Pay on Results?

by affirmwealth

Posted: 13 years ago 23 replies

OFFLINE MARKETING

I'm still trying to figure out which is the best business model for me.

1. Giving out freebies generates a lot of interest, but in my experience when it comes time to actually pay me, it's like pulling teeth.

2. Having them pay half up front or all up front is more difficult (in my experience) unless I have had a prior relationship or they are a referral. These days a lot of companies got burned by SEO consultants promising results and not delivering. So now they are more skeptical.

For web design this is easier by showing samples or even just going ahead and designing the website in advance, then selling it. I just started trying this business model out (flipping) but no results yet.

3. Pay on results. I really like this model best (for SEO), from an integrity sense. It makes me feel good because I'm not just promising results, I'm delivering results. So that makes me feel good.

However I am having a challenge with the logistics. I want them to sign a contract and preferably pay $1 down so that I can get their billing info (and commitment). However Thursday I had a prospect who was all for it until he read my contract and realized that he was going to have to pay $1 down. He said, "I don't give out my credit card info".

So that kind of ticked me off because he was originally a freebie taker. Which means I already did work for him and proved myself. Now I feel that he is just playing games.

Okay, let's say he decided to take me up on my offer. I'm not sure how I would bill him. I have PayPal and I have Google Checkout but with Google Checkout I would have to wait 10 days since it is a new account.

Feedback appreciated. Thanks in advance.

P.S. Oh yeah. I just recently launched a local news site that I think may be so hot I may drop all my other business models for it! If you have experience in selling advertising space, please share

#pay #results

jimbo13

13 years ago

Do you not have Direct Debit in the States? Google it, may be called something different out there.

eg How do you pay your telephone bill each month? Can't be off a Credit Card surely.

Practically all bills in the UK are payed this way.

Dan

PS: I wouldn't give you my CC details for $1, I'd just give you the $1

PPS: Of course he gives out his CC details. He wouldn't have one otherwise would he unless it is used solely to scrape ice off the car windscreen in the winter.

Thanks
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ayma

13 years ago

Originally Posted by jimbo13

Accepting Direct Debits is not as easy as it seems. This also do not guarantee payment as anyone can cancel it at any time.

Thanks

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AussieT

13 years ago

Originally Posted by jimbo13

PS: I wouldn't give you my CC details for $1, I'd just give you the $1

PPS: Of course he gives out his CC details. He wouldn't have one otherwise would he unless it is used solely to scrape ice off the car windscreen in the winter.

Asking for $1 via cc was promoted in a resent WSO. The idea was to only charge $1 and then have their cc details for the next monthly billing at the full price.

But it seems there may be a bit of resistance to this method

Thanks
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jimbo13 13 years ago

AussieT

Oh okay. I didn't know that I was just thinking it seemed like an odd thing to do on a credit card.

I am a firm believer in getting some sort of money at point of sale as it shows commitment and reduces cancellations. But do it with a cheque or cash.

The physcology is that once you have handed even a little bit of money you shift mentally to an owner of that product/service.

That's why Direct Sales guys are usually taught to always ask for something.

Ayma

I don't know is it difficult? It is the UKs' preferred method of payment for recurring payments, can't be that hard.

I agree that they can be cancelled but the rate is very low and the service will then be cancelled. I can cancel a CC payment. What is the difference?

That is why service providers use it. I don't pay my phone bill and it gets cut off. Simple.

I think it may be a moot point as I don't think DD is in the States.

Dan
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Richard Tunnah

13 years ago

Originally Posted by jimbo13

Being accepted to take direct debit payments in the UK isn't an easy thing to do. You have to go through a whole process as banks have some liability with DD unlike standing orders.

Rich

[ 1 ] Thanks
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jimbo13 13 years ago

Thanks Richard.
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Nail Yener 13 years ago

If you decide to go with the "Pay on Results" model, you should be very careful about defining the results before starting your work. Moving to #5 from #9 on the first page could be a great result on your side; however, if the business owner doesn't see any increase in sales even if you get them to #1, it will not be a good result for them.

Besides, if you are not very experienced in SEO, you might not get the result you or the business owner desire. That will make your effort a complete waste. So, think carefully.
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- tpw 13 years ago
  
  Originally Posted by Nail Yener
  
  If you decide to go with the "Pay on Results" model, you should be very careful about defining the results before starting your work.
  
  So, think carefully.
  
  I agree 100%.
  
  I must admit, I tried this model with SEO, and it was painful.
  
  The only people knocking on my door for the "Pay on Results SEO" were companies that were in extremely competitive industries, with deep-pocket competitors.
  
  I lost my ass on that model.
  
  Thanks
  
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Richard Tunnah 13 years ago

I've not tried 'pay on results' for SEO but have for other services and it creates a minefield. You should allow for non payment or at least late payers with this model. Unfortunately you can end up taking time to chase non payers. Not something I'll ever do again. I'd rather find a few clients that have the money and are willing to pay an upfront fee of sort. Yes it loses you clients but in my view many of these may be the ones struggling or not forthcoming with payment later.

Rich
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affirmwealth 13 years ago

Thanks everyone for their input.

As you can see, I'm trying out different business models, looking to find that right "fit".

I think with the freebies as well as with the pay on results, you get a better response rate, but like Richard said I think you also have to count on some "Lookie Lou's" and others that really aren't serious or don't have the money to pay you.

So you end up wasting some of your time. Which can be annoying.
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Fernando Veloso

13 years ago

I have a policy of NOT working for free.

Every minute I spend working for free, I am losing money somewhere else. Dead simple. The "freebie to get them in the band" never worked for me. People who know what they want, know they have to pay for it.

Pay Per Results.

I have top ranking sites in different niches and often sell advertising in them, but I don't offer a freebie to prove they work. If people wanna pay and get in, great. If not, I monetize them some other profitable way. The approach I use is to rank the sites and then sell advertising or sell the sites.

People who really want results know they have to pay for them. Thats the kind of customer I want too.

[ 1 ] Thanks
1 reply

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affirmwealth

13 years ago

Originally Posted by Fernando Veloso

I have a policy of NOT working for free.

Every minute I spend working for free, I am losing money somewhere else. Dead simple. The "freebie to get them in the band" never worked for me. People who know what they want, know they have to pay for it.

People who really want results know they have to pay for them. Thats the kind of customer I want too.

What I appreciate about what you wrote is that you said "That's the kind of customer I want."

I think that is the key. I've been doing a lot of bending over backwards to get customers, but truthfully, I also want a customer that knows what they want and has the money to pay me. I don't mind showing proof and testimonials that I know what I'm doing, but (and I'm really trying hard not to say the "H" word...too negative) I REALLY dislike wasting my time.

Thanks

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iAmNameLess 13 years ago

Wow... I think you find it difficult to get people to put up half or the full amount because you're unsure of it. You have to act like it is normal and he's crazy for not doing it. If he or she doesn't put it up, then they aren't worth your time.

I don't bend over backwords to get clients, I do what is necessary and I over delivery when I get them, but someone that wants to argue over price or payment terms, isn't someone I want.
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xlfutur1 13 years ago

He balked at $1 down?

I"m with nameless, don't bend over backwards to get a client. Pick them carefully and work with the ones you want to work with. Not ponying up $1 to get started should be a huge red flag. Probably turn into a pain in the neck client anyway.

If you are certain you can increase their business with your services then expect to get paid. The Yellow Pages guy doesn't do anything for free, so don't let the client jerk you around. Just walk.
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redlegrich 13 years ago

I did the SEO service thing. It's too much of a pain. I say find a ripe niche where there are potential clients who NEED your service. Create a well done site for that niche and get it ranked, if you selected your niche and local area well then you should not have much problem.

Then find a renter or buyer, whatever you prefer. You are firmly in control, if they buy it you are done. You can offer further work with payment up front for set prices. If you rent it same deal, but you are even more in control. If they don't pay you take your site and find another buyer, in most cases in days.

I have a friend here in Seattle with the top ranked local SEO business. This is the only way he does business. He is in control and he does not have to work with crappy sites that are hard to work on (another BIG benefit).
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danielkanuck 13 years ago

I'm not fond of the freebie model. Since you're providing a service, i think you should go with the pay on results deal. If you can find a way to back up your services with strong testimonials and case studies - along with combining a "service guarantee" with your pitch, i think you can make it work for you.
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mjlimey 13 years ago

Affirmwealth - Im in Houston also. Have not had a problem selling services, have you tried the networking groups (BNI etc), they are all over H-Town. I don't do anything for free - I lay out a plan they say GO or No. What's your main goal - Local SEO or other services? We should brainstorm - it's a big market here.
PM me.
Mj
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- affirmwealth 13 years ago
  
  I have not participated in any networking groups as of yet. I haven't even gone through my own personal list of contacts yet.
  
  Right now I'm still in the formation stage as far as my prospecting strategies and business model is concerned.
  
  I'm working on different business models, trying to find the right fit for me.
  
  So far I've noticed that I'm pretty good with videos and getting them ranked.
  
  I also am pretty good with press releases, and I know WordPress like the back of my hand.
  
  However, I'm most excited about mobile and Facebook site design and marketing. Go figure!
  
  So like I said, I'm still in the formation stage, trying to figure out what is going to work best for me in the long run. Thank you all for your input.
  
  Thanks
  
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mygold 13 years ago

Thanks a lot for your kind info.
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lingo 13 years ago

Im also looking at a results based model so cheers for starting this thread.
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tambajosephfoyah 13 years ago

I would say suggest Pay Per Results. However, they would be paying for results you've already achieved before selling them the ad space. Build your site first, get it ranked and then approach advertisers with your results in hand.

Seeing the potential monthly visitors they could receive it will be easier for them to recognize the value of your service.
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- edakehurst 13 years ago
  
  On web design, they pay half up front and half when finished. The only exception is when I make them pay all up front.
  
  On SEO, They pay one month at a time, in advance. I get a verbal commitment for 8 months minimum, but they are really only ever at risk for one month at a time. I never have anyone balk if I have properly built value and if I have done a good job of presenting myself as a solution for them. Every time someone balks at that, I can usually pinpoint it to a less than perfect pitch or presentation on my end.
  
  Thanks
  
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