Web Design Pricing 2.0 Basics

The pricing model that many new web designers default to when determining their fees doesn’t work well. I’m referring to working on an hourly basis.

The problem with hourly work is that your focus is on pounding out hours. And, this is bad for both you and the client.

For you, your work motivation becomes something you must do to get the money.

And according to Daniel Pink, author of Drive: The Surprising Truth About What Motivates Us, this style of carrot-and-stick motivation (carrot is the money, stick is the lack of money) often kills creativity because your focused is moved away from the joy of designing to the goal of money. Your motivation comes less from your internal life juices.

For the client, he becomes focused on minimizing the hours you spend while getting the most design value out of you.

It’s like hiring a lawyer who works hourly. Not fun in my book.

A better pricing model for freelance web designers is “per project” – or pricing 2.0.

web design pricing 2.0

A per project fee means determining a fixed cost for specific results you will provide the client.

This is web design pricing 2.0 and this model is better for both you and the client.

For you …

You get more freedom as you can spend as much time as needed to get it done properly.

You also have a predetermined goal to achieve as defined in the project details at the outset.  And instead of focusing on accumulating hours, you can stay focused on the project goals.

There’s also less administrative work as you also don’t have to track and manage hours, thus reducing your administrative work. Nice.

For the client …

He gets a fixed cost for help. He doesn’t have to worry about minimizing or monitoring your hours spent on the project.

He can focus on the goals.

Clients don’t really to hire web designers, they want what web designers can bring. And by pricing on a project basis, he is more likely to get what he wants – specific results.

Here are some tips for web design pricing on a per project basis:

  • Do “per project” priding on big projects. Make sure the project is big: takes many weeks or months to complete and results in significant results for the client. For example, building an e-commerce website.
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  • Do “hourly” on small updates or routine work such as projects that take only a few hours and do not have much creativity in them like optimizing images or compiling statistics.
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  • Determine specific goals for the project. Be specific about the goals you want to help clients reach. If you’re going to redesign a website to improve usability, then one goal could be to reduce the time for the top three most common tasks performed by half – and actually test it out with users.
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  • Give a general outline of the main steps you will take apply to achieving the client’s goals in the detailed proposal. You don’t need a 10 page fully spec-ed out proposal for a website design project of a 1-million-sales revenue mom and pop restaurant.
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  • Base your fee on the value your project will bring to the client.

    For example, if you’re doing a brochure website for a landscaping business who just wants a website because it’s written on their business card., they don’t care of people find them online, and they already have a full business of clients, then the website you build them is not likely going to add much to their business goals.

    However, if you’re creating an SEO-optimized website for an online jewelry business that is banking on 80-90% of sales to come from the site, then your help is crucial. Your fee will be very high.

If you’re a 1.0 web designer who wants to have more fun in your projects, make things simpler, and make your proposals more attractive, move to a pricing 2.0 project-fee model for your web design proposals.

Wuddya think? What tweaks can you make to your pricing?

2 Comments

  1. Daquan Wright · September 7, 2011 Reply

    Nice topic, another one that stumps many people. Hourly vs. project pricing is a deep, DEEP topic amongst freelancers.

    Many say you shouldn’t do hourly, until you’ve acquired significant experience because until you do, you’ll be shooting in the dark. Others say project pricing is better because clients can relax and not have to rush you to death. They also like it better, because they are free to craft beautiful products.

    In truth, I think it depends. I think the smaller the job, the better it is hourly (until you’re working with a corp with lots of funding, like say, Apple).

    When it comes to project pricing, I think you should calculate what you need to survive and break up the overall charge into hourly wages.

    Let’s say you charge $800 for a small e-com website that will take a month to complete. In this sense, you’d be working at $10/hour.

    However, with more speed, you can be more productive and earn far more. Now let’s imagine you do that same site for $800, but in 2 weeks. That leads to $20 / hour, so as you’ve noted, the faster you work the more you make.

    For that example, I used 2o work hours / week, not 40.

    I think you’ve done an excellent job on the article. I always go with project pricing, I want to craft beautiful products. I care about having enough money to put food in my mouth, buy clothes, pay for my internet, and of course save some for an emergency. But more than anything, I want my portfolio to shine with awesome projects that look good. Even though my area of focus is programming overall, I still love ui design and it’s a big part of my work.

    I’ve seen some designers say they don’t put up project rates because they want to be competitive.

    I see others (developers as well) put up their rates, saying something along the line of “projects start at $50o” and such. What’s your take on that?

    I’d like to think about an hourly wage that’s fair for me and put up a baseline on my site as well, I think of it as a safety net. Anything below that amount simply wouldn’t be worth your time and mostly bottom feeders will try it.

  2. sumit · April 5, 2012 Reply

    nice tips. I mostly charge for full project.

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