Marketers; Are You Charging Your Clients Enough?
By Michelle Greer.
You have broken down creating keywords and negative keywords to a science. You have your clients running a full throttle social media campaign, complete with Facebook group, Twitter followers, blog, et al. They are now enjoying more exposure and tangible results than they ever did before. If you don’t know how to properly sell this value to your clients, you could be losing money and not even know it.
RainToday, a service based marketing firm, surveyed 343 marketing, advertising and PR professionals on their thoughts of pricing.
What was the scariest part of their jobs, according to the survey?
- Uncertainty about what price a particular client will accept (45% rated as at least “extremely/very challenging”)
- Pressure not to leave money on the table (41% rated as at least “extremely/very challenging”)
- Pressure to compete on price from prospects / clients (30% rated as at least “extremely/very challenging”)
Are you irritated that your client just doesn’t get that companies with good branding means less work and more money? Here are some findings from RainToday’s survey that could be useful to you:
- Offering a discount immediately is just money out of your pocket. Although 59% of firms discounted their services an average of 12%, the industry leaders who opted not to discount their services saw this money go straight to their profits. “Not only are there major financial implications to discounting, the discounting discussion shifts the conversation from being about the value the firm provides to being about price. If price is an objection (and it often is) don’t jump straight to cutting price – cut the deliverables and promised outcomes first and the decrease in price will follow (without forfeiting project profitability),” according to report authors Mike Schultz and John Doerr. (See Andy’s previous advice on the dangers of discounting your fees).
- A potential recession should not affect what you charge. 64% of marketing firms expect to charge more money in the next 1-2 years. According to Schultz and Doerr, “Right now, the United States economy is uncertain at best. Yet, even though the economy has slowed, the data suggests that most firms have either not felt a pinch or are not adversely affected by downturns. It will be interesting to see how the next several quarters of U.S. economic growth (or lack thereof) will actually affect fees for marketing, advertising, and PR services.
- Focusing on value is key. 43% of premium priced firms focused on value-based pricing vs. only 21% of bargain priced firms.
To find more information on how successful and not so successful marketing, advertising, and PR firms handle pricing, purchase RainToday’s report.
About Michelle Greer