Art A

7 May 2015

Are you adding value? Then you need to be charging for it

Monopoly money“£40 for a haircut? It’ll only take you 10 minutes! How about a fiver?”

“Listen, my bladder surgery yesterday didn’t seem to take very long considering the cost. Any chance you can pop back in there and have another go at it?”

You’ll probably agree that statements like the above are completely ridiculous and would – rightly – get you laughed out of any hairdresser or hospital.

Why then, are they suddenly par for the course when it comes to hiring a copywriter?

I’ve been at this long enough to know whether a potential client is a good egg or whether they’re going to try and beat me down on price. Rewind a few years, and you’d find conversations like this in my inbox:

Me: “I charge £30-50 for 500 words.”
Potential Client: “Hmm, bit more than we’re looking to pay.”
Me: “Well, I could do a test piece for £20?”
PC: “How about two for £30?”
Me: “Oh, go on then.”

There’s something about junior copywriters that makes them willing to halve or even third their rate at the drop of a hat, and there appears to be one key reason for it.

Pricing inconsistencies

As the PCN’s recommended rates page demonstrates, there’s very little in the way of consistency – or regulation for that matter – when it comes to copywriting rates.

This is problematic because it encourages ‘junior’ copywriters new to freelancing to charge a low day rate, even though they may have acquired all sorts of relevant experience via a full-time job or side project.

They usually do so because they’re desperate to gain experience and generate material for a portfolio. This isn’t good for anyone because it a) means that inexperienced copywriters often struggle to pull in a living wage and b) it devalues copywriting, making it more difficult for senior copywriters to charge what they’re worth.

What’s the solution?

Look again at the questions at the top of this page. Hairdressers and doctors don’t charge using a day rate or an hourly rate; they charge based on their expertise and the value of the services they offer. The same should be true of copywriters.

There’s a lot of talk about value-based pricing around right now, though I hear more about it from designers and developers than I do copywriters. I’m not sure why, as value-based pricing is just as applicable to copywriting.

Here’s a rough template of the three things you need to know before you can start working out how much you’re going to charge for a project:

  1. how many visits a client gets to their website per month
  2. what percentage of visits to their website result in a purchase
  3. the average value of purchases made on their website.

The terminology of those three things might vary from project to project – for example, you might need to replace website visits with email opens, percentage of clicks that result in a purchase etc – but hopefully you see what I mean.

If you’re writing a well-optimised piece of content for a client that stands to generate, say, 1,000 visits to their website every month and 5% of people who visit that website purchase goods worth £20, your post stands to make them in the region of £1,000 per month.

I freely admit that the conversion rate from blog posts is very different to that of a sales page or  homepage, but it can be worked out fairly easily if the site already has a blog or calculated once the blog has been live for a few months.

Even so, this isn’t an exact science. SEO is difficult to predict and purchasing habits can vary wildly from month to month. But it doesn’t need to be an exact science, because you’re just trying to come up with a ballpark figure for the value your work stands to add.

I’m not saying that, in the above example, you should try to charge £12,000. Or even £1,000. What I am saying is that I hope this approach will show you that charging £20 for such a piece of writing is ludicrous.

If you can convey that to a client – and work out a level of compensation that’s fair to both of you – you stand a much better chance of actually being able to charge what your work is worth.

Enjoyed this article? I’m primarily a freelance copywriter, but you’ll find some bloggy bits on my website too. Just click the link for more.

  • Roulette wheel

What do you think?

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Joanna Tidball

May 10, 2015 at 8:04pm

Very interesting reading, thanks Art. I generally charge on a project basis and use a standard day rate to work out my quotes. I’d say pretty much every new contact asks what my day rate is, as one of their first questions. So I think it’s quite challenging to move away from this concept entirely. But there have definitely been occasions when I have undersold myself and should have applied more of a value-based pricing model. The times that come to mind were when I’ve been asked to produce something on a very tight deadline.

Jackie Barrie

May 21, 2015 at 11:30am

If they quibble about my quote, I ask clients: “How many customers do you need to win to pay my fee?”

Sometimes it’s only one.

Their body language and attitude changes as soon as they view copywriting as an investment and not a cost.