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Why does even the lowest price makes clients run?

by man5
44 replies
I consider $20/ per hour as a the lowest price you can go if you are a professional. But it seems like most of my clients get scared and run away when I mention it. So this means, either I lower the price to keep the business or forget about those clients.

What is your opinion on it? What do you do in this situation?

Discuss.
#clients #lowest #makes #price #run
  • Profile picture of the author Mike Hlatky
    I have no idea what you are charging $20 per hour for. So, I can't really speak about that specifically.

    But, if it is a low price like you say it is, you might want to raise your prices. People usually associate higher price with better features, more quality, etc. Since your price is so low, your clients might believe that you aren't going to do very good work.
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    • Profile picture of the author man5
      Originally Posted by Mike Hlatky View Post

      I have no idea what you are charging $20 per hour for. So, I can't really speak about that specifically.

      But, if it is a low price like you say it is, you might want to raise your prices. People usually associate higher price with better features, more quality, etc. Since your price is so low, your clients might believe that you aren't going to do very good work.

      $20/per hour for graphics and website design work. I think I am attracting low level customers that don't have much money. I have 2 clients right now willing to pay me $20 or more per hour, but they got good income, so they can afford it.
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      • Profile picture of the author Mike Hlatky
        Originally Posted by man5 View Post

        $20/per hour for graphics and website design work. I think I am attracting low level customers that don't have much money. I have 2 clients right now willing to pay me $20 or more per hour, but they got good income, so they can afford it.
        No offense, but when I land on your website, it doesn't really scream, "I am a sweet designer, hire me". It looks like a very plain design and requires the visitor to scroll to the right to see the website - not very professional.

        Also, I have always paid for graphics or websites per project, not per hour. I think both parties are a lot better off if they can pay per project.

        NOTE: I am not trying to bash you. Simply stating possibilities of why no one is paying for your work.
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        • Profile picture of the author Ben Armstrong
          Have you also considered that it may be better to consult with the prospective clients on exactly what they want and then quoting them a cost for everything rather than charging $20 per hour?

          I also agree with the post above. I'd really put some work into the front page of your site.
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        • Profile picture of the author RachelCorrine
          You are getting great advice here. In my experience as a designer, clients like a flat fee (which you can base off an hourly estimate). Also, paying $20 per hour is crazy low. Those are student prices where I come from. You clients are likely not taking you seriously.
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      • Profile picture of the author Daniel F. Lavoie
        Originally Posted by man5 View Post

        $20/per hour for graphics and website design work. I think I am attracting low level customers that don't have much money. I have 2 clients right now willing to pay me $20 or more per hour, but they got good income, so they can afford it.
        Website design is really - really - competitive (I know that, I've been in a business venture in that same niche in a past life).

        The problem is that everyone know a young kid in their family or friends who 'can' make a website for them at a cheap price.

        So when you come off asking for 60$+ for the job they can't believe why it's so expensive.

        The secret :

        1) Go after people who already have invested money in a website before and know how much it costs for a great design.

        2) Go after people who have money. There are a lot of tire kickers out there. You don't want to deal with them.

        Daniel F. Lavoie
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        • Profile picture of the author CMCarlin
          JonWebContent has it spot on when he mentions that value is more important.

          Price is merely perception. Its what they get for that price that gives it weight. Of course, a customer needs to be able to actually afford it too, but you don't want those customers. They can tend to be higher maintenance than the guys that can and do pay for premium services.
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  • Profile picture of the author goharnett
    what I say if I know the person will balk, which goes for those economy minded clients, is "I normally get $120 per hour, but I'll give you your first hour for $50. Does that sound fair to get started?"
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    • Profile picture of the author myob
      Walk away.
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  • Profile picture of the author SolomonHuey
    There are people who will pay your price.

    That being said, most online marketers would be able to find similar services for much cheaper and with fantastic quality.

    Honestly though, there are too many variables to say why or why not people would be willing to pay the fees you're asking.

    Solomon Huey
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  • Profile picture of the author Zachmo
    You could improve your website so clients will just go speechless and wont bother if the price is so high or so low as long as the site's design speaks that the designer is worth it to be hired.
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  • Profile picture of the author Silas Hart
    Kudos for you for figuring out how to advertise that you make websites and charge $20 an hour.
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  • Profile picture of the author J.M.Wilson
    I suggest you read Dan Kennedy's "Ultimate Sales Letter" and in this case pay particualr attention to the chapter entitled "Beating The Price Bugaboo"
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  • Profile picture of the author Ian Varnava
    I was always under the impression that freelance web designing and graphics design was more of a "per project" based price, and not a "per hour" price. Do you tell the client "It's gonna take me 3 hours to design your logo so that's gonna be $60 at $20 per hour"? Hmmm... there's something here I am not understanding.
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  • Profile picture of the author man5
    My website isn't done. Of course it needs to improve on design, but i rather not wait until it's done perfectly and then advertise it. I have the basic design down. Just needs to stand out and perhaps a better written content.

    I didn't say no one is paying me. In fact, I got some clients even before I put up the website. I think the problem is that when ever I advertise it, I say it in a way that they can afford it(good marketing strategy though). And that attracts low level customers around here, that think they can get a graphic design work done at a minimum wage price.

    I mention them 2 rates. 1. hourly. 2. per project. And now the 3rd one I added that has monthly feature. But I don't think I am going to continue with anyone that is going to brag about the price issue, especially if it's more than fair, compared to this industry.

    I am still new to IM and being self-employed. In fact, I never actually realized I was self-employed/entrepreneur until recently. I have been making fair bit of money. I just need to get little more experience and knowledge under me and then I can start marketing to the big guys(rich fellas).
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    • Profile picture of the author Gary King
      Originally Posted by man5 View Post


      I mention them 2 rates. 1. hourly. 2. per project. And now the 3rd one I added that has monthly feature.
      Don't pile on too many options... give them one.

      People hear x per hour and usually then panic because they don't know how many hours it will take. It's also a FABULOUS way for the unscrupulous to rip people off - "oh, it took me longer than I thought, so it's gonna be a lot more"...

      I'm NOT saying you are ripping people off, just that customers have likely been ripped off before like this. I've seen hundreds that have. They're gun-shy of the hourly rate thing.

      Quote them by the project. Work out your quote based on the number of hours it will take you times the amount you want to earn per hour. Build in a little cushion for estimating errors and such. Hey, if you're way over, and you really want to make a friend, tell them it's cheaper than you quoted when you're done.

      Offer to do updates/other services so you can keep that money of course.

      Remember, people will freeze when given too many options. Laying out 3, 4, 5 or more pricing plans will just make them freeze - when they do, they just say "No" so they can get out of the uncomfortable situation...

      All success,
      Gary
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    • Profile picture of the author jtprattmedia
      Originally Posted by man5 View Post

      My website isn't done. Of course it needs to improve on design, but i rather not wait until it's done perfectly and then advertise it. I have the basic design down. Just needs to stand out and perhaps a better written content.

      I didn't say no one is paying me. In fact, I got some clients even before I put up the website. I think the problem is that when ever I advertise it, I say it in a way that they can afford it(good marketing strategy though). And that attracts low level customers around here, that think they can get a graphic design work done at a minimum wage price.

      I mention them 2 rates. 1. hourly. 2. per project. And now the 3rd one I added that has monthly feature. But I don't think I am going to continue with anyone that is going to brag about the price issue, especially if it's more than fair, compared to this industry.

      I am still new to IM and being self-employed. In fact, I never actually realized I was self-employed/entrepreneur until recently. I have been making fair bit of money. I just need to get little more experience and knowledge under me and then I can start marketing to the big guys(rich fellas).
      20 bucks an hour says amateur. Plain and simple. That's what you pay an outsourced designer (or less) in other parts of the world. Your web site indicates you're in the US - most people know decent online designers get $75-150/hr. here, AND most US based designers getting that regularly and are in demand have a waiting list anywhere from weeks to months.

      If you're getting clients either local or online that will pay $20/hr it's because they are naive to design and development work and pricing. These are the same type of people that will kill your time with questions and simple issues - because they are non-technical and can't figure out how to add a facebook widget.

      Higher price is an instant screening tool to weed out wannabe get-rich-quick web site owners and tightwad small businesses who want it all for free.

      I would update your site as others mentioned. There isn't anything there to show you're a good designer (yet). I mean for gosh sakes - the testimonials page doesn't even have screenshots, but now that I looked at it - your portfolio page does. This may explain why you're not getting additional work once people view your site.

      I don't mean to be insulting in any way - but to be constructive, your portfolio work is not good (to be blunt). Not only are the designs bad, but they display poor technical knowledge, bad coding, and virtually no SEO skills. Look at the Maximalus site - you're using a 3.6MB graphic in the header. This is web site design 101 here - you just don't use a graphic that big on a web page (let alone the home page). Any web designer with experience would know this. I would imagine some potential clients would as well - especially because the page load time on that site is a beast.

      Just my 2 cents.......
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  • Profile picture of the author iAmNameLess
    Well you are going to need to totally redesign to gain faith from businesses. YOUR site should show things you are capable of. Standard rules do not apply to web design sites. You need to show and flex your muscles. Your layout is jacked up... biggest problem right there, you will only see people wanting to pay 10 an hour.

    Thing is, your price isn't the problem... your website kind of is, just spend just a tiny bit longer on it, fix up a few things and you will be fine.

    The major question is, how much do you value your time? Do you value your time at $20 an hour? Is that your price tag that you truly believe people are getting quality?

    I would charge a project fee, and just do it that way. I average about a $50 an hour rate when I charge a project fee.
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  • Profile picture of the author VegasKid777
    Hi, I think your issue isn't price, it's your website that is selling your services... I'm using firefox 3.6 and look how it loads! I wouldn't pay you $20/hour to make a website that doesn't display properly.

    Also before we start an argument. I have a niche site that gets %40 of it's views from firefox users.
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  • Profile picture of the author mriley08
    I hate to agree with the comments about your web site, but if this is your service it needs to represent the best you can do. I've researched a lot of web site designers. They usually charge per the project (if you want to figure this out on your own per hour, that's great, but quote per project). Then, you charge per hour for updates. $20 is cheaper than a lot I have seen. Many charge over $100 per hour.
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  • Profile picture of the author terrapurus
    If you don't value your own time then people see right through it. Quadruple your rate.
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    • Profile picture of the author iAmNameLess
      Originally Posted by terrapurus View Post

      If you don't value your own time then people see right through it. Quadruple your rate.
      EXACTLY! You will notice when you raise your prices, more people come knocking!
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    • Profile picture of the author man5
      Lots of great advice!

      Sure my website needs work to attract bigger fish, but like I said before, I have been getting clients even before I had a website. Even now, the website isn't really complete and yet I am still getting requests.
      (the website's resolution is wrong. Thanks for pointing it out. I designed it according to my computer's resolution. But now I have to convert it to 800 x 600 px, as that seems to be the best size for everybody.)

      Quadruple my rate? I don't think I am at that level yet, unless it's a few hours job. And yes, I think per project is the best way to go. However, some clients prefer by the hour.

      A while back, someone asked me to do SEO work for their small business. I told him $300/ per month minimum( I explained it in better terms of course). He never replied back. And $300/ a month for good SEO is low.
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      • Profile picture of the author iAmNameLess
        Originally Posted by man5 View Post

        Lots of great advice!

        Sure my website needs work to attract bigger fish, but like I said before, I have been getting clients even before I had a website. Even now, the website isn't really complete and yet I am still getting requests.
        (the website's resolution is wrong. Thanks for pointing it out. I designed it according to my computer's resolution. But now I have to convert it to 800 x 600 px, as that seems to be the best size for everybody.)

        Quadruple my rate? I don't think I am at that level yet, unless it's a few hours job. And yes, I think per project is the best way to go. However, some clients prefer by the hour.

        A while back, someone asked me to do SEO work for their small business. I told him $300/ per month minimum( I explained it in better terms of course). He never replied back. And $300/ a month for good SEO is low.
        You aren't on that level yet because you don't believe you are!

        $300 a month is very low, and that may just be the reason why he never replied back. Low price doesn't entice everyone. It turns some people away.
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      • Profile picture of the author terrapurus
        Originally Posted by man5 View Post

        But now I have to convert it to 800 x 600 px, as that seems to be the best size for everybody.)

        Arggghh! Flashback to 2003!
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      • Profile picture of the author CyberSorcerer
        Originally Posted by man5 View Post

        A while back, someone asked me to do SEO work for their small business. I told him $300/ per month minimum( I explained it in better terms of course). He never replied back. And $300/ a month for good SEO is low.
        $300 is very low for good quality SEO work. I don't even touch an SEO job now days for under $1,500/USD, but I didn't start getting SEO clients like that. My clients now come from word of mouth, but my first SEO clients were at $8/hr on oDesk. Take a look here and see for yourself.

        Yea you might have to do some jobs at lower prices, if you don't have referrals or any portfolio, but your goal should be to do the BEST job you absolutely can and get some word of mouth from it. For a service type business there is no kind of advertising that can beat word of mouth.

        And you SHOULD finish your own design site before promoting your service because nothing beats a good website to show potential clients if you're a web designer.
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  • Profile picture of the author Headfirst
    Originally Posted by man5 View Post

    I consider $20/ per hour as a the lowest price you can go if you are a professional. But it seems like most of my clients get scared and run away when I mention it. So this means, either I lower the price to keep the business or forget about those clients.

    What is your opinion on it? What do you do in this situation?

    Discuss.
    I usually bid out a complete price for a project, but for ongoing and consulting projects my hourly rate is $120/hour. If you're having trouble getting $20, you're not specialized enough.

    I got a great quote from another local entrepreneur; "If your clients still want your bid to compare "apples to apples", you haven't communicated your orangeness."

    If you haven't figured out your orangeness yet you wont be able to command top dollar.

    What separates you from the competition?
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  • Profile picture of the author Headfirst
    Also, on the less philosophical side, what does your presentation look like? Do you show up in a nice car, in a suit or a sport coat? Do you give your client a nicely bound presentation or a professional quote? Are your marketing materials professionally printed or are they made on your inkjet?

    Do you have a properly registered business or are you asking your clients to write the check out to you personally?

    All this comes into play. Your client will make an assessment of what they think you are worth the first time they meet you. If you come off as a $10/hour basement freelancer, that's all they will ever see you as.
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  • Profile picture of the author pethanks
    $20 per hour? It is already expensive men. What service are you offering?
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    • Profile picture of the author smartlazy
      Banned
      I'm not surprised that few people are willing to pay you $20 per hour for your web design service. No offense, but based on your website and portfolio, nobody in their right minds would pay you the rate you want.

      I suggest that you look around and see what other professional web designers are doing. When I started designing websites, my design and programming skills are piss-poor. Now I can design Web 2.0-ish sites from scratch. I looked at the portfolios of top web designers and I got my inspiration from them.

      I hope you don't get offended by my comment. I'm just offering constructive criticism.

      Originally Posted by man5 View Post

      (the website's resolution is wrong. Thanks for pointing it out. I designed it according to my computer's resolution. But now I have to convert it to 800 x 600 px, as that seems to be the best size for everybody.)
      My monitor has a 1366x768 resolution and I still have to scroll to the right to read the contents of your site.
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  • Profile picture of the author JonWebContent
    If you can't get $20/hour it is because you are selling price........not value.

    When you attempt to sell a cheap price, you have to market towards people that can't afford much. People that can't afford much, can't afford $20/hour for web design. If you try to market $20/hour web design to a business owner that has money and is willing to spend, they will never buy from you because they'll see that $20/hour and assume you are lousy.

    So what I'm saying is if you are going to market cheap web design ($20/hour is VERY cheap compared to most), you had better start marketing the value of your services to small business owners.
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    • Profile picture of the author iAmNameLess
      Originally Posted by JonWebContent View Post

      If you can't get $20/hour it is because you are selling price........not value.

      When you attempt to sell a cheap price, you have to market towards people that can't afford much. People that can't afford much, can't afford $20/hour for web design. If you try to market $20/hour web design to a business owner that has money and is willing to spend, they will never buy from you because they'll see that $20/hour and assume you are lousy.

      So what I'm saying is if you are going to market cheap web design ($20/hour is VERY cheap compared to most), you had better start marketing the value of your services to small business owners.
      Very true.... I market affordable web design, and that is typically a project fee around $1,000. Sometimes I can do a really simple site pretty quickly and they would fit in the 500 range.
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      • Profile picture of the author Jon Patrick
        requires the visitor to scroll to the right to see the website
        I will join the chorus of people recommending that you repair this ASAP. Things like this are really going to throw potential clients off when you are offering them web design work. They don't want their own websites to wind up hanging off the side of the page.
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      • Profile picture of the author JonWebContent
        Originally Posted by iAmNameLess View Post

        Very true.... I market affordable web design, and that is typically a project fee around $1,000. Sometimes I can do a really simple site pretty quickly and they would fit in the 500 range.
        Exactly. Affordable is a great "value" word that does not cheapen your services. Now, if you used "cheap" or maybe even "low-cost" to replace "affordable", you would be cheapening your services.

        And when I go to your website, I notice you are selling Affordable Web Design, but no mention of price. Instead, you bring value to the service. A lot of business owners get stuck on "price" and think the only reason people buy is if the price is right. That's not true at all. A good salesman sells value.
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  • Profile picture of the author WillR
    I totally agree with all the other posters. If I was looking for design services and landed on your website as it is right now, it would take me all of 2 seconds to close the browser. And that is not just because the website doesn't even center in the middle of the screen (that is quite bad actually when you are trying to attract clients). That is because the design of the website is far too simple - I could easily get a free wordpress theme that looks better than that. Your website is like your shopfront. If I am a customer and I can see how lazy you have been with your own website, the last thing I am going to do is employ you to do graphics for me.

    The fact of the matter is there are so many good graphic designers online now. And lots of them that offer really awesome graphics for really modest prices. You need to fix your image if you want any chance of competing with these other designers. I need to be wowed the moment I see your site. I need to be wowed as I go through your portfolio of previous work. At the moment I am far from wowed.

    And yes, stop with $20/hr. That means nothing to someone who is trying to get a website built. They don't know how long it is going to take - only you know. So come up with some standard packages so both you and the customer know straight up what each other is going to get.

    Yes, you may have some clients you have already attracted. My guess would be these are going to be big time wasters for you. You present quality and you will attract quality. Present crap and you will attract crap. Plain and simple my friend.
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  • Profile picture of the author alysemackie
    Actually, $20 is already very expensive. Clients are also doing business so as much as possible they will minimize the cost.
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    • Profile picture of the author JonWebContent
      Originally Posted by alysemackie View Post

      Actually, $20 is already very expensive. Clients are also doing business so as much as possible they will minimize the cost.
      That's not true for many business owners. Yes, all business owners want to keep costs down as much as possible because it is not cheap running a business. However, many entrepreneurs are looking for the best services that will help them grow their business.

      $20/hour for web design is VERY cheap compared to most. As hard to believe as it may seem, there are TONS of business owners out there willing to pay FAR MORE than $20/hour for web design.
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    • Profile picture of the author JonWebContent
      Originally Posted by jooneth View Post

      In this global economic crisis, $20/hour is considered high cost and only a few people afford it. If you check on online job board such as elance, freelancer.com, etc, you will realize the competition is really high now. Some designer and programmer are willing to get paid as low as $2/hour ( YES, $2 per hour ).
      My previous roommate is a web designer that charged a little over $50/hour and had absolutely NO problems getting clients.

      $2 an hour? Where? You can't even live off of $7 an hour where I live - which is has a very low cost of living compared to the majority of the United States.
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      • Profile picture of the author iAmNameLess
        Originally Posted by JonWebContent View Post

        My previous roommate is a web designer that charged a little over $50/hour and had absolutely NO problems getting clients.

        $2 an hour? Where? You can't even live off of $7 an hour where I live - which is has a very low cost of living compared to the majority of the United States.
        I think the guy might have saw some data entry people from overseas. Even some of the cheapest firms in india will charge a minimum of $10 an hour.

        You truly do get what you pay for. I bought a guy out for a monthly fee, from uraguay, for $200. Thought it was a great deal, but his knowledge of programming and web design was so limited, that it actually cost me more than that in losses!
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      • Profile picture of the author smartlazy
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        Originally Posted by JonWebContent View Post

        $2 an hour? Where? You can't even live off of $7 an hour where I live - which is has a very low cost of living compared to the majority of the United States.
        You need to look beyond the border and to the far east.

        I can make websites and some people approach me to make a custom website for them for less than $100. I am not an expert programmer and I know only basic HTML, CSS and Photoshop. The sites they want are simple 10-page static HTML sites (not Wordpress) with a contact form. So yes, there are people who are willing to pay less than a hundred bucks for a simple website.
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        • Profile picture of the author iAmNameLess
          Originally Posted by smartlazy View Post

          You need to look beyond the border and to the far east.

          I can make websites and some people approach me to make a custom website for them for less than $100. I am not an expert programmer and I know only basic HTML, CSS and Photoshop. The sites they want are simple 10-page static HTML sites (not Wordpress) with a contact form. So yes, there are people who are willing to pay less than a hundred bucks for a simple website.
          And the sad thing is there are people WILLING to make sites for less than 100.

          Lets be real here. You don't believe in yourself enough to charge right, so I doubt the client would be getting a deal there with you. I think over time it will end up being buyers remorse. If you don't value your time, why should anyone else take you seriously? When I see someone say they will make a site for under 100, I stereotype them as a highschool student for a class project. Client probably gets the same quality work too.

          Why have a full schedule of websites for such a low amount when you can take a project a week and make 4X the amount you currently do.

          I offer low budget design for people who are broke, like $299 for a very simple website that I complete in about 6 hours. I don't have many of those clients because I turn most of them away. Most sites on a shoe string budget, you are going to have to deal with people who are trying to get their moneys worth and trying to milk you for everything. No thanks.

          I would rather charge a flat rate where I know I'm getting profit, and if I get a difficult client, then they are going to pay me for being difficult.
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  • Profile picture of the author astnpwrz
    Definitely use the 80/20 rule here. Bulk of your business should come from those 20% that actually "got some money to spend" and they'll produce 80% of your income. These tend to be the most pleasant people to work with. Keep your price high, and your work higher quality and you'll be fine.
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    Multi-tasking is just half-assing a bunch of stuff at the same time!!

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  • Profile picture of the author lerxtjr
    Kudos for you for figuring out how to advertise that you make websites and charge $20 an hour.
    haa, hoping that wasn't your intent. WarriorForum participants are the least likely pond for you to fish in for a catch.

    That said, I'd suggest that you stop charging by the hour immediately. Charge by the package. Put a design package together that includes 1) planning documents, 2) planning meeting, 3) design, 4) implementation of the design, 5) training, 6) support, 7) seo/traffic

    My package offer comes out to $160 per hour and people tell us we charge too little. And, no, I'm not interested in ANY inquiries from WarriorForum participants. I have my own lead generators and referral sources that keep us plenty busy.
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    Come practice your public speaking skills with us FREE every week! SpeakersSpeakLIVE.com >>

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  • Profile picture of the author Hunter06
    When you're selling, the process should take care of all the questions your potential client has. Price should never be the deciding factor. IF your potential client walks away then you have failed to cover all their objections to their satisfaction. You need to look at your sales process!

    Speak to some of the potential clients that walked away and ask them why. Be honest with them and ask for their help. If you approach them in a manner that conveys respect and honesty then you may just be surprised at the response you get.
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