5 Factors to Consider When Pricing Social Media Services
by Rachel Strella
in Business Advice, Entrepreneurship, Social Media Business, Social Media Manager, Social Media Manager Profits, Tips
05 Dec 2011
Pricing is one the most difficult things for a service-based business owner, especially when it comes to social media management. There is a fine line between getting paid what you’re worth and losing business because prices are ‘too high.’ There isn’t much precedent for social media pricing because the media are so new. It also takes time to organically grow an audience for clients and enable them see the benefits of social media marketing.
Here are a few factors to consider which may help in developing pricing for clients.
Experience. Are you fresh out of the gate or an established business with measurable ROI for clientele? Be honest with the answer to this question. It’s easy to think that a higher amount is deserved, but has it been earned? If you’re starting out, price lower to build the business. Evaluate how much time you have spent learning, monitoring, strategizing, testing, and revising on a continual basis and price accordingly.
Time. You will need paid for your time, even if you’re just starting out. Calculate how much time projects are taking you and determine a fair hourly rate. As you become more established, consider the value of your time with other factors competing for your attention such as: multiple clients, business operations, ongoing research, staff, and equipment. You may want to establish package pricing to account for both time and experience.
The media and elements within it. Managing a Facebook fan page for small, local business may be much different than managing a blog, fan page, Twitter account, LinkedIn account, and Foursquare deals for a regional chain. It’s important to take into account the different types of media being managed and how much time is devoted to each one. Equally important will be elements such as content, monitoring, engagement, and reporting. Will you be developing the content or will this be provided by the business? Will you be monitoring the accounts and how frequently will be you be checking in? Are you responding to inquiries, commentary, and customer service issues? How are you communicating ROI to clients?
Degree of difficulty. More detailed industries require more effort. Some social media managers may specialize in a type of industry – for example, photography – while others, like me, are more broad-based. Either way, in order to be the voice of a brand, it’s imperative to have knowledge of both the industry and the clientele. No two industries are created equal (example: event planning vs. sky-rise architecture).
Clientele. The ideal clientele are the ones who provide enough information to work with, but allow the social media manager to decide what’s best for the brand in relation to the social media strategy. Realistically, however, many clients will fall into one of two scenarios: they may try to micro-manage the effort despite the lack of knowledge of social media or they assume the social media manager can ‘do everything’ and thus offer no insight into the operations, policies, or voice of the business. If you get the sense a client may fall into one of these categories, it’s important to consider the extra time spent in working in either one and price accordingly. Make sure your contract is favorably negotiable should you discover one of these scenarios shortly after working together.
What other ways do you determine price for a service?