Value: A new Pricing Consideration for Freelancers

SEASON 3, EPISODE 9:

Welcome to the 4th season of TWC, where Jenni and Wudan will dig into persistent themes and issues that we haven't had time to cover in seasons past. During this season, anything goes! We’re kicking off this string of episodes with a conversation about value. Writers and creatives often grow up in a world where their work isn’t valued. See: the journalism industry, where we’re persistently told by publishers that it’s somehow okay to spend weeks on a story and get paid a few hundred bucks for your reporting, research, writing, and other labor. So the big question is: How do we break out of that mindset and see ourselves as valuable? And how do we use the value we provide for our clients in a practical context when it comes to negotiating prices?

Full Transcript Below:

Wudan- Hi, everyone, and welcome to The Writers' Co-op.

Jenni- I'm Jenni.

W- And I'm Wudan. Hey, Jenni.

J- Hey, Wudan. How was your summer?

W- I mean, I came close to taking six weeks of vacation this summer, all told. So I am not complaining. Lots of backpacking, lots of miles logged, some overseas travel to Italy for normal-sounding things like weddings and vacation. So what about you, Jenni?

J- Yeah, so we ended up staying in Oregon. You know, I feel like the last few episodes of last season I was talking about how we were going to move. So we didn't move. We ended up realizing that we really love living here and some stability would do us some good. So we are actually here through the end of the year, and then probably forever, which is really awesome. Because it means I actually have more childcare, which means my business can grow. So yeah, it's really, really good. And I also took a big chunk of time off. I took three weeks off, we visited family on the East Coast, we flew across the country with a toddler, which I really don't recommend. My husband and I went on a five-day vacation without our kid. It was so nice. We got to sleep. So yeah, I'm really glad it's fall. But it was a really good end to the summer I think for me.

W- I love it. Sleeping in is what vacations are all about as an adult. So here we are, we now have wrapped up three seasons of this podcast, which have each been themed around a particular issue.

J- Yep. And then in classic us form, we took a break.

W- And then we decided that there was more we wanted to say

J- Yep, there's a lot more than we can discuss in our themed seasons. 

W- Or our events and courses. 

J- Yeah, so a part of this season, which we are calling Season Four is going to be talking about the things that just like come to the top of our minds. Things we've been wanting to address, but haven't really had a space to talk about.

W- Yeah, think things that fill mine and Jenni's text threads with angst. Things we are commonly encountering with our coaching clients, things we are currently pondering with our own businesses.

J- Yep. It's all the things that we haven't gotten to dive into before, which I'm excited about.

W- Absolutely. So Jenni, what are we starting with today?

J- Today we are going to talk about, dun dun dunnn: value. I am super stoked about this one. I think this is like our number-one most texted about topic. We have wanted a place to discuss value for a really long time. We rage about it on our text thread. And now we are going to rage about it on the mic. So get excited.

W- Yeah, rage on. Let's dive right in.

J- So Wudan, let's talk first about really what value is. What do we mean by value?

W- Yeah, so we're gonna do the boring thing where we read off a definition from the internet. But I think that's important because it gives us common ground. So from the dictionary, value is defined as the regard that something is held to deserve. The importance worth or usefulness of something.

J- Put another way, value is something that someone receives when you offer them a product or a service. And I think we encounter value a lot in freelancing because most of us are making a thing that provides value to someone else. But matching that idea of value to pricing is really, really complicated. So the concept comes up a lot for writers, I think, and in conversations between writers because we feel really devalued when we're offered too little money for a big project. Like we have this sort of idea that there might be more value than what we're getting paid for. I think that value is kind of threaded into every decision we make as small business owners and entrepreneurs.

W- Yes, for sure. So freelancing business stuff aside, Jenni, what are some things that have been high value in your daily life? Like things that may seem pricey at the outset, but something that really benefits you?

J- This is a great question. So the first thing that comes to mind for me is actually therapy. I pay literally $800 a month out of pocket for therapy, but this therapy has changed my life. It's not covered by insurance, which sucks, but the particular therapist I have right now is so good that there is no way I could walk away from it. She's uncovering stuff from childhood that has been like buried for years and years and years so yeah, the money is really no object for me because the value is so high to me and then to my family and then to my coaching clients, right? There's this huge trickle down. If we're thinking like items that give me value, I'm gonna go with my juicer, I think. That's really funny for me to say, but I'm obsessed with my juicer. I guess I'm becoming like a juice person. It was pricey, but every time I make myself a green juice at home, I just get like really excited and it's totally worth it. What about you? What is something that has been giving you a lot of value lately?

W- So one thing that's been super spendy for me lately is that I started building a traditional climbing rack.

J- Ha, in case you missed it, Wudan is a gearhead.

W- Yes, so basically, I'm entering the amazing world of traditional climbing. And what that means is you're climbing up a rock face, and there are no bolts drilled into the wall to clip your protection in. And that means you have to put in your own protection into natural cracks and slivers in the rock as you free climb your way up. It's admittedly pretty scary stuff. Hi, Mom and Dad. So you want to make sure that your protection holds so it can literally save your life. Trad racks, traditional racks, usually add up to, you know, around $1,000 to start off. Sometimes more, sometimes less, depending on what kind of climbing you do. I haven't nearly spent to that level yet. But that's just to give you a sense of something that's pricey, but can save your life, which is, you know, priceless.

J- Yeah, that is a really great example of value, right? The value of saving your life. So if you transfer all of this to the freelance world, I think that we can talk about value in terms of a good story, right? Or there's value of a newsletter that you might create for a client or his or her audience, or there's value in a blog post for for-profit company. They're getting things out of it. There's also value for a piece of art or an ebook, right? In all of these cases, somebody is getting something valuable out of what you're making. Absolutely. So Wudan, why don't you give me an example of a project that you've done that's been high in value to a client?

W- Totally. So, one of my clients is a biotech company who makes gene sequencers. And I write blog posts for them that showcase what kind of research these machines enable. I get paid around $1,000 to write one 500-word story that's based off of one interview, which seems to be a pretty fair rate in my book. For reference, there are lots of different sequencers, but one sequencer can cost over $100,000. So if a prospective purchaser reads, you know, something I've written and decides to buy a sequencer that return on investment for a client is super high.

J- Yeah, that's amazing, right? It's 100 times what they're paying you. It's crazy. I have a similar example, on a slightly smaller scale, I write blogs for a mattress company and the hourly rate comes out to, I don't know, it's probably like $200 an hour, one or two interviews required. It's pretty low bandwidth. But think about it. If my blog post sells one mattress, that company is making $1,500 minimum, right? And I think this is also true for me with gear reviews. They all have affiliate links. So I might make a few thousand dollars for a gear review that I do, because people you know, I get paid that few $1,000 rate. But for the publication, they may be making 1000s of dollars based on how much people click through and buy the products that I'm talking about. So each time somebody clicks on the article, the company makes a portion of that revenue, the value for them is huge. And it's also ongoing, which I think about a lot. It's a big one for them. They're getting a lot of value from me.

W- Yeah, it's passive revenue for them. So ultimately, we believe that it's important to price things based on value. Even more behind-the-scenes services, like editing or fact-checking or managing projects. Then the questions are more like, what is the value of having a polished feature story for X publication's audience? Or what is the value of having a factually accurate book or magazine story? Or podcast series or documentary? Or what is the value of having a responsible, organized Project Manager for something complex? Like those are the types of questions that I ask when I think about value.

J- Yeah, absolutely. Because having that organized project manager might save you hundreds of hours of work, right? So we know that this is a little bit of a gray area, when you start to think about pricing as related to value instead of what people are offering you, right? Like you're kind of walking into this new arena of freelancing. It's a mindset shift. And we talked a little bit about this in our pricing webinar a while back with Melanie Padgett Powers and Jennifer Duann Fultz. And we're gonna put a link to that resource in the show notes too, just because I think it pairs really well with this conversation.

W- I think the TLDR is that the value of your work is important for figuring out pricing. I love that in our TWC Slack, we have a whole channel dedicated to pricing. And people have started to ask each other like, what is the value of this ebook? How much should I charge for ghostwriting? What is the value of the script? Sometimes it can really help to workshop value with other people to try and suss out what a company or client is getting from you. And I think there's also this idea that your expertise has value, too.

J- Yeah, I do have a favorite metaphor that I like for this idea of value in terms of expertise. I'm going to share it with you. So it goes like this. A woman is sitting in a cafe. She sees Picasso walk by, she calls him over. She's like yo Picasso can you draw my portrait? I'll pay you whatever makes sense. And he's like, Okay, sure. So he sits down, pulls out a piece of paper spends about 30 seconds sketching her face and hands her back an original Picasso. The price is 50,000 francs, he says, and she's totally shocked. She's like, this only took 30 seconds. And he goes, No, it took me my whole life.

W- Yo Picasso. I mean, ultimately, a client is getting more from you if you have expertise in an area too. Your expertise increases the value that they get from your work. If your work is better, they don't have to spend as much time editing or polishing catching your mistakes. And if you have expertise, that means more people come to your work. And that pays dividends for the brand or publication.

J- Yeah, value matters. But I think the hard part of this is that freelance industries like journalism, like freelance writing, like content marketing can significantly devalue work as a matter of practice industry-wide.

W- Womp womp. Yeah, especially journalism.

J- Journalism is so so so critically important for our democracy. Like we really believe that obviously, we've both spent a lot of time in this industry. And at the same time, freelance journalists are deeply undercompensated all the time.

W- Yeah, I agree. I mean, we can talk about full time journalist salaries, or the fact that some or not most web outlets pay $300 or $400, for feature stories that, at worst, require a foreign correspondent to go somewhere potentially dangerous and cover a complicated story. And at best, they might still require a week or two of work for, you know, a few 100 bucks. That's really not a living wage.

J- Yeah, not at all. And I think what sucks is that most writers and journalists come into a freelance space that says, This is what you get, right? Like, this is what you deserve. And if we believe that's all we can get then that's all we ask for. And then there's this chronic undervaluation issue that is pervasive,

W- It's a really tough mindset to fight. It's definitely a limiting belief. And it says, freelance writers don't get paid well, I encounter this so much with my coaching clients who I think write for low paid outlets, because they publish often and are more open to freelance pitches. It's obviously great to get work out there. But then I think people who I work with feel so burnt out, because it's just unsustainable to keep writing stories for such little pay.

J- Yeah, I think I've talked about this before, but I remember having a month where I wrote 25 stories, when I first started freelancing, in one month. Like in 30 days. And each was paid $200 or $300. And it was horrible. Not even just because it was so many stories, which was bad, but also tracing down 25 invoices was horrible, right? And I remember just feeling like I was sprinting, like I couldn't breathe. And I don't know very many people who can sustain that for a long time, especially if the projects require a lot of reporting. So the biggest change I think someone can make in their business is this switch from many small projects to a few larger ones, which to me comes down to thinking more about value, your own value and the value of the work you're creating. Because hecticness is toxic, right? It's that limiting belief again. This is all I can get. And the small assignments might be all I can get, when that may not be true.

W- Right. Or the limiting belief that all freelancing is hustling, and hustle mentality is not necessarily healthy. So when I talk to coaching clients who focus primarily on journalism, about diversifying their business and taking on branded or university based client work, they are blown away by the pricing there. I will say you can get paid about $1 a word. And it's hard for them to fathom that number, because they've been consistently devalued for so so long, and how can that not get to someone? Right?

J- Totally. It's a pattern. It's a habit, right? It's a habit of expectations. And I think we should also say that this is getting worse in the industry. Like, it's not just you. You know, if you were a journalist a couple decades ago, you were more likely to make a living wage. And as more and more publications lay people off, I mean, you all know this, more and more people get into freelancing. There's a lot of people out there in the industry, it can sometimes feel like a race to the bottom. And journalism's business model is broken. It's not your fault that it looks like this. Because there's no solid revenue streams. I could talk about this forever. It's not on you. It's on the industry. But I think we have to get pretty feisty to break out of this cultural belief that our work doesn't have value. Like it's really counterculture to say I have more value than I'm being offered by this publication. It's super brave, I think. Yeah.

W- And I also think being surrounded by people who tell you, this is how much your work is worth, all the while paying you extremely little for the effort involved can really really impact someone's overall self worth.

J- Mm hmm. I think that is the root of a lot of self confidence issues, to be honest.

W- And it takes a lot of mindset work to change that, I'd say. In coaching—I already used this term a few minutes ago—we call these limiting beliefs, which we are going to dig into all about limiting beliefs for next episode. But as a teaser, you know, limiting beliefs are things that we each have internalized to be true that are preventing us from breaking out from that shell.

J- Yeah, the best way to break through these limiting beliefs is actually just first of all to like notice them, and then you interrogate them, which good news, if you're a journalist, you're like, perfectly primed to do this, right? You're investigating these beliefs. So here's an example. We'll do this quickly. Because like Wudan said, we are going to talk about this for a full episode. But this is a good place to talk about it just to start. So the limiting belief here is that if you're a working journalist, you're not going to get paid well, for your work. Right? My first question would be, where does this idea come from? Who came up with it? Wudan. What do you think?

W- Well, I don't know. If you're coaching me, I might say it's an idea that comes from publications. First, they're the ones who set these rates. And they've decided that this is what they'll have to pay. But maybe it also comes from people who have struggled in the industry.

J- Yeah, totally. It makes sense that it would come from people who've had a hard time, right? They're gonna talk about how you don't get paid well, and you're going to hear that and you're going to take it in. I am also wondering, who does this limiting belief serve?

W- You know, definitely the publishers. And I would say people who love the starving artists mentality, perhaps?.

J- Yeah. It serves the people who make the news. It serves the people who are living under this limiting belief, right? It sort of helps them support their ethos, but it doesn't serve us. So I want to know what evidence there is to suggest that working journalists don't get paid well.

W- I think this might be true for some, if not most people, although it might not be the big picture truth. So many working journalists don't get paid well. See: local newsrooms. Most publications don't pay freelancers well, and a lot of people end up making less than minimum wage on long reported story. So it's true for some people.

J- Yeah, that's one of the things we talk about a lot in coaching. True, but not the truth. So is there evidence to suggest that working journalists do get paid well, Wudan?

W- I mean, I know about a handful, mostly freelance who do.

J- Yeah, I think there's a group of journalists out there who are making this work, right? Some of whom are making six figures, many of whom are doing work that serves them and also pays the bills. So there's evidence to suggest that some people do get paid well, and evidence that suggests that some people don't. So last question would be what is a new rule that we would use to replace the original one that would serve us better?

W- Something maybe along the lines of I have a choice about how well I can get paid?

J- Hmm, yes, choice, right? We love choice, right? We're not stuck. So this is what it looks like to be coached on the limiting belief, by the way, and we will dig in on to this whole thing in a future episode, and look at how to put that rule into practice. But it's all kind of like mind games, right? Like you actually do have control over what you believe, and especially asking questions about it can sort of like loosen your grasp on it. So I like to say sometimes we're dealing with effects, right, like struggles with money, poor self confidence. And if we treat these symptoms alone, we sort of miss the cause. And the cause is some of these limiting beliefs that are just buried under there, especially the ones about value that keep us in a tiny box, and then mean we're not asking for better pay.

W- Yeah. And this low pay issue in journalism is just truly a losing battle. It pushes journalists also into a scarcity mindset pretty much immediately, and then they are also less willing to invest in themselves. So if you're earning $500, on a story that takes you a week to report, write, and edit, you will probably be less willing to invest in professional development for say, you know, $1,000, because that's two weeks of work in your mind.

J- Yeah, absolutely. It totally makes sense. Let's talk about investing in yourself. Because I think this is another part of value that is super important, and that you and I yell about a lot in our text threads, too.

W- We do yell about this all the time. Yeah. So we put up you know, a few online coaching groups, they cost about $800 for three months of content, community coaching, and these programs at market rate are probably over $3,000 for three months. And we frequently get messages from people saying that we're taking advantage of people or that we're charging too much.

J- Yeah, it's hard. Because I mean, to be honest, we're pricing based on value. This is what I mean. If you go through three months of coaching, you are definitely going to walk away with a different mindset, I promise. And that is going to ultimately enable you to make more money, feel less stressed, and be more in control of your workflow. You be at the cause of your life, instead of the effect, and is that worth $1,000? Is that worth $800? To us, the answer is yes. But you have to think about it based on the value not just the price point,

W- Right. Because the value can actually be infinite. I always say that investing in yourself is a form of value, because going to a conference or signing up for coaching or taking an online course, is a way to do that increase your value.

J- Yeah, this is one we could talk about forever. But I think let's get practical. Yeah, Wudan?

W- Yeah. Love the practicality. So if we're thinking about pricing based on value, Jenni, how do we handle this whole thing of our clients offering lower rates?

J- Yeah, I don't know about you. But I feel like the only way I can figure this out is to accept prices based on how much time a story is going to take me to write or like how long it takes me to complete it. Like that's how I figure out if the rate that they're offering me makes sense or not to begin with.

W- Yeah, I think this tracks well for journalism for me, too. I think most newspapers and magazines offer prices for various services that don't necessarily reflect the value of the work. So let's take per word rates. I hate to say this, but a longer story doesn't necessarily mean that it is a more valuable contribution to society. Or conversely, a shorter story doesn't make it less valuable to readers, or take a service like fact-checking, which is traditionally paid hourly: if you have a more experienced fact-checker who takes less time working on a project, does it mean that their work is less valuable, because they're more efficient?

J- Yeah, this drives me nuts. So I mean, in other words, if the position is paid hourly, and you're a new fact-checker, the project might take you 10 hours, if you're more experienced, you will be faster, and it will take you 5, so the more experienced person is either going to get paid less, or they're going to be forced to like fudge the numbers when they submit an invoice, which feels horrible. So both options are bad, right? This is why we really urge folks who produce journalism to push for flat rates, because those can be more reflective of value. And also to be really clear on the scope of work. So if the scope of work changes and things take longer again, the pay changes. It's the only way for things to be equitable to both sides.

W- Again, more on why and that pricing webinar we mentioned, we will link that in the show notes.

J- Yeah, we got really deep into that, I think in that webinar. So here's the question, Wudan: how do we figure out how value interacts with our pricing? What are your thoughts on that? Do you have like a formula for how to add value into pricing?

W- I don't know if there's necessarily an answer to that formula, like a rhyme for the madness, because we're never going to be compensated for the full value. And I say that thinking about my biotech client who makes you know, 100x ROI on what I produce for them. But I think that value should give us negotiating power when a client comes back to us and quotes us some standard market rate. What do you think, Jenni?

J- Yeah, for me, I think value partially has to do with this mindset of if I understand the value they're getting, I'm more confident asking for more. I think for me, I'm also aware of my hourly rate. And then, like I said, like, I'm just asking myself that direct question, once I see what they're offering me, what value will they receive from this work? And if the answer is something like, Oh, they're gonna make $2,000 from this event I'm producing, then I'm probably going to edge my hourly rate up, right? So there's no formula, but I guess I'm going to call it like a value tax, the more value they get, the more I'm going to inflate my rate to match that value.

W- Yeah, that's super. So Jenni, let's make this a little more brass tacks for our listeners. We've been giving pretty concrete examples about value. But let's shift gears a bit into how to tackle it when you're discussing a new project with a client. Jenni, what do you like to say in a situation like that?

J- Yeah, I love this. I want to say that this applies mostly to work outside of journalism, because it's really challenging to price based on value in journalism. So for me, I just push really hard on my non-journalism clients to make sure that that pricing reflects value. And then in journalism work, I'm doing more to curb my reporting so it doesn't take as long, if that makes sense. So it's sort of different tactics. Because I do think there's less flexibility in journalism.

W- Yeah, that's a very important caveat.

J- So ordinarily, if a client comes to me for a prospective project, I first need to understand what their client's needs are on their business level. So maybe they're trying to sell something, right? What is it? How much do their products sell for? Or if they're nonprofit, maybe they're trying to attract funders, how much funding are they going to get? If they're a burgeoning startup you'd want to know, are they trying to get the attention of venture capitalists? So I asked for some info about the utility of my work for them in that first conversation or email. What are you hoping this piece of content does for you? Before we started recording, I was saying to you, Wudan, I'm working on a project where I was building out templates to help a new publication launch a product review segment. The value to them is huge, right? But I wanted to understand what that value was. So I asked a lot of questions up front, because it is content marketing, so they're gonna make a lot of money off of these. The second thing I also do is I want to understand how whatever I'm producing, the thing I'm producing for them, how that thing is going to be used. So is it going to be in a newsletter? How long is it going to be and who subscribes to the newsletter? How big is their audience? Having that sort of big picture, I think really helps me understand how to assess value in addition to knowing what their budget is.

W- These are great questions. And if you're not writing these down, don't worry, we will have a checklist for our All Access members so you remember to ask about value. So Jenni, what do you do next with all this information?

J- Yeah, like I said, I know my hourly rate. And then I'm going to use this info I've gathered on value to figure out how much to press the pedal to the floor, if you will. This is where I think pricing gets a little squishy, right? Like it's just sort of gut-based reaction sometimes. Right now, I'm focused on coaching in my business. So I'm asking, what do people get from these sessions? Who's my audience? What is the value they walk away with? What is their ROI? Using that information, then helps me understand how to price sessions and packages. For working with a content client, same thing. If I understand that the value is huge, and they have a huge budget, you better be sure I'm doubling my hourly rate, right? This is pretty intuitive, though, like I said, and part of it has to do with how much time I have, too. So we've talked about rush rates, things like that, right? It's sort of like looking at the value to me and the value to them of the project. So yeah, Wudan, why don't you answer this question? What about you?

W- I don't really think about hourly rate, once I'm thinking about value. And that's because I try to max out a client's budget if they have it, especially if the project is valuable to them in a big, monetary way, because I see my rate doubling, sometimes even tripling. And it doesn't really matter that much to me at that point.

J- Yeah, that makes sense. I mean, sometimes clients don't get it too, right? I frequently get the "we believe we're paying you a competitive rate already." Do you get that, Wudan? What do you say when people say that to you?

W- Yeah, I do. And I don't think it's my place to Yansplain to the client what value means. I don't see how that can result in a good relationship with that client. So I usually will say, for the timeline, scope of work and value of this project, I would charge x, would that work for your budget? And I mean, I change around the language in there, depending on the factors that are most salient in me coming up with a price. But I just very subtly add that I am pricing based on value and pray that they will get it and if they do not, then they are not the right client for me. What do you like to say, Jenni?

J- Yeah, I think that's fair, that they're just not the right fit for you if they are not willing to acknowledge the value of the project, I do think that it is good to be out of budget for some clients. And so this is another limiting belief that I think I've worked through. I talk with a lot of clients about this. At first I thought people saying no means I'm charging too much, right? Like, that makes sense. And yes, if every single person says no, then I'm probably charging too much. But if 20% of people say no, I think that's a good sign. It means I'm valuing myself, and my time, and that's important.

W- Yeah. So in summary, think in terms of value. I think for freelance creatives, we may be socialized to believe that what we do is not valuable, a la the starving artists trope, and Jenni, to your 20% of people saying no point, I once heard that if you're not getting told, like 40% of the time that you're too expensive, you're not pushing hard on your rates enough.

J- I love it. Yeah, another limiting belief sliding in there I think too, about the starving artist trope, like we talked about before. So writing, editing, project management, research, photography, all of these things are legitimately valuable to clients and readers. You're helping people promote their brand, you're telling stories, right? There's a lot of good that's being done. There's a lot of impact that your work is having. And sometime I will yell on here about the research on the value of art and good communication for society's wellbeing. But I will just say now, like this stuff matters. And if we're believing that it doesn't matter, we're we're actually sort of buying into a lie.

W- So if you haven't ever thought before in terms of value, we hope our conversation today helped reframe that thinking. And like we said, if you're a Patreon member, you'll get a little checklist on how to consider value for your clients.

J- Yep. And please let us know if thinking in terms of value changes how you think about your business and negotiation. We always love hearing your success stories. 

W- You can write us us at thewriterscoop2@gmail.com, or find us on Twitter at TWC_pod.

J- Yeah, we're probs on Twitter. And we've also got that fun Slack group that our Patreon All Access members get to hang out in. And a lot of these discussions about value come up all the time. So if you're looking for a community and a place to bounce ideas off of other folks, that is a great place to go. You can join us any time. It's patreon.com/twcpod.

W- I think that's it. I'll see you soon for our next episode, Jenni.

J- Bye Wudan.

W- Season Four of The Writers' Co-op is made possible by you, our listeners. The Writers' Co-op is co-hosted and written by me, Wudan Yan and Jenni Gritters. Our producer is Jen Monnier. And our editor is Susan Valot.