If you haven’t noticed, I recently added some prices of design/development packages to the site. I’m rather nervous about doing this because so few people are aware of what design costs. From the experience I’ve had as well as hearing from other resources, my prices (especially those I have posted) are incredibly low. I have pretty much no overhead since I am freelance and work from home, so my clients benefit from me charging simply for the work that I do.
Regardless of my competitive prices, there are still those that expect to get a logo for $5 or a website for $100. Those are the people that I fear will see my pricing on packages and automatically close their browser tab before reading more into the site and learning why design costs so much. I’ll most likely be taking the prices off the home page due to this but leaving them on the packages page.
It took me a few months to actually decide what to charge and why. I know what design is worth, but many people do not. Price should not be the deciding factor for anything that could triple the size of your business, but for people that don’t realize its ROI it often is unfortunately. At a BNI Networking Lunch today a man gave a short but rather impressionable speech on the topic of Pricing. Though I’ve determined my general range for pricing, what he said made me think. Though I didn’t write down what he said verbatim, here are some key points that I took away:
“People will see $4.99 as being less expensive than $5.”
I remember hearing this a few years ago and finding it interesting. I didn’t pay much attention to it, however, because I had never imagined owning my own business.
“A person will see $6.89 as the same as $6.49 because it is still under $7.”
He also mentioned that he had encouraged some of his clients (as he is an accountant) to raise their prices from $6.39 to $6.89 because they won’t much notice the difference–and it worked.
This got me thinking about the prices I’ve advertised on the site. I personally always round up. If I were to see something that was $2985, I would automatically round up to $3000. I wouldn’t think “wow, that’s less than $3000″, I would think “geez! Almost $3000?!?!” I think that since I heard the information about how people see $4.99 as less expensive than $5 I changed my own psychological stance on the matter. I also prefer a standard, even number such as $5 because it is easier to digest instead of having to round up. I wonder how many other people now think the same, and I wonder if it would truly benefit me to lower a price from $3000 to $2985.
Hi, came across your blog from smashing magazine.
I often pondered the same question about pricing. I tend to agree with the £4.99 being more appealing than £5.00 arguement.
I often wonder at people who want a logo designed for £25 and a whole website for under £100. Unfortunately there are people who offer those prices and so it is up to the client to decide on what kind of value they will really get for their money. I used to worry about overpricing, but now I have come to the conclusion that the people who only want to pay £25 for a brand and logo identity are not the sort of clients I necessarily want.
I often have to explain to people, not in the design industry, that you are not only paying for the designer’s time, it’s the whole creative process involved.