“What should I charge for X?”
Ah, pricing… Get used to asking that question, my friend, because it will follow you at every stage of your freelancing career.
Three reasons for that:
- No market standards exist for freelance copywriting or content writing rates.
- As your business and skills evolve, you should re-evaluate the worth of your work in the marketplace from time to time, and adjust your rates accordingly.
- High-earning freelance writers base their pricing on value, and that value can change from one client or project to another. A landing page that delivers just one $5,000 sale, for example, is worth a lot more to a client than a landing page that delivers 100 sign-ups for a free demo.
Without market standards and so many variables at play, it’s common for freelancers to feel lost when it comes to rates, so let me give you the good news upfront:
It’s your business, your rules. It’s ok to experiment, make up your own pricing, change your mind, then change it again.
But how do you define those dang rates?
First, it’s helpful to understand seven rate models used by fellow freelance writers. Some are profitable, others not so much.
A caveat: We won’t be able to satisfy all your pricing questions in this post, but we will cover a lot of ground.
My goal is to leave you with at least one idea to experiment with in the coming weeks, that will put more moolah in your pocket.
Without further ado, behold:
*** 7 RATE MODELS ***
Rate Model 1: HOURLY
Charging by the hour is likely the most common freelance writing practice. It’s frowned upon by high-earning freelancers, but still a viable option in some scenarios.
The trouble with hourly rates is that you make less and less money as you grow more efficient and nail assignments faster. In essence, you get penalized for being more skilled and completing jobs twice as fast as inexperienced writers. Doesn’t seem fair, does it?
Another argument against hourly rates is that they limit your income potential by tying your income to your time, making it difficult to step away from your computer and take time off without hurting your pocketbook.
Finally, time spent on a project is a poor measure of the value of your output. Let’s say, for instance, that you charge $80/hour and it takes you four hours to write a sales piece, for a total of $320. That sales piece goes on to generate $50,000 in sales for your client. The $320 price tag, in that case, is far too low and not reflective of the value your work delivered. Make sense?
On the flipside, hourly rates may be ideal when the project scope isn’t clear and you don’t have a solid idea of how much time and effort will be required to complete it. (Even then, your client will ask you to estimate your total hours for a ballpark total cost so he’s not writing a blank check for endless hours.)
From a project planning and execution perspective, whatever rate model you adopt is still going to involve time spent on a project, so it’s wise to have a minimum hourly rate in mind that’s acceptable to you, even if you never advertise it.
A word of caution: Don’t make the mistake of basing your hourly rate on your past salary as an in-house employee. You’ll starve that way. As a freelancer, your rate should be at least double what your hourly income was as an employee.
Rate Model 2: DAILY
You’d be hard-pressed to find this practice in the U.S., but it’s a common one in Europe. (Hello, European readers!)
Similar to hourly pricing, day rates cover all work completed within a day.
Daily rates do offer more flexibility than the hourly model, since you don’t have to track every hour. Beyond that, the same rationale discussed above for hourly rates apply here as well.
Rate Model 3: WORD COUNT
Just like it sounds, this model charges per word. It’s a practice you might encounter on the journalism or creative writing side, but rarely in business writing — because it makes no friggin’ business sense.
If you’ve been charging by the word, this is where I sit you down, lean close, look deep into your eyes, and have a come-to-Jesus moment: For the love of Pete, don’t do this to yourself.
Let me explain: A project’s word count is no indicator of its value, nor the amount of time and effort that goes into it.
Writing a 75-word ad or a 30-second radio script, for example, may take you more time and skill than a 1,000-word blog post, because you have to pack so much research, context and persuasion power into just a few words.
Plus, if that piece’s goal is to generate sales leads (as opposed to educate or entertain), those few words are working a lot harder for your client as well.
Per-word pricing is flawed in so many ways, I can’t even think of a benefit. (Well, perhaps building your portfolio. Better than unpaid work, right?)
Don’t do it, friend. Friends don’t let friends charge per word.
Rate Model 4: FLAT FEE
With a flat or fixed fee approach, clients pay for the work you deliver, not how long it takes you to complete it. Whether you get it done in 2 or 20 hours, the project price (and its value to the client) remain the same.
This model enables you to charge premium pricing because it changes the conversation from hours to value.
Steve Slaunwhite explains that mindset shift in The Wealthy Freelancer:
“A client may balk at paying you $100 an hour for 10 hours of work, but will have no objection to a project price of $1,000 for the same project. Why? It’s all in the way a client looks at it. If your hourly rate is more than her hourly salary, she may think you’re asking too much. A fixed-project price, however, takes that salary comparison out of the equation, making the client stop and consider if the project is worth the price instead of considering whether you are worth [it].”
Value-based pricing does require a deeper conversation with a prospect upfront so you can discern the project’s value to his or her business and frame your conversation around that. The extra effort enables higher rates.
Rate Model 5: RETAINER
One of my favorite models, retainer agreements commit you and a client to recurring work, typically at X dollars for X deliverables or hours per month.
It’s a win for clients because they have a trusted writer who’s already familiar with their business, messaging and audience at their disposal. That relationship and familiarity enables faster project turnaround and higher-quality writing, for less than they’d spend hiring out individual projects.
It’s a win for you because you have a guaranteed income and steady workload for several months, or at least for the foreseeable future.
(Disclaimer: I currently have three clients on retainers, and those relationships drive most of my income.)
I’d recommend suggesting a retainer agreement as a savings opportunity for the client when you sense he/she has a recurring need for content. (Repeat customers are great candidates for this model.)
Rate Model 6: PRODUCTIZED CONSULTING
Similar to the flat fee model, productized consulting is a fixed-price, fixed-deliverable engagement. The difference lies in the last part of that sentence: fixed deliverables.
You decide upfront what the gig will entail — its scope, processes and output. You then package those elements into a product, give it a name, a price, and voilà: You’ve got a productized service.
Some examples, off the top of my head (I just made these up):
- Lead Generation Starter Package: includes a sales letter, a white paper, and a five-part email campaign.
- Success Stories Development: interviews with 3 customers, development of testimonials, audio recordings of said interviews, and customer story narratives for use in newsletters, case studies and sales materials.
- Social Media Influencer Package: Maintenance of three social media accounts with 15 updates per week and management of social media inquiries & comments.
Brennan Dunn of Double Your Freelancing explains the benefits of productized consulting:
“When a client buys your time, there’s no implicit guarantee that their problem will be solved. But if a client hires you via a productized consulting offering, psychologically it’s no different than buying an off-the-shelf product for them — even though it’s still your time, and still probably something totally custom… It’s really just a sales and marketing technique that defines the product, rather than leaving things open-ended… It’s a way for YOU to spell out the rules of your engagement, what it will cost, and what the buyer will get.”
Rate Model 7: TIERED
Tiered rates are a simple but powerful way to boost your income and sales conversions without much effort on your part. It’s the only way I quote services anymore.
The idea is this: When prospects ask you for a quote, give them three options:
- a bare-bones (low-end) rate
- a standard (middle-of-the-road) rate
- a premium (high-end) rate
I call them Basic, Standard, and Premium, but you can call them whatever you want. Each relates to a different service level and deliverables.
The low-end option might require the client to do some of the work upfront, like completing initial research in-house, so you only handle the writing part. It might also limit revisions considerably.
The high-end option might include moderate to deep research, interviews with customers/experts/sources, and extras like related content for social media, promotional blurbs for newsletters, graphic design or sourcing of royalty-free stock images.
An interesting shift happens when prospects are staring at three rate options: The conversation in their minds moves from “Should I hire this person?” to “Which service level will I buy?”
Most people avoid extremes (the cheapest and most expensive), and settle for the middle option. Occasionally, you’ll meet a prospect who wants the red-carpet treatment and goes for the high-dollar choice.
Give tiered rates a try next time you’re asked for a quote. You’ll be surprised by how many prospects choose a pricier option when you make it available.
Having zoomed through these seven rate models, I know you have questions, so let’s tackle some FAQ’s:
1. I still need a ballpark idea of what others are charging. Isn’t there a rate calculator or formula I can use?
I hear ya, and I wish I could throw some numbers at you. And you’re right, there are freelance rate calculators out there. Google will give you a handful, but please read the caveat below before you jump over there.
With so many variables at play — your niche, skill level, experience, market, types of clients, types of projects, and so on — it isn’t feasible for me or any fancy calculator to give you rates that would apply to everyone, or every scenario.
I can tell you three things, though:
- Here in the U.S., anything less than $55/hour is considered low. That’s for freelancers who are skilled at writing persuasively for business, so if you’re not there yet, it’s fine to go lower and work up to that level and beyond.
- The lower your rates, the more you’ll deal with prospects trying to haggle. They’ll likely be high-maintenance too, because low rates attract cheap buyers who don’t value your time or services.
- It’s helpful to network and research the websites of writers who are doing what you want to do in terms of niches, specialties and markets. Many writers post their rates online, or willingly share their rates when asked. Just don’t be surprised to find inconsistencies because, again, no market standards exist.
[ UPDATE: I’m not a fan of hourly rates but knowing what an hour of your time is worth is very helpful in defining your lowest-acceptable rates. Here’s a handy calculator. ]
2. Isn’t customizing rates a lot of work? I don’t want to spend a lot of time on quotes.
Well, yes and no. Some of the rate models covered above do take a bit more work than throwing out a single, catch-all rate but the income boost is well worth your trouble.
It’s helpful to create a Fee Schedule for your eyes only, where you record acceptable price ranges for the types of projects you’re going after. This fee schedule will serve as a handy reference so you can quote new projects without much mental gymnastics.
You may also find it helpful to share a price range with prospects before submitting a formal quote, saying something like:
“Mr. Prospect, I want to give this project the thought it deserves and give you a formal quote within 24 hours, but my range is typically X for this type of work. How does that line up with your budget?”
You’ll get feedback on your price range right away so you don’t waste time writing proposals for people who can’t afford your services.
3. Should I post my rates online?
This is another case of “your business, your rules,” and opinions vary regarding the pros and cons of publishing your rates.
One approach many writers adopt is to list price ranges for common projects.
A benefit of doing so is that a price range doesn’t lock you into a single number, and it automatically disqualifies prospects who want something cheap and can’t afford you. A downside is that you pigeonhole yourself into that range and prospects might push for the lower-end number.
I choose not to list my rates online because I like being able to change my mind and adjust my pricing on the fly. But it’s totally up to you.
4. Which rate model do you, personally, use?
I use a mix of retainer, hourly, tiered and flat rates. A couple of older clients are still on an hourly structure, but I no longer quote hourly rates.
Today, most of my income comes from retainer clients. Plans for the future include transitioning hourly clients to a flat fee or retainer arrangement, and introducing productized packages.
Keep in mind these are my preferences. You may decide a different model works best for you.
5. Where do I go from here?
Research writers in your niche or area. Join an online group, meet them for coffee or shoot them an email. You’ll find most writers are generous with their expertise. It’s amazing what you can learn if you just ask. Then use that insight to build or upgrade your fee schedule.
Spend more time getting to know prospects next time you’re asked for a quote. Find out what’s driving them to seek you out, and how your service will benefit them. What are their goals for the piece they want you to produce? What problems will it solve, and why now? What’s that worth to them? Price your work accordingly.
Finally, choose one or two ideas we’ve covered above and take them for a spin. Don’t be afraid to experiment, and don’t wait to have it all figured out before you move forward.
In our line of work, continuous experimentation and learning what works for you are vital ingredients for building a business that you love and that affords you the lifestyle of your choice.
Wishing you much clarity, success and money in your pocket,