Service that Scales: Pricing Guidelines, Tips, and Strategies for Freelancers

Take a look around any online marketplace and you’ll see the labor of designers, writers, and digital artists severely undervalued. In a short-sighted shoot for ultra-low prices, online entrepreneurs are aiming to spend less and less on services, and unfortunately many online providers are following suit with their pricing.

One element of the issue is an ignorance of the value of great design. Since Photoshop became a standard installation on a lot of high school PCs, everyone under 18 with enough time on their hands could pretend to be the next big designer. The prevalence of basic design abilities has lead many people to think that great design is easy.

We’ve all heard the horror stories about clients demanding infinite revisions and 50-page websites for under $150. They’re not particularly nice to hear, but in many ways designers effectively bring them upon themselves. By not setting clear pricing and a long-term marketing and business strategy, a lot of designers, writers, and other online workers push themselves into a corner with their business.

Being a successful designer isn’t just about your design ability. In the end, it’s the designers with the best marketing abilities, the best client management skills, and the best abilities to find great clients that end up on top. These strategies can help you expand your design expertise into scalable business and an income that you deserve.

Marketing On Price

Don’t do it. For those that don’t know, marketing on price is essentially the strategy that many big-box retailers take to bring in customers. They offer the lowest prices on their goods, and make up for the reduced margins by selling a much higher quantity than their smaller competitors.

Not only does price-based marketing not work for long-term online workers, but it effectively devalues the time and skills of everyone in the industry. When you’re selling a service – in this case a design service – there are no margins to think about. The only non-monetary currency is your time, and devaluing it to take on more clients isn’t a good strategy.

Would you rather work 60 hour weeks at $20 per hour or 30 hour weeks at $40 per hour? Taking on more projects isn’t always a good way to increase your income. Instead, you need to start marketing yourself according to value. There will always be ultra-cheap, low quality providers around. Let potential clients know that you’re worth your time, and not the value of other providers.

Taking On Per-Hour Projects

Another poor strategy taken by some designers is the per-hour pricing model. This is quite common on websites like Elance and other freelance marketplaces. In exchange for the potentially larger per-hour income of a performance contract, many designers choose a per-hour pricing model, essentially securing their rates and work commitments before they begin.

From an income security point of view, this isn’t a bad position to take. The security of a wage means that even if you get very little done, there are still earnings coming your way. Of course, few per-hour contracts end up being lucrative for the designer. Instead of steady work, they’re assigned far too much work to be completed in far too little time, significantly dropping the value of their time.

Whenever possible, take on projects that pay for performance. If you have the skills to complete their project quickly, a performance-based position can bring in significantly more income, and also free up your time to focus on your own projects, acquiring and refining skills, and enjoying life outside the office.

Bidding For Clients

Bidding websites may be good for filling time between major projects, but they’re not a long-term work platform for designers. When you find contracts through bidding websites, you’re forced to compete on price – other designers bid low, and the artificially low prices skew the entire marketplace. While it’s possible to find some good clients through bidding websites, they’re largely overwhelmed by low-cost, low quality providers.

The best investment for any online freelancer is their own web presence. With some simple promotional efforts, you can have clients coming to you instead of you having to chase them. When you control the stream of opportunities, you’re able to decide what you’re time is worth, how you’ll manage contracts, and what projects to take. Bidding websites are short-term; your own web presence is a scalable strategy.

If you’re an absolute beginner and want to get up and started quickly, even a free WordPress blog is enough to attract prospective clients. The focus of your first few months online shouldn’t be taking on as many clients as possible, but creating a web presence that allows you to take on worthwhile clients. Endless grunt work brings in income straight away, but it also robs you of the time required to expand your business, develop the connections that are necessary for worthwhile contracts, and focus on refining and developing your goals.

Your Turn To Talk

I hope you enjoyed this post! Please feel free to chime in and share your thoughts by leaving a comment below! Any points you’d like to add or discuss or stories you’d like to share? Please do! :)

About the author:

Mathew Carpenter is a 17-year-old business owner and entrepreneur from Sydney, Australia. Mathew is currently working on AddtoDesign, a website which provides value added design buzz. Follow Mathew on Twitter: @matcarpenter. Follow the development of @AddtoDesign.


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