Who Should Offer Package Pricing

Pricing is one of those topics that most creative professionals have trouble with, no matter how long they’ve been in business.

With my mentoring clients lately, I’ve been working on pricing strategy, whether hourly (not usually ideal), project-based (then you have to deal with scope creep) and retainer-based (best for ongoing projects and clients you know well). (More about these options in my book, The Creative Professional’s Guide to Money.) 

But the most underused strategy for creative pros is package pricing, especially if you’re offering web sites. In fact, here’s an example of 3 tiered packages I recently helped Jill Anderson of jilllynndesign.com develop for her web site services (http://jilllynndesign.com/packages/).

In general, package pricing is your best response to that ridiculous question: “How much is a web site?” or “How much is a logo?”

Instead of writing off those clients, you say, “It depends.” Then you present your 2-3 packages which span a range of services and a menu of features. The client can see the parameters clearly and choose from what you offer. And/or your packages serve as a starting point from which to customize their project.

Anyone out there doing this? With success? What lessons or best practices have you learned?

Comments

[Marco]

Hi Ilise,
I have used lately such a strategy and discovered the power of it. A big client asked for a set of illustrations and wanted to know the cost. I decided to propose three packages but in fact wanted him to choose the middle one . So I have presented a range of very poor features in the first one, a good number of features in the second one and a large number of features in the third one. Number one's price was cheap, I was sure a big client would never choose the cheapest one. The second choice was a high price, double the price I would have asked without the "packages strategy", but I thought that placing that choice in THE MIDDLE would have made the client value it as a good proposal. The third choice had a very high price, nearly embarrassing.
Guess what, the client said "Nice, let's go for choice number three, I want the top!"
That's a pretty smart way of using the "package strategy", highly recommended !

[Laura Foley]

Last year, I developed three PowerPoint training packages and posted the prices on my website. My husband, who works for a large corporation, told me that that was a terrible idea since my prices were "laughable" compared to what his company was used to paying. I had thought the prices were pretty good but now I'm not so sure. What's a good way to gauge prices before making them public?

[Laura Foley]

By "laughable" he meant "too low."

[Ilise Benun]

Marco, I love that story and it just proves that we often underestimate what people are willing to pay.

And Laura, when you say "laughable" you mean too low or too high? As for gauging prices, I think it's trial and error so try them out on prospects and get feedback from actual clients before posting them anywhere public.

[Helene Abrams]

This is great advise. thanks!!!!

[Alizah]

Sounds like a great idea.
Question: I have been considering offering packages but wanted to know how individuals handle it when those extra requests come. It always ends up being more work then originally requested and every case is different. That has been my hesitation with the packages.

[Christina]

I go back and forth. I agree with Alizah. I always send a custom proposal b/c it seems each client has their specific requirements that packages never fully provides. I like Marco's idea but that would mean additional work for each client to prepare different packages. I do have a standard price that I start from and pull a estimate from there.

[D. Kendra Francesco]

I create jewelry - and the packages idea has given me an idea for taking my Etsy store to the next level. (I keep my fingers on the pulse of the copywriting world for a number of reasons, including great ideas!)

For the lady whose prices are "laughable" simply raise them! Your husband didn't say you were laughable, just your pricing. So go for broke.

For the lady whose client chose the third package, way to go! One of my former retail managers taught this, "Never go to the cash register before the customer does."

[D. Kendra Francesco]

Sorry, Marco; read your name as Marcia (glasses anyone?).