#EspressoMonday Episode Nr.19
Table of Contents:
- How much does a website cost or how much do I charge for WordPress website?
- Long Term Versus Short Term Clients
- Pricing Strategies: How Paul Jarvis Was Able To Charge High Prices For Web Services
- How To Charge More As a Freelancer
- How to Charge More as a Freelancer From a Developing Country [An Interview With Janet Brent]
- Quest for Disruption: Why the Web Design Industry is Ripe for a Change
How much does a website cost or how much do I charge for WordPress website?
Every Monday is a great day because of #EspressoMonday, but today’s episode is much more special because we have Brent Weaver of Ugurus to address our question of the day. So before you get lost in the discussion, let’s get some espresso down our throat to complete this awesome Monday ritual and start the week right.
As already indicated in our title and headline, we will delve into another common question or dilemma faced by web designers. How much does a website cost? The question might often be asked by those who are still starting in the freelance world of web design. On the other hand, it can also be the dilemma of those who’ve been in the business for quite some time but still struggling about pricing, especially when faced with clients who want a much cheaper website.
The Price is Right
One of the dreams every web designer wish for is that they will be able to quote a price that won’t be contested by their clients. When we’re talking of price here, we are not talking about going cheap but getting the right price concurrent to the value you are bringing into the table.
So how do you charge your clients? How do you convert the effort and the time you’ve put in the project into money?
Unfortunately, you don’t just come up with the price in your head just because you want it. For example, not because $1K sounds nice, you’d charge your client $1K. On the other hand, pricing is not that complicated as you might want to think. In fact, it should not give you a sleepless night or cause you stress for that matter.
To be honest, however, this question is relative. It is like asking someone how long the string is without the specifics. That is because pricing depends on a lot of variables – the type of customer you have, the market they are in, the requirements, what you’re going to do for the client.
Let’s say someone calls you and tells you that they need a website set up on WordPress, you can imagine yourself calculating the numbers in your head. Is it worth a hundred dollars, a thousand dollars, or more?
If you are vying in the commodity space and your client comes to you with a certain specification, like how many pages, what type of content, or functionality, you might find yourself stuck with a few hundred dollars.
This amount might sound fair but let’s face it, it is not the amount that will help you achieve financial security. It might not even pay the running bills you have. So comes the question, how do you make a website that is worth thousands of dollars?
Building the 10K Website
In Ugurus, we have a program we call the 10K Boot Camp where we teach and challenge web professionals how to sell their thousand dollar website. What does it take for a website to be worth tens of thousands of dollars?
What goes into the formula is not really mystical or something new. Rather it is a combination of consultation, strategy, and vision to help your clients achieve the website beyond the specs they want. It also includes five important elements called design, development, content, strategy, and tactics.
When you always put these five factors in consideration every time you build a website, it doesn’t really matter what type of template you purchase on ThemeForest to build that website.
We always say it here in the 1WD community that websites are not just about the aesthetics. In fact. it’s just like a mantra we always tell community members that a good website isn’t just about how beautiful it looks to the visitor. Instead, when you design a website, you should grasp the vision of your client – what is he trying to achieve with that website you are building? Therefore, you design the website with your client’s goal in mind as well as the thinking whether the website will convert well or not.
When you think of development, you have to make sure that the website you are building is well-developed and well-tested. With all the different platforms and devices, these days, your client would want a responsive website. Does it work on different browsers? Does it function well on different devices?
Content is one of the most overlooked elements by web designers. They often think that as designers, they are just responsible for the technicalities as well as the aesthetics. So what happens is, they spend a lot of time making the design look great and when deadline is almost around the corner, they just fill in the blanks. So what the clients get is a great looking website with substandard content.
You will be surprised that you can earn more and command a higher price as a web professional if you know how to write. Why not? Call it beauty and brains – and we all know that it is a very lethal combination. Not to mention, very profitable as well.
When you finished building your client a website, it does not stop there. You add more value on the table as well as your pricing when you help them develop a strategy for their online business. Who wouldn’t want great advice, especially if it means generating more income for your business? It will also send your clients a message that you are a professional who knows what he or she is doing.
This includes different tactics that leads to more traffic and higher conversion rates. What kind of marketing tactics will work for this website and the industry your client is in?
Calculating the cost of the website isn’t just about how good it looks, but it involves different vital elements. The five factors mentioned above are very basic, but they are your foundation towards creating a thousand-dollar website. They are also your foundation towards a secure and fulfilling career as a web design professional.
In the next section we will go a little bit more in depth about the cost of a professional website. We are going to look at long term and short term clients.
Long Term Versus Short Term Clients
Clients and Coffee
Like the #EspressoMonday episode last week, this episode goes in-depth with one question. It is still about clients. This time, however,we will be talking about long-term and short-term clients as well as the difference between a professional and professionally-looking website. Sounds interesting? Grab your cup of coffee and learn precious nuggets in just a few minutes.
How Much Does A Website Design Really Cost?
Free website builders are one of the woes a professional web designer or developer faces. These “free” web services have beautiful predesigned templates which allow you to create a beautifully-looking website in a matter of minutes. It can even make a non-web designer look like a professional with hundreds of templates to choose from and easy installation process. Or does it really? So….
What do you do with “free” web services, like WIX or Weebly, which claims that anyone can build a professional website for no cost?
Why pay a thousand dollars for a website design when you can have one for free? Why should I pay that much? Isn’t it easy to design a website?
These are oftentimes the questions web designers/developers face from clients and critics alike. Questions that seem to mock or belittle the effort and value you put into your website design. The question is reminiscent of the parable of the $100 nail which you will soon read here at one of our future articles.
Like the carpenter in the parable, you don’t need to turn tail and run. Instead, you should be able to clearly communicate to your clients the value of what you’re doing because once they understand it, how much they invest won’t be a problem anymore. Never mind the critics. And before we completely digress from the topic, here are some tips and pointers to address our question for this week.
Professional and Professionally Looking Website
Is there any difference at all or is it just a play on words?
Professional is an adjective while professionally is an adverb :)
On a serious note, there is indeed a difference – A professional website design lets you build what YOU want to build, whereas a professionally looking website lets you build what THEY want to build within the confines of their rules and regulations.
Now, there is of course nothing wrong with a professionally-looking website since they offer you various tools and blocks to make your website look good. Furthermore, there are also businesses that need these types of websites, specifically self-employed freelancers and small business owners.
For example, a freelance photographer who needs a beautiful website where he can add his portfolio and contact number. Or a small business owner who needs a simple shopping cart in his website. However, there is not a lot of interaction going on in these types of websites.
A professional website, on the other hand, is something that you can customize and build upon. It is something where you can weave your magic as a designer/developer to make it unique and fit to your clients needs. Furthermore, these websites are open source allowing you to tap into the code source and change it according to your preferences.
Long Term VS. Short Term Clients
People who usually go for these free website builders can be considered short-term clients who are trying to drive their website design cost as low as possible. As mentioned earlier, they are the self-employed freelancers and small businesses who are looking for a quick fix. They build a website, launch it, and forget about it until they want to change something after a few months. They think that by building a website, they will be able to establish an online presence without too much of an investment.
Here at 1stWebDesigner, however, we teach and encourage you to look for long-term clients instead of short-term ones. There is no problem with such clients but focusing on the short-term might be too taxing and time consuming for you as a professional web designer. Your mindset SHOULD be focused on building long-term professional relationships with your clients.
Long-term clients are the medium to large-sized business enterprises as well as public figures. Conversely, the self-employed freelance photographer could become a public figure and when he becomes one, he will need a monthly maintenance for his personal brand. Instead of just a personal portfolio, his website becomes bigger and more complex with landing pages, separate pages which features his work by category, videos, case studies, and more. In short, it becomes a marketing website to promote and advertise his personal brand.
The same goes true with medium businesses and large enterprises which need daily, weekly, or monthly maintenance and management. Once a business reach these scales, they understand that they have to invest more money in order to generate more profit. In these cases, free website builders which offer a quick fix will not suffice anymore.
We actually just released the training course to help you get the skills you are looking for on the way to become a professional web designer.
It is The Ultimate 2015 Web Design Learning Course, where in 9 hours we will teach you how to Build Your Own WordPress Site – 100% Responsive & Flat.
You will learn how to build website from scratch in Photoshop, then convert PSD to HTML and CSS. Finally using Bootstrap magic, we will convert the website to become a fully responsive and functional WordPress website. We throw in some business lessons, interviews, and many bonuses to amplify your learning and help you get some clients as well!
To sum it all up, small businesses and self-employed freelancers are those who usually champion free website builders and there’s nothing wrong with that. On the other hand, medium to large business enterprises and public figures are those who do not hesitate to invest more in a professional website. They understand that value begets value – that in order to gain more, you also need to invest more.
The difference, therefore, is the scale.
What does it mean to you as a web designer?
Well, you don’t have to be a Math wizard to figure the numbers out. But surely, you would want to pursue those who belong to the larger scale. It will definitely save you the effort and time plus, of course, great returns.
Remember don’t think about the cost, think about what results you can create to your clients. Good clients know, that website builders will not magically give them a website, that converts and drives sales to their business. You can help clients to solve hard technology-related problems by improving their website and not just make it professionally looking, but to become the website that drives results your client desires.
In the next section we will look at some pricing strategies.
Pricing Strategies: How Paul Jarvis Was Able To Charge High Prices For Web Services [Podcast]
The Podcast Episode with Paul Jarvis
The Real Investment
Awesome seems to fall short when you use the word to describe Paul Jarvis although, of course, he won’t use that word to describe himself. However, all you need to do is just take one look at his accomplishments and you will concede that “awesome” indeed sounds feeble.
Let’s enumerate some of those accomplishment to give you a clearer picture of what Paul has done. If you use the abstract description he uses for himself, he is a web designer, a best-selling author, and a gentleman of adventure.
However, if you use the more concrete description, the ones used by his clients and the people he has worked with, you will hear words, such as genius coder, designer of my dreams, and even the holy trinity of website design.
These are not empty, flashy words because Paul is everything any web designer dreams of becoming. He is a regular contributor for a lot of trusted and popular online publications, like Forbes, INC, Huffington Post, Smashing Magazine, and more. Among his clients are big name companies, such as Yahoo, Mercedes Benz, and Microsoft. He also has a string of bestsellers to his name as well as an online course for freelancers called the The Creative Class. (get 100$ discount, use code: firstweb)
If you’re not impressed, here’s the real whopper: Paul Jarvis’ web design projects start at $9,000 up and never below that budget. What more – he does not accept new projects until mid-May.
Now, you might be wondering already how on earth was he able to do that?
Paul himself is going to tell you how he was able to do that. However, you might be surprised that there is really no magic formula from the Hogwart’s School of Wizardry that brought Paul to where he is right now.
The Road to Success
[ctt title=”Our views get skewed because our interests are also skewed. ~ Paul Jarvis, How to Be Rich as an Artist” tweet=”Paul Jarvis, How to Be Rich as an Artist: Our views get skewed because our interests are also skewed. http://ctt.ec/XRQ03+” coverup=”XRQ03″]
The quote above was from an article Paul wrote for the Huffington Post entitled, “How to Be Rich as an Artist.” The article was about someone who preaches the illusion that you can get wealthy as you pursue your art. While this is true, this truth – earning millions by churning out bestseller or a hit – only applies to a mere 0.1 percent of artists or even lesser than that.
Paul was speaking from experience when he wrote that.
What people would only see was the glamour or the figures – that he was doing $9,000-worth of projects. What they didn’t see was the process how he got to that place. As Paul himself said, people didn’t see the numerous times he made mistakes, the trial and error phase, and the hard lessons he has learned along the years while freelancing.
Paul started as a freelance designer way back in the 90s working in different industries, making his experience in the business extensive and spanning around or more than a decade. After trying out several industries, he realized that he needed to specialize in a certain industry or a group of audience.
For Paul, that audience were the people who focus on the Internet. The choice is logical – he also has his work tied mostly to the Internet, even the tools he use revolve around it.
Branding and the Target Audience
One of the factors that seem so obvious among the success stories that we have featured here in our podcast series is being able to find your target audience or your specific niche.
This seems to be a no-brainer because not having a target audience is like shooting for the moon and missing it. It becomes a futile effort because it’s like losing your way in a complex labyrinth. The saddest part to this shooting for the moon part is that you won’t land among the stars. Why? Because you are shooting into the vast expanse of space and what you know, no matter how good it is, has its limitations.
Being able to find your target audience will help you save a lot of time, money, and effort into your marketing. It will also be easier for you to know how to reach them. Above all, as Paul mentioned in the interview, focusing on a certain industry or target audience will help you make a name for yourself or, in other words, it helps your personal branding.
Once you identify who your target audience is, you have to know what their pain points are – their needs and wants. If you want to strengthen your personal brand, you have to know those pain points and the unique way how you can solve them. In Paul’s case, his personal brand is that of someone who gets things done.
In fact, this is one thing in common among some of the successful web designers in the industry – being able to solve the problem or meet the need and delivering what is expected. As Paul Jarvis mentioned in the interview, clients do not want and do not care whether you know HTML or use the latest tools, what they care about is you were able to help them fix their problems. And part of that fixing, on Paul’s part, is by teaching his clients how to use the website he has designed for them.
Your Clients, Your Sales Force
[ctt title=”Promotion is necessary, but for the most part, it feels like I’m looking backward at what I’ve already made. I’d rather be looking forward, at what I’ve yet to create.~ Paul Jarvis, More Doing, Less Promoting” tweet=”Paul Jarvis, More Doing, Less Promoting: Promotion is necessary, but for the most part, it feels like I’m looking backward at what I’ve already made. I’d rather be looking forward, at what I’ve yet to create. http://ctt.ec/XRQ03+” coverup=”XRQ03″]
Another interesting thing which Paul mentioned in the podcast interview was that despite his experience and expertise, he doesn’t care much about titles and only advertise himself as a web designer. For him, people are looking for what they need and what they need at that moment is a website. Thus, the next thing that they will look for is a web designer.
Moreover, clients will not hire you based solely on the titles you have but because of what you can bring to the table. Then, when they see what you can do anything more that you have to offer will just follow. When they see that you deliver, they become your fans and, eventually, they become your sales force. You don’t even have to tell them to promote you but they do so in order to share you to others.
As Paul has experienced, most of the clients he has are just through word-of-mouth. One client was satisfied so he recommended him to another who has the same need. Paul further added that you don’t even need to promote yourself. Instead his encouragement is just to focus on doing a great job that is valuable to his clients and, at the same time, is also valuable to him. Even the testimonials your clients have of you should focus more on what you have achieved and less on who you are.
Tapping into the Buyer’s Instinct
This is a simple yet sobering truth that every web design professional should remember – People will not open their wallets unless they trust you. In simple terms, they won’t be willing to pay more unless they see the results.
How do you do this?
By constantly behaving towards your clients best interest first. This means that you give them the best solution and not just any solution. This can be achieved by having a discussion with your client and taking the time to listen. It also means being honest whether you are a good fit or not and when you aren’t, you tell them immediately in a professional manner. Whatever business values you have displayed will never go unnoticed.
Another way of generating trust from your clients is to do what you say you would do. So when you say you’re going to deliver the project on that date, be sure that it’s ready on that day. This also sends the message that you value your time and in so doing, they will begin to value your time.
Your clients will just mirror the actions you have shown them.
You have to position yourself in a way where clients see you as an expert and not just another laborer. An expert who is so in-demand that your clients have to wait until before they get booked.
Being able to get to a place where you receive $9000 worth of project offer like Paul is a dream come true. However, like all successes, it’s never an easy ride. There are systems and practices that you need to follow in order to achieve success and Paul Jarvis has an online lecture called The Creative Class. (get 100$ discount, use code: firstweb) which helps you how to be a creative freelancer and make a career as a freelancer who charges more.
The next section will tell you how to charge more.
How To Charge More As a Freelancer
Most freelancers out there work as a freelancer either because they are in need of a job or they want to increase their skills and improve their portfolio. But have you ever thought about the fact that all of us do it for money too? Now some of you might disagree with me and I fully encourage you to do it.
Then I also encourage you to go out there and work for free, while marketing yourself as a volunteer designer. After three months come back to me and I am sure you will agree that you freelance for money. If we wouldn’t need money to survive, we would probably not work at all.
Now I am not saying all freelancers are focused on the money. Some of them are not even full-time freelancers, but do this as a hobby after their normal 9-5 job; but even they charge money.
So you might ask yourself now and then:
How much should I charge the client? Should I charge him by the hour or maybe a flat rate per project and should I ask for milestone payments or not? At some point you will find answer to all these questions and then the supreme one will come: how can I charge my clients more than I do now?
This is a difficult question to answer because the internet is a relative new domain thus unknown to many. Sometimes it is difficult to even convince the client that the sum you ask for is actually quite decent – how will you manage to convince them to pay even more?
Now I know many freelancers prefer to work for a lower fee to get the project, than ask for an outrageous sum and not get anything. I totally get it. I’ve found myself in this situation many times. Sometimes I still do. I probably always will, but if you are able to land your dream project, money shouldn’t stop you. However, we’re not talking about dream projects, but about the normal, weekly design or development assignments you can get.
How Much Client Is Willing To Pay?
The question you will always have to answer is how much is the client willing to pay. Think of the importance of your job, which is also the criteria used in any other business to determine the salary of an employee. You also need to think about how much demand there is for the kind of work you do, and how many other people can do it. While you can be a genius at comic book design, there might not be anyone interested in them anymore, as they are not profitable. Moreover, there are so many designers out there who can do the same job and there is always someone out there who can outclass you, that landing a huge project is highly unlikely for the average freelancer.
How much to charge
The first step is knowing how much you are worth. You need to determine how much you can charge and the way you do it (per hour or by project). Think of costs versus profits, your experience and skill level and the demand we talked about earlier. Then try to research the market for and see how much a designer in the same situation as you would charge. There is no shame in asking other fellow freelancers how much they charge and set your price accordingly.
If, for example, the demand is very high, which means more people are in need of your service than you can provide, you can ask a higher price and you will get it. But consider that unless you do something really special, this is not the case, as the market is saturated with professional designers and developers with years of experience. And talking about experience… consider it when setting your prices as well, because it matters, regardless of what many nut jobs in the field think. Would you like to be operated on by a surgeon on their first day, or a surgeon with more than 30 years experience?
Consider Who You Work With
It is also rather smart to know the client you work with. This is not easy to do all the time, as many clients you land are new to you, but just think of it for a while. If you ask $1,000 for an integrated blog, to an individual it might seem too much for him, but you might get away with $3,000 from FedEx or Coca Cola for the exact same product.
Most freelancers start low, with small companies and individuals, build their portfolio and then thanks to this, and their experience, are able to land higher clients who will pay more. This is the normal path. Hoping to charge hundreds of thousands dollars per year in the beginning is unlikely to happen – there are designers with more than 20 years experience out there who don’t earn that much.
Market Yourself and Your Products
Selling you and your products is crucial. The way you do this will affect your final price. But knowing how to sell yourself and your skills will definitely help you get away with a bigger paycheck. You are in charge of developing products and also in charge of marketing yourself and landing clients. This is not easy to do because you need skills in two areas of the web, but knowing how to properly use these skills will give you an advantage over the others.
Many freelancers out there undersell themselves because they want to get hired. As said earlier, they would rather work for a small fee than not work at all – which is a normal way of thinking. But for how long are you willing to work for lower wages than the others?
It is very easy to spot in a supermarket two products from different companies (with the same ingredients and same weight) that are priced differently, only because individuals place more value on one than the other. To give you a more familiar example, consider an Apple computer and a PC. Or to go even more in-depth, consider a Sony Vaio laptop and an Asus. They do the same thing, both of them have the same warranty, the Asus might even have better specifications – but the Vaio will always be more expensive.
Underselling yourself is strongly linked with this principle of undervaluing yourself to the client. If you don’t undersell yourself, the client will not think less of you., always be confident about what you can deliver.
There is no shame in negotiating your prices down – everybody does it. But try to stand by your standards as much as possible and always have a clear minimum that you don’t go under. You might lose some clients now and then if you negotiate strongly, but don’t be afraid of doing it. The clients who will accept your demands will respect you more and we all know this can lead to further collaborations.
Show you are a good guy
This is much easier than you think. It has something to do with knowing how to sell your products and knowing something about selling in general. Just ask salespeople how often they use the “and there’s even more” technique. The main idea is to make the client think he gets a good deal. Little does he know you would have charged the same amount regardless, but at least you look like a good guy. Let me explain:
Let’s say your price for developing a customized CMS plus customized graphic design is $750. Now you go to the client and tell him you will develop a customized CMS for him for $750. And there’s even more; you tell him that for an additional $250, you will also throw in the design for his web page. The bottom line is that now you get $250 more for the same products, and all you did was pull a simple sales trick. Tell him that if he is interested, you will do both for only $750, as you are really excited about working with him.
What did just happen there? You still get $750, your original asking price, and you still have to develop exactly the same products, but now you seem like a good guy and the client thinks he got a deal out of you. Not only did you get the client, but he will also recommend you to others and we all know how much viral and word of mouth marketing means.
Explain everything in detail
Laying out every detail to the client is important, especially when working with clients who don’t know too much about the web. They might search Google to see what a development process entails and realize it would be much easier to hire an expert than try to do it themselves. They just don’t get it and don’t care about it, it is not their business.
Therefore you might want to explain to your clients what your products mean. Explain to them why you charge so much, put everything on paper, from domain and hosting costs to each hour you spend on developing the website. If you show them in detail why you charge as much as you do, it is an increased possibility that you will land the project.
Keep in mind you don’t do this because you are desperate to land the job, you do it to help the client. You will earn more gratitude by treating them with respect and they will appreciate you even more after this, because not everybody takes the time to explain the process and what the client is actually paying for.
If you expected me to tell you precisely how much to charge during the course of this article, you were obviously wrong. I can’t tell you how much to charge because it depends on many internal and external factors and there is no way for me to discuss this with each of you individually.
The conclusion is that very few clients will pay less than the market dictates. You can try whatever you want, you will not fool many. Don’t ask for outrageous prices and always remain within the market price range. Selling yourself properly is what will help you charge closer to the higher end. Always make the customer feel like he gets a great deal and that you do something for him by developing these products, not him for you by paying. Don’t forget to treat every single client with respect, this is what will bring you more referrals from him in the future, and keep you in their minds when they have any projects in the future.
How do you try to set your prices and when do you think is the right time to start charging more? Are you pleased with what you get or you would like to charge more, but the market does not allow you?
Below you will see how freelancers from developing countries are charging the same prices the the ones from developed countries. You will also learn how you can do it.
How to Charge More as a Freelancer From a Developing Country [An Interview With Janet Brent]
In the world of entrepreneurship, it’s becoming more and more trendy to outsource to developing countries, since this way you can hire skilled people for a fraction of the cost. I always had mixed feelings about this: is it really okay to pay someone a slave-wage only because they are living in the Philippines or India? It seems that most entrepreneurs think that it’s justifiable, therefore I was pleasantly surprised to stumble on an article by Janet, a Filpina web designer from USA, who called BS on this whole thing.
I know that many of you guys are from developing countries, therefore I decided to interview Janet, and ask her to explain her take on this outsourcing trend and share how she went from working for low paying clients to working for high paying ones.
In this interview:
- What was the difference between working as a web designer in the USA and working as a web designer in the Philippines.
- Why Janet presents herself as a location-independent web designer instead of a Filipina web designer.
- Why Janet thinks that web designers from developing countries should increase rates for their services.
How much web designers around the world are getting paid
When you hire web designers from developed countries, a good web design can cost thousands of dollars, especially if they are already established in the industry.
- Stephanie Hobbs charges $1,200 for a 4-page website. She charges more depending on the size and complexity of the project.
- Noel Green charges between $2,500 and $5,000 for a complete website.
- Artisan Pros offer different packages with prices ranging from $1,495 to $3,595.
Wondering what web designers from developed countries charge per hour? Many people start out with a low rate, for example $15/hour. However, over time they gradually increase their rates from to $60-70/hour.
- Mary-Frances Main charges $60/hour for most web design work
Web designers who are really established and well-known often charge $100/hour or more. Now, when it comes to web designers from developing countries, that’s a completely different story. Sure, there are some who managed to establish themselves and therefore can charge the same rates as web designers from the US or UK. However, the majority of them earn significantly less money for the same amount of work.
I don’t want to point out anyone in particular who is charging low rates since that might make them feel uncomfortable, therefore I suggest you to take a look at popular freelance boards like Freelancer and oDesk to get an idea about the differences in rates. Pay attention to average bids. Sure, there are some projects where average bids go over $1,000, but on many others they are in $50 -$250 range. There are also many jobs that offer $4-$7/hour rate. Why clients offer low rates like that? They know that there are people in developing countries who are willing to do the job for a that amount of money.
Here’s a real screenshot from a real ad on one of the freelance boards:
Yes, you read it right, they want a high quality homepage and logo, with three different versions for a website and six different versions for a homepage, and, of course, unlimited revisions in their selected version, all for $70.
Sure, there will always be a big difference between the rates of those who just started freelancing and those who are more established, which is perfectly fine. However, we all know that there’s something else going on. People who pay extremely low wages don’t target inexperienced people who are just out of college. They look for decent web designers from developing countries that are willing to work for a very small payment.
Now, here’s the question: is it okay to pay someone from India $70 when you would pay $2,500 to someone from USA for that same job? Is it about bringing more opportunities to developed countries or is it about exploiting people who are vulnerable due to their financial situation? Let’s see what Janet has to say about this.
Please introduce yourself to our readers
I’m Janet, an intuitive graphic/web designer for conscious creatives and heart-based small businesses. I’m interested in passionate people making positive change. I guess that’s my “elevator pitch” but like attracts like and I’m finding there’s no shortage of amazing people I make connections with.
Why did you get into design in the first place?
“I knew I wanted to be a graphic designer since sophomore year in high school when I job shadowed one who worked for a sewerage agency. Not a glamorous design job at all, but he talked with so much passion that really attracted me and made a big enough impact that I chose to make that my career path! Before then, I had no idea that “graphic design” existed but I was always interested in art since the moment I could hold a crayon at age 2.”
What is your professional design-related experience?
“I taught myself HTML when I was 13. So I became a “professional” web designer when I got on the WordPress bandwagon and slowly got into paid gigs. I now spend most my time designing e-books, opt-ins, logos and websites for solopreneurs. My first professional design job straight out of art school was a graphic designer for a souvenir company.”
What is the difference between working as a designer in USA and working as a designer in Philippines? What about the difference between presenting yourself an American designer or as a Filipina designer? Do clients treat you differently depending on where they think you live or what nationality they think you are?
“I have experienced day jobs both in the US and Philippines and I have to say that people in the US have it easy. In general, there is a lack of organization in Philippine companies and less worker protection. Working overtime is a norm, so it’s not just 40 hours a week, it’s also 50+ for less than you’d earn in the states. I definitely think there’s some influence as to presenting yourself as a US based or Philippine designer. It takes some branding skills to avoid getting taken advantage of. Since its often assumed that you outsource to Filipinos, I struggled with this early on.”
You’ve mentioned on your blog that this month you will be breaking your personal record for income while self-employed. However, in the past you’ve had a full-time job that pays only $400/month, as well as your share of low-paying clients. How did you get out of this and started earning decent money?
“It’s a mindset shift. As simple AND hard as that. I think I had collective cultural baggage of being a Filipina. I had never felt like a minority in the states because it never affected me until now. The poverty consciousness was something I had to work through emotionally. I trained myself to be in an abundant mindset. I’m big on personal and self-development so I’m grateful for this path because it’s been a big learning curve.
It’s also important to brand yourself in an empowering way. Rather than promote myself as someone who lives in the Philippines, I say I’m location independent and a digital nomad, and I work with clients from around the world. I reject the outsourcing business model. That’s not what I do. Slowly but surely, I’m learning how to stand in my power.”
There are a lot of designers from the developing countries that feel that they are being massively underpaid. However, they feel stuck because they don’t know how to raise their rates, get better clients, and earn more. What would be your advice to people who are in this situation?
“It’s tough because I’m fortunate to have the Western background of being raised in the US, which does help. There’s a sort of colonial attitude that we’re somehow ‘under’ Westerners and with outsourcing, it’s viewed as helping developing countries because it provides jobs. I don’t think its that black and white.
More designers should stand up to low rates and not accept them. The more you accept low rates, the more that you will continue to receive low rates so why not help the industry out and raise the standards rather than be part of the problem? Thinking outside the box is also good.
The time = money model isn’t very scalable so thinking more entrepreneurial in regards to solving problems and offering a product could be more rewarding in the long run.
Technology is empowering and it’s also the greatest equalizer. Most people in developing countries don’t see that because they’ve also been taught that they’re not equal, so you have to empower yourself and despite external circumstances, it starts from within.”
Keeping in mind that there are low-paying clients who are tight with their budget and high-paying clients who are after quality. But high-paying clients are suspicious when hiring people, especially from developing countries. How can designers from developing countries present themselves in a way that would dispel doubts of high-paying clients?
“That’s a great question because it addresses the fact that low-paying clients tend to hang out in this cesspool. People in developing countries tend to get this low hanging fruit. My advice would be to reject the outsourcing business model. It’s tricky, and I’m not even sure what that would entail. But “outsourcing” just has that connotation that attracts low-paying clients so it’s not the right brand to pursue if you want higher paying clients.”
Many designers from developing countries feel uncomfortable with charging the same rates as their counterparts from developed nations because it seems “unfair” to them since the cost of living is higher for developed nations. How can designers from developing countries overcome this mental barrier that keeps them from charging more?
“Yes, there’s some truth towards having a lower cost of living, so charging a US price seems counter-intuitive. But there are still ways to earn more and increase your livelihood because you DO deserve to live more than paycheck to paycheck. I’m not saying you should be making $100/hr. but you shouldn’t be making $2/hr either.
Ask yourself what’s a fair price to work towards. There’s this cultural emotional baggage that’s a collective experience, and you’ve got to break through the scarcity mindset. I’ve really benefited from personal development techniques like EFT.”
If you are hiring someone for a minimum wage job, aren’t you justified in paying a person living in the USA $1,160/month and a person living in Lithuania $360/month for the exact same job. Many employers justify this by saying that they’re paying them the equivalent amount of what they’d make on their own country. What’s your take on this?
“As I said, it’s not so black and white and I believe there needs to be more education on both ends; entrepreneurs and workers in developing countries. On one end, you shouldn’t be a “slave master” and I’ve talked to Western entrepreneurs who have outsourced and secretly feel guilty about that issue. And on the other end, you shouldn’t happily accept $300/mo. especially if you’ve got a full family to take care of. I don’t know how locals do it! I also love the phrase my VA friend said: “If you pay peanuts, you get monkeys!””
Outsourcing to developing countries is becoming more and more popular among entrepreneurs. However, the ethical side of it is quite a complex topic, since on one hand, it provides a lot of opportunities to people from developing countries, while on the other hand, paying someone from Philippines way less than you would pay someone from USA seems like outright racism+nationalism when you think about it. What is your take on the whole thing?
“I see it as a kind of colonialized attitude. It’s a slippery slope and I think there’s a lot of room for improvement and education on both sides. And it’s not just Caucasians who are outsourcing. I know Filipino-Americans who are taking on this model and starting businesses to provide for Filipinos. The upside is they want to help raise the livelihood of Filipinos and create a stronger middle class. I don’t have all the answers and outsourcing is neither good or bad. But we are a globalized world and outsourcing is here to stay. There are still many opportunities for better solutions.”
You’ve said on your blog that if you pay peanuts you end up hiring monkeys. Honestly, I never understood the obsession with hiring people who are willing to work for ridiculously low amounts of money, because it seems to be counterproductive in the long run. Would you agree that it’s penny wise and pound foolish?
“I agree that it’s counterproductive in the long run. It might end up costing you more money in the end, because it’s the difference of hiring a professional from the start, vs. outsourcing and then having to backtrack and hire people to fix it. The quality of work IS usually less because outsourcing businesses tend to hire people straight from college and train on the job just so they can pay their employees even less. You’re not hiring professionals. You’re hiring people who are still learning and who knows how organized their internal systems are!”
What would be your advice to young people from developing countries who want to become professional designers (and get paid as such!), but are at the very beginning of this path?
“On the job training can work if you’ve got good mentors, so look at the team before you decide to take on a job. Job interviews should be as much interviewing the company as they are interviewing you. Look for internships or apprenticeships. Don’t underestimate the internet beyond Facebook. As I said, it’s the greatest equalizer. You can find the latest Western-based design trends and learn from example. Read and learn as much as you can through design blogs. Find a niche that interests you so you can stand out. If you love outdoor sports for example, you could design specifically for outdoor sport companies and start to brand yourself within that niche. Don’t just be a designer. Be a designer for a particular passion. You’ll stand out & be less generic.”
Last, but not least (and slightly off-topic), you have this crazy experiment going on right now, your “Live on $2/day” challenge. That sounds quite extreme! Can you tell us more about it?
“I’ve been quite lenient about it. I’m living on $2/day but relying also on “gift economy” which also just means my boyfriend gets to pay for me. The idea behind it isn’t to limit myself with a poverty consciousness but see exactly how abundant we are if money weren’t a consequence. There’s a lot of options when you choose to simplify. It doesn’t become limiting, but very freeing! I’m also selling stationery for $2 and donating 30% to my favorite non-profit, Her Star Scholars.”
Thank you, Janet!
In a nutshell:
- As a web designer from a developing country, you have to understand your worth and drop the limiting beliefs regarding your nationality, because only when you do that you will be able to successfully charge reasonable rates.
- You don’t want to be dealing with low-paying clients for the rest of your career. It’s okay to take on questionable jobs when you are only starting out, but it shouldn’t become a habit, and you should move on from that as soon as you can. Keep in mind that clients who pay the lowest fees are also the ones that are the hardest do deal with.
- There’s nothing wrong in charging your clients western rates even when you live in developing country. Think about it: if a web designer from USA would move to your country, would they start working for $2/hour, or would they keep charging the same rates as they did when they were living in the states (assuming they work with international, not local clients)? You are under no obligation to adjust your rates based on the country you are living in.
- Take time to figure out how you can present in a way that would allow you to attract high-paying clients. Good branding will help you to avoid being taken advantage of. What can you do in order to distance yourself from the “cheap labor from the third world” image?
- As an entrepreneur, it’s important to understand that when you pay someone low rates, you will not get the same quality as if you would pay someone a decent amount of money. People from developing countries are not living under a rock, they know what the international industry rates are, and therefore understand that you are being a stingy douche when you try to hire someone for $2/hour. People who know that they are being exploited simply won’t give you their best.
Here three articles that are really valuable to web designers who want to increase their rates:
- Ramit Sethi explains how you can earn more money as a freelance web designer.
- Pricing your work: how to guarantee that the price is right
- Quality-price-ratio in web design (pricing design work)
Pay attention how important your positioning is. Charging lower rates doesn’t necessarily lead to more clients. Would you rather position yourself as someone who is willing to work for peanuts or as someone who knows their work and has their price that is non-negotiable? Think about which person you would like to work with if you would be a client with a decent budget.
Guys, what are your thoughts on this whole issue?
Have you ever struggled with being underpaid because you are from a developing country? Have you ever hired someone from a developing country for an extremely low rate?
Is outsourcing an ethical thing to do?
Let me know in the comments!
The next section is not totally related to website prices, but it’s kind of a relevant for the whole industry. So we think it’s a good reading. More you know the bigger your value.
Quest for Disruption: Why the Web Design Industry is Ripe for a Change
Much like a shark, businesses and industries die if they stop moving. Few years ago I was managing a successful design agency in the heart of Tel Aviv and business was booming. However, not soon after establishing ourselves as a go-to agency for companies looking for design agencies, I identified several problems that were significantly hindering efficiency.
I realized that our team, comprising designers and developers, were unhappy and frustrated with the workflow. Web designers and developers were struggling to find an effective way to work together and consequently provide clients with the service the required and deserved.
Starting with the Client
I began to think of ways in which we could transform our business while benefiting the industry at large. Clients were always complaining about the lengthy design process, the high costs and the inability to truly put their initial concepts into workable design solutions.
The lion’s share of my day was spent on the phone with clients who were complaining about the high costs of changes they wanted to implement after we had already submitted the work. The changes were usually requested even after the client had already approved the final work.
Don’t Trust Me!
In Israel, trust and good relationships go a long way. Sometimes clients would simply give up on their demands and complaints about high costs because they trusted me. We would shake hands, exchange pleasantries and suddenly everything was resolved and back to normal.
Suddenly, a barrage of poignant questions hit me: why the hell should they trust me? Why isn’t the process smooth? Why am I not delivering fast quality sites without the need to talk about trust? Why is the process so complicated?
In the throes of complicated and nearly existential questions, I began to consider alternatives.
My first instinct was to follow the money trail. A whopping 70% of the budget went into the development process and coding. I then asked myself who should really be out there as the face of my agency. The answer was obvious: The designer needs to be at the forefront of the process and the face of the operation.
At this point I hit a wall. There was no chance I would put the designer in front of the customer because it would cost a fortune. Therefore, in order to create a serious alternative to the existing order, I needed to go back to the drawing board and understand the full process, from inception to execution.
Shifting the Balance of Power
Since development took so much of the budget I began to think about solutions around this realization. Why should a design agency be at the mercy of coders? Why not take the developer out of the equation and create something automatic? Why not build something that would generate code automatically like a machine?
This is the line of thought that led to the development of the technology and the eventual founding of Webydo. Once we started, we quickly realized that it’s not such an easy task.
This of course meant, perhaps somewhat ironically. that we needed to hire a team of extremely talented developers to create a code-generating machine to allow us to put the designer at the forefront of the business.
I started speaking with techies, CTO’s, coders and all told me: it cannot be done. They argued that there was absolutely no way to take the developer out of the equation. They were convinced that there will always be a need for developers to make modifications.
At the time, some 6-9 years ago, a simple website between 5-10 pages would cost $10k.
This meant that every small or medium size business had to invest significant amounts from the annual budget in order to have a simple, branded website.
Pay for Design, Not for Technology
As part of my quest to find a solution I became fixated with the following three notions:
- Customers should pay only for the design.
- The technology should come with zero cost.
- Clients shouldn’t have to wait for months to get their website.
At the time, it took a lot of time and alterations to create a website and therefore we had to create something that would cost significantly less.
It’s about Designers
As part of the fundamental shift, we decided to focus our efforts around the design community.
They would tell us what they want and we would develop a product around these wishes.
We identified three types of users:
- Code-oriented and less visually inclined developers.
- Designers whose focus was only on the look and feel
- The amateur: their day job was neither in design or development, but built sites as a hobby, spending around 10h a month on designing websites
Our focus was to be on designers whose expertise was to work with Photoshop. As part of the focus we took a good long look at Photoshop and asked the designer community about tools they would like to see as part of the design software.
From this, I took away one nugget of wisdom: once you understand who is your target audience you understand that every segment has its own needs.
As a consequence, we decided to focus on publishing: from design to seamless ability to publish the website.
This meant that we had to divorce the hobbyists from the professionals. Professional designers live in a world completely different to that of the hobbyists and DYIers.
It’s All about Ctrl+Shift.
We decided to build the engine and users would provide the rest: what features to add and how the UX should work. We began to ask our designer community what they wanted to see in a design software. We opened a democratic type process without any preconceived notions..
The first request was to create shortcuts on the right side of the keyboard. Everyone in the office screamed that it would crazy to focus on shortcuts instead of adding new features.
But this was the highest voted feature and we decided to honor the designers’ wish.
Once we added the shortcuts, designers’ satisfaction rate went through the roof. After sourcing our professional designer crowd, we understood that a designer works with their right hand unlike amateurs who use the mouse. With professionals, it was all about Ctrl+shift.
This was a very personal, eye-opening lesson for me and my team. We realized how important it was to understand the differences between the segments and respect these differences.
Keep the Pressure at Bay
During the early stages of developing Webydo, my investors were insisting that we work with everyone, developers amateurs and professional designers. However, my counter argument was that if we were to disrupt the market, really help the professional community and how the future of design will look like, the focus had to be on the designers themselves.
Everything else could be automated.
Our designer community was loud and clear. They wanted 100% creative freedom and 85% would not suffice. This meant that our goal was to provide designers with a publishing tool that would convert any design into fully functional website. Second point of focus was a solution with technology. We understood that designers don’t care about technology, but they want technology that empowers them. They simply want to do whatever they want and do not care about the specific workings of the technology.
So, listening carefully to designers, we developed a web-powered tool without the weight of technology: this meant that we had to provide a hosting service, the purchase of domain names, billing, design, delivery and a good CMS to liberate designers from the weight of technology.
Now we had a technology that liberated the designer from the code and allowed them to focus on design while effectively servicing clients from one platform.
Our first users taught us what Webydo should eventually become: the DNA of a design business. We realized that a designer needs a mini CRM (Customer Relationship Management). Once the designer creates a site for one client and another one is in queue, the work must be archived into folders.
What’s more, designers have no time or interest to mess with hosting. We decided in the very beginning that we had to give a full service solution, or no solution at all.
New Era of Strength
Twenty years ago developers were at the front and designers were in the background. This meant that oftentimes designers were not able to deliver the vision of the client because they were not communicating with one another effectively. Because the ability to make changes to a website was not immediate and required the attention of the developers, clients often left their sites unfinished or unpolished.
Now we understand how the website acts and functions. Therefore the number one priority is to understand that the technology needs to serve the end-purpose: a beautifully designed website that meets the criteria of the client. Moreover, today we have fewer barriers for technology.
Browsers are strong which means that designers can use SaaS and integrate Dropbox, Google Drive as part of their toolbox.
Let Developers Develop and Designers Design
Following my initial epiphany and the preceding problems I identified, it’s clear that the whole industry is up for disruption. Webydo isn’t about unseating the developer, but empowering the designer. Both professions are crucial, but they should exist separately, each focusing and cultivating their own unique strengths.
Shmulik Grizim is the founder and CEO of Webydo. Shmulik has more than a decade of leadership experience in the internet industry and a passion for good design. Webydo represents Shmulik’s quest to change the way professional designers create for the web.