Pricing is scary as a freelance web designer.
Ask for too much and you run the risk of losing the project.
Price too little and you might get taken advantage of by a client and miss out on some serious “dough.” ?
Before we dive too deep let’s talk about some principles
Time-Driven vs. Value-Driven Pricing
A lot of clients will ask for your hourly rate and even some freelance web designers swear that hourly charging is the only way to go.
Here’s the thing though, you can only go so far charging people hourly.
Why is that?
At a certain point, what you’re worth won’t match what someone might be willing to pay if it’s framed by an hourly rate.
Think about the financial transactions you make. All of us are willing to give away something we have to get something we feel is of greater value.
Stay with me for Econ 101 here.
There’s a lot to the value of something that has nothing to do with a price tag. For instance, I don’t buy Starbucks coffee because it’s the cheapest product on the market. It’s not.
I buy it because I like the way Starbucks coffee makes me feel about myself. Don’t laugh at me we all do it in some form or fashion. It’s just good branding. I buy it because I’ve dialed in exactly how I like “my” drink. And, I buy it because it’s convenient. There’s a drive-through on my way to work.
I could buy Dunkin coffee which is cheaper and also on the way to work. But, I value Starbucks coffee more than I value Dunkin coffee despite the price and convenience.
When you give a client an hourly rate you are communicating that your value is attached to the time you spend on the project. And, there’s so much more that you have to offer a client than just HOURS WORKED.
- time savings (you do the work so they can focus on more important things)
- expertise (you’ve spent a lot of time developing skills they haven’t)
- future success (you’re setting the client up to win down the road)
These are all value-based benefits you are passing along to your clients that are pretty hard to translate into an hourly rate.
And, as you grow as a freelance web designer, it will take you less and less time to accomplish the things that need to be done in order to give the clients the value you offer.
So, in order to really charge what you need to charge a client, you have to eventually stop trading time for money and start trading VALUE for money.
How to Know Your Value
The next question then is “How do I know what my value is?”
There are two parts to that:
- How much the market determines
- How much you can communicate your value
How Much the Market Determines
How much the market determines is pretty simple to figure out but it takes some time.
If everyone says yes to you then you’re charging too little.
If everyone says no, then you’re charging too much.
You want to have a mixture of people telling you no and yes. That’s your sweet spot, and that’s what the market determines is your value.
When I first got started I called a few other web design freelancers and asked them what they were charging. The range was pretty big all the way from $500 to $7000 per website.
Since I was just getting started and had no experience, I went towards the lower end and asked for $750 per website. If you’ve been building websites for longer you’ll start much higher. It depends on skill and experience.
With every project, I would raise my rates. I was always worried that people would tell me no if I asked for more than my last gig but for a long time they didn’t.
In fact, it was about 2 years before I started getting more nos than yeses.
When I hit that point, I leveled off and knew what the market valued me as.
It’s since gone up because with more experience comes more value.
So, my encouragement to you is to pick a price. Don’t do it randomly. Find out what other people are charging who are equal in skill level and base your price off that.
Eventually, you’ll start getting a lot of “You’re too expensive for me,” comments from clients. That’s when you know you’re approaching your pricing sweet spot.
BUT, be careful not to put to much weight on the word of 1 potential client. I’ve had conversations with a few folks that tried to convince me I was charging too much.
My response is always, “If that were true then I wouldn’t have 10 other people that have hired me at that rate.”
Typically, these folks are nightmare clients and just trying to get a “screaming deal,” from me.
You’re looking for A LOT of people to tell you that. And, typically those people tell you not by trying to convince you you’re too expensive. They do it by hiring someone else.
How Much You Can Communicate Your Value
Being good at communicating your value takes time and intentionality.
I used to work as a bank teller. We had sales goals that we had to try and hit each month. Every once in a while an offer would pop up in our system for the client we were helping.
During my first week, I had a trainer standing next to me as I was helping customers. The trainer was there to help me out and show me the ropes.
As I was helping someone, one of those offers popped up. I was excited! This was my opportunity to show them what I was made of, and that I was eager to learn.
So, I went for it.
And, quickly bombed it.
The trainer had to step in and try to help salvage my stumbling attempt. I didn’t even have answers to his questions about the credit card I was trying to sign him up for.
Me: “Do you want a credit card?”
Customer: “What’s the annual rate?”
Me: “I don’t know.”
But, here’s the thing, I didn’t let that discourage me.
I kept trying. And, I got better.
Much better, in fact. In a few months, I had some of the best sales averages in my region.
But, that could only come from going for it, making mistakes, and adjusting along the way.
Here are some practical things you can do to communicate your value:
1. Keep it Close to the Client’s Revenue Stream
In the book, “Clueless at the Works,” my friend Anthony Garone says that if you want to move up either in position or income at your company you have to keep what you do close to the revenue stream of your company.
The same is true for freelance web designers.
If you can’t connect what you offer with your client making more money, it’s going to be a hard sell.
So, instead of saying, “I make awesome designs.” Say, “my designs drive engagement from users which turns into conversions which makes you more money.”
2. Store Up Past Success
With every project you work on, you want to make sure that you’re tracking the success of the project.
So, make sure to look at things like how much revenue the client was making from their old site and track the difference a few months down the road after you’ve done your work.
You could also look at things like bounce rate or the amount of time a user spends on the website.
If you get deep into Google Analytics you could track goals right from within the analytics dashboard.
Bottom line is you need some solid facts about your value. Not just feelings based statements about how awesome you are.
3. Let Other People Talk for You
No one can convince potential clients of your value like the testimony of another person.
This is called social proof.
Humans look for it in almost everything they buy.
Think about the big purchases you’ve made in the past year. Did you ask friends for the opinions or if they knew someone?
Did you read reviews on amazon before making the decision?
This is all social proof and will help you a ton when it comes to communicating your value to a potential client.
But, here’s the thing, testimonies don’t come easily even from clients that are super happy with the work you’ve done.
So, you’ve got to be sure you’ve got a system in place that makes it easy for clients to give you feedback and then use that feedback to help you.
When I first got started, I personally asked my clients to write a google review for me. A few weeks later, if they hadn’t done it yet, I followed up and asked again.
The record for a client giving me feedback is 1 year after I was done with their project. Believe me, I asked them for a solid year.
What finally did it? They needed some help with something simple and I didn’t charge them. INSTEAD, I asked them to write a testimony instead.
Make sure you make it easy for clients to give you feedback AND be persistent until you get it.
A Simple How To Pricing Guide For Freelance Web Designers
Finding the right price to charge your clients as a freelance web designer takes some time. But, over time you will dial it in and feel confident about what you charge.
The most important things are:
- Discovering Your Market Demand
- You want a good mix of people telling you both no and yes for your services. Too many one way or the other tells you you’re charging too low or too high.
- Communicating Your Value
- Prove that what you do makes your clients more money than they could without you
- Track the success of past clients
- Be diligent about getting testimonies from former clients.
If you stick to those principles it won’t be long before you feel great about the prices you charge clients as a freelanc web designer.
Now it’s your turn. How do you determine how much to charge a client?
Any jobs you WAY underbid?