I got a lot of positive feedback on a previous post discussing pay to play and some basic economic principles. I gave a simplistic explanation as men with boners aren’t known for their comprehension skills 😛 but since you guys enjoyed it I figured I would write some additional thoughts. Unlike the previous post, this entry is going to be directed to other sex workers.

Something that I’ve been thinking about a lot lately is the concept of price in sex work. It’s a touchy subject because our industry is one that’s very personal. I’m not going to get into the argument of selling your body because frankly I think that’s bullshit, many professionals “sell their bodies” from gymnasts to construction workers. But I will say that there is a certain intimacy involved in adult industry transactions that make some take price personally i.e. directly assigning yourself a value based on the amount charged – the higher priced you are, the more valuable you are as a person and vice versa. This logic is obviously flawed, for many reasons. The basic one being that first of all, all of us are priceless. Yeah this is kind of mushy but it’s true. Only one of you exists in the universe, and if you disappear no amount of money will bring you back. So now that we have that out of the way…

I am all for sex workers charging the highest possible price the market will bear. I think there is an epidemic of people charging incredibly low rates who should be charging much more. I frankly feel sorry for some of them because they believe they must compete on price and price alone. This strategy is unsustainable for many. When your main selling point is low prices, what happens when everyone else lowers theirs too? You have to stay competitive, right? It just becomes a race to the bottom and everyone loses, including customers because from my observations the performer is not able to give his or her all. I spend a lot of mental and physical energy on my customers and expect to be well compensated for the exchange. Are there performers and/or customers out there who are ok with a more high volume, McDonald’s approach? Yes! And McDonalds is a huge company that makes millions of dollars every year. You can absolutely be successful doing the McFuck (ohhh I went there), but it doesn’t work for everyone, in fact I’d argue it doesn’t work for most.

So that brings me to, why you should charge higher prices.

Price elasticity. A more elastic good or service would be one in which demand has a negative relationship with price. Higher price, less demand. Lower price, more demand. Simple right? Well, not so much. Economists assume that human beings make rational economic decisions. Men with boners don’t make rational economic decisions.

But what does this mean? Well, your prices are not set in stone based on some arbitrary industry average. Sure, on a macroeconomic level sex work as a whole is very elastic. Prostitution prices have fallen since the recession. No such study has been done on online sex work that I know of. However on a microeconomic level it’s a different story, and prices become more inelastic.

What makes a product/service inelastic? There are many factors, I will be focusing on the one most relevant here, substitution. The less substitutes available, the more inelastic a product or service becomes. There is no substitution for you. Sure, a customer could want someone with a big butt, or green hair, or tattoos, but if they want you, your personality, your scent, your experience, they will pay. They will pay obscene rates. They will pay as high as the market will bear. Are there less customers willing to pay, or who will take a substitution? Yes. But that isn’t your target market. Separating yourself from the pack and being unique allows you to become more inelastic.

Veblen goods. Now, reading previously it seems pretty clear that higher prices, less demand and vice versa. However, we know that isn’t always the case. Here we have the mindfuck known as a Veblen good. This is where a product or service’s demand increases as price increases. Crazy right? Now, I’m sure my customers have noticed I’ve raised my prices from $6.99/$9.99 a minute on my main site to $9.99/$14.99. I am busier now than I was before. In the middle of slow season, summer. But why? Well, economics says the Veblen good effect. If given two identical options, one with a higher price point people will chose the higher price, almost every time. It is perceived to be of higher quality by function of price alone. Then afterwards you rationalize your spending decision and convince yourself how much the price paid was worth it.

Conclusion. There is a lot more I could get into about this topic since it combines a lot of my personal interests (sex + business + psychology) but I’ll leave it here for now and just say that you shouldn’t be afraid to charge higher rates. You are not competing with anyone but yourself.

M.