Opinions And Ramblings By Adam Kmiec On All Things Media

Tag Archives: Price

Price vs. Value

It’s not secret that I think Chris Brogan might be the biggest snake oil salesman ever to walk the land.  The other day he might have jumped the shark.  Chris shared with the world his “day rate.”  Are you ready for what it is?  Sit down.  Get comfortable.  Please don’t have any water in your mouth as I am not responsible should you choke on it.

Ok, here we go.  Chris Brogan’s day rate is $22,000.00.

Did you just say WTF?  I know I did when I first read it.  Let’s break this down.  At $22,000.00 a day, he’s worth $8,030,000.00 per year.  What does that really mean though?  Let’s add some context shall we.  That annual “salary” would make him 2x more valuable than Drew Brees, 8x more valuable then Evgeni Malkin (and only 1 million less valuable than Sindey Crosby) and roughly the same cost as having both Dustin Pedroia and Kevin Youkilis on your team.  You might ask why I picked professional athletes as a comparison point.  Well I did it for two simple reasons

  1. The public often complains about the skyrocketing and out of touch with reality costs of super star athletes
  2. We’re passionate and attached to our super star athletes

Usually with athletes we have a way of comparatively reviewing them against their competition.  Whether this as at the contract negotiating table or the arbitration table, this happens all the time.  Athletes and owners will often lament that it’s not personal, it’s business.

Heck, even Chris argues, “Pricing. This isn’t black magic. It’s business. It’s commerce. It’s fairly basic.”  Well, he’s right about it not being black magic.  He’s right about it being fairly basic.  Let’s see how basic it is:

Price: Price is the starting point for what the owner/author/provider/etc. thinks something is worth.For example, the suggested retail price of Trust Agents is $24.95. That’s what Chris thinks his words are worth on a per book basis.

Value: Value is what the market deterimines something is worth. For example, this copy of Trust Agents currently being sold for $6.00 on eBay.  Hmmm…$6.00 sure doesn’t seem like $24.95.  Actually it seems like people value Chris’ words 75% less than Chris does.  Well it’s like Chris said, “This isn’t black magic. It’s business. It’s commerce.”  Well said.

I don’t begrudge Chris charing $22,000.00 a day for his “services.”  On multiple occasions I’ve asked him what those services are and what he’s actually done, but he’s yet to respond or provide any real backup to substantiate he’s capable of doing what he says he can do.  And it’s for that reason, that while Chris’ price is $22,000.00, I value a day with him at $1.05.  That’s the cost of a McChicken + Tax.  It seems appropriate, at least with the McChicken I know what to expect from the experience.

So, Chris is right, he charge what he wants and I can pay what I want.  Although, there seems to be an interesting gap between price and value doesn’t there :)