Hello Successful Creatives,
We’ve established that the mindset behind charging by the hour is a mindset that will never allow you to scale. This mindset must be broken if you are going to build a successful business that pays you in predictable ways. Instead of charging by the hour, you must consider how to package your services. Bundling your services and then offering a variety of packages is one of the best ways to make efficient use of the skills and services you already offer. Below is a simple example of this concept.
Consider how a web designer might package his or her services:
Package 1
Theme and plugin updates (within a month of release)
Email support
Package 2
Theme and plugin updates (within two weeks of release)
Email support
2 site changes per months
Package 3
Theme and plugin updates (within a week of release)
Email and phone support
10 site changes per month
Monthly WordPress lessons
There are a number of reasons this works. One is that you are leveraging skills you already have, but maybe never thought about selling. If you build websites, of course you can teach WordPress! Why not have a premium offer for a premium price that includes doing something you can do easily?
Also, you are not offering your potential client a yes/no option. You are offering them multiple choices. They also feel that, as the package includes more and more services, they are paying less and less for them.
(INTERESTING FACTOID: Most people will buy the higher priced options you offer. It is a statistical fact that only 20% of people will choose the least expensive option. Good to know!)
Learning how to organize, present and package the skills and resources you already have access to can make you significantly more income. In fact, it allowed me to more than quadruple my income in one year.
Let’s not forget that when you present clients with packages that are well thought out and organized, you make a much different impression than a person who simply gives the option of working at an hourly rate. A freelance worker charges an hourly rate. A real business offers options and a curated set of valuable products and services in the form of packages. From whom are you more likely to get a rich, thorough and professional service and result?
Selling packages also makes it much harder for people to compare you to the competition. If you give an hourly rate, the client will almost certainly compare you to the competition and value you based on how that hourly rate compares to your competitors. But if you provide packaged pricing, it makes it much harder to perform that comparison. Furthermore, we have found that the perceived value of a collection of services and resources, in a package form, is also much more likely to be selected by the kind of quality, high dollar clients you should be marketing to.
Look around at the various businesses you deal with and purchase from. How many of them provide you the option of buying a package of products, resources and services? Fast-food places do. (Burger, fries and a drink.) Cable companies do. Hardware stores do. (Get the drill and the bits and the special little do-dad for $99.99) Gyms do. (Access to the gym with personal training and bring a buddy for free.) The list goes on and on. Why do companies do this? Because it is an effective packaging and pricing strategy that works. It can be scaled. AND we have found that offering packages has a psychological effect that allows you to charge much more for the same services (or even fewer hours of that service) than you would make by billing hourly.
To your success,
Melissa McFarlane
Creative Successful Entrepreneurs
