Pricing — The Position of F*ck You.
You must run a business, not a free creative workshop on the weekend…Every client/project must meet a certain requirement, your requirement. Establish an engagement process and a level where clients meet you, not you meet them. A bad client experience is lacking valuable exchanges, you’re considered expensive because that’s a common phrase for a high price, or you’re not worth the price.
The Gambler (2014) is a film about a man who is not truly a gambler, he is someone who merely uses gambling as a tool for self-destructive behavior. Jim (Mark Wahlberg) does not try to win when he gambles; in fact, his primary goal is to lose everything. Nobody who wants to win doubles up on every single hand — it’s a surefire way to lose everything very fast, a suicide bet if you will. A true gambler would at least have some aptitude for playing cards, and would want to win. Gamblers are addicted to the rush and excitement of the win. Jim was seeking the loss.
One of my favourite movies, if my bold title did not give it away, but my focus was not on Jim, it was on Frank (John Goodman), the premise aside, the entire movie for me was centred around “fuck you”, whether that was from a position of wealth or having absolutely nothing. The point for me was being able to say fuck you because you either had nothing to lose, no need for anything, or everything to gain. A bold and confident place to be.
John Goodman in The Gambler
When it comes to client management and running your business, your pricing says a lot about who you are, and what you are willing to tolerate. Of course, we don’t go around telling people who don’t agree to our terms “fuck you” …not in those words anyway, and that’s not the point.
That said, understanding markets allow you to know how to price.
Let’s establish some points about pricing, the fundamentals. Pricing is more about confidence than anything else, it also requires the ability to build some level of trust which comes from confidence in the information you possess. Of course, you must have something valuable, know how to create value, this can simply be your knowledge on how to solve things or innovate new things. Solutions to big problems are an immediate go-to, but sometimes small solutions to small problems can be worth even more.
To build trust and confidence in the other person with the money to pay you, you must also be confident in how you speak about what you know. You should never go into a pricing conversation desperate, instead enter because you want to do the thing not because you must. At least, don’t let the other party know that you need it if you do.
So then let’s recap, pricing success is built around knowledge, confidence, trust, value, and leverage.
Markets don’t necessarily determine price, markets reveal information on what people are willing to pay for, and some things are just not going to garner the price you want, understanding markets is good. If the market was solely responsible for price, then everyone would have the same offerings, there would be no competition. Clients/customers would simply select who they like best, which they do anyway.
There is a dynamic difference between a service business and selling commodities, both benefit from leveraging value, some choose to compete on cost prices by going high or low, others let the market dictate how they price. Demand, and how many hands touch something can determine the final price, that’s a commodity, services are centred around a bespoke approach, no client pays the same price, and what those clients pay is determined by establishing an engagement level, and the value of their problem/need — Value-based pricing.
Clients will always select the least risky option, those who select based on price are a different thing altogether. Your ideal client finds you, but you have to position yourself for that to happen, and nothing beats preparation.
“Luck happens when preparation meets opportunity” — attributed to Seneca.
It’s ok to have service fees, but don’t attach pricing to deliverables and time, price solutions. You find the value of a solution by defining the cost to a problem, how much is costing unsolved, and how much will cost to solve it. Then you state your price for executing that solution.
Your price is a result of understanding what you’re going to do, and having a defined process, a framework for exploring solutions. You won’t be able to present the solution because the client called, and if you did that, then why would they pay you for anything more? They can simply take that and go to a cheaper service.
Therefore, you charge for consultation, and project proposals. Your first proposal should be a summary and the overall investment, your engagement price, get them to agree to that. That’s the consultation, that’s your service fee. Never give a price on the spot, or at the first meeting, only let your average engagement level be known, this will help to qualify them.
Blair Enns speaks about a one-page proposal, and that sounds exciting to me. He also has a course on this, but first, here is a link to his amazing book, ‘The Win Without Pitching Manifesto’.
Have you ever received a free consultation from a doctor? In addition, most services charge for consultation, they are qualifying you. They will never tell you in detail, how they will solve your problem, they give you a summary, an overview of a process to getting the problem solved.
Sometimes people get trapped in price, numbers, money, but instead of lowering the price, introduce atomization, phases based on what capital is available. Your billing will be based on receiving initial payments — deposits — for each phase. Price is the same, the solution is executed in phases by starting with the most impactful area.
Client management, stand up to them. No, I don’t mean be an asshole, be an expert, diagnose and prescribe. Creative professional spaces, agencies etc. always feel a need to prove themselves worthy of the client, this should be the other way around, that’s not a confident position. Set the engagement and stick to the process. Gain trust and maintain value.
Money comes in, to pay the team, equipment usage, essentially to cover overheads, and a contingency, always have that because time and the value of that time can never be paid for. This allows you to happily spend the time solving client problems and managing them without worrying about lost effort, energy, and time.
The image above is an image of the popular USD and the latest currency, Bitcoin. Depending on how the photograph was taken it can be intimidating, I thought this image was tasteful. That’s money, don’t fear it, change your relationship with it, be comfortable with it.
The best people and services in the creative industry charge for their thinking, not deliverables. There are other services that do that, but that’s a different clientele, you decide. Remember to define deadlines, and curate the right people for the job, all that is involved is what defines your prices, including profit. You must remember that money needs to go back into the business.
The better, or more valuable the conversation the easier it is to close on a price you want. You also don’t need to send over a bunch of information on multiple pages, that’s work, don’t work for free. I know we are all in different places, different markets, this is why you negotiate value not price, value can be applied to everything, but the price is a variable. We are all not brave, but we can be bold, define value, cost, and set your price.
There are many articles written about pricing creativity, there are also many advocates online and across social media. Hopefully, my bit will contribute to helping creative professionals find and define their value.
Most definitely be in a position to say no — The fuck you position.
