This is a question that all marketing agencies must answer at some point. How do you determine the cost of your services? In this blog post, we will help you determine how to price your digital marketing services.
Since COVID19 forced all businesses into remote work for about a year (that seemed more like a decade), more and more businesses have been realising the importance of going digital, but this wasn’t the only outcome of the pandemic. Mid 2020 witnessed a lot of people losing their jobs, and to know one’s surprise, many of course turned to freelance.
I personally have conducted 4 digital marketing workshops over the past 3 months, with the majority of the attendees being those affected by the pandemic and seeking a career change.
So, now that you’ve become a digital marketing professional and have started freelancing, how do you price your services?
What Are Your Services Actually Worth?
This is a question many new freelancers struggle with, along with understanding how much would a client find value in what you’re providing.
Let’s start with, don’t set unreasonably high prices, and at the same time, don’t offer your services at such a cheap price that you’re not encouraged to do the job anymore. After all, you will depend on referrals. Heck, I still get referrals from clients I worked with 3 years ago.
There are three things you want to consider when setting your prices:
- What are your services?
- What’s the market value of said services?
- What are clients willing to pay?
So, how can you price your services?
Bundled pricing is where you offer a set of services at a lower price. For example, you may offer digital marketing services such as SEO, social media marketing, and website design for $x/month. Bundled pricing is ideal for both freelancers and clients alike.
When creating bundles, don’t create something useless that you know isn’t beneficial. Try to offer your clients Good/Best alternatives.
I personally use both bundled pricing and individual pricing.
Individual pricing is when you set prices for all different digital marketing services. That way, potential clients would have the ability to pick what they want.
This approach is seen on many agency websites, where they clearly state the price of each service they offer publicly.
Hourly pricing is when you charge an hourly rate for your services. This can be tricky, because some clients may take advantage of your time.
You should always have a project brief in place so that the client understands what they’re paying for and how long it will take.
The Pros and Cons of Hourly Pricing
- You’re in control of how much time you spend on a project.
- You can price your services however you want.
- There’s the potential for clients to take advantage of your time.
- It can be difficult to estimate the amount of time a project will take.
- You may not be able to work on other projects if you’re tied up with one project.
Another pricing option is retainer pricing. With retainer pricing, you agree to a set number of hours each month in exchange for a discounted rate.
This can be helpful for both freelancers and clients alike. Freelancers can have a guaranteed number of hours each month, and clients know that they will always have someone available to help them with their digital marketing needs.
Things to consider if you’re sending a client of yours a retainer pricing include:
- Retainers can be canceled suddenly, so it’s best to agree on a notice period in your agreement.
- If you’re personally unavailable and have a teammate assisting you, then provide the client with their contact details. You want to avoid a “We’ve been trying to reach you!”
Lastly, agency pricing is when you set your prices as an agency. This is usually seen with larger agencies, where they have a team of specialists working on different aspects of digital marketing.
Have you built a team? Do you have different specialists with you? If yes, then go ahead.
Agency pricing can be tricky because you need to make sure that the cost of your services reflects the amount of work that will go into it.
When setting your prices, you’ll want to consider the following:
- The amount of work that will go into the project.
- The number of people working on the project.
- The skills and experience of your team.
- Tools and resources needed for the project.
- Project management time.
In conclusion, there are a few things you need to consider when setting your prices for digital marketing services. You want to make sure that you’re priced appropriately, while also making sure that you’re profitable. You also want to be competitive in the market, so it’s important to do your research. What works for one company or freelancer may not work for you. So, find what pricing structure works best for you and stick to it!