If you’re confident about the results you can achieve for a client and not in dire need of cool hard cash, performance pricing could be an option.
Value-based pricing sets prices based on the value clients gain, rewarding providers for delivering results. It aligns interests and incentivizes solving costly problems, though providers must understand value provided and guide clients to recognize it. In this article, we break down the how’s and why’s of a value-based price and show how you can take the first step.
If you ask a freelancer or agency what they wish for the most, they’ll usually say “more leads and clients and recurring income.” Retainers are a popular way to get monthly recurring revenue (MRR). But retainers are not without issues and they should definitely not be considered “passive income.”
Value-based pricing helps shift the focus to outcomes from deliverables, and encourages everyone involved to work together for success. But, it can be hard to persuade customers to switch to this model since they may be used to something else. This article discusses three methods of pricing: contingency, performance-based, and fixed price. We also explain which methods to avoid.
An effective way to better understand what your customers value most is to map the customer journey. With a thorough understanding of the customer journey, you can streamline your marketing and communicate value directly. In this post, we share insights on how you can enhance your value-based pricing ability, by gaining a profound understanding of the customer journey.
If you have stumbled upon our website, you either know what value-based pricing is or you are curious. As with most things worth learning about, there is a lot on the subject, so this post is intended to serve as an introduction with references to further reading. The topic is long and wide, so we can't cover it all at once.
Shifting from cost-plus hourly billing to value-pricing might seem daunting. “Where to begin?” is a common question. It all starts with how you relate to others. It’s a mindset, not a method.
A client once told me a story from his life that beautifully illustrates how understanding what other people value gives you the opportunity to enrich their lives.
Value-based pricing is a complex subject that involves more than just marketing and customer experience design. In order to effectively capture the true value of your services, you need to invest in both. The goal is to provide a superior customer experience that isn't just about selling something different from the competition but offering it in a unique way that offers greater value.
When you use hourly pricing or price for effort, your pricing reflects the time, effort, and work that went into producing the service or product. But what does that mean, and what are the consequences of billing for effort?
I admit it! We love value-based pricing and for many good reasons. But value-based pricing isn’t the only way to price your services. Choosing a pricing strategy can feel daunting. In this series, we’ll take a look at some common pricing strategies used by agencies, consultants, and freelancers. We will list their pros and cons to help you choose the best strategy for you.
Agencies with high pricing power can raise their prices without their clients raising their eyebrows, if the circumstances are right. By leveraging this fact well, you can sell rather trivial "grunt work" as highly critical "nuclear event work," for which price isn't an issue.
If you ask a business owner if they know their business model they’ll likely say that they do. Chances are they tell you something focused more on what how they do rather than what they do for others. As a result, they fail to grasp the value they create and being able to price for it.