Copywriting rates: Does an hourly rate limit your earning potential?December 17th, 2013 2 Comments
This is a question I’ve thought long and hard about, over the last 11 years. My answer? I don’t think it does. Here’s why…
When you quote fixed prices, clients focus only on the cost
Perhaps an hourly rate would have been limiting in the early days, but not anymore. I used to work to fixed prices. Did that for 8 years. But I found there’s a limit to what clients are prepared to swallow for each project. Ghost-blogging is a great example…
For a quality article, I’d usually spend upwards of 3 hours (most likely 5-10). Let’s assume 6. Most clients, big or small, are not prepared to pay much for articles, so I’d calculate a fixed price based on how many hours it would take me, and how much I have to earn for that time to make it worth my while. After 11 years, I know that amount is $150/hr. So if I quote a fixed price on a quality 700-1,000 word article, here’s what I have to say to the client: “Hi John. Your article will cost $900.”
With an hourly rate, they also think about the work involved and the value
If, on the other hand, I quote an hourly rate, here’s what I have to say to the client: “Hi John. Your article will take me about 6 hours. At my standard rate ($150/hr), that’s around $900.”
In my experience, clients are more likely to baulk at a flat cost of $900, because all they see is the cost. When I quote an hourly rate, however, they see the hours that go into it, they consider that my hourly rate isn’t much more than most plumbers’, and they start to think about the value, not just the cost.
Yes, there’s also the uncertainty of the hourly rate to consider. But when the price is this high, I think the other factors, described above, outweigh that concern. (Plus I also prepare a written proposal, and I assure the client I’ll tell them the moment I think their project is going to take longer than expected.)
With the ‘ideal client’, fixed prices are the way to go
Yes, I agree if you quote hourly rates to a client with deep pockets and a true appreciation for the value of copy, AND they want you above all other copywriters, you’re definitely shooting yourself in the foot.
But I don’t get many of them
Let’s be honest. There aren’t many of that sort of client around. So your earning potential is always going to be limited by how many hours you can work. No matter what your pricing model. That’s why I also sell ebooks and software products. They earn money even when I’m on holidays.
Read more about my reasons for switching to hourly rates
Of course, these aren’t my only reasons for switching to an hourly rate approach. Read more about why I switched to hourly copywriting rates…
Please comment below with your thoughts. I'm not so old a dog that I can't learn a few new tricks!