The Wild, Wild West Of Quoting
Your Price: 10 Classic Mistakes
By Paul Strikwerda
In the unregulated world of freelancing, putting a price on a product or service is one of the most talked about and controversial topics.
Copywriters know all about crafting compelling copy; web designers are great at creating sticky sites, and voice-over actors can sound like they know what they’re talking about, even if they don’t.
BUT CAN YOU SELL?
Here’s the problem: just because you’re good what what you do, doesn’t mean you know how to sell yourself.
If anything, you’re probably selling yourself short and you’re leaving a lot of money on the table.
How many schools or vocational training programs are actually teaching Business 101, Sales Techniques or Negotiation Skills?
With a diploma in hand, many graduates discover that it’s a jungle out there, and the only way to learn is by trial and error. That’s an expensive strategy.
So how can you make sure you get a decent price for your product or service?
Let’s begin by avoiding these 10 classic mistakes when quoting a price ...
1. Blind Bidding
Especially in today’s market, where lots of freelance jobs are auctioned off instead of negotiated, it’s tempting to just plug in a number, no questions asked.
Clients love it because your eagerness, ignorance or desperation practically guarantees them a bargain.
Project details are left vague for a reason! But how can you make the right offer without having the right information?
That’s because you’re falling into trap number two. You are …
2. Making Assumptions
Poor client! She said she was operating on “a small budget,” so if you really want that gig, make sure you put in a lowball offer or give a discount.
NOT SO FAST! What might be a “small budget” to some might be a large chunk of money to others.
How can you be so sure whether a customer you don’t even know can or cannot afford you or your product?
Did you just read the tea leaves? Did that little voice in your head tell you so?
The “limited budget excuse” is the oldest trick in the book of cheapskates. And you’re buying it because you’re …
3. Not Doing Your Homework
Do you have any idea who your mystery prospect is?
You’d be surprised by how much can be found out by spending a few extra minutes on your computer.
GET THAT INFO!
Wouldn’t you want to have these data available before you quote a KIA price to someone with a Bentley budget?
Of course some web site-seeing won’t give you all the answers, nor will it give you a chance to build a more personal relationship with your prospective buyer.
Dry facts always have a backstory, and you’re not getting it because you’re …
4. Not Asking the Right Questions
Ideally, your product or service is the solution to your client’s problem, and the pleasure to their pain.
But if you don’t know what their specific wants and needs are, you won’t be able to fulfill them to their satisfaction.
Any price will be too high if your prospect doesn’t feel that what you’re offering is what he really needs.
WHAT DO YOU NEED?
Ask yourself: what do I minimally need to know to make sure that I am the right person for this job and to put in a reasonable bid?
Once you’re fully prepared, why not turn the table by asking: “How much have you budgeted?” (notice the not so hidden presupposition).
But I must warn you: it’s easy to sabotage this process by …
5. Too Much Talking,
Not Enough Listening
It boils down to this: do you really want to know, or are you just asking?
If you’re passionate about your profession, chances are that you’re full of it … Some people - not you of course - are even full of themselves.
And because you know and care so much about what you do, it’s very easy to go on and on and on about it. Zzzzzz.
DO YOU GET IT?
As I said to the computer guy at Staples: “I don’t need to know how it works, as long as I know that it works.”
He didn’t get it. He was in his own little world. I think he’s still talking to me, even though I left the store two hours ago.
When you’re actively listening to your prospect, make a mental note of certain buzz words and phrases that are an indication of why this project is important, and what this project is all about.
If you’re on the phone, write it down. If you don’t, you’ll be …
6. Ignoring Client's Terms
What might be important to you could be utterly irrelevant. What really matters is what’s important to your client.
Never tell a prospect why they should hire you. People do things for their reasons, not for yours.
For instance, you might believe that price is a decisive factor in the deal you’re discussing, because that’s how you operate.
DON'T RUSH PRICE
But nothing is ever bought based on price alone, and perceived value might really be what the client is basing her decision on.
Some of us prefer more expensive brand name products. Others favor more affordable store brands.
Do not bring up the price or your fee until the customer does. Otherwise, you fall into the trap of …
7. Bad Timing
Every sales trainer will tell you: never mention the price until a customer has fallen in love with the product.
Highlight the benefits first, and be sure to use your client’s criteria and your client’s buzz words.
Make the sale based on value. Value is usually defined as benefits received, divided by the price paid.
If the perceived value is higher than the price paid, your customer’s a happy camper.
But what if a prospect tells you: “I can’t possible afford that. That’s too much money.”
Is it ‘game over’? Only if you keep on …
8. Believing Objection = Rejection
Wrong! Objections are opportunities to better understand your client.
One salesman put it this way:
Here’s the thing: it’s almost impossible to handle objections if the customer’s interest is not high enough, or when the prospect is not a “qualified buyer.”
Those are the people who are “just looking” and who aren’t authorized to make purchase decisions.
“Your price it too high” is the oldest objection in history. Linguists call it a "comparative deletion" because the obvious question would be: “Compared to what?”
And without knowing the price concern, you can’t possibly help your prospect overcome it.
WHAT'S THE PROBLEM?
Usually there are two reasons:
In the first scenario, you haven’t convinced your client that what you’re offering truly meets his or her needs, or is valuable enough. In that case, you need to backtrack a little.
In the second scenario, you can start offering other options.
There’s a third possible response to the price objection: giving in. That has to do with …
9. Questioning Your Own Value
If you start apologizing for your prices, or if you’re undervaluing your services because you don’t think you’re worth it, stop negotiating because you look like an amateur.
The least you can do is go back to number 3 and educate yourself about the going rate for a particular project in a specific market.
Secondly, read The Money Book for Freelancers, Part-Timers, and the Self-Employed, and get a grip on your finances.
Know how much you need to make to break even, and how much you want to make to lead the life you feel you deserve.
Get a backbone and be proud of your price!
Losers lower their prices. Winners know what they’re worth!
KEEP THEM INTERESTED
A word of warning: if a prospect senses any sign of insecurity, you’ve just shot yourself in the foot.
Remember that people equate price with quality. If they contacted you, they’re interested in hiring you, so hang in there and avoid …
10. Falling for False Promises
Never accept a job based on the promise of future work. The job is the job.
Even when the client holds up a juicy carrot and says: “If this works out, chances are that a whole lot more will come your way,” treat it as a big red flag.
You know that you’ll end up doing more for less, and you’ll never hear from them again. End of story.
ABOUT PAUL ...
Paul Strikwerda is a 25-year veteran of the voice-over industry whose Nethervoice service features German and Dutch voice-overs, translation and evaluation services. Born in Holland, he has worked for Dutch national and international radio, the BBC and American Public Radio. Although 90% of his work is in English, Strikwerda also records in Dutch, German and French. Clients include Novartis, Johnson & Johnson, and the Discovery Channel. He also publishes an informative and entertaining blog, Double Dutch.