Whether you’re a freelance Chat Marketer or an agency owner, pricing your services can be difficult and confusing. Charging too much may scare clients away, charging too little and, well, your services may come off as poor and cheap — even worse, your profit margins could shrink.
A good price will cover all your costs — from contractors to office space and taxes — while meeting customer expectations.
So if you want to stay in business, finding the best pricing strategy is key to your success. Follow these tips we put together on pricing and upselling your Chat Marketing services:
Learn the market you want to sell to
Understanding your market is the cornerstone of pricing your Chat Marketing services. To start, dial in on who you are targeting, whether your customer is a local business or company with a more than $5 million annual salary. You want to learn how much these customers are willing to pay, and how much your competitors charge for similar services.
Take the local business option, for example. The Small Business Association reports the average business spends about 1.08% of annual revenue on advertising, restaurants spend roughly 1.93%. If your average local business makes about $100,000 a year, you can estimate how much they’ll likely spend per month (roughly $1,080) and determine your price based on that figure.
For larger businesses and corporations, you can charge significantly more. However, make sure you can deliver on the value of your price. You’d rather have a smaller retainer for years than a large one for six months.
Determine what services you’ll provide
In addition to learning more about the market, you want to lay out what services you’ll provide for clients. Chat Marketers can offer:
- Chatbot building
- Bot maintenance and optimization
- Chat marketing strategy
- SMS marketing
- Messenger marketing
- Paid social ads
- E-commerce nurturing and segmenting funnels
If you’re not sure where to start, begin with what you know. Are you a Facebook ads specialist? Sell that with a chatbot add-on. Are you a Chat Marketing extraordinaire? Price for a complete suite of SMS, email, and Messenger Marketing.
“One thing to ask yourself when pricing your services is, ‘How complex of a bot does your client need to achieve their goals?’” says Mackensie Liberman, founder of award-winning Chat Marketing agency, Orca Marketology.
She advises chat marketers to consider how complex a client’s bot will be:
“Third party app integrations, external requests, and connecting APIs — specific functionalities like taking payments, scheduling, coupon distribution, and more — can give you options to adjust your pricing as necessary.”
Once you paint a clear picture of what your offering will be, you can better understand what you can charge to clients.
Choose a revenue goal and work backward
This one may seem like a no-brainer, but it’s common for Chat Marketers to overlook working backward when pricing Chat Marketing services.
Say it out loud, right now, How much do you want to make this year? If you want to make $100,000, you’ll need to make about $8,334 a month. Figure out how many clients you need to take on, at a price that suits your business, and there you have it. If you want to charge $1,000 a month for services, you’ll need 8 or 9 clients a month on retainer to achieve your goal.
Don’t forget your taxes
It’s extremely common for freelance marketers and new agency owners to overlook this part. You don’t want to end the quarter thinking you made a certain amount, only to be hit with a tax bill you forgot to take into consideration.
First, you need to figure out your tax rate. Once you know, take what you want to charge and multiply the number by that rate. For example, say your tax rate is 20% and want to make $3,000 a month in profit for a Facebook ads and bot maintenance package. To offset your tax bill, you’d want to sell the package at around $3,600. It also gives you a little room for clients to negotiate without eating too much into your margins (and some clients will try to negotiate).
If you don’t keep an eye on your profit margins, you won’t be in business for too long.
Take costs into account
Just as you want to consider your taxes, you’ll want to include all your costs and expenses when you price a project. From the example above, say you need to hire a contractor to set up and optimize ads for $2,000 a month, or need to buy another software like Viral Loops to run a certain campaign, you’ll need to include that when pricing your services.
Consistently raise prices
There comes an exciting point in every marketer’s career at which some surprising results for a client springs forth. Now, you have an amazing case study to share with future prospects — and you’ve proved your value enough to raise your prices. Again, find the fine line between overcharging and charging the right amount.
If you’re going to raise prices on old clients, do it after a quarter or yearly cycle. You don’t want to raise prices out of anywhere — it’s unprofessional and doesn’t take clients’ needs and budget into consideration. Instead, send a note a month or two ahead of time to let them know of the changes.
For new clients, make sure you can prove the value of the price they’re going to pay. If not, you risk losing them after their contract is up.
Offer add-on services
As you build a relationship with your clients, you’ll start to learn more about what they need to succeed. This makes for a great opportunity to offer add-ons to their existing services. It’s always easier to sell to an existing client than a new one.
For example, if you’re providing Messenger Marketing as a service to a client. You can easily upsell them SMS and email services. Creating a multi-channel campaign doesn’t take much technical know-how or time using ManyChat. And the value your client gets from the added service is worth way beyond what they’ll pay for.
Key takeaways for pricing and upselling your Chat Marketing Services
- Research the market and find out how much the average customer is willing to pay for your services. You can then set a comparable price.
- Determine what services you will provide and how complex your solutions may be. It’ll help you decide how much time you put into a project, and price more accurately.
- Set a yearly revenue goal and work backward to figure out what you should charge monthly to each client.
- Don’t forget to include all your expenses and taxes into your price.
- Raise your prices after seeing consistent, positive results with clients.
- Offer add-on services. With ManyChat, you can offer omnichannel marketing campaigns and execute them with less time and resources than ever before.