Serving your customer, valuing yourself

My brother-in-law is a freelancer like me. He’s a camera operator and sets all the cabling for larger live streamed tv-events - mostly sports related. He called me the other day to ask for help raising his rates. You see, he’s been working for the same company for seven years and hasn’t renegotiated his rates at all. It is especially daunting to ask for an increase when you’ve worked for one company for so long. Many of us have found ourselves in very similar situations and this is tough to navigate.

Communicate your value

I told Johan, my brother-in-law, that I think its well deserved and he should begin think about solid reasons he can present about his need to raise rates. I explained that his customer would be motivated to agree to this raise if he gave a convincing argument. He came back with some great options: more experienced, more qualified to do specialized things, loyal to the company, and hasn’t received a raise for seven years.

When working with one customer for so long, it becomes easy for them to lose track of your personal growth during your time together. Whether its experience, skills, or certifications/education, its important to clearly communicate this increase in your marketability. This discussion can lead to not only talks of increased rates, but of further opportunities to continue to grow. It can be a win / win situation for both of you!

Why packaging is a wise method of increasing rates

When I asked Johan about what he wanted for a raise, he said 150%. That’s a steep raise! When I said that may be going too far, he was certain that it was in-line with what others with similar experience were billing. I asked him if he had given any thought to how he would increase rates and what his customer would feel most comfortable with. There are a few options out there, so I asked him what he had in mind.

He wanted to charge the same base rate, but put an hour limitation on it. He would charge $500 for the first 10 hours and then for every additional hour, he would charge an extra $50. This flat rate with extended billable time method ensures that he is guaranteed his usual rate if an event runs short, but also raises his pay for those insane 12 or 14 hour days. He actually gets paid for the extra hours of work. I understand this and it’s something I’ve done in the past too. But take my word for it, it’ll get your more money that day, but won’t make your fiscal year any better.

You see, when you go into a restaurant or shop in a store, you prefer to know the price before your order. That’s just common sense, right? What if your email provider charged you according to the amount of email you receive? The first 500 are free, but each additional one is $0.02. I’d be terrified at the end of every month. Just like you and me, Johan’s boss wants to know the price before he signs the deal. He doesn’t have any influence over how many hours the work is going to take so it’ll be impossible for him to calculate - and budget for - the cost of the work upfront.

I recommended packaging his services instead to make it beneficial for his customer to invest in him. Let’s say he charges $500 dollars for a day’s work (he doesn’t, but it’s just simpler for the mathematics). Instead of selling them one day at a time, maybe he could put them into packages to add a sense of savings. How about offering the employer the possibility of buying 20 days for $11,000? Or ten days for $6000?

Make your pricing as friendly as possible for your customer - and make sure you benefit from it too! This, is in it’s most simplest form, is seen in almost every software as a service (SaaS) today. Monthly is $9.99 and yearly is $99 - a quick way for their customers to get 20% off by subscribing for a full year. For the company providing the service, it gives them cash upfront as well as committed customer for the next year.

Regardless of what business you are in, how can you rethink your pricing strategy?

Please share:TwitterLinkedInFacebook
Get more writing like this

Sign up and get new writing, just like this, every other two weeks. Unsubscribe any time (I'm not a dickhead).

Books

User Experiences that Matter (2016)
Mastering Freelance (2017)

If You're Getting Started in UX

What's a 'User Experience' Anyways?
How Do You Learn UX?
Working as a UX Designer

Next Steps in UX

Working as a UX Lead
Defining a UX Strategy
Writing as Part of the UX Process

Thought-pieces

AI Ethics - A New Skill for UX-Designers
Designer Ethics & The Moral Implications of our Apps
The Future of the UX-Designer
Voice Input’s Effect on Social Norms

The Work We Do

Chasing Growth
New Tools Don’t Always Equal Productivity
Why Designers Need to Write
The Tools I Use to Run My Business

Featured Writing & Interviews Elsewhere

Q&A With Anton Sten, Author of User Experiences that Matter - Adobe
What the F*#!ck is a UX Designer anyway - Working not Working
It’s Time for a Code of Ethics for Designers - Medium Modus
The Art of Going Freelance - .Net Magazine
It Takes Time - Being Freelance episode 100

From My Newsletter

UX of Email Newsletters

Working as a UX-lead

2018 in review

What’s my location?

I’m taking a break

Stay humble, stay eager

Back to Work!

Vanity Metrics

The Future of Retail

2017 review

What do you do?

Carpe Diem UX-designers

What´s Good Design?

Chasing Growth

A Redesign

Is Less More?

Why Simple is Hard

Pricing It Perfectly

Trusting Your Gut

Built to last

An Eye on the Future

UX Design explained

Bite-sized Posts

Leave the Phone at Home

Delight Comes Last

The Cost of Lies

Big Mood Machine

Simplicity is a war

The next iPhone

Leadership or management

Everyone should own a dog

Silence is gold

Cameras that understand

Humans, not users

Keeping AI Honest

Right to privacy

The State of UX in 2019

Why scrap scrappy?

Organized for browsing

The iPhone Franchise

Why Small Teams Win

The Bullshit Web

Just keep at it

Let them eat cake

Netflix Culture

Skype

Unfoundered

Tech is not Neutral

Productivity

Whose risk?

Why Small Teams Win

Phone Bored

Karim Rashid

Dieter Rams

Bleeding Out

Fake News is spam

Conversational Design

Dropbox

Bye bye Facebook

Cuba

The seat at the table

Givenchy

Love letters to trees

Pricing Philisophy

Specialize

Personas

Make me think

Hawaii Missile Alert

Why Design Systems fail

What You Build

Checkout for Winners

Living a Testing Culture

Creative Class

How To Predict Your Future

Github

Medium

Design quotes

Enough

Why?

ARKit

Designing for Mobile

Failure, Reflect, Renew

Growth

Working with me

Great user experience

Naming your icons

Conversations

All writing

Leave the Phone at Home

UX of Email Newsletters

Delight Comes Last

The Cost of Lies

Big Mood Machine

Simplicity is a war

The next iPhone

Working as a UX-lead

Leadership or management

Everyone should own a dog

Silence is gold

Cameras that understand

Humans, not users

Keeping AI Honest

Right to privacy

2018 in review

What’s my location?

The State of UX in 2019

Why scrap scrappy?

I’m taking a break

Organized for browsing

Stay humble, stay eager

The iPhone Franchise

Why Small Teams Win

Back to Work!

The Bullshit Web

Just keep at it

Let them eat cake

Netflix Culture

Skype

Unfoundered

Vanity Metrics

Tech is not Neutral

Productivity

Whose risk?

Why Small Teams Win

Phone Bored

Karim Rashid

Dieter Rams

Bleeding Out

Fake News is spam

Conversational Design

Dropbox

Bye bye Facebook

Cuba

The seat at the table

Givenchy

Love letters to trees

Pricing Philisophy

Specialize

Personas

Make me think

The Future of Retail

Hawaii Missile Alert

2017 review

Why Design Systems fail

What You Build

Checkout for Winners

Living a Testing Culture

What do you do?

Creative Class

How To Predict Your Future

Carpe Diem UX-designers

What´s Good Design?

Chasing Growth

Github

Medium

A Redesign

Design quotes

Enough

Why?

ARKit

Designing for Mobile

Is Less More?

Why Simple is Hard

Pricing It Perfectly

Failure, Reflect, Renew

Trusting Your Gut

Built to last

An Eye on the Future

Growth

Working with me

UX Design explained

Great user experience

Naming your icons

Conversations