Two alternatives to the hourly rate. Bring back the FREE in freelancing.
By Louise Doorn | Jul 24, 2019
Ah, the freelancer conundrum. Selling your time caps your income. Let’s be realistic, you won’t likely work 40 billable hours a week. It will be more an average of 25 hours you can charge back to clients. If your income model is based on selling hours, there are three scenarios to grow your earnings.
How to increase your revenue
You work more hours to make more money. Risk here is burn out, no time for learning, experimenting, networking. Over time you will cannibalize on your value as a marketer if you can’t keep up with new developments.
You stretch the time needed to finish the project so the gaps between projects get smaller. The risk here is perception of not working effectively. Budget spent vs. tangible outcomes might be poor ROI.
You increase your hourly rate. With increasing transparency through online platforms, you have to be either very good, work for top tier clients, be very fast and/or have unique skill sets to justify a higher rate.
Let’s do the math
Say your desired gross revenue per year is €70.000. Add another €12.000 for expenses. That’s €82.000. If you multiply 40 work weeks x 25 hours = 1.000 billable hours annually. Then divide €82.000 by 1,000. That gives you an hourly rate of €82.
That rate might price you out of the average client’s budget and limit you to mainly corporate clients, whereas you might also want to work for startups or SMB’s (small and medium businesses).
Not to fret, though. Three things to futureproof your freelance career:
Create a fixed price model to increase your income
Consider accepting equity in a start-up that you really believe in.
Create subscription pricing models.
Meet Sophie, a social media marketer in fashion, working as a freelancer for 6 years with top-tier brands in usually 4-6 month projects for 3-4 days a week. She not only created the Instagram strategy at Tommy Hilfiger across Europe but also introduced and ran influencer marketing for G-Star.
Sophie knows fashion from the inside out. She recently noticed a lot of purpose driven fashion tech startups and boutiques in the cute 9 streets of Amsterdam in need of smart marketing. Those companies would love to work with Sophie, however her hourly rate at €75 is steep for SMB’s and start-ups.
Bring back the FREE in freelancing
Since Sophie has gained tangible experience and knows which tools, KPI’s and content tactics matter, so she will be very efficient delivering her packages.
Sophie created two packages:
Social media starter package for fashion brands.
Monthly Instagram content, engagement and growth package
Each package will have a detailed scope, price and social proof. For clients there are no budget surprises or disappointments about work done.
For Sophie it will bring back FREE in freelancing, since most packages can be worked when, where and how it fits her calendar.
When clients are happy Sophie will use ratings and reviews as social proof, allowing to charge more premium pricing over time.
With a clear understanding of the scope, she can repeat this package and the process for multiple clients, reducing her time needed in total.
Example of a package on the HelloMaaS platform:
Benefits of selling fixed price packages
Be in control
Get rid of the uncertainty that comes with hourly rate pricing and boost your revenue by offering your experiences, know how and drive as a package.
When you price your package according to client results, and your expertise, clients will have a better understanding of “what’s in it for them” and be more open to accepting your proposal.
Packages are about output. Many clients don’t mind where and when you work as long as you deliver, communicate well and consistent.
HelloMaaS members with packages can be your allies and you can connect during our workshops to create packages with a review by our team, other freelancers, get advice on pricing and learn about package that sell well.
Futureproof your freelance career with HelloMaaS
If you are a marketing freelancer with recent work experience in the Netherlands, create your package! We will help you price and scope it.
HelloMaaS will selectively promote packages, so you can focus on creative and effective marketing with your new clients. You might be surprised at how much your income, productivity and sense of true agency will increase.