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


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.

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 Link

Good design is subjective Link

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 Link

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 Link

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 Link

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 Link

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 Link

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 Link

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.

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 Link

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 Link

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 Link

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 Link

  • Burns Auto Parts6
    Leslie Burns-Dell’Acqua is a consultant for professional photographers, but much of her work, and her two podcasts on pricing especially, can be generalized to all types of creative work.
  • 12 Realities of Pricing Design Services7
    Good list of points to remember.
  • Harvard Business Review on Pricing
    Just in case you really want to throw down some money to read one of the most respected business schools in the world talk about pricing.

Footnotes Link

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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.

  1. 1

    Very insightful article. Thank you for sharing!

  2. 2

    Useful information… thank you thank you thank you.. you guys rock AND ROLL

  3. 3

    Edgar leijs

    July 14, 2009 5:53 am

    I think i must agree, I’ll share this on twitter!

  4. 4

    Thanks, very useful!

  5. 5

    Hmmmm…. a good read and full of great information, v.nice and thank you for sharing this. :o)

  6. 6

    Good article! When I price design work I find myself thinking about the possibility of that wonderful “spark” of creativity also. I usually give an hourly rate with a set minimum, this also depends on the complexity of the project based of previous talks with the client. Though setting a fixed rate period works out well also, if you get the spark and finish in a few hours you’ve just made an awesome profit.

  7. 7

    Excellent article! I always have trouble when it comes to pricing my work. I love the comparison between wine and design, I completely agree to that. I look forward to more articles from Jeff Gardner!

  8. 8

    Robin Parker

    July 14, 2009 6:04 am

    Correct me if I’m wrong, but doesn’t revolve around getting designers to do spec work for free, on the off chance that they might win and actually get paid for their work??

  9. 10

    Grace @ Sandier Pastures

    July 14, 2009 6:07 am

    Very timely since I have been looking for web designers to create a new blog theme for me. Sadly I have very little budget and still looking for that “Good design that’s cheap” ones…

    Great article!

  10. 11

    I charge hourly when I freelance. Just over half of what we charge here at the studio. After sitting down and talking to my clients I, draw up a proposal based on the number of hours I think it’ll take for me to complete a job. If they want something creative, I allocate more hours to the design time, if they want something less creative, or don’t want to spend a lot of money, I’ll allocate less hours to design. Research should also be counted for in any pricing structure, as should client meetings etc.

    Charging by the hour helps clients to visualise where their money is going. Design is a process and as such, parts of it can’t be quantified. It’s important to have a pricing structure in place so that your clients can relate, they need to see where their money’s going. That’s why I won’t be moving away from an hourly structure anytime soon.

  11. 12

    I find as a creative contractor (writer/creative director) and purchaser of design (animation/graphics) for my clients, the biggest factor they fail to factor in is TIME. The old adage “good, quick, cheap–pick two” generally applies.

  12. 13

    Onur Oztaskiran

    July 14, 2009 6:20 am

    Pretty good article. Except for the pricing part. As long as we enforce designers to generate pricing as competent as they can, the rates will keep dropping down, and in a couple of years, we will find ourselves doing stuff for $1.

    I never work cheap and never regret because I don’t. I stay hungry but never undervalue my work. So my best suggestion on that is, whatever you think your work is worth, add a few more values to it and send to the clients, because eventually they will try dropping it a little down and at the end you’ll get paid exactly the amount you wanted.

    Golden tip =)

  13. 14

    Great article. I work as a developer, but handle a lot of the project management and am often tasked with the grim job of “hiring a designer”. In my experience, finding a skilled designer with an interest in your brand is a hard task, and we pay well for our designers too. Far too often we get hyped up by a designer, only to find them slacking and pushing pixels, 1px at a time and charging hourly for it, or over-charging on super simple tasks (Ever seen 3 hours to add 1 solid line and 2 lines of text?). Good designers are definitely a rarity, but sadly, bad designers who think they are good designers are far too common.

    I’m not a designer, “and I don’t play one on TV either”, but I’ve spent -many- years building myself in the industry and I’ve filled the designer boots more than a few times – It’s a difficult job, but far too often it really isn’t -that- difficult.

  14. 15

    Man, wish i had that article about 5 years ago. Very nice.

  15. 16

    Chris McCorkle

    July 14, 2009 6:22 am

    I generally agree with you. Thank you for sharing this!

  16. 17

    You’re so right. If I start a website where I do the design and the code work I always charge per project. If I have to do the updates for the website I charge per hour and send the customers one bill per month/year.

  17. 18

    I think this article misses a pretty critical factor in the QPR equation. When I read the word “Design” here, I don’t know what I’m supposed to think of. Is it pure graphics – color, form, typography, layout, composition? Or is it concept, visual communication and creativity – or is it usability, function and usefulness? Or possibly all of the above? In my experience failure to produce quality comes from ill refined requirements. Designers with strong grasp for design objectives and goals will typically succeed if their skill level and creativity are matched by their talent for visual communication. Good article, but I need more for this to really be useful.

  18. 19

    Joseph Cotten

    July 14, 2009 6:32 am

    I always price by the exposure the finished design will have, and thereby in conjunction, the benefit the finished design will provide to the client. So, if I design an outdoor banner advertisement to go on a small neighborhood street, it will cost MUCH less to design than the same banner displayed at a busy metropolitan intersection. The exposure of the design at the intersection is greater, providing a greater benefit to the displayer, and thus is worth more to the client. This method is per the Graphic Artists Guild Pricing and Ethics Guide.

  19. 20

    Very useful thanks!

  20. 21

    yea.. Wish I would have read this years ago…

  21. 22

    @Joseph With all due respect, that’s a method I really don’t agree with. All clients should be charged the same. Why does the final application of a design affect you at all? Charging based on the benefit that you think your design will give to a client is purely subjective, do you wait 6 months before you invoice them or something?

  22. 23

    Jarod Taylor

    July 14, 2009 6:42 am

    Awesome article! Written absolutely well. Good job!

  23. 24

    An excellent primer.

    We just re-branded and re-positioned our ad agency to focus more on value-based compensation models. The billable hour is a thing of the past, and totally useless to those of us in creative industries. There is simply no way to adequately bill for the time it takes to come up with a brilliant idea. If the creative spark for, say, the Apple logo took an hour or even a week to come up with, is what it is worth even remotely comparable to that time?

    As Amy says:

    The old adage “good, quick, cheap–pick two” generally applies.

    That has always been our mantra, and we are not afraid to let potential clients know that “cheap” is off the table because we are not willing to sacrifice “good” (and they are usually never willing to sacrifice “quick”). Not every dollar is a good dollar, and not every potential client is a good fit for us. It’s especially hard to turn away business with the economy the way it is, but sometimes you just have to.

  24. 25

    nice article. Thank you Smashing.

  25. 26


    All clients should be charged the same.

    I totally disagree.

    What the client is trying to accomplish has a lot to do with how the project should be priced. If they are unveiling a product in an already crowded market, the effort required to create something that will be effective is much more taxing than helping a client who is already at the top of a narrow market keep their footing.

    As the creative energy required for coming closer to the client’s definition of “success” goes up, so must the price.

  26. 27

    best post i have read on SM. Very good job!

  27. 28

    Jeff Gardner

    July 14, 2009 6:56 am

    Thanks for all the kind words everyone!

    @Jon Fukuda – I agree with your for sure! Ill defined requirements are one of the biggest killers in terms of both quality and frustration over pricing! If you have a very clear idea of what you’re trying to accomplish then the whole issue of pricing is mitigated significantly.

  28. 29

    @John S
    Thats where an hourly rate comes in handy. If a job is going to take longer, it’ll cost more. You’re still charging a base hourly rate. Some clients demand less time, some demand more, the ones that demand more, pay more.

  29. 30

    Kevin Monk (Mango Swiss Ltd)

    July 14, 2009 7:02 am

    I entirely disagree that you “don’t charger per hour”. We charge on a daily rate basis and this keeps some financial constraints on designers and stops the budget for a project getting inflated. What’s more – I’ve found that the quality of our design work increases when it’s time limited. We all need some degree of self policing; designers included.

  30. 31

    Bryce Howitson

    July 14, 2009 7:06 am

    I completely agree with Jon. By definition “design” IS NOT subjective. The visual aesthetic can be “liked” or “disliked” since lets face it, not every one has the same taste in color, imagery and so on. However, true design be it interactive, architecture, furniture, product etc is based on the simple premise of solving a problem. I’m not saying that the solution shouldn’t be beautiful, but judging a design solution simply on its aesthetic merits is circumventing the entire purpose of design. At its heart a design solution either solves a problem or it doesn’t, meaning there is absolutely nothing subjective or perceived.

    Let me propose an alternative. When purchasing design there should be a clear goal in mind. It may be the job of the designer/group to help define these goals, but the only way to determine the true ROI is to have something to measure. Left over logos or web templates may look very nice, but by definition these objects cannot solve the individual goals/needs specific to the purchasing party. Anyone who doesn’t understand this concept is unlikely to find any true lasting value to purchasing design.

  31. 32

    Andy Gongea

    July 14, 2009 7:07 am

    Good design is cheap – I don’t agree with that.

    You may find good designs at a relative small price but experience and talent are achieved only with hard work – and hard work is not cheap. And I don’t want to start talking about services like 99designs.

  32. 33

    This is is full of flawed assessments of general economics. Actually, it’s hardly addressing economics at all. You’ve completely misunderstood the nature of the business and failed entirely to acknowledge the relationship between clients and designers and the value of it.

    If helping companies perform better is your job and all that’s preached to them is cost-cutting manoeuvrings, you’re under-serving them.

    But, maybe you’re on to something. If it’s all about perceived value, then this article, full of bad advice might be just as valuable as good advice – for you, at least. You’ll irritate professionals who’ll read it, they’ll share the link with their colleagues, hits will increase, and you’ll get paid.

    Rather clever.

  33. 34

    Well done and straight to the point. I appreciate posts with straight-forward and valuable insight based on experience and practice. cheers!

  34. 35


    Thats where an hourly rate comes in handy. If a job is going to take longer, it’ll cost more.

    Hourly rate is bunk, as is the “time” it takes to do the work. I can turn out a good design a lot faster than a freelancer or a junior designer, and I would have to charge far more per hour than people are willing to spend for that privilege. It’s a deeply flawed model.

    I believe that the job should be priced based on the result it is expected to produce. If you were going to have open heart surgery, would you care about how much “time” it took the surgeon to get the job done, or would you care about how successful the surgery was?

  35. 36

    Roy Vergara

    July 14, 2009 7:21 am

    thanks for the great article! i found the pricing strategies portion to be particularly interesting.

  36. 37

    I disagree with the reasoning on charging by the project. In this business you have to be appealing, you have to compete and you have to work smart. That means being forthcoming about design and anticipating things like when a stroke of imagination will take 10 hours or 3 hours to become real imagery. What revisions will mean, how much trust you get from the client that your design is effective and their changes will cost them.
    I find that many projects you are going to be able to get your designs done just by working through them. The spark of creativity will always be apart of aspects of design, but in design these days, communication is key. And so is using proven tools and techniques, using what’s already out there, working like an assembly line sometimes. Using checklists. Pete the commenter is right on here. Having a minimum is good, knowing what you want to be worth and treating it like a business where sometimes you attract clients on price, perception or not.

    And you’ll get more clients later on because of your efficiency. Let your later clients benefit from your efficiency, even if the last client paid more. Why not reuse something and be transparent. What sounds like being fair actually isn’t. If you “buy in bulk” then your customers should see the discount too. You will be able to price people and feel good that you are faster and less expensive. If you are a company with overhead, surely it gets more complicated and you’ll start to have absolute project prices. At that point you also risk getting undercut by a few of us quality designers.

    I wouldnt’ compare wine with design. It SOUNDS cool to do, but on second thought it’s really just BS.

  37. 38

    Dennis Michael

    July 14, 2009 7:41 am

    Your article is confusing and somewhat concerning. Putting in references to SPEC WORK websites and saying “good design is cheap” degrades your article severely. You shouldn’t have put in a reference to Spec Work. This is a very touchy issue with those who wish to get paid accordingly and wish to rid our industry of these sites that demean our craft. I think you need to do some more homework on the graphic design industry before writing articles like this. And judging from your Bio, you have very little knowledge on Graphic Design Professionals and the Spec Work issue. Maybe you should stick with Photography references until then.

  38. 39

    I charge using a mix of hourly and fixed bid pricing. For the more well-defined design jobs for which I have enough experience to know how long it will take, I charge fixed bid based on my time estimate plus perceived value. For poorly-defined jobs or consulting work (such as helping a client define what they want!), I charge by the hour. I track how much time I spend on each type of design/development activity, so I will hopefully be better able to estimate fixed bid jobs over time.

    Well-known software engineering author Steve McConnell does a two-phased approach using the “cone of uncertainty.” He charges one price to get from unknown requirements to a pretty good idea of what to build. Then another bid for the rest of the project once he gets to the point of fairly well understood requirements. See Construx Software.

  39. 40

    Jeff Gardner

    July 14, 2009 8:05 am

    @Dennis M. – Believe me, I’m not in favor of spec work. And it looks as though a few people may have misunderstood those assumptions: I included those because they are commonly held beliefs in the minds of many in the general public. I’m not condoning those view or arguing for them, just pointing out that they exist, and recognizing that they are what makes pricing design inherently very difficult.

    @John S. – I like the metaphor of the surgeon! You don’t care how long it takes, only that the job was done properly. That said, I fully understand and (almost) agree with many of the comments backing using hourly rates, especially those of you that said you charge for the project in a lump sum and then charge hourly for work above and beyond the project (extra edits, collateral materials, etc.).

    Hourly rates bother me because, in the end, I think it cheapens the value of the work in the mind of the client. Too many designers charge too little for a service that is highly skilled! Unfortunately, charging hourly, can also introduce questions like “Is my designer actually working the hours that he is billing me for?” in the mind of the client.

    As a business owner myself, I always appreciate it when a professional (in any field) can know enough about their chosen profession that they can give me a rough total cost from the outset. It gives me confidence because it shows that they know what they are doing and they know how long it will take and what their costs will be in completing the work. And for them, while they take on a little more risk pricing by project, they are left with the upper hand in defining boundaries and terms (which is fine with me as the client, so long as those boundaries are clear).

    As I said at the end of the article though, these are only guidelines and, in the end, you have to make your own decisions about how to bill your clients – and for that, I’m glad that so many readers here have such strong opinions in both directions!

  40. 41

    Good article! But I’m still not sure how the creative coefficient works exactly..


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