A design project is a journey – but how much should you charge for it?

Emily Penny looks at the thorny issue of working out how much to charge.

Recently a new app has been rocking the boat on the London taxi scene. Black cab drivers are protesting over a new mobile service that they say acts like a meter, a method of charging that only they are entitled to use.

Charging by the meter is a premium model. Solicitors and plumbers are known for charging by the clock, perhaps because they’re needed in a crisis and they can. For most products and services, we expect a price upfront. Upfront ‘packages’ put the customer in control as there’s less risk and they can better manage their budget.

But compare the set menu to the ‘a la carte’ – it’s also a budget model. Whenever marketing focuses on price as a selling point, you’re probably at the value end of the market.  

As designers (I’m thinking of graphic design and branding), we’re in a crowded and competitive market, and buyers tend to hold the power. For this reason, we’re often asked to take part in beauty parades and jump through hoops to win work – and the service we provide is usually quoted for upfront. So just like the minicab drivers who must deal with the traffic and the diversions and honour the quoted price, we take a risk on how demanding the journey might be.

Changing that dynamic with clients is the subject of Blair Enns’ inspiring The Win Without Pitching Manifesto. Enns recommends that we specialise and become experts (just like black cabs). As in most other sectors, if you can build a reputation and a brand that reassures your customers, then you can change the relationship in your favour and charge a premium.

But ironic as it may, there’s a tendency for design businesses to shy away from applying the principles of branding to themselves. It’s easier, in the short-term anyway, to avoid sticking your neck out with a point of view and to blend in and compete as a commodity, chasing volume rather than margin.  

But, if you did call the shots, if you could choose exactly how to charge, how would you do it? Whatever the client can afford? An upfront quote based on estimated time? Or charge as-you-go, guaranteeing that your cover your time and that of your staff to the penny?

Or would you dispense with the hourly model altogether, maybe think about a fee that’s relative to the value of your work to the client?

The DBA Effectiveness Awards help both clients and agencies to think about the real value of design. Could you charge a fee dependent on the result? I hear stories (or are they myths?) about royalties or stakes as payment for graphic design, but it’s not at all common and usually sounds like a high-risk gamble for the designer, perhaps working with a start-up client.

The reality is that we have to think about cash-flow. The reason designers like an hourly model is that many are small businesses, and we tend to think about the short term: monthly salaries, monthly billing, and trying to balance the books. This short-term mentality makes charging by the hour feel more tangible and manageable, so quoting upfront is what we’ve come to accept.

Getting that estimate right however can be more art than science. Clients come in all shapes and sizes and what might sound like the same project for one is likely to be a very different experience for another. For this reason it’s unwise to have a set price list for particular deliverables. The more strategic or creative the project is, the less quantifiable it’s likely to be.

Being aware of what to look out for and what to ask your client at the outset is critical.

Three things contribute to the time needed for a project: the complexity of the problem, the complexity of the journey, and the complexity of the deliverables. And while we tend to focus more on the latter, it can be easy to overlook the first two – which is where you’re more likely to run into problems.

Venn

 

The complexity of the journey is probably where things most often go awry. There’s a complicated factor in there, and it’s called ‘people’. For many projects it’s as much about engaging the client team as it is about delivering a final ‘thing’. The design process is often a journey of discovery, enabling the client to clearly think through where they are and what they want.

You need to know who the decision-maker is and, if it’s a group, whether they have a shared vision and objectives, and how defined that vision is.

Some years ago I worked with a client team of mixed stakeholders, with different objectives. We sat them down and used exercises to help them share exactly what they thought about the current market, and where they thought the opportunities for the new brand were. They later revealed that despite going into partnership this was something they had never done. We couldn’t have answered the brief without first defining it and bringing this large group with us.

Recently I worked with a client team comprising four directors with different ideas about what success looked like. We ended up sitting them down with the design concepts and some scissors, and involving them in the design process and decisions. They didn’t want us to reveal ‘the answer’, they needed us to help them find it and believe in it themselves.

At the other end of a project, the downfall can be the lack of broader staff engagement. A wonderful experience and connection with the immediate project team throughout the creative process counts for little if staff are not on board to nurture and sustain a brand or design concept, bringing it to life.

The point is that as a design company, it’s good to aspire to being a ‘black cab’, building a trusted brand and making sure you’ve done ‘the knowledge’ to set yourself apart as an expert. And if you are required to commit to the fees upfront, so be it, but be sure to be reimbursed for the journey, not just the destination. It’s all part of what you’re delivering and how you’re adding value. Design consultancy is a service, not a one-size-fits-all product off the shelf.

Emily Penny is co-founder of Colourful Design Strategy.

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  • Humphrey Couchman November 30, -0001 at 12:00 am

    Very interesting. In my experience – both as a client and latterly as a brand strategist – there’s a tendency in pricing/negotiating to focus on deliverables and skimp on the journey. Short-term thinking, as you suggest, that can lead to longer-term costs. There is so much value for everyone in the journey – not least in helping to work out what the destination is.

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