How Can Freelance Copywriters, Designers, and Devs Charge More?
It’s interesting to read the discussions about how much creative freelancers charge. Sooner or later, these phrases come up:
“Know your worth.”
“Raise your rates.”
“Add 20% to what you were going to charge.”
Could You Design a $1-Million Logo?
Then, to confuse matters further, people bring up the redesign of the Pepsi logo, which cost $1 million back in 2008.
The $1-million logo. How much would you charge?
Every designer in the country said something like, “I could do that for a lot less. Pepsi must have been out of their minds to pay that. Just give me a hundred grand, and I’ll get you a logo.”
So, let’s get back to how much you should charge for your work.
What Market Are You Working In?
Before you get into the dollars and cents, you need to think about your market. That’s followed by proof to support your expertise in that market.
It all comes back to your portfolio. For example, if you’ve been designing e-commerce websites for small independent businesses, that defines your current market. Your portfolio will show those small-business websites. Ideally, you will have stats to prove how successfully these sites performed.
With a strong portfolio, you’d likely be able to get many similar jobs.
But you’d have a tough time competing for the website of a large multi-national corporation. You’re just not in that market. Yet.
To get back to logos, if you’ve only designed for smaller companies, it’s unlikely that a company like Pepsi would consider you for their rebrand. From your portfolio, it’s evident that you’re not in their market. Pepsi would want to see a portfolio with many recognizable international brands to even think about hiring you.
BTW, if you ever have a chance to look at a design proposal from a major design firm, review it and take notes. It’s eye-opening to see what they include. You’ll see the depth of their thinking and research that goes far beyond “a guy designing a logo”.
Your Market Limits Your Pricing
If you think about it, your pricing is limited by how much your clients have available or want to spend on the services you offer.
You can’t squeeze big budgets out of small companies. The money just isn’t there.
There’s a straightforward rule (with exceptions, of course): Bigger companies have bigger marketing budgets. So, to get more money, you have to be working for bigger companies.
But even within your market, how do you know whether you’re charging too little?
You don’t know unless you begin to raise your rates and get no pushback. Then you know you’ve probably been charging too little. That’s where “Add 20% to what you were going to charge” can become useful.
Think about your next $500 project. What if you proposed to charge $600? Would anyone even notice? That’s a 20% increase.
Your Pricing is Also Limited by How You Charge
These days, you hear many people talking about transparency. Being transparent with how they conduct their lives, how they work (building in public), and how they charge.
But, transparency about how you charge can hold you back.
For example, some creators charge by the hour. In journalism, writers are often paid by the word. Both of these are pretty transparent. But both punish the creator.
Let’s look at charging by the hour. To keep the math simple, let’s say you charge $100 an hour. You do a job that takes you five hours, so the bill is $500.
Then you get similar assignments, and you become more efficient. What once took you five hours now takes just three. Should you now charge $300 because you’re better at your job? Or charge $500 and lie, saying it took you five hours? Neither option is good.
Consider writing where you charge by the word.
Many people have been credited with saying, “If I had more time, I would have written a shorter letter.” Every writer knows that taking the time to edit usually improves the writing. It often makes it shorter. So, should the writer get paid less for taking more time to make it better? Makes no sense.
How Can You Charge More? Change How You Charge
The first way to increase your billing is to charge by either the project or on a retainer.
When you charge by the project, you’re saying that this “thing” (your project) costs $X without explaining how long it takes or how much you want per hour.
It’s like buying a shirt in a store. It costs $X with no explanation about the costs of the material, the hours of labor that went into making it, or the storekeeper’s profit. The shirt costs $X—take it or leave it.
Charging by the project makes it far easier to raise your rates simply because it’s not transparent. No two projects are exactly alike, so if you quoted $X for one project and $X + 20% for a similar one, it’s difficult to argue against that.
However, if you start getting resistance, you know you’re reaching the limits of what you can charge that client, or more broadly, those types of clients. To charge more, you have to escalate into a higher and better market.
A retainer works well with clients where you have ongoing projects. You settle on a monthly fee, define the deliverables for the fee, and the client pays in advance at the beginning of the month.
Charging by the project or retainer are much more professional ways to bill and are more rewarding for the creator.
Find more detailed information about all the ways you can charge, including by the project or retainer, in the blog post Best Pricing Models for Creative Services.
How Can You Charge More? Charge for Everything
Many creators undercharge because they don’t outline all of the work that they provide. Specifically, they don’t include meetings, research, and especially revisions.
Don’t shortchange yourself with skimpy estimates. Make sure there’s enough detail in your estimates so you can charge for all aspects of your work.
I wrote about writing better estimates in this blog post: Increase Your Billing With Detailed Estimates.
Three Ways Freelancers Can Charge More for Their Work
The first way to charge more is to work your way up into a better market category. Go after better clients with bigger budgets. You’ll have to do this step by step.
In many cases, it comes down to research that supports your creative ideas.
Bigger clients want reassurance that your solution will work. That’s why Pepsi paid $1 million for a logo revision. It’s far more than just a logo. Without seeing the agency’s proposal, I’m quite confident it included tons of research.
The second way to charge more for your work is to create a virtual agency. That will allow you to handle complete projects, which makes you more valuable to clients.
So, rather than simply being a writer and offering only writing, you now have a virtual team that might include a designer and developer. Now you can pitch complete projects, rather than just the writing portion. Get all the details about creating a virtual agency here.
The third way to charge more is to get a job at an agency for a while. That will give you experience working for more prominent clients along with higher-profile portfolio pieces. After a few years, go back to freelancing or launch your own agency, but start at a much higher level than where you currently are. I wrote about how to use an agency job as training for starting your own business here.
Just imagine how much you would’ve learned if you were on the Pepsi logo redesign team. You’d know what it takes to charge $1 million for what seems like a simple logo redesign.
Get Your Book Here
Learn more about how much freelancers should charge in my book, How to Start a Successful Creative Agency. It’s the essential business guide for graphic designers, copywriters, filmmakers, photographers, and programmers.
I highly recommend this book!
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This book breaks it all down from beginning to end. It gives practical advice from a seasoned veteran and a path you can follow to your own success. It’s an easy read that doesn’t bog itself down and highly adaptable to your personal career journey. I highly recommend this book!”
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