When I first started out in the web design business (many, many) moons ago, I charged a fixed fee for projects. Back in the early 00’s, web design businesses were much more aligned with IT, and was a ‘thing’ that Advertising Agencies bought, rather than something that Agencies just were. From a business POV, back then, it was so much easier, to charge a fixed cost for email, or a website, or a blog add-on. But now, those of us who have graduated to more complex, integrated, strategic marketing services of which websites etc are a part, it is becoming almost impossible to quote per job and be effective.
In 2016, not only has my project proposal & spec/scope writing effort trebled (making me a very unhappy camper, because I hate writing long-winded documents and would rather focus on delivery), I am finding that there are increasingly more misunderstandings around scope, expectations, multiple providers doing lots of ‘marketing things’ with no strategy, and ultimately, unhappy clients with fragmented, poorly performing marketing.
Quoting per project just doesn’t work for the majority of (good) digital marketing providers anymore, because we are constantly having to pitch, get approval, invoice, chase for payment, clear up misunderstandings with other providers, clear up misunderstandings about what “completion” means… you name it, for something that is constantly moving & changing.
Many agencies still quote work on a per-project basis, and it shows in the results they are not delivering. I have traditionally charged this way, and I am going to be honest with you: it stresses me out. I hate it. It makes me everything I don’t want to be, and frankly, it makes me want to quit doing what I love at least once a week, because I simply don’t do my best work. When I am focused on planting the tree, I struggle to see the forest and I either find myself giving away strategy for free to win the project (to get paid), or implementing non-strategic ‘things’ to meet milestones (and get paid).
As marketing becomes more integrated, with multiple channels that change daily and need a rapid response and a rock-solid relationship between client & consultant, fixed-price billing just does not work in most cases. In fact, it actually undermines it in the long term, and it’s why so many clients feel neglected after the deposit is paid, no matter which Agency they work with.
Some truths…
Milestones are an absolute bitch to work with.
For everyone involved. Everyone is under pressure over something that should be creative, and fun to work on. There is only so much a great Project Manager can do when you are a freelancer who has finite time, is reliant on timely payments, working with other freelancers who are in the same boat. Project management skills work up to a point, but the nature of the business is that we find ourselves simply trying to survive, most of the time, due to delays and misunderstandings.
We are striving to meet milestones (and, as a result, put pressure clients to meet milestones) so we can get paid. I can’t tell you the number of times over the years where I have had to rush work or put pressure on clients for signoff, to get paid in time for Christmas or to pay rent, because another client had been sitting on feedback for 2 months. This erodes the relationship over time, because clientsshould be able to take their time, without pressure. We should all be working together to achieve perfection, and happiness, and quality and results. I should not have to send cranky emails about clients taking their time because I am worried about my rent being paid.
It sucks. But, on our end, just one delay on milestones in a project can fuck up our (and our providers’) entire month because we have planned for cashflow that doesn’t happen. This is not good for anyone.
Most small businesses are boom-bust with money.
For most freelancers, even the ones doing well, the juggle with project-based pricing often has us in a state of BAF (Broke as Fuck), stressed out and just juggling from invoice to invoice at least 50% of the time. It makes us emotional to always have $50k in the pipe and $-3 in our bank accounts, and sometimes, unable to see the woods for the trees.
We can’t pay bills with our pipeline, so it becomes a source of stress. And I will tell you from experience, it is hard to think strategically about your client 12 months from now, because you are worried about getting paid this week and are sending cranky emails. Cashflow stress for freelancers is a major distraction that does not create an environment for people’s best work.
Definitely doesn’t for me.
There has to be a new way.
As part of my rebrand that I have been (slowly!) working on, I have also been reviewing other aspects of my business, and what will stop me quitting this thing I love. Cashflow stresses me out. It pushes me into a place where I am focused on tasks rather than strategy and ultimately, it is not where I shine.
I have thought long and hard about what is most important to me. And that is to be seen as high quality, effective and a muse for your success. My billing structure prevents this from happening.
I want to be able to focus properly on my clients. It is what I do better than anyone I know. I want to make the money somewhat immaterial, so we can have great ideas, and innovate, and plan ahead. I want my services to be accessible and easy and different from other agencies, where clients can pay off their projects over 6–12 months.
I want to immerse myself, befriend you, be your favourite person and your CMO and become heavily invested in your results. I want to be overjoyed about this job I love. I am not driven by money and I resent the fact that it gets in the way of my best work. I get immense satisfaction from seeing clients succeed, and that is the part that I love: getting under the hood and helping others to build something great. I can’t do that when I am pulling a 40 hour sprint on a last-minute deliverable to get paid.
I am transitioning to a retainer model. Even project-based quoting will be spread over monthly payments (3, 6, 12, 24 months) instead of milestones. With costs spread over time, there are a number of advantages:
- Transparency. You know the costs upfront and can incorporate marketing spend easily into your budget and cashflow. It provides ease in billing and accounting on both sides, and you know what your marketing spend will be, well ahead of time and can plan (and review) accordingly. There are no surprise bills or awkward misunderstandings over milestones and terms.
- It is results-driven rather than task-driven. In contrast to short term, ad hoc projects (eg a website, or SEO, or campaigns, or hourly billing), we can take a more creative, more strategic, medium-long term approach and implement the best solution, from month to month, that benefits you.
- It is flexible. In an age where there are multiple, fast-moving channels that can change in an instant, the retainer model allows us to measure frequently, assess our strategy and pivot quickly. Every business is different, and requires a different combination of services to achieve their goals. When something is not working, we can identify the problem and try something new.
- We are a team. Both sides become invested in building an ongoing relationship/partnership, rather than simply “buying a thing”. Me and my team are held accountable by you for delivery and performance every single month. There is no “hit it and quit it”, which is common with many Agencies. I immerse myself in your business, am highly invested in your business and will act like an extension of your team. Your success is my success.
- There are no stones left unturned. Many businesses like to hire different agencies for different tasks, eg website, SEO/SEM, print design, email marketing, media. This becomes problematic when there are fragmented strategies, different agendas (usually it is to upsell what they provide), or a lack of clarity around responsibilities and/or project management. This usually results in communication problems. I provide a bespoke service that has no agenda other than to get you the best result for the lowest investment possible, and make sure that we have all our bases covered.
- We can be creative and have fun with your marketing. We are not limited to a specific project or engagement. If someone has a great idea that is out-of-the box, we can do it. Of course, there may be additional costs (eg video production or photography or ad hoc costs that fall outside of the package), but the ideas themselves and the planning are all included.
- We can plan ahead. We can plan well ahead of time so that opportunities are not last-minute or missed (eg, tax time, Christmas promotions, new financial year). If you book with us in January and need content for June, we can start planning ahead, knowing that we will still be working together. This allows for a calmer, less rushed campaign (which usually means better quality), and allows us to work together in the slow periods.
- We build more assets. If we find videos, or photos, or opportunities in our travels (eg whilst looking for stock photography or looking for templates), we can start to build you a collection of assets that make it easier when it comes time to execute campaigns. Again, this stops the ‘mad scramble’ that often happens, and ultimately means better quality, which means better results.
- Reporting is streamlined. We have a monthly, in-person meeting where we review results together. I also provide you with reports that you need, in a format that is accessible/understandable to any stakeholders.
- It ultimately makes everything more affordable. Ultimately, you end up being able to spread projects costs over 6, 12, 24 months. You can have awesome stuff done without having to lay out a lot upfront. It is more strategic and thus much better value in the long run.
So, my strategy is to now have a handful of customers, who want a holistic and strategic marketing consultant that will be your guide. You need to be able to commit to 6–12 months and ideally beyond, but this is where the great results are. It doesn’t matter what your price point is, but if you want a solution where you can spread the costs, get a better strategy and a tight relationship with your Agency, get in touch.