commit: 6b2ca8a - #414 (2014-03-05 12:54:44 -0500)
I had many client inquiries this past few days after I published my infographic and some guest posts on the web. And I was thinking of pricing them not solely based on the price that is on the market. (There are many things to consider, I know that!)
There are some clients see $500 as an expensive price for an SEO service. (And I'm wondering if this is really a pricey one seeing that services like link prospecting, content creation and content promotion takes a lot of time and effort.
I just want to know, the things do you consider in doing your pricing decisions for your services?
Yeah, most low quality clients will pay thousands of dollars for automated PPC but bargain with you about a few hundreds of dollars. Skip those "clients" altogether unless you are an absolute beginner. They are not clients, they are beggars. I had clients I charged student rates out of pity and then they've posted their holiday pictures from the Maldives on Facebook while I struggled to make ends meet.
Consider these resources about proper pricing:
thanks for sharing these resources Tad. :)
Great resources right there, sir! Thanks.
Good idea for a discussion, Venchito! I find pricing one of the most difficult aspects of the SEO sales process. No one wants to underquote and risk doing a lot of work for less money, but at the the same time, if you overquote, you risk the prospective client going to a competitor!
A few things I take into account:
1) Industry competition - How competitive is the industry? Will a little bit of work do the job, or are we talking about "car insurance" levels of competitiveness?
2) Previous SEO work - Has the website had previous SEO work done? What was its quality? If it's had good SEO work done before, it might only need a bit of a steer. However, if it's had bad work done and it's received a penalty, that's a whole different ball game entirely. Similarly, what if there's been no previous work done but all of their competitors have been doing SEO for years? That would factor into it, too.
3) The type of SERPs - What shows up in the SERPs for their main keywords? For example, if a Map 7-set always appears, then you'll have to give a big focus to Google Places/Google+ Local, which could affect the type of work you do and ultimately the price.
4) The value of new customers/clients to the prospect - This always feels like a bit of a cheeky one, but Alan Weiss (author of Million Dollar Consulting) swears by it. Don't necessarily quote what's needed, i.e. just your time. If you know that just one new client is worth £100,000s to the prospect and you've only charged them £1,000 for the work, you're effectively missing out. There's even the risk that you'll be considered cheap (as in TOO cheap). Even if you charged them £10,000, they'd still be delighted with the ROI and would therefore consider it a worthwhile investment.
My golden rule as well: never simply quote whatever you think they can afford. Go by what you think is needed to do the job (properly) and how much it will earn them back.
And as you've said, Venchito, different people will always value things differently. I had one person say "ouch..." to my day rate, while others have said that they've thought that it's a bargain. I guess you'll always have more of the former, because people will always try to haggle and drive your prices down. But if a few people don't like your prices, it doesn't necessarily mean it's because you're doing anything wrong (unless you're quoting insanely high prices, that is...!) :-)
I approve this comment! Yes, when they balk at $500 it's often that are not in it for the LONG term or they have overcharged their clients and contracted you for peanuts to make a tidy profit. If you have prospects like these... run the other way [(Yes, happened to me not too long ago... once bitten learned and never lost the lesson;)]
Good answers Steve. Thanks for sharing your thoughts. It's really a tough thing to come across with a client whose budget matches your expectations.
Here are my tips for pricing SEO consultancy projects:
1. Charge by the hour - I base every thing via an hourly rate to the client, so they have requests and we build a custom quote, I have never been a fan of a one size fits all approach. 2. Report all work done each hour, show the client what you have done for the money they have paid. Use time tracking if you have it.3. If the client requests a project you can work 20 hours a month for example – link building and on site, consultancy.4. Recently due to demand of services, we have introduced min spend limits, because the thing is if some one wants to pay $300 a month they may expect 10 hours of your time for that rate and if you charge on a specific rate it can get out of hand.
Now in regards to what you can charge that comes down to what the market is willing to pay, what the teams experience is, people will pay what you are worth in the end of the day. If you provide value/ case studies and results they will pay you a premium.
"My golden rule as well: never simply quote whatever you think they can afford. Go by what you think is needed to do the job (properly) and how much it will earn them back." Fantastic comment Steve! Couldn't agree more.
I personally like to work with the client throughout the project and get them to generate their own content as much as possible. This not only helps reduce the quote/project price on their end, it also encourages them to produce their own content and help build their confidence at the same time. The fact that they know their industry inside out means that they're already perfectly suited to create content that's relevant, quality and awesome for their readers. All they need is a bit of guidance and the 10% professional SEO advice that comes with a price.
Pricing is always an issue to me, I mean i try not to hire
the clients who are not really ready to pay me the amount that is justified but
this way i end up saying no to almost 80% of the leads that comes my way!
I really like the idea of per hour charges but I am not
really sure how it will work for a person who is not available in the same
geographic location as the client is like me.
The clients I have I usually charge them on project basis and
report the progress on monthly basis so that they can have an idea that their investment
is not going to waste their time and money.
Moosa, I have a few clients in the USA and I am based in Australia. I just charge them based on USD price per hour. We have chats all the time on Skype. I have had no issues with that pricing model for global clients.
I've actually turned down international work - I turned down a US enquiry recently. As I understand it, if a client in the UK, refuses to pay me, there are things I can do about it legally. Overseas? Not so much...
Make sense but for a countries like mine where Search Engines and Digital Marketing Industry is not stable, we are not left with much choices!
Usually you can do sue diligence on the client, you can quickly do some background checks, see how many staff they have ect. If they are a decent size operation then yeah they will probably pay. You can run into people who don't pay you all over the place it happens with all businesses, contacts and statement of works don't meant jack for some people. An element of trust needs to come in with the business. But yes I can 100% understand people not wanting to take on specific projects.
Before you do anything, just ask them what their budget is. You've cut out half the work then. It takes a bit to get used to, being so upfront, but you've got to make it worthwhile.
The biggest barriers to constant work at good rates are freelancing sites that pit well versed SEOs against each other for really ordinary rates. They have created a low entry barrier for just about anyone to say they can optimise a site at low prices.
There have been numerous leads I've scoped for, only to have them come back with what they want to spend. In these situations, I say thanks for the chat and move on.
If you find yourself having to over-justify the spend, then send the lead to freelance sites.
NEVER be afraid of putting value to your work. Don't underestimate what you're capable of because you want to get a lead.
from the SEOs point of view you are right but from the client's perspective its kind of stupid to tell them what they can spend at step 1!
I mean why pay $1000 when work can be done in $500 #youknowhowitis!
What I usually say to people is the following:
1. Due to recent demand for our services, we only take clients on a at a min spend limit per month of around $750+ / month, sure we will take on lower spend if its a friend of the business or something. I mean some companies have min spend of $2,000 + a month or even more for some bigger companies have higher min spend levels. 2. Always have a quick chat to people when they come in as a lead to qualify what price they want to pay. What have they done in the past what type of budgets ect. What KPI metrics do they want to track. I usually show people advice about picking an SEO company - http://jamesnorquay.com/tips-for-selecting-a-company-to-do-your-seo/
3. In the end of the day if their budget is small and they want to pay $5 bucks an hour for SEO. I say fair enough their are plenty of people who can do SEO on oDesk ect. I appreciate the call and the opportunity.
My biggest tip when doing business development: You need to know when to say NO to people!
Your last tip is Golden... unfortunately i learned this the hard way... learn to say NO or die!
16 comments, but not a single one with more or less exact (sample) price for a client per week of work.
A lot of people aren't comfortable sharing that information. What I charge, based on experience, where I live, etc, could be completely different to someone in another part of the world. It wouldn't be smart say I earn $600 a week when you don't know how much of that goes on living, bills, and so forth.
In fact, I'd say earning $600 a week here could be equal to someone earning $400 a week in another country, so the purpose of sharing the prices, at best, gives someone a ballpark.
When I lived in Belarus I started from $50 a week (I never charged per hour, just per week of work from Monday to Friday, and I sent my reports in Excel with GA PDFs every Friday). My first SEO job was to build 10 backlinks. The client paid me $10. Then I moved from $50 to $200 a week. Then I moved to the US.
This is the first question many small business owners ask me and it is perfectly normal to know in advance and before making a decision how much will SEO cost your business. To get directly into the point, there are 3 different pricing models when it comes to buying SEO services:
1) Per hour
2) Per project
SEO Services per Hour
Per hour is the most popular pricing scheme. You pay the SEO Company or SEO consultant a fixed rate per hour. What usually happens is that you make an agreement in advance of the activities to be performed and the estimated hours needed and at the end of each month (or project) you are given a report with the details and the actual number of hours worked. You then have to process payment according to the agreed hourly rate.
What is the range for hourly rates?
The range for the SEO services rate goes from $20 per hour to $200 per hour. This huge difference depends on a number of factors, some are explained below:
Region – According to different studies SEO services in Australia costs more (on average) than buying SEO services from a United States firm.
Size of the company – The bigger the company the more money you will pay for SEO
Of course there are always exceptions to the above rules. For example our hourly rate at the moment is $30 and we offer SEO + Internet marketing services for small and medium businesses (see details below as to why we can offer lower prices).
SEO Services Per project
This is different than the per-hour pricing scheme. You agree with the SEO firm a standard price for the project as a whole regardless of the hours spend. Usually there is a 30% down payment and the rest in predefined milestones (i.e. completion of campaign, go live for a redesigned website etc.)
Thanks for sharing your thoughts! I'll be choosing from those models for my services..
How about people answer a quick survey on this anonymously: http://www.surveymonkey.com/s/ZHPQMRV
I'll share the data at the end of September to give people a chance to enter in the information.
You got a nice topic for discussion here Venchito. I think per hour is the most popular pricing arrangement and more appropriate. You can pay the SEO Company or SEO consultant a fixed rate per hour. I guess this is much better.