Today’s enlightening guest post comes from Walt Kania, a freelance marketing writer who discovered an eye-opening secret about setting your price.
Pricing is mostly in your head. Treat it that way.
By Walt Kania
I used to think that our fees as writers were pre-ordained by all sorts of fancy economic and accounting factors, like ROI or cost of goods sold, quarterly forecasts, or operating margins and EBITDA. I assumed it was mostly indisputable arithmetic. Or maybe sunspots.
Somehow, I thought that the fee I could get for that case study had something to ‘the struggling economy’ or ‘the credit crisis’ or something to do with Greece. When a client said “I can’t pay more than $600” I figured it was because nine slender spreadsheet geeks upstairs had calculated that their business model would implode if they spent more than $597.06.
Nope. It ain’t that logical.
Fact is, freelance rates (and prices for everything, by the way) are mostly random, arbitrary, irrational, wildly variable and hugely emotional. There are no formulas.
It’s 93% head game, 7% economics.
And that’s in our heads, and our clients’ heads, both. It’s mostly about habit, or convention, or a wild guess, or what someone else said, or what they paid last week. There is no logic or justice to any of it.
I have a long-time client who thought that $150 per hour for copywriting was unconscionable. “No way,” she said, “We can pay only $1250 for these customer articles and no more.” Funny thing is, that works out to about $195 per hour for my time. But she’s happy so I haven’t told her.
One time, I sweated for hours over a price for some marketing pieces that a client would be doing a few times a month. It was a recurring assignment so I didn’t want to be too high and blow it. But not so low that I’d lock myself into a losing deal. I changed the price in the email at least eighteen times trying to get it right. I finally got tired of figuring and retyping. I decided on $1650, sent the email, went to bed.
Next morning I read the email I sent. Yipe. With all the changing and retyping I had somehow screwed up. Instead of quoting 1650, I had typed 2650. A thousand dollars wrong. For the next hour, I panicked, trying to think of a way to recover from this debacle.
In the meantime, of course, the client emails me back. “Okay 2650 is fine. Very reasonable. Let’s go ahead.”
Uh-oh. Do I tell him it was a mistake? Or do I shut up and figure it was karma at work? Perhaps the angels had guided my fingers to the true and noble price, despite my cowardice. Maybe I should just high-five my dumb ass luck.
Turns out, I did none of that. After catching my breath, my first instinct was to worry. “Holy crap. What is he expecting for 2650? How good does he expect them to be? Can I pull this off? How many rewrites will he want? Maybe the last guy charged 3650. How do I compete with that?”
That is pretty much the same reaction a young photographer had when I told her to raise her rates for those shots she was doing for interior decorators. “Oh my God,” she said. “They will want the world for that.”
She felt safer being cheap. Way too many of us are like that.
Yes, it works the other way, too. I had been doing long video scripts for this Fortune 500 company, for like $2000 each. Then, after a few bribes, a friend set me up with the video guy at an even bigger-ass Fortune 500 company that did the same kind of videos. I figured I’d charge them $2,000, too. Or even bump it to $2500.
At the meeting, this fancy video guy says, very proudly, “We normally pay $1200 for these video scripts. I assume that’s okay with you.” Bigger ass company, lower rates.
Do not look for logic in this. And don’t try to hide behind it, either.
Here’s a trick question.
What’s the difference between a $1200-a-day marketing writer, and a $500-a-day writer?
You’re thinking: skill, portfolio, contacts, network, track record, confidence, who they know, domain knowledge, access to top markets, specialized skill, internet presence, blabbity blabbity.
Nope. Those are all excuses and rationalizations. (Many of which I have used, by the way.)
Here’s the difference.
One day, the $1200-a-day writer — for whatever reason — decided that her ‘get out of bed’ fee was $1200 a day.
It’s that simple. That irritatingly simple.
There was no voice from on high, no august body anointed her forehead with oil. There was no certificate of permission.
She just decided.
And that’s all it ever takes. Ever.
One day, you decide. It has to happen in your head first. Then it happens in the world. Wait for approval, and you will wait forever.
I know, you’re thinking: “That’s unrealistic. My clients would never stand for that. There is too much competition. The economy only supports $200 articles. This is suicide.”
Here’s the thing.
When you’ve decided you’re a 1200-a-day writer, you have your sights set on different folk. It happens automatically.
It has to happen in your head first.
Check out Walt Kania’s blog at http://thefreelancery.com