And trust me, I have been there. Fingers hovering above the keyboard, shaking and thinking the client is going to say no, fight me on the price or worse, I hear nothing back and lose the job anyway!
Now these mistakes are common, we have all made them at least once in our career. It’s kinda like a rite of passage. But here are the top four mistakes that I have made in the past and I know others have too.
Pricing like you’re the one paying the bill
I’ve definitely had times in the past that I have gone to send a quote and thought “wow, I would never pay this much for this!”
But this is where we get caught up. We start negotiating the cost on behalf of the client BEFORE we have even sent the quote. Ridiculous, right? We aren’t our target audience or our own ideal customer. We see our own value from what we produce but it’s not up to us to price ourselves for us to afford what we do. We aren’t the one paying the bill!
And on that note, more often than not when we are dealing with clients, it’s making things fit into budgets rather than wallets, right? Money has been allocated for someone with creative talents and abilities that exceed that of the client to be able to do the thing they are investing in, they’re investing in that creative solution
Forgetting that pricing is perception.
Have you ever seen someone charging $7 for a product and rather than saying “wow, that’s great value” you end up doubting its quality because it’s priced so low and then don’t buy? It’s a tactic that some businesses use to make sales, and while that may work for them, it’s not the way you’re going to be able to make money as a freelancer, creative or any kind of business that wants to place themselves as a luxury item.
Now that’s not to say that there are products that you can frame as a lower price point, otherwise known as a loss leader or low tier offer (LTO). But you can’t be setting the price low constantly or you won’t make any money and probably have a worse off reputation than before.
Also, when you start low at that kind of price, you’ve got sooooo much further to go when it comes to raising the prices of your products or services. So whilst it may work to get people in the door, those people are now being trained that this is what I should be expecting to pay, not more.
Thinking that being cheaper will win you the job.
I’ve been there! We can get so in our heads and make some pretty big assumptions about the way our clients are thinking and viewing our services
So when we know that there are other creatives in the running for the project we are quoting, we can start to fall into comparison trap and, boy, do we fall hard! What if they are charging less than us? Will that mean I need to drop to be cheaper? What if the client chooses them because my prices are too high in comparison?
But here’s the thing, that may not be the case. If the client is placing importance of the job being cheaper rather than providing value, or completing the job and fulfilling the brief, then they may not be the client for you. I personally have had clients in the past let me know that they chose my service over others when it was the more expensive option, but chose that they wanted someone who showed the passion I displayed when I started with them.
Long and short of it, being cheaper isn’t always going to be the thing that wins you the job, and if they do choose you because you’re the cheaper option, are they a client that you want?
Not running your numbers and remembering that businesses run on profit and progress.
I’m sure there are a few people out there who are like “But I want to make it so I can be afforded by everyone”. And that’s a nice sentiment but a terrible strategy. If you are plucking numbers out of the sky and positioning your prices without running your numbers, that’s not a business, that’s an expensive hobby.
I don’t want a champagne lifestyle, I want to have enough profit at the end of it to spend on fancy cheese without it being a special occasion.
So to make that possible, it’s really important to remember that you are pricing for what you do, in your circumstances, where you are and who you are serving. What I mean by that is when we price based on others prices, we often don’t know how they came to those prices, what expenses they have, what other factors have played a part in their pricing decisions.
Which is why it’s important to understand what you are charging, what the value you are bringing is and how that plays into your unique recipe of pricing. What ingredients do you need? Do you have studio hire or other expenses? Are you wanting to balance your workload over less working hours, therefore need to cover yourself? And we can’t bill for every hour of the day, so what percentage of our working hours is actually billable? I’d love to say that the hours I work are all billable but they simply aren’t, so we need to account for that.