Quality-Price-Ratio in Web Design (Pricing Design Work)

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I’m about to make a bold statement. The quality of a design and the monetary cost of producing or procuring that design have absolutely no relationship whatsoever. It’s a bitter pill to swallow, I know. Many of you are crying foul at this very moment, but hear me out. I’ll explain my radical position – and hopefully give you a few pointers about how to more effectively price and position your design business in this brave new, and uncorrelated, world.

wine
original image by Kris1

Quality-Price-Ratio (or QPR as it’s commonly referred to) is a concept that is used extensively in the wine trade. In it’s essence it’s nothing more than a measure of perceived value, of the enjoyment you receive weighed against the price you have to pay. Do you feel that the benefit your gained was worth the price you paid? If you don’t, then the product or service has a low QPR. On the other hand, if you feel like you got away with highway robbery then the product or service has a very high QPR. I’ll spare you the metaphysical comparisons between wine and design beyond this one important point: There is no correlation between price and quality when discussing wine or design.

The Assumptions

Good design is subjective

While most good design shares many of the same basic characteristics, beyond a certain point the perceived value of all design is subjective. What appeals to me may not appeal to you; in fact, you could go so far as to say that you hate it. But, if you were being honest (and the work in question was in fact well done) you would have to admit that it was, at the very least, well put together.

Good design is cheap

Don’t misunderstand me. I’m not saying that good design should be cheap or that it always is cheap. I’m just saying that, these days, good design can be found very inexpensively. Think 99designs2, Graphic Leftovers3, and even some of the more reputable stock agencies. These services are extraordinarily popular because they bring good design to people on a budget. These services can also be extraordinarily difficult to compete against.

Good design has no correlation with price

From the client’s point of view, the QPR of design falls into four, and only four, categories.

Listed from lowest QPR to highest:

  1. Bad design that’s expensive. As a client, you do not want to be here – it’s a world of pain.
  2. Bad design that’s cheap. This type of design, I think we’ll all agree, has a fairly low QPR because, well, it still sucks even though you paid very little for it.
  3. Good design that’s expensive. This is a tough one. You’ve gotten a great product, but you’ve paid a hefty price. You normally just tell yourself that you did the right thing because everyone knows, “you get what you pay for”.
  4. Good design that’s cheap. This category has the highest QPR because you are getting a great product for a small price! Who doesn’t want to be here?

Your clients are clearly looking for that magic fourth category, while you’re trying to get them closer to the third. This is what makes selling design so difficult – you’re interests and the clients interests are clearly at odds.

Good design is about attitude

A little attitude and a little cockiness never hurt anyone. I would argue that those two qualities have actually helped more businesses than they’ve harmed. Why? Because being confident in your product or service is infectious. If you believe strongly in the value and the worth of what you’re selling, your clients are going see that – and respond in kind.

Good design is about branding

Brand is all about good will. Having high brand equity is nothing more than having a stockpile of good emotions and good response reactions from consumers. What does this have to do with good design? It doesn’t, other than the fact that consumer will give the benefit of the doubt to a design that has a strong brand behind it. They may not know what good design is, but if they respect your name – chances are they will respect your design.

Pricing Strategies

Let’s face it, deciding how to price your creative services is hard. You are, in essence, trying to attach a discrete number to your creative acumen; which makes it seem very much like you are bragging if you charge a lot or like you have no backbone if you charge too little. But it is imperative that you get beyond these feelings. Design, and good design especially, is a very scarce resource and, as such, should be priced accordingly. But how to go about arriving at a number?

A note about premium services

I once heard about a wedding photographer (who charged average prices) that wanted to work less. So, she figured that if she just began raising her prices there would simply be less interest from clients. First she bumped up to $3,000 a weekend, then $4,000, then $5,000. To her astonishment, she actually began receiving more requests from clients. The clients figured that if she was charging such a high sum, she must be really good. Truth being told, she hadn’t gotten any better, she’d always been a good photographer – but the higher price led her potential clients to believe this and, in the end, they were never disappointed. Finally this photographer raised her prices to $20,000 per weekend, essentially pricing herself above what almost anyone could afford. Her potential clients then began offering to fly her to remote locations around the world just for the chance to have her shoot their exotic weddings.

I think you get my point. The old economic adage that higher price correlates to lower demand doesn’t always hold true, and this is especially true of luxury goods. Design is a premium service. A luxury good. It is certainly not necessary to run a business (just take a look at all the used car dealers of the world for confirmation), but results in a definite advantage to the businesses who value good design. Don’t be surprised to find that design and the pricing of design follows a slightly paradoxical pricing relationship.

This little story also illustrates how important market positioning is to luxury goods. You’d be a fool to try and compete on price with sites like 99designs, so don’t try. Compete on completeness, your creative vision and your customer service.

With our new assumptions and the idea that design is a luxury good, let’s take a look at a few tips to help you formulate a sensible price for your design services.

Don’t charge per hour

Design, or any other creative endeavor, should never be charged hourly. I know, it’s an industry standard method, but I whole-heartedly disagree with it – and here’s why.

clock
original image by Scarleth White4

Charging hourly works fantastically for things like stamping exhaust pipes or writing legal briefs – any type of job that is characterized by taking inputs and transforming those inputs using a specific process, it’s easy to see the direct correlation between hours and number of exhaust pipes or legal briefs.

On the other hand; with creative pursuits, and design in particular, there is often no time correlation what-so-ever. Sometimes you get that spark and a project takes 2 hours, sometimes you have to batter yourself for days before you feel that you have something remotely resembling a decent design. Should the client in the first instance have to pay nearly nothing for their design while the client in the second pays through the teeth?

Hourly rates are unfair to both the designer and the client. Well then, I can hear you asking, if not hourly, how are you supposed to figure out how to charge?

The cost of doing business

money
original image by bradipo5

The first step in coming to a fair and reasonable valuation of your services is to take a look at your cost of doing business. Cost of business is simply everything that it takes for you to operate. The cost of your computer, the cost of all the software that you use, if you rent office space, the cost of your office space. Think of every single thing that you use on a daily basis to get your work done and write them all down. This is your cost of doing business (I find it easiest if it’s written in monthly terms), and you should revisit and revise this number at least once a year. To estimate a per project break even figure you can divide your monthly cost of doing business by your average number of projects completed in a month and you will have an average baseline project cost.

Your cost of doing business serves as a baseline to your pricing equation. This, by the way, doesn’t mean that the average baseline project cost is the lowest price you can ever charge for a project, but, it should, instead, serve as a guide post to help you maintain profitability.

The creativity coefficient

Let’s not mince words, creativity is hard work. It’s not rote production, transforming inputs using a standard process. Design, as with all creative pursuits, is all about creating something from nothing; and because of this, creative work demands it’s own pricing methods.

Price = Creativity Coefficient x Cost of doing business

The creativity coefficient is nothing more than a multiplier that you apply to your base cost of doing business. This coefficient (or multiplier) gives the designer a measure of control to help match the prices they charge with the difficulty and involvement of the projects they work on. The creativity coefficient should be based upon three things:

  1. Difficulty: If the project is difficult or very involved – charge more. This should be clear at this point. If you’re producing one tri-fold brochure your multiplier may be as low as 1.20, on the other hand if you are completely rebranding and redesigning a medium to large company’s image your creativity coefficient may go as high as 10 or 15.
  2. Brand strength: Simply put, if you have a strong brand behind you – charge more. At first glance this may seem unfair but, in reality, it is the simplest and most effective way to separate potential clients into the two groups that matter. The ones that just want to work with you because of your name – but are going to be a major headache (especially over price), and the ones that recognize the value that your brand brings and are willing to pay for that value.
  3. Individuality: If the client is coming to you because you specialize in a certain type of design or in a specific medium and there is no one else out there that can competently perform the work – charge more. Niche work is important and there is value in being different, especially in today’s hyper-homogenized world, clients that come looking for something different will be expecting to pay premium prices for something that they cannot get anywhere else.

The creativity coefficient gives designers a simple and effective way to try and wrangle concrete numbers around the value of creativity. And because you are starting with a baseline amount that reflects your actual cost of doing business you are ensuring that your business will stay profitable.

The Take-away

Finding a balance in the way that you price your designs isn’t just about economics and finding the highest number that you can get away with. These guidelines are just that, guidelines. Hopefully they have given you a new, and inspiring, light in which to view your services and the value of those services – but in the end, it comes down to feeling that you are providing a valuable service to your clients and that you are being fairly paid for those services.

Further Resources

Footnotes

  1. 1 http://www.flickr.com/photos/kristinbradley/3430174833/
  2. 2 http://99designs.com
  3. 3 http://graphicleftovers.com/
  4. 4 http://www.flickr.com/photos/iloveblue/2415834085/
  5. 5 http://www.flickr.com/photos/bradipo/1435739708/
  6. 6 http://www.burnsautoparts.com/BAPsite/Index.html
  7. 7 http://vandelaydesign.com/blog/marketing/12-realities-of-pricing-web-design-services/
  8. 8 http://press.harvardbusiness.org/harvard-business-review-on-pricing

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Jeff Gardner is a business nerd. He loves spreadsheets, graphs and helping companies figure out how to perform better. He also enjoys writing, photography and being outside. You can check him out at his blog.

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  1. 1

    I’ve felt the same way about charging per hour for some time now, but it seems its rare to run into anybody with that same opinion.

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  2. 102

    @Andrew
    Thank you. You’ve summed up what I wanted to say far more eloquently.

    Design is not art. Art exists to justify its self, design always exists to serve a specific application.

    At Door4, when we work with our clients, we sit down and find out what they want to get from their project, what their budget is and what can be accomplished within the confines of that budget. We HELP them, because it puts us on a professional level. It ensures their repeated business. Any professional should know what he/she can do in a set number of hours. A builder would not sit down with one of his clients, factor in the cost of his own time and materials, then add an amount onto the top of his quote based on how much money he thinks his client will make out of the building. Need I remind everybody of the 80/20 rule? If 80% of your business is supposed to come from regular clients, and you’re ripping them off, how do you expect to grow your own business.

    I’m sensing two very different approaches to design on here (possibly cultural, if any of the companies in Manchester charged for their time the way a few of these posters are suggesting, they’d be out of business in months). One group seem to want to provide a service to their client, then get on with the next job. The other group can’t seem to stand the fact that they’re ‘just’ designers and not artists.

    Let go of your egos and start treating your clients the way they deserve to be treated: Inflated pricing schemes, pricing based on the depth of clients pockets and pricing based on the projected success or exposure of a creative (I’m standing by my guns on this) wouldn’t wash in any other industry and it’s what’s setting ours back.

    Apologies for the rant, but this is something I feel very strongly about. We’re here to serve our clients, not the other way around.

    @Jeff – You’ve opened up an interesting can of worms here.

    2
  3. 203

    For the most part, I am in total agreement with your statements. I often find hourly billing to be the bane of my creative endeavors. But there are some things that I feel you didn’t answer in your post. How does one determine a base line for different types of work, be it brand design, consulting, web design, web development etc..?

    Your formula doesn’t account for contingency. Contingency is what allows wiggle room in the price that you quote your client and can get you out of a sticky situation.
    I personally like to give the customer a range of time, so that they know what the maximum and minimum is for a project and then if you come in under that is savings to them, but then they aren’t surprised if you hit the top.

    We all know the adage that your time is money, and that is naturally why hours are billed, even though this may not be the best way of tracking the energy or thought that was used.

    I agree that price does not always equal quality, many agencies take advantage of their name to rob the client blind. But at the same time, someone who has had a lot of experience can manage and deliver projects without as much trouble as someone newer to the industry. And of course they charge more based on their experience.

    So while I do agree with the don’t bill hourly concept, fixed bidding is not always a good answer either as you will be roped into something that you may not like.

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  4. 304

    @Pete

    pricing based on the projected success or exposure of a creative (I’m standing by my guns on this) wouldn’t wash in any other industry

    We’re not like many other industries. We don’t manufacture a standard product that can be mass produced, and those that try only dilute our industry and cheapen it. Every project is different and every execution needs to tailored specifically to meet the objectives for which that project was intended to do. In most industries, the objective is never in question – either the product does what it was intended to do or it doesn’t. Beyond that, there are only slightly varying degrees to which consumers will measure the differences that determine how well that objective was met.

    The major issue we face is that more often than not, we have no real mechanism for measuring how we meet our objectives. And even worse, many of us don’t really care. If your company charges $10k for a website that was supposed to increase sales by $50k and fails deliver, and my company charges $15k for the same website, BUT if it fails to deliver will only cost $10k but will cost $25k if it performs, which do you think a savvy business would prefer to go with? The expenditure offers no link to the ROI, or the one that offers to tie the risk to the reward?

    Performance based compensation is not about ego, it’s about results. And in order to get those results the clients we work with have to serve OUR interests as much as we serve THEIRS. Risk, reward and respect are all two-way streets and for far too long those of in the creative fields have ceded our equal footing with our clients out of fear of the consequences. I appreciate that your opinion differs from my own, by I too feel very strongly about my position.

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  5. 405

    The Cranky Knight

    July 15, 2009 8:39 am

    Even though I may be relegated to being the sunk at the picnic, I can not agree at all with the application of QPR to site development. Granted, you do not have the luxury of ignoring the client, BUT the client is not the consumer. The site visitor is the consumer. That being the case, you have to contour the site to the expectations and behavioural characteristics of the true consumer. On top of that, the site has to be developed in such a way that it is marketable in itself in order to attract visitors.

    To accomplish those goals, a lot of effort has to be expended on stuff the owner never sees and/or doesn’t consciously recognize (such as information architecture, typography and vertical rhythm, usability, and all the rest).

    In short, in my view, there is a direct correlation between price and skill which translates into a direct correlation between quality and price.

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  6. 506

    ariel sommmeria

    July 15, 2009 8:46 am

    I don’t know soo much about design, but I do about wine. And good wine is expensive and often the quality is correlated to the price. ;-)

    1
  7. 607

    Yes, let’s remove the voodoo from the design process. But to oversimplify the definition and value of things like brand equity just show you’re oblivious to the strategic component of design. “Pretty pictures” are one thing, but when a design accomplishes a goal, that’s what the client is paying for. It takes time and expertise to develop a strategy (design or otherwise) and if it’s good and on track (hopefully #3 under your pricing scenarios), it’s worth every penny.

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  8. 708

    I can’t believe you even hinted at the idea of 99designs.com being ‘good design?’

    Good design is not cheap, it is not easy, and it is definitely not subjective.

    Not Cheap/Not easy – great designers take time to talk to clients, understand their problems, and solve them.

    Not Subjective – I think you’re confused on the difference between design and decoration. Designing is the act of solving visual problems, decoration (what you’re talking about in this article) is throwing a bunch of junk on a page to make it look cool.

    This is the only article I’ve ever read on Smashing that I really really hated. But I guess it’s ok because everything else I’ve ever read here has been amazing.

    1
  9. 809

    Good points however I disagree in some respects. I charge a top dollar hourly rate for my experience & expertise in the industry but also some similar ongoing projects I can usually just give an approximate overall value too and notify the client.

    My clients don’t complain as they know at the end of the day `You get what you pay for’ and the best bit is they keep coming back and not only that recommend me to their friends. But keep in mind these clients are long term and we’ve built up a very good relationship over the past decade or so. That is the critical part as your article seems more directed at getting new work.

    However as I stated you make some very good points that will work in some cases but isn’t the be all end all.

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  10. 910

    Awesome article!

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  11. 1011

    Price = Creativity Coefficient x Cost of doing business
    punch line

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  12. 1112

    99 design is the cheapest way to get best design … all you have to do is pay about 100 USD to 99 design (you can put any prize you want like 700 USD coz after all, you gonna win the prize) to do the contest and you can get all the best design idea (since idea can not be own only the implementation) … after you find the one that you like …. you login as designer and make any design that you as contest holder choose to win that is youself so the money or the prize will be back to your pocket.

    by doing it you can sell your design idea expensive while keeping the cost low .. about 100 USD plus some banking fee. I do that often and my clients always satisfied with my work.

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  13. 1213

    First off, this article has MANY assumptions not based on real day-to-day business practice. I can say with absolute certainty that much of the so-called advice in this article is very wrong and it carries with it much misinformation.

    1. Deciding how to price your creative services is not hard. First off, you have to be honest and decide if your skill level is average, very good, or top-end. Compare the design work you do to top-end designers such as 2advanced, 24-7media, and Agencynet and be honest about where you fall. Believe me, these top-end designers are charging a min. $100-$200 or more per hour for their design work!

    2. The don’t charge per hour comment is completely wrong! Up front, people want to know two things: How much? and How long? And you have to be able to tell them how much and how long. If you are an average designer you should be charging $50-$70 per hour. If you are a very good designer you should be charging $75-$95 per hour. If you are a top-end designer then you should be charging $100 or more per hour. You price out every aspect of the design and programming process. For example, we designate 12 to 16 hours for three home page comp designs depending upon complexity. You must price out the site page by page depending upon complexity. You do not say, well I charge per hour on a day-to-day basis and I don’t know what cost we will end up with. NO! Your client has a budget and wants to know up front an accurate cost range, and you have to be able to give them that range. And the only way is to pre-price out the job up front using an hourly charge based on complexity.

    3. Hourly rates are not unfair to the client, because they are to be used to create a cost proposal, not to be used as a day-to-day, hour-by-hour rate based on your “creative spark”. You give the client a cost proposal up front and work hard to make good on the cost proposal you made…move it!

    4. The comment on the cost of doing business is all wrong! Your operational costs are your own problem, not your client’s. If you rent out a plush $10,000 dollar a month office space because you think you need it and it looks cool for clients, well that’s your problem and perhaps a poor business decision on YOUR part.

    5. You should also have pricing levels based on technical skill and code complexity, for example:
    XHTML and graphic design = $75 per hour
    Programming and Forms = $100 per hour
    Database programming = $125 per hour

    Sadly, this article was NOT written from a real business perspective and fails to properly inform.

    5
  14. 1415

    @99design – sorry champ, but you’re an idiot. essentially your asking designers to do spec work with no guarantee of payment and that hurts the industry. no payment = no work, that’s all that matters. i bet you get paid a heap load from the dumb arses using your site and i bet you don’t trickle any of that money down to the 40,000 designers that are on there. you should be shot for this blasphemy, its digusting and i spit on you.

    sorry for the rant, but seriously, this ain’t on. check out no-spec dot com and give your support.

    5
  15. 1516

    The pricing model that I was taught and has served me well as both a designer and developer is to look at the salary you want to make per year then divide by 2000 hours which is roughly the amount you would work on a 52 week yearly schedule @ 8 hours per day.

    That gives you a baseline hourly rate. Then pad that by some percentage as you see fit to account for downtime as a freelancer, the difficulty of the project, and the client bringing you the work, cost of doing business, etc. Then take that rate and evaluate it against your market to see how you fare. A great resource for this is http://www.designsalaries.org/calculator.asp

    You should never, never, ever, work spec projects. You’re just selling yourself short. it doesn’t matter if the design takes you five minutes or five days, you’re being paid to come up with a solution and should be paid accordingly for the knowledge and research that you put into it. The idea that a client shouldn’t pay for the time it takes to evaluate different design options is ridiculous, if that’s the attitude of the client then the client can take their project somewhere else.

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  16. 1617

    An interesting, provocative article, and great for stimulating discussion and debate — I agree with many of the ideas.

    But in the context of pricing for the real world business of design, I think it’s simplistic and a little naive.

    Whatever terminology you want to use (“value-based compensation” or “creativity coefficient (X) cost of doing business”) essentially what you’re talking about is either:
    a) quoting a fixed-price before the work is done
    b) quoting an hourly price before the work is done
    c) some combination of the two.

    Either way, the client needs agree on the value of what they’re asking the designer to do before they’ll even give the designer the job.

    And that’s the difficulty with fixed-pricing (aka “value-based compensation”): clients are notoriously bad at understanding and agreeing with the ultimate value of design until the work is done and has proven itself successful (and sometimes not even then!).

    So, while the work on the Apple logo may have ultimately proven to be vastly under-valued at the time it was done, on what planet would the client have agreed to pay its ultimate value BEFORE the work was done? And for that matter, how would the designer even concretely define that value in a way the client would understand and agree to?

    The only thing that both a designer and client can concretely know before the work is done is the value of the time it will take to do the work.

    If you’re a casual designer or dabbler then this is probably an academic discussion without much consequence to you. But if you earn your living primarily by doing design, then how you set your pricing is serious business.

    And in serious business, time is money.

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  17. 1718

    First off, I admit that I did not read every single comment entry. So whatever I say may have been covered above.

    I think the discussion (and the creativity coefficient) fail to adequately consider two things: opportunity costs and correspondence time. Opportunity costs deal with the issue of the best way one’s resources can be allocated. If you are spending time on one client there is a chance you are denying other clients because you have allocated your resources (namely time) towards the current client. This client may be less-than-desireable and the project may be mentally taxing, but you have committed to it, so you have to resolve it. The financial implications of this business decision are not clear-cut, but need to be considered.

    Also, the no one appears to be mentioning all the time that goes into correspondence with the client that is not normally billed out. As we all know, this can eat up a large chunk of non-billable time. And correspondence time varies a lot from project to project. Somehow, this time must be recouped.

    Both of these factors make it even more difficult to give a clear-cut calculation to billing.

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  18. 1819

    The note about premium services is incredible. Not to say that I’m going to triple my prices just yet, but it gives you a good insight into how the industry works. Those few paragraphs completely changed how I look at the economy, as my introduction to economics class never got into luxury goods.
    Thanks for the article!

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  19. 1920

    Paying through the teeth? Sounds painful.

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  20. 2021

    Andrei Gonzales

    July 16, 2009 3:00 pm

    Nothing out of 99 designs or other crowd sourcing companies is good. “Pretty” != good design. Please avoid such misinformation. It only devalues the work required.

    0
    • 2122

      I would just like to mention how harmful crowdsourcing sites are to the design industry – many people don’t agree- they make people work for free – what was free labour called again? S- something – anyways If you are opposed to these kind of sites – designers take action – Please report the guilty platforms exploiting designers to the Better Business Bureau.

      0
  21. 2223

    GRAMMAR NAZI!!!!

    ” >>you’re<< interests and the clients interests are clearly at odds.”

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  22. 2324

    Wow. I am shocked that you mentioned 99 designs.

    As someone who runs a blog that represents our field, you sure do have no idea what you’re talking about.

    Welp, now I know what blog I won’t look at anymore, I can find “100 greatest whatevers” elsewhere.

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  23. 2425

    99 is a swetshop of desperate volunteers … it whores design to a level it should never be taken.

    Great article and response. Lets face it there is only one thing you can base your cost on that is quality of the work you produce and track record. Experience = charge more …. simple

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  24. 2526

    Great article… good comparison…

    but, authors website says “don’t use IE, use FF”, but in Firefox itself, I’m getting horizontal scroll bar…lol

    and it works fine in IE…lol

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  25. 2627

    I found this article very interesting and I believe that I agree with most of it, but after reading everyone’s points, I feel I still have much experience to gain. I have worked as a freelancer and I had many problems, as a student in North Florida, no one wants to pay for design.

    But like many people have brought up brand equity, ROI, and marketing, I also am learning (currently earning a degree in advertising) that these things can really help you understand how to deal with pricing. It is hard to think of your work as design, not art, I agree but your unique selling point is still creativity and can add to your quality of your work.

    Since I have been trying to find something other than sales to measure return, I find this an interesting measurement. I would love to find a case study where this is put to use and shows some kind of measurable objective in a real life situation.

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  26. 2728

    I could see how its necessary to charge by the job but you also have to give the client an hourly rate to account for any revisions to their requests. I can’t tell you how many times I’ve designed something exactly to what the clients wants only to make 80% changes. A job that I forecasted to take 4 hours easily can turn into an 8 hour job. And the client always has revisions.

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  27. 2829

    The “don’t charge by the hour” comment is pure ignorance coming from an amateur. The author even admits it goes against what everyone else is doing. “I know, it’s an industry standard method” – author. Yes it’s an industry standard, because it works. You can’t base your pricing model on IF you get or don’t get a creative spark. If you can’t crank out 4 or 5 logo designs in an 8 hour period then maybe you aren’t that good or fast of a designer. If you can’t crank out 2 or 3 home page comp designs in 16 hours then again maybe you really aren’t that good or fast of a designer. I can put all of this another way. If it takes you all day to create a single logo then you are too slow and not that good of a designer and you should seek a new career. If it takes you two days to create a single home page comp design, then again you are too slow and you need to seek a new career. Most all studios I know, including my own, charge by the hour based on the project complexity. It’s a common sense model and works well. If a client wants more designs or has a lot of revisions, then those requests are marked as outside of the original project scope and AGAIN you simply charge by the hour of how long it’s going to take to make the new updates; simple, easy, and effective. Clients constantly want to know how much and how long. You must be able to provide that information up front and the only way to provide that information is to estimate the hours it’s going to take and then multiply that hourly estimation by your rate of complexity. In your complexity model, XHTML and graphic design will always be at the lower end of your per hour charge while more difficult and complex services like database development or 3D animation will be at the higher end of your per hour charge. I could put it like this, database developers make more than graphic designers, because database design is much more complex and less people are skilled in it, therefore that service comes at a premium price.

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  28. 3031

    I completely disagree with the author. Finding the right price-per-hour that fits you workflow is a must for every designer, expecialy if you are a freelance. You need to schedule every work you do, so after 2/3 years of work you have a complete report about your common timigs over projects, so you can accurately extimate your prices.

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  29. 3132

    Great article! Excellent points, I don’t charge by the hour very often, but it still gives me a lot to think about!

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  30. 3233

    I’ll try charging $10,000 per project and let you know how it goes.

    Maybe some fools will believe I am worth that much like this lucky photog.

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  31. 3334

    Very interesting points – I’d love to have a chart of “creativity quotients”

    In the end, Creativity Quotients are almost like hours – but more subjective. That means we’re basing projects on perceived difficulty/creativity. For example, a trifold brochure for one person might be considered difficult – but because it’s harder for one person, I guess that means it costs more. It’s almost similiar to hourly. The better and faster you are at something, the cheaper it costs a customer. A slower designer who is just starting out would consider a simple brochure to be a 10, whereas we might consider it to be a 2. The person with the 10 ends up with a higher price point.

    We charge hourly, but this article makes it very compelling to change. But what about revisions, change orders, scope creep? Do you tell the customer some arbitrary numbers? Flat fees for each?

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  32. 3435

    Great article and really good discussions within the comments. It’s very interesting to find out other creatives thoughts and experiences.

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  33. 3536

    Great Post! Inspiring and Helpful. As creatives it is our duty to find a way to continue to progress in our endeavors and that means we have to properly price our services.

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  34. 3637

    Excellent post, and well-aligned with my thinking. An issue I wished was addressed was how to educate / convince / persuade potential clients that good design is not a commodity and why your rates are what they are. It’s really hard for me to send a proposal to a prospect explaining that it’ll be $4,000 to design and build their web site when they have no knowledge of what it really takes, how much time is involved, or why the $350 web site the kid down the street will make is ultimately a bad decision.

    It’s cute to just “charge a lot”, scare away the tire-kickers, and get premium rates for your services. But in the current economy, I don’t want to say “no” to any potential work. So how do I target, find, pitch, and win those clients who “get” creative design and the cost / value ratio?

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    • 3738

      I think if you’re working with people all other the world, it’s still easy to find premium gigs, despite the economy state

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  35. 3839
  36. 3940

    I enjoyed reading your blog and have subscribed to your rss, the points you make are all very insightful!

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  37. 4041

    I charge by the hour and it has worked great for me. There is too much nonsense, “business talk” on these blogs, if you get paid by the hour at a regular job, then it makes sense to charge by the hour as a freelance, only a little more, because well you have to pay for the internet, computer, phone and office space.

    That’s about it. If you get the “Creative Spark” in the shower in 2 and a half seconds, who cares? is the time that you spend putting the idea to work that counts.

    Is about kickin’ ass more than business talk.

    Thanks!

    Camilo

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  38. 4142

    Well structured and written. Thank you.
    :)

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  39. 4243

    Great article. It helped me understand the important things in my work.

    I also agree with Camilo, its creative work but also implementation work which is, very often, more important.

    Thanks.

    Mario

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  40. 4344

    Thanks for the excellent article! I was feeling stuck trying to decide what to charge for my services—there is NO concrete information about this topic on the Internet—and this helped me immensely. Now I can cross pricing off my to-do list and start worrying about building the actual business!

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  41. 4445

    I was going to write something clever, but this board is crowded.

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  42. 4546

    Many Thanks. I run a Web Design Firm and I was looking for a basis of working out how should I Estimate a work.
    Our Designs are good, liked by our Clients, but we are not highly paid for that.

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  43. 4647

    I have read the article, along with most of the replies. I think the biggest misconception (like some of you have mentioned) is the fact that most people see the design as just a pretty image, which is completely unnacaptable in this day and age.

    Fir example: you can have the nicest looking website with the lowest conversion rate on one hand, and on the other, a design that simply performs/converts (which might not even appear “easy on the eye” to some). Difference? Even if the client paid more money for the 1st one, the 2nd client has gained a greater return on investment.

    Another huge problem that I see is that graphic designers believe in providing several mockups up-front, and what’s even more frightening, ACTUALLY listen to their clients! Really? Why? You are the professionals! You, out of all, should know what’s best for your client; you should educate them instead of bending over and doing what THEY tell you to do! This hurts the industry so much in my opinion.

    I will use the good old heart surgeon explanation: you don’t tell your heart surgeon how to do his work, nor does he provide you with 3 ways he can operate on you. There is only one way to fix you, and that’s by doing it “right”.

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  44. 4748

    C&C InfoTech with expertise in PSD to XHTML, PSD to wordpress, PSD to Joomla, PSD to Drupal, e-commerce website development, search engine optimization, Online product entry.

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  45. 4849

    Thank you for making available this information & advice. It is invaluable to web designers who are starting up a freelance business.

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  46. 4950

    Good article, but question… What amount do you charge up front? A certain percentage? I currently have a client that’s looking for me to design and build them about 15 websites. I charged them hourly for their first website done (but I didn’t design it) and they paid me $650. I’ve been looking to raise my prices but never know the right time.

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  47. 5051

    Excellent article. It help me understand the valuable things in my work.because we are a team of website design but our charges starts from only Rs. 1499/-. your article is really help full for me…thanks again… :)

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