3 Pricing Steps to Help you Charge Top Dollar
Pricing is tricky business. Everyone’s got a different opinion and there’s tons of conflicting information out there. You want a simple answer, but instead, you end up with your head spinning.
And what happens? You end up under-charging and competing on price.
While there are a lot of factors that go into pricing your services, there are three main steps to follow if you want to raise your rates and stop competing.
Figure out how much money you need to make
A lot of designers jump into selling their services before they’ve taken the time to calculate how much money they need to make.
I saw other web designers selling websites for $500- and decided that was the price I needed to charge. So I did.
And then I spent my entire first year in business working my tail off, only to end up with $12,000 at the end of the year. Not nearly enough to live off of.
My mistake? I had no idea how much I needed to cover my expenses every month. $500 seemed like a lot of money at the time (never mind the fact I also often discounted this in order to compete and land jobs), and sure, it’s a nice chunk of change. But it wasn’t anywhere near what I needed in order to pay my bills, and I ended up working with a lot of clients at once, juggling projects, and working for months in order to earn that $500.
Once I realized my mistake, I sat down and calculated out how much money I needed to make each month, as well as how many projects I thought I could realistically juggle (and sell) at a time.
The result? Far more than $500.
So I had to figure out how on earth I was going to sell websites for my new prices.
Calculate how much money you need to make! Watch my free mini-course on how to charge $1,000 more for the websites you’re already making here! https://erinflynn.com/add1k
Stop treating yourself like a commodity
So now you know you’ve got to charge more, but how do you do it?
When I first wanted to raise my rates I did it wrong. I went from designer’s website to designer’s website and I looked at what they were doing.
The problem? They were doing it wrong too.
Everyone was treating design like it was a commodity.
You might be wondering what I mean by that--what I mean is that they were selling lists of tech and features and competing against each other to offer more, for less.
And when design is a commodity, it may as well be gasoline.
You probably don’t care which gas station you go to. And given the choice, you probably just go to the one with the cheapest gas price.
The same thing happens to design when you treat it like a commodity.
A potential client comparing designers who is given a list of tech features as the main selling point, will go with whichever designer is cheaper.
For example, let’s compare two web design packages:
Designer A’s Package - $1,000
Custom WordPress theme
3 Plugins installed
3 Page templates
Designer B’s Package - $1,000
Custom WordPress theme
3 Plugins installed
5 Page templates
Which do you think the potential client will choose? Well, they probably don’t have any idea what a page template is, but they know if they go with Designer B, they’re getting two more for the same price, so Designer B will win every time.
When you list your services this way--whether it’s web design, brand design, or something else--you’re making your work into a commodity. It’s a list of tech or features, and nothing more, so clients will always choose to get more for less.
And the result? A race to the bottom to try to land clients. You end up like I did, always adding more without increasing your prices, to try to convince clients that they should hire you.
Until you end up doing so much for so little, that you think you might snap.
But what else can you do?
Stop competing on price and tech/features. Remove those pricing tables from your website!
Sell the value of what you’re creating
Alright, so if you’re not selling a bullet-point list of stuff to your potential clients, what do you sell instead?
The solution to their problems.
Here’s the deal: Clients who pay top dollar aren’t buying a brand or a website. They’re buying something that will deliver results.
And the results most clients want? More leads, more sales, and saving time.
If what you offer can do any of those things, you can charge based on the value you’re providing, instead of tech skills or bullet points.
Once I switched to selling the value my websites delivered, I was able to raise my prices drastically. I went from $1,000 to $5,000 within about two months. And got more clients! And then I went from $5,000 to $10,000+ after just a few clients.
How? Because I was providing a solution to my clients’ problems, and selling that instead of the tech.
How much would you pay for a brand design that included 3 logo concepts and a color palette, along with a business card design? Well, you might be a bit biased, but go ahead and put a mental price tag on it.
Now think about how much you’d pay for a brand design that attracted more and better clients, that helped gain the trust of potential clients automatically, and that resulted in an increase in revenue? I’m guessing the mental price tag you’re assigning is higher than in the previous example.
The same goes for websites, of course.
How much would you pay for a website design that included a custom WordPress theme and plugin installation of three plugins? Probably not a huge amount.
But how much would you pay for a website design that turned browsers into buyers, that grew your email list, that saved you time from answering questions and making sales, and that increased your profits automatically? Probably a lot more.
Nothing about WHAT you’re selling needs to change, just HOW you sell it. Instead of bullet-point lists and features that make you look like a commodity, focus on how what you do solves your clients’ problems.
Clients will pay a lot more for a solution to their problems than they will for a bundle of files.
When you sell the solution, it’s easy to charge higher prices, and even cover your monthly income goals with just one sale.
And amazingly? Clients are easier to sell to, and much more willing to hand over their money.
Reframe your services to sell the value of what you provide. How does your service solve your potential clients’ problems? Watch my free mini-course on how to charge $1,000 more for the websites you’re already making here! https://erinflynn.com/add1k
There are a lot of factors that go into pricing, but in order to charge premium prices you have to follow these three steps.
Make sure you know how much money you need to make, and your income goals. Selling your services without knowing how much you need to make or how many projects you need to sell to cover your expenses is a recipe for disaster.
Don’t be a commodity. You’ll always end up competing on prices and racing to the bottom in order to land clients. Stand out from the crowd and ditch your bullet-point lists and tech talk.
Sell the value of what you offer. When you sell the solution to your clients’ problems, they are willing to pay premium prices for that solution. You don’t have to change what you’re offering, just how you present it. What is that solution worth?
If you follow these steps, you’ll be able to charge more and stand out from the crowd.
And if you need help? Watch my free mini-course on how to charge $1,000 more for the websites you’re already making here! https://erinflynn.com/add1k
Erin Flynn helps web designers make more money without working more. A web designer since 1999 and a small business owner since 2012, she’s spent the past six years figuring out the business part of running a freelance web design business so that you don't have to. When she’s not teaching designers or working with her own design/development clients, Erin can be found exploring the mountains near her home in Aspen, Colorado. Find out more at erinflynn.com