If you frequent any freelance writing forum or community, you’ll notice thread after thread related to pricing.
“How should I price this?”
“How much should I charge for this?”
“What would you price this at?”
Over the course of nearly 20 years in this industry, I’ve concluded that rate-setting tops the list of thorny issues freelance writers navigate on a daily basis.
Today, let’s look at some principles about pricing that can help you confidently set your rates, no matter the type of deliverable involved.
Three Approaches to Freelance Pricing
In general, I see writers use three basic approaches to setting their rates: per word, per hour, and per project. These by no means represent every pricing model available, just the ones I see most frequently. And the truth is each of these approaches may be appropriate in different circumstances.
Per-word is a commonly used rate for freelance journalism. Many magazines and digital outlets pay per-word rates for reported articles. These rates commonly range from a few cents per word to $2 per word.
Per-hour pricing commonly applies to retainer arrangements. Many marketing agencies or direct clients will pay a set fee per month to secure a set number of your hours. Like per-word rates, hourly rates can vary dramatically, depending on the writer’s level of expertise and the number of hours the client desires per month. It’s not uncommon to see monthly retainers that range from $30 per hour to $100 or more.
Per-project pricing can be applied to nearly any contract. In this scenario, the writer quotes a single rate for a one or more content assets or other materials. Project pricing can occur on a one-off basis or on a monthly retainer basis.
Pros and Cons of Each Type of Pricing
Each type of pricing has its benefits and its pitfalls.
Per-word pricing gives you a concrete basis for quoting projects consistently. You could adopt a personal pricing model of $1 per word for blog posts, for example, which makes it easy to quote a job when a client approaches you. However, per-word pricing can drag down your effective hourly rate to a point that the project isn’t viable from a business standpoint. Ask a freelancer who wrote for a woman’s magazine back in the day, and they’ll tell you that $2/word sounds great until you’re on the sixth interview for a 700-word article and, later, when you’re performing the 10th round of edits. Women’s magazines were notorious for making ridiculous sourcing and edit demands on writers, but the same scenarios happen today.
Per-hour pricing can be useful when you’re quoting a project with nebulous parameters. For instance, if you really want to provide high-level content strategy to a client, but you don’t know precisely what will be involved, and they want you to interface frequently with their internal marketing department, then possibly an hourly rate makes sense.
On the minus side, hourly pricing works against you once you gain proficiency with a type of writing or some particular subject matter. I see nurse-writers, especially, penalize themselves for being able to write quickly on a general health topic. If your nursing knowledge and research skills enable you to produce a 500-word blog post on flu prevention in 30 minutes, whereas it might take another writer three hours, don’t penalize yourself by halving your hourly rate and charging that! Instead, your knowledge and expertise should add value to the client, in terms of reduced editing and fact-checking time, so you charge a premium hourly rate for those types of assignments.
Per-project pricing is the model I use the most because it allows me to maximize my effective hourly rate. But per-project pricing also has the potential to drag down your hourly if you don’t take the time to fully define the project scope, don’t factor in situations like editing-by-committee, or otherwise fail to pin down the many details required to give a rate quote that works in your favor. Still, I do strongly recommend going with project pricing at every opportunity because I feel it’s the best way to maximize your revenue.
Other Factors to Consider in Pricing
Beyond choosing a basic approach to pricing your services, in general, or creating a proposal for a specific project, you should take into account various other factors that affect how you set your rates.
As a nurse, you possess a high level of expertise in certain areas, such as within your particular specialty. In my case, I have a background in aesthetic medicine, which is helping me potentially land a lucrative client in this area. Your expertise demands you charge a higher rate than other writers because your expertise benefits clients in many ways, from enhancing the authority of your content to, as I said above, reducing fact-checking time, to instilling an authenticity that a non-clinician couldn’t possibly achieve.
Of course, your level of writing expertise must factor into the pricing equation, too. Whenever I’m asked to quote a type of writing that’s new to me, I price it lower than I would price something I’ve done a thousand times. That seems fair, given my level of expertise is lower. This doesn’t mean I offer bottom-of-the-barrel pricing in exchange for learning how to write something new; it just means I account for my level of writing expertise when quoting every job.
Value to the Client
Many writers will cite ‘market value’ as a factor in determining rates, but I have a few problems with that. First, figuring out what a ‘market value’ is can be tricky. For example, you can consult online rate sheets or “how to charge” articles, but always take these with a grain of salt. In my estimation, it’s very, very difficult to determine a ‘market rate’ for any type of content asset because, today, you must take into account the global availability of freelance writing services. For example, a novice writer in India likely will not value a 500-word blog post at the same rate as an expert writer in Vancouver. One may charge $25, while the other charges $500.
However, writers who talk about ‘market value’ have it half right. What you should consider in rate setting is the value to the customer of the content assets you’re producing. This is not the same thing as ‘market value.’ Every client possesses unique needs and aims to achieve unique goals. Whenever you price, you must make the case that your services will deliver the best value to that particular client. This type of pricing discussion allows you to justify your rates, no matter how they conform (or not) to “the going rate for this sort of thing.”
Regardless of the general pricing model you choose to use, you should always consider your expected time investment to produce the content assets required. You should aim for an effective hourly rate that compensates you adequately (or, better yet, handsomely!). And don’t overlook the time required to deal with invoicing, paperwork, and other bureaucracy when calculating your time investment.
However, the effective hourly rate should never be the end-all pricing factor that informs your rates. In a case of a project where you possess low expertise and price accordingly, your effective hourly rate may suffer some. In a case where you appropriately value your expertise and authority, your hourly rate may bulge. The effective hourly rate range should be just a scale you can use to make sure you’re not cheating yourself when pricing.
Factors You Should Never Consider When Pricing
All too often I see writers taking into account various factors that have no business entering their pricing calculations. As nurses, we often tend toward “people-pleasing,” and you must resist that urge when setting rates – except that you should focus on pleasing the one ‘people’ that matters most: YOU. Avoid these pricing traps.
What the Client Likely can Afford
I see writers bring this up frequently in discussions about how to price a service. They will say something like, “This is a big agency, so I think they can afford a higher rate,” or “They’re a start-up, so I expect they can’t afford to pay much.”
These considerations have no place in your pricing model, and you should banish them immediately.
Let me ask you this: When you walk into a Mercedes dealership, does the salesperson size you up and think, “I don’t think she can afford to pay $65,000 for our new convertible, so I’ll offer that car to her for $20,000 instead”? OF COURSE NOT. Because what you can afford is your business, not the car dealership’s.
The same is true for your pricing. What the client can or cannot afford is none of your business. Your rate is your rate, and if they can’t afford it, then they can move on to a different writer.
Your Current Workload
Many of you will tell me I’m wrong about this. I understand. It’s dreadfully difficult to grasp the counterintuitive nature of what I’m about to say.
A lot of writers – and I have been guilty of this myself, in the past – discount their prices when times are slow. Look, I get it. When you’re desperate for work to pay the bills, sometimes ‘anything’ seems better than ‘nothing.’
I urge you to avoid this type of thinking. It is a scarcity mindset, not an abundance one.
To make my case, I’m going to quote from the book Million Dollar Consulting by Alan Weiss, Chapter Nine, “Establishing Fees:”
“…here are some instances and conditions that might justifiably cause you to cite fees at some levels below your usual level.
“Note that none of these reasons includes ‘tough times’ or ‘business is slow.’ Whatever your fee structure is – and we’ll examine several alternatives in a moment – you must adhere to it. If you do, you’ll find your business growing steadily over the long haul. If you don’t, then your approach is ‘whatever the market will bear,’ and your short-term income will be at the expense of long-term wealth.”
I strongly recommend you read this book. There’s a newer edition than the one I have, which is well-worn and dog-eared. This book revolutionized my own business practice and drove my revenue skyward.
The Going Rate
As I said above, you should never allow a client to talk you down by citing “the going rate” for something. There is no such thing as a “going rate,” there is only value to the client. It is your job to make an airtight case, in terms of the value you’re providing to the client. When you do, the “going rate” discussion goes out the window.
What do you think about this rate-setting advice? Post your comments!