No, I am not asking if you’ve been lost in an African jungle.  I am asking if you ever used a service or bought a product because it was an amazing deal?  You know, the $99 40″ LCD from Best Buy on Black Friday.  That type of deal.  Ever notice there is always a condition.  The store only has 5 or there is a rebate, etc.  Well, it is the same with those chain photo studios.

Gregg was in a store recently and saw a sign for their portrait studio – “16×20, 4-8×10,6-5×7 and 48 wallets only $12.99″.  I can’t even get the paper to print all those on for that cheap.  So you may be asking, why would a company advertise something that is losing them money?  It’s called lost leader.

Lost leader is a deal, advertise special or cheap service to get customers in the door.  Once in the door it is there opportunity to sell you other stuff.  Now, I know what your thinking, chain department store don’t come up and sell me when I go in for the deal.  But they usually have other items strategic placed around the tv, cell phone or photo studio that are impulse buys.  In the case of photo studios, they usually do something to keep you waiting in the store – appointment is running late, come back in in 15 minutes to see your pictures.  Any excuse to keep you in the store, just long enough to get you to buy something else.  But not long enough to leave and go shopping else where.

Now they are not totally losing their shirt.  Those $12.99 deal usually are only one pose and one specific background.  If you want a different background-it’s extra, if you want a different pose-it’s extra, if you need just one more 8×10 it going to cost you regular price, which is not cheap.

I know what you are thinking – what about the Picture People or Olan Mills, they offer deals like that.  Well, the Picture People is out of business in most locations.  I’ll guess, I do not know, that they tried to compete on price with the department store studios.  And they lost.  Olan Mills, they make some money in their portrait studio store by high pressure sales, but I’ll guess – again I have not seen their sales numbers, that they make the majority of their money on church directories.  Yes, volume is most likely what is keeping them alive.  Last time we got a picture for the church directory, it was nasty high pressure sales (“we can only do this for your church if you purchase pictures from us”), an ugly background (they photographed us on 2 different backgrounds) and if we wanted retouching it was an added charge.

Wal-Mart has learned that you can’t make money with lost leader photography. Since February, they have closed the studios in 529 retail locations. “Portrait studio operator CPI Corp. posted a loss of $43.9 million in its fiscal fourth quarter ended Feb. 4.”

Why am I telling you all of this?  Because I want you to be educated.  I want you to know that if something seems to be to good to be true, it usually is.