How Charging Too Little Hurts You and Your Clients [Video]
Written by Joe Soto on November 28, 2017
If you’re a digital marketing agency, a consultant or a coach, chances are you’re charging too little. If you’re charging anything less than $1500/mo to your clients, this will be an important read for you.
Charging too little is not just hurting you, it’s hurting your clients.
I witness it all the time. Especially when you’re first starting out. You may be lacking the confidence and self-worth to charge more. And that might be a tough pill to swallow, but someone has to be candid with you.
So how does charging too little hurt you and your clients?
Charging too little means you have little budget to work with, therefore fewer resources to execute on getting your client results.
By signing on a client you’re committing to deliver on results for them. Typically, this means driving new revenue. Helping them get more customers or clients. If they aren’t spending enough on your fee, how can you justify paying a team member to do the work and dedicate the time necessary to drive results? If you’re doing all the work yourself, you won’t scale beyond a handful of clients. You can’t do it ALL for very many clients.
Your monthly retainer fee has to have margin. Ideally, a margin that leaves you profitable. So you’re hurting yourself as well because you have expenses including in fulfilling work for your client including your time and your team member’s time who’s dedicated to the client.
Think of it like this. Let’s say for this purpose you are helping clients with Facebook / Instagram advertising to get new customers or client inquiries (leads). Would you rather have (Group #1), 15 clients who all pay you $500 – $1,000/mo. + $300-500 in FB advertising fees or (Group #2), 5 clients who all pay you $1500 – 5,000/mo + commit at least $1,000+ per month in FB advertising? Which group of clients would you be afforded to help more? Which group of clients are going to be willing to collaborate to assure you have what you need to do a great job for them? Which group of clients will be easier to deal with?
Which group is committed to getting results? It’s your responsibility to show them that paying your fee sets them up for success. It puts them in a better position to get results. Isn’t that what they want anyway?
When you have more budget to work with, you can do a lot more for the client. You can deliver the results you promise. You make them more money and you make more money.
It’s ethically the right thing to do if you have your clients best interest (results) in mind.
There’s nothing worse than taking on a client for too little and not being paid enough to really help them move the needle, get results.
In my latest YouTube Video, I draw this all out for out in 12 minutes, showing you how charging more makes a lot more sense for you and your client – especially if you expect to get results. And, if you watch the video closely, I’m showing you HOW to sell your client on this as well.
While I do dive into the sales process that supports charging more in my Marketing Agency Academy online course, feel free to leave a comment or question on the YouTube channel and I’ll do my best to help.
Tagged as how to sell clients, joe soto, local consulting academy, social media agency training