Many freelancers, even those who are confident about their skills and the services they are selling, often face issues in pricing their product right. They lose gigs either for charging more than they should be, or underestimating the worth of their service and giving off the wrong impression of their quality by charging too low.
If you’re just starting out as a freelancer and need tips to help you with pricing, or if you’re an experienced freelancer and still struggling with pricing your services right, you should hear me out.
In this article I will help you realize the common pricing mistakes freelancers make while offering their products and services, and show you ways to correct them.
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Comparative pricing
If you ask your customers to compare your prices with those of your competitors, you are making a big mistake. According to a new research done by Stanford University, asking your customers to compare your prices is not the right thing to do.
Most of the times, it backfires on you and sends the message that you’re compromising on quality. It also causes fear in the mind of the potential client about you asking them to compare somehow shows that you are tricking them. Bottom line: Don’t do it.
What should you do instead then? You should raise your price and tell your customers that you provide better value than your competitors.
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Telling customers about your finances
Fact of the matter is that your finances are none of your client’s business so they shouldn’t have knowledge about it. If you have sold your services for a charity for much lower prices in the past, you shouldn’t share this knowledge with your potential customer. All they need to know is whether or not your work proved its worth and was of any value to them.
Your past pricing, whether they were lower or higher, should not be a part of your discussion with the client. This is vital especially if you charged lower than your present rates. The client might feel that they are being cheated upon if you are charging them more for the similar thing you did for lesser bucks in the past.
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Not using discounts
Not using discounts, or at the least, not using them wisely is another common mistake many freelancers make. Discounts can go a long way when doing business with the same client or when attracting more customers to your business through the current ones you have. When exactly should you use discounts?
- One of the ways to make your discounts worth the while is by offering them for work you do in bundle. For example, you can offer a discounted (or free) logo design for every website you design.
- Discounts can also be used for in exchange of links and referrals, as a part of advertising your business.
- Discounts can be helpful while bagging in a customer. Offer them at the start of business relationship. For example, if you are offering templates for blogspot and want to attract more customers to your template, you can offer 50% discount for the first template you design for them. This can prove fruitful in starting business on a positive note.
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Not anchoring prices
The effects of anchoring your prices can be fruitful for your services and products. This is often ignored by most of the freelancers. Even the most experienced freelancers might not make use of contrasting prices of their regular services from those of premium ones.
Researches show that even the experts increase the perceived price of a product when anchored against the one whose price is much higher. So don’t ignore this precious trick when your price your products as it can help you get away with charging more for a product or service which you would sell for less, otherwise. The important thing is that the client won’t feel cheated this way when your prices are higher.