Public Relations practitioners are a dime a dozen, or so I’ve heard. Who’s not a dime a dozen are really good practitioners who bridge business and marketing with public relations (ok, here’s a plug, close your eyes…like Jayme Soulati).
Of late, more small business owners are asking me for hourly rates, and the answer is not one I ever provide immediately. Here’s why:
1. Hourly rates vary per client, project, budget available, deadline, and other parameters.
2. Marketing and public relations practitioners do not bill like lawyers. If someone in our field is billing $300/hour, that is extraordinary, and the small business is likely looking too far up the ladder or in an agency for a business partner. (By the way, even lawyers are getting slammed for hourly rates; more clients are demanding alternative fee arrangements.)
3. Independent practitioners should recognize that if a business owner is asking for an hourly rate, there’s an opportunity to sell a project or a retainer that becomes a long-term partnership versus a one-off hourly gig.
3. Before sharing an hourly rate, schedule a call (call it a “free consult”) with the small business owner to ascertain what the needs are or what project is looming that requires some marketing help.
4. After listening, assess the project duration. If you’re still tied in with the traditional ways of accounting, then multiply the hours to complete the project by an hourly rate.
A typical press release, for example, should be billed at about $500 (this includes research/interview, writing, approvals, publishing). That happens to be a project fee and not an hourly rate x 5 hours — why? Because senior practitioners who know their stuff can write a press release faster than it takes to engage on social media every day. Why should that expert penalize her expertise with an hourly rate to accomplish something more efficiently?
5. When someone asks for an hourly rate, push back and say, “how about a phone call?” Assess what the needs are. If you don’t do this, you’re worse off than if you provide an hourly rate. People are fishing and comparing notes — well, Sally in Miami is $250/hour and John in Little Rock is half that, guess John gets the business!
6. If you provide an hourly rate, you get no chance to sell your expertise. This is the clincher, so let me repeat…if you think that informing people of your cheap hourly rate is going to earn you business, you’re sadly mistaken. Don’t denigrate your expertise just to win a project for a few hours; you’ll find yourself backtracking and expending too much time for too little money.
7. Those business owners seeking hourly rates are likely shopping amongst a cadre of practitioners (because there are hundreds seeking work today) to find the cheapest labor. Remind yourself “people get what they pay for.” When you as a practitioner refuse to play that way, you’re doing yourself and your profession a huge favor. Be mindful of that.
If your response below happens to be, “yes, but it pays the bills.” I’ll argue and say, “I beg to differ, respectfully.” When you realize your valuable time is being eaten with a gig that went south, you can do nothing about it but lose money and deliver on the plan to save your reputation.
Amen. #ThatIsAll
I don’t share an hourly rate, at least not anymore, for writing or illustrating. I’ve found that the people looking for an hourly rate usually are bargain-shopping. They’re basing the value on the price rather than on the expertise.
@Erin F. You’re so right, Erin! It takes maturity to know when not to respond to that question, too. Better to say no thank you than to work yourself silly to lose money. Thanks for stopping in!
My standard line is “I’m not a taxi cab. I don’t charge by the minute or the hour. When you work with me, you’re not buying time: you’re investing for results.”
I resisted posting any fees on my site for over a year, and I’m still not comfortable with it, despite having done so. I prefer to customize each working relationship to the individual (that’s the way I’ve always done it IRL. I’ve never talked hourly rates, AND if someone were to ask me my fees in the first few seconds of conversation, I’d know they’re not my customer. I’d send the tire kickers to my competition, because they’re asking about rates before they even know if I can do something for them. I call it the dollar-store-buyers.) Every day I swing back and forth about having published some prices online, and there are clearly at least two schools of thought from the “experts” and “gurus” (did I just say that out loud?;) One: post them. People want to at least know if they’re in the ball park of consideration. Two: don’t. If people are interested, they’ll call/contact you.
It’s a conundrum. Great post @Soulati | B2B Social Media Marketing . You #RockHot as always. Cheers! Kaarina P.S. hmmmmm…I wonder if I can stir up a good old fashioned #TeamBlogJack here…mwahahahahaha
@KDillabough @Soulati | B2B Social Media Marketing I have the same battle about prices. I decided to list mine when I updated my “work with me” page. Maybe it’s a gauntlet of sorts. If people want to run it, then they’re definitely worth more consideration than the person who says, “But you know me…Can’t you give me a discount?” (And, yes, I’ve had people say that to me.)
@Erin F. @KDillabough @Soulati | B2B Social Media Marketing I still struggle with this one – and, for that reason, haven’t yet published my rates on my site (and Erin will remember me having this struggle in our podcast conversation!).
I understand the logic of publishing rates as a means of scoring the lead, but as I move into more and more project work, billing hourly doesn’t often make sense (except when I’m working with an agency as opposed to directly with the brand).
@jasonkonopinski @KDillabough @Soulati | B2B Social Media Marketing Yet another reason I don’t publish a rate per say. I publish how much a coaching session or sessions cost. 🙂 I keep my rates to myself.
@jasonkonopinski @Erin F. @KDillabough Great distinction — working as a subcontractor on the agency side. Sadly, the agencies have made us think like this — hourly vs. project. It’s every quarter hour of billing that has to be recorded; I know b/c I’m an agency brat from Chicago. Hard to get out of that rat race.
@Erin F. @KDillabough I think we had a discussion about that situation, didn’t we, Erin? I always assess the job to determine if I’m paying it forward, giving back, doing pro bono work or just plain old bootstrapping due to learning ground. There are so many ways to skin it; you limit yourself when you put one figure out there.
@Soulati | B2B Social Media Marketing @KDillabough Now I’m doubting listing prices again… *sigh*
@Erin F. @Soulati | B2B Social Media Marketing @jasonkonopinski It’s like the never-ending-story of a merry-go-round, isn’t it? I feel like I’m going round and round chasing my tail. Although I’ve put a price on a one-hour coaching session, I’ve never charged “by the hour”. I’ve always identified the project outcomes/results, what’s needed to help someone get there, and created a project fee, customized to the individual. But that just doesn’t seem to work online.It’s a conundrum for sure.
@KDillabough @Soulati | B2B Social Media Marketing @jasonkonopinski The only benefit of going through the process of listing a price on my site is that it makes sure I’m charging what I and the session are worth.
@KDillabough @Erin F. @jasonkonopinski EXACTLY! So why put that up there? Makes me want to run over and see what it is and “say, wow! She’s so cheap or she’s so expensive!” I was just at your house and that didn’t even cross my mind, but it will for some.
@Soulati | B2B Social Media Marketing @KDillabough @jasonkonopinski I think thesaleslion should give us his two cents. Or three, depending on what he charges these days. 😉
@KDillabough Don’t we blog jack after noon? Oh, it sure is on the East!
I hate to think that my competition are looking at my rates and then undercutting; I always get screwed anyway because I over service. So, what’s a few dollars in chump change?
But, because of the fact that some new businesses with VC funding may be green about how to hire a practitioner of any sort, I would not post my rates. It requires, as said, a discussion.
Love the “I’m not a taxi cab service! Not sure if you saw today’s Wall Street Journal; they’re considering assessing a tax on how many miles Americans drive and foregoing the gas tax!! OMG, really? What a nightmare.
@Soulati | B2B Social Media Marketing Did someone say BlogJack? In credit to this post and the fab topic, I can’t find a place to jump off and be naughty. It’s a topic we all seem to struggle with, and serious, beneficial conversation is ensuing. But it is after noon here….mwahahahaha
@KDillabough Dang, I love you, Girl.
Jayme, you’ve made a great case for charging by the project rather than by the hour! We’re not PR, but your principles can be applied to any service business.
Over time, and with experience at how long specific projects and tasks take, we’ve developed a mix of pricing structures that works well for us and for our clients. A website is priced by the project’s needs, but ongoing support is priced by the hour. Certain aspects of a video project are priced by the hour (length of time on-site) but other aspects are project-priced (artwork, DVD menus, packaging, duplication). Custom Facebook apps (e.g., website-in-Facebook) are priced per project, depending on the bells and whistles desired.
I think most people want to know right up front whether or not they can afford a service, so anything a provider can do to help a potential customer get over that barrier before first contact is made is a boon for both sides. That’s why we finally posted estimated prices for our most popular services on our website, to at least give people ballpark figures they can reference before they contact us. It’s saved us a lot of time, increased our sales, and made a world of difference in our sales process.
@New England Multimedia I remember when you told me you were posting your price menu and I asked you why. For you, it works. You have many different ways of working with clients and some of it is product driven. For me/we in PR, we have no product; it’s a service, a strategy and a deliverable that changes every time. I think there’s a difference…?
Hi Jayme,
Can’t say I disagree with your approach. The only thing I think someone might poke holes in is the idea of “it depends on the client.” What naturally flows from that for me is “So you’re going to charge me more because I’m Pfizer?” Perhaps you intend that statement differently; would love to hear your rationale then.
On the flipside, it’s allllways good to offer the nonprofit discount.
Clients love pricing per deliverable. On the vendor side, though, you sure can get screwed. Scope creep! Clients that go MIA and then you never get paid/finish the work! Endless revisions! Extra meetings! You can only prevent so much of that!
@jennwhinnem It does depend on the client, Jenn. Larger clients get charged more because it takes longer; period. Too many committees, too many meetings, too many approval processes, too much legal involvement, longer to market, changes, revisions, rewrites, blah, blah, blah.
If someone is charging per hour, great; if they’re doing a project fee, they’re screwed.
@Soulati | B2B Social Media Marketing Got it. Thanks for explaining. Perhaps that was just a hole in my knowledge and if so I’m embarrassed I aired that publicly.
Also, once, as the client, we allowed a T&M contract – when we got the bill it was $1M. That, um, sucked.
@jennwhinnem No hole in your knowledge at all; why would you know that, Jenn? Good grief Jenny Brown.
Now, who managed that $1M fiasco? I don’t believe you had carte blanche to say yes on that budget, right? That was the fault of the superiors who didn’t manage a bill. Who doesn’t know someone is billing even 1/10 that amount? Criminy.
@Soulati | B2B Social Media Marketing Oh I had nothing to do with it. Wasn’t my contract or budget. Happened w/in an org I worked for.
The biller’s invoicing system was being converted to another system…it took much longer than they expected. And then voila, 1M.
@jennwhinnem OMGosh; that’s LOL
@jennwhinnem I’ll charge you more because you have two n’s in your first name……just sayin’………
I’ve found that an hourly rate can be used against your too many ways. I always try for a project rate unless I have a long-term commitment. The one time recently when I did not get a project rate, it came back to bite me. So I’m with you 100%.
@barrettrossie Doesn’t this all boil down to trust? If someone unknown to me or someone I’ve only had a few conference calls with asks for my hourly rate, I ask for a call. I give more free calls than anyone I know. In that hour is tons of free advice; LOL. Ever been to Mexico? “For you, almost free now!”
Just like in my business, avoid the ‘shoppers.’ Set up the first meeting and see what the expectations are and if it’s a fit and you can help them, then come up w/ a pricing structure you are comfortable with. If they are just playing one off the other, that is a no-win proposition to begin with and rarely leads to a productive long-term business relationship.
@bdorman264 Hey, sorry I missed this comment, Bill. You’re right, of course. A sign of a good counselor is one who can walk away from a deal that isn’t right. That client will respect that.
Watched the Voice last night and the kid selected the coach who was most critical instead of the coach buttering him up. That was smart.
Hey, I’m finally here and boy there’s some conversation going on!
In my previous life I worked in the pensions industry and generally an annual fee was agreed in the contract indexing each year by whatever rate. Anything which fell outside that would have a project fee attached to it based on charge out rates for the employee level within the organisation working on the project.
When the economy turned sour everyone was undercutting everyone else for work and annual fees were getting more and more squeezed. The clients pretty much wanted something for nothing too. And they had every reason to as in the good times when the annual fees charged were much higher firms were happy to give that extra service with a smile. Now in the bad times, clients are still expecting that level of service but for much less money whilst the firms providing the service are looking more for the project-based work to supplement the annual fees.
Maybe providing free gummy bears is the answer!
@timbo1973 Look at what’s happened to JCPenney?! The former Apple exec now CEO is having a rough and tumble time getting peeps away from the customary coupon. When you spoil a customer, it’s terribly difficult to change their behavior; especially when it comes to price discounting.
The quality message will sink in, yet it will happen over time. Thanks for coming over, Tim! See, I have amazing gummy bears in my house!
“…(ok, here’s a plug, close your eyes…like Jayme Soulati).” Laughed out loud. Really that time, like a “ha-ha-ha.” Just burst out. Missed you, Jayme. Thanks for giving me more excuses for–sorry, arming me against–the side of me that whispers I may be missing out on something by not posting my rates.