey, and compare our studio’s revenues and profit percentages vs the average the survey, you will find that we far exceed the averages.

            We care about having success in our studio while producing beautiful photography. If our studio doesn’t generate enough revenues, then we can no longer stay in business. Every business owner should want to maximize their revenues while producing a great product.

            Your assumption that a company would have to charge less to “care about the people you are photographing” is an incorrect assumption and can be completely discredited in every industry…not just photography. To assume that the closer to zero something costs the customer somehow indicates the care a company has for their client is plainly illogical.

          • Not everyone can afford to pay the outrageous prices that some photographers are charging. These are hard economic times and if I can help a couple people have beautiful images of their family….why not give back a little?

          • That is a fair choice. Looking back on our own experience with Groupon, we could have maximized our Groupon exposure even more and taken advantage of the fantastic opportunity that Groupon offers.

          • I (and several other photogs in the area) do not agree with what you call “mistakes”. We are all smart people who have made decisions for ourselves. I would really appreciate if you would take my name off of your blog and leave me alone!

          • Everyone has an opinion. Mine is based on experience, math, and logic. Also, it is based on the PPA’s Studio Management System which helps photographers make higher profits in their businesses. Your costs (COGS) vs the revenues are way out of line. If you took a moment to have one of their specialists consult you in your business, you would find that you would be much more successful even based on where you are today.

            By following their benchmarks and the examples of other very successful photographers, we have been able to triple the revenues into our studio and enjoy a thriving business.

            I removed your name from our site as requested however, your Groupon deal will remain here as a case study to help other photographers who are considering Groupon. We average 1-3 photographers from all over the country each month who seek our advice on how to maximize their Groupon experience. We are able to point them to several case studies like yours and like some of the photographers who have far outperformed the others. Like a basketball players statistics, we post the Groupons who have mathematically harmed their chances to maximize revenues.

            One photographer who sought our advice is on track to exceed $80,000 in revenues from only 78 Groupon sales. That will most likely far out perform your Groupon and he will work far less than you will work.

            More revenues and less work is something that many photography artists want. They want to be able to refine their craft and become better artists, thus creating better portraits and work for their clients. Having the time to be creative and be artists is something that many photographers who contact us would like.

    • I am not interested. I don't care whose name is on that Groupon deal. It is a poorly structured deal for AH. Similar to the several others I have written about in other cities.

      Perhaps it would be helpful to read further on this site. You will quickly see that AH is only one of several photographers that I list under the review.

      My interest is not in any particular Photographer. Rather, my interest is in the business deal that they are striking with Groupon. If photographers structure the right deal, then they will make a huge amount of revenue from the Groupon exposure. Structured incorrectly, they will work their tails off with very little revenues and profits compared with the hours they put into it.

      Unfortunately and generally, photographers use their own names as their business name. For this reason, some photographers take it personally when I use their company as a case study. However, this is not the intention at all. If they were named ABC photography, then it would perhaps not be taken personally.

      Like any business case study, you take the facts, apply economic and mathematic cost analysis to the facts and form an educated conclusion. With AH's case study, you can see I do exactly that using math and economics of time and scale.

      The fact that I write about our own Groupon deal and am willing to give away this information for FREE just to help my colleagues should indicate that I have interest in helping other photographers and not in AH.

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  3. I think you have way too much time on your hands to sit here and do your "mathematical" garbage on other photographers. I have seen you in several of these Groupon discussion boards trying to stray potential customers from buying their deal of the day. It is one thing to have an opinion, it is another to bash people over the internet based on your poor experience. Just because other photographers have better luck in additional revenue than you, doesn't make it right for you to post these retarded articles.

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  4. I love ur blog and very helpful, I just started my photography business and really wanting to use groupon to get my foot in the door, hopefully with ur cases I can make a good profit

    Reply ↓

  5. Hello Bill, I thought your review was point on. I saw it as an unbiased review. The bigger point I saw was how do we as photographers, present consistent products that return a fair profit. From what I have read from other post, Groupon wants more of each photographer for their profit and customer, but, it robs the service person of their true profit. The other point, is if we have a consistent model that we offer, then Groupon can’t so easily strong any one photographer.

    Reply ↓

    • Jay, you’re absolutely right and you get it. The idea behind my reviews of Groupon is certainly not to diss any photographer for their trying. Groupon can be an excellent vehicle to make a great profit, but it has to be kept in check. If a photographer sells 200 sessions, he/she is going to be slammed busy. That is my point. You just can’t sell 1,000 of these sessions, giving away the farm and actually make any real money. You’d be working for minimum wage.

      Reply ↓

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