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March 21, 2011 at 10:05 am #1056462Up::0
Firstly, you are in probably one of the most competitive industries in the world so that’s always going to be tough. Here is my advice:
1. Be clear about what services you want to provide and at what price point.
2. Don’t try and ‘educate’ prospects. It won’t work and all it will do is waste your time and annoy you.
3. Communicate your message as clearly and succinctly as possible on your website.
4. Constantly analyse the market and market segment you are targeting. Constantly review your offering and strategies to ensure you are either ‘best in class’ or at least close to being so.If your business model is a winner and you are good at your job (maybe read some top rated Sales books to read about what elite Sales people have to say) you will find a way to be successful.
A couple of examples of companies operating in the same industry but selling at very different price points:
1. Hyundai is a very successful company and so is Mercedes Benz.
2. In Myer and David Jones you can buy shirts for $20 and $200. There are very successful companies selling at both price points.
3. My solicitor charges $300 an hour. Some legal councils (like QCs) charge $5000 a day.
4. Some computer systems engineers are on $60k a year and some are on $200k a year.and on and on it goes.
March 21, 2011 at 11:14 am #1056463Up::0Daniel, you are absolutely not the only one dealing with these kind of problems. You’ve already got some good tips here, especially from Gordon and LemonChip.
‘Education’ or better ‘constant information’ is a necessary thing, be it through a blog, a newsletter or articles.
Not all prospective clients know about how much work goes into a job like a website or a professional logo design. I have seen people being really surprised when you tell them that you want to sit down (or skype) for an hour or so to talk about their business and their objectives before you start working on the logo.I presume that if someone is that interested and contacts you, then you realise that the budget is small but the client is keen to get a good result and is willing to cooperate, you will be happy to offer him or her a good deal.
In designing their website you’re not just a technician or an artist who puts things together – you’re often an extension to their marketing department.After a while you can pretty much tell who is just shopping around or trying to get your prices down (never heard about that thing with the faked quote, what a waste of time from their side!) or who is really interested in getting the best for his or her business.
I just expect from my clients that they take their business as serious as they expect their suppliers to take theirs. If they don’t, then they aren’t the right clients. Then they can go and buy off the shelf. Because I want my clients to take my services serious as well.
The others will recommend you. It might take a while before you get the ball rolling, but it’s worth it.
And I know that there is still a need here for professional (non-intimidating) webdesigner.
Cheers to Perth
AstridMarch 21, 2011 at 11:44 am #1056464Up::0Astrid makes some very good points here. An important Sales skill is ‘getting control of your customer’. That is in no way a negative or disrespectful thing to do. One way to do this is by being a pleasant likable person and good at your job (like Astrid seems to be from what I have heard said about her). When you are like this the ‘prospect’ will pick up on this and be open to doing a deal. By slowing your prospect down a bit and using some well developed Sales techniques you will be able to close more profitable deals. The problem with this approach is it is obviously more time consuming so it won’t suit all business i.e. more suited to larger business deals.
From what I understand of your business you need to use a combination of techniques to get the best results. First of all, many of your prospects are going to search several companies online who provide similar services to your own. That is why having a really compelling website designed to quickly provide all relevant information and compelling reasons to buy from you will be very important. Things like a free call number, easy contact options etc help. Then when a prospect contacts you use your Sales skills to ‘qualify’ them and put an appropriate amount of time and effort into doing a deal with them. As you get better at this you will develop very valuable skills that will enable you to quickly close the higher quality prospects and not waste time with the lower quality ones (people asking you to perform your services for half the price you quoted I would suggest fall into this latter category).
As Astrid also mentioned, repeat business and referrals is a great reward for better performing businesses in the marketplace.
March 21, 2011 at 12:10 pm #1056465Up::0It is certainly a case of ‘you get what you pay for’ as with anything, but as mentioned by a few others many people may not know why one website should be more expensive than another ‘cheap’ one.
I currently don’t have a “the process” page/section on my portfolio site, but thinking it might be a good piece of info to give a brief overview of whats really involved with creating a website. I assume whilst being generally informative for a potential client it may also give some indication as to the level of work that will go into the site and a better understanding of why a site might cost what it does.
March 21, 2011 at 12:16 pm #1056466March 21, 2011 at 12:33 pm #1056467Up::0i don’t mean all the technical stuff but more along the lines of
“…once an agreement is reached to go ahead with the site I will then spend the next few days custom designing your website from the ground up, based on our initial meeting..”
“…after I have presented the screen shots of the layout of individual pages you are able to give feedback and suggestions to be reworked into the design until we are both happy with how the site looks….”“…once the design stage is signed off on, I will build the site, test in various browsers, de-bug..”
and so on…March 21, 2011 at 12:34 pm #1056468Up::0JohnSheppard, post: 69442 wrote:Have you ever tried teaching an 8 year old how fibonacci numbers work? Why not?ps, what are fibonacci numbers…?!
March 21, 2011 at 12:47 pm #1056469March 21, 2011 at 1:18 pm #1056470Up::0Hi Daniel
I’m dealing with this myself. Not so much people comparing my feature list and prices….
but rather doing my best to exit a cycle of being cheap to get hired, producing work worth more than was paid but of less quality than i really want to produce.
It’s very psychological.
My only advice would be as other forum members have said, to have confidence, understanding. Try to turn away such clients before they get on the phone with you – sounds like you’ll save yourself a bit of stress.
Honestly I don’t know what convinces or educates people in the end – I really suspect it’s just as much to do with how you present and communicate – how you make people feel.
I’ve heard from web-marketing people with SHOCKINGLY ugly sites that you can double and triple prices and get more business. It must have everything to do with their personality as far as I can tell.
Currently in the process of rebranding and relaunching http://digitalempowerment.com.au
March 21, 2011 at 1:54 pm #1056471Up::0OneArmedGraphics, post: 69350 wrote:Hey Daniel, I think most will say that if a short & sweet “you get what you pay for” doesn’t work then, they’re probably not worth the trouble.That’s the similar situation in the Web Hosting industry. There are clients willing to pay the lowest price and have high expectations with the level of customer support and reliability. I see so many businesses relying on budget hosting.
Cheers,
ShaunMarch 21, 2011 at 5:12 pm #1056472Up::0Hi Daniel,
Yep…… I feel your pain also. I’ve dealt a lot with this in the past myself. Personally I think the best thing to do is be FIRM with your price – this isn’t a swapmeet where you can haggle prices. I’d do the best to show to them that you are a professional but also let them know that your prices are not negotiable (in a nice way) & the prices you charge cover the quality of work you provide. If they want to walk, then so be it. Better time spent on someone that is prepared to pay for your time rather than someone that may be a penny pincher.
I understand businesses may have only budgeted a certain amount for said website, however is it really worth spending that money on a low quality website when you may have to spend more on it at a later date? A couple times of late a client has decided to use someone else who has provided a cheaper quote than mine & then came back to me to implement other stuff in it & I ended up having to fix a lot of the other coders mess. The moral to that story is that at the end of the day it ended up costing the client MORE than I originally quoted him after paying the other coder + my fees to fix things.
One of the reasons why I think some businesses don’t budget much for a website is because a lot of people don’t see them as a serious business cost. A restaurant for example may budget 50k to build the kitchen, yet may only budget 1k for the website as they think “that’ll do”. Why? Perhaps because there are so many people out there that like to call themselves designers or developers & do “$500 websites” & then word gets around that “Oh….. Johnny got a website for $500.. so our $1000 will surely get us a nice site.” What they don’t understand is that Joe developer probably has 6 months experience, is doing your page in frontpage & if he doesn’t know any design is probably paying someone in a third world country $50 to do it.
I could go on… but I’ll leave it at that for now haha
March 21, 2011 at 9:15 pm #1056473Up::0Re: Need help avoiding price wars with Web Design… Fi
The Fibonacci sequence is an example of a divisibility sequence.
http://en.wikipedia.org/wiki/Fibonacci_number
The following is an extract from a post on my old blog.
The great masters like Leonardo da Vinci used mathematical bases in design with divine proportion and perspective grids; the spacial design systems are based on grids; the Fibonacci Sequence uses number theory and creates a dynamic system of grid, space, scale and form. The Fibonacci sequence is a mathematical sequence where the next number in the sequence represents the sum of the two numbers before it. Using the Fibonacci Sequence creates a dynamic system of grid, space, scale or form.
Proportional Systems are used in design – we define everything by its size ratio.
The Square Proportion is the simplest and can be a square or a double square. It’s ratio 1:1, 1:2, 2:1 remains the same no matter what size of the squares.The Divine Proportion (used by Leonardo da Vinci) is also known as the golden ratio, golden section or proportion, golden mean or rectangle. It is a geometrical system dating back to Stonehenge. The divine proportion can be found in nature, faces, anatomy, architecture, and far more – even the stock market rise and falls is related to it. In measurement is is the division of a line segment into two parts as according to the golden or divine ratio. The total length a + b is to the longer segment a, as a is to the shorter segment b. Often useful for developing systems of space and form.
http://www.unicorngraphics.com.au/design_blog/files/maths_design_proportion.php
March 22, 2011 at 1:44 am #1056474Up::0Wow ok – this is a good topic and I’m definitely getting my 2 cents in here.
I am new to these forums but I have a wealth of experience in this area from all sides of the coin. I’ve worked on the infrastructure development team of YellowPages website back in 2003 which got me close to their web-development team, I’ve worked with various small businesses, local businesses and helped implement everything from simple “About us” business sites for local Olive growers, fashion shops, photographers, video editors, advertising agencies, to full e-commerce sites with months and months of custom integration, custom banking solutions, custom API’s, tie into telephone systems.
I got out of the web-design business years ago, because the web-design business is turning into a commodity market. Sorry, it *is* a commodity market. I can buy a world-class template that is perfectly suitable for a small business from any number of template sites for 10 bucks. And I can pay a pimply teenager $100 to make a few modifications to do what I need to do.
Don’t insult business owners, they might not have a clue about web-design or anything technological related. But they know when they are being short changed – and paying anything over a few hundred bucks for “web-design” is being short changed.
You’re dealing with a few distinct client groups, and I’ll use these groups to illustrate why you must compete on price alone and why if you want to grow you must exit the web-design business.
The clients who don’t know what they want – and are clueless
These clients are the businesses who will fight for the lowest price, why? Because they don’t see any value in a web presence. Educating isn’t going to help here, because any smart business owner will realise when they are outside their expertise and will pull in outside help.
If the business owner is clueless, is fighting on price alone and will not pull in outside and professional help – they’re a doomed client. They’ll buy a China made Ute because it saves them $2,000 but breaks down 10x more then a Toyota. They’ll buy Italian canned tomatoes, even if it bankrupts the farmers around them.
The clients who don’t know what they want – but are smart
What happens when the client is outside their experience, doesn’t know what they want, is a smart business owners and a friend over a beer tells him “You must get into Web 4.0”.
They pull in expertise advice, and no-one goes to a web-designer for that advice you know why. Because the business owner doesn’t yet know what even web-design is, but he knows 1 thing that the web is a medium for advertising.
The client goes to an advertising and brand identify company: someone like Cre8ive who dominate the Canberra market and similar branding firms.
Notice that these guys *do* web-design, web-development and graphic design but notice that none of these service are predominately listed on their sites. Why? Because they focus on brand development, brand advertising and sure that means they’ll overhaul the website, make new flyers but they are not selling web-design!
The businesses who are smart go to these guys and are willing to pay a lot of money for these services. Because they’re not just getting a web-site out of it, but a entire brand and presence in the market. The business owners knows that by investing $10,000 in brand identify that he’ll get $50,000 in return.
Think about what you’re giving your clients: You may give them a flashy website, but are you even remotely securing them any new revenue streams? are you branding their business to potential new clients? are your marketing them? are you helping them grow? are you helping them tap into new markets?
You’re doing none of that, you’re just building their website which any old pimply teenager can do. Go visit any branding company, you’ll see the well paid and creative geniuses will bat eye lids at you when you speak html to them but the part-time college student in the corner earning his 2 Minute noodle packets will understand you.
Now guess what, when the client is outside their expertise and they pull in outside help – they pull in people like (http://cre8ive.com.au/). Notice that a heap of their work is website development and design, but notice how they’re website doesn’t sell web design? It’s because they sell advertising and brand identify services and they are very, very, very good at it.
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The clients who know what they want – these businesses know what they want, are are willing to pay to get what they want.
You can lump me into this group, I know what I want for my businesses and my clients. And looking at your website you give me none of that. You have flash on your website to start with, and that automatically rules you out but beneath that if I know what I want you’re just not giving it.
Think about it.
I know my business, and any successful business in it’s first few months will know what works and doesn’t work very quickly. They will know what to tell clients, and what sells and doesn’t sell. So they know what content they want on their site, they will generally know what type of layout they want, and basically hand you the specifications on how to make the site.
At the end of the day you’re just the code monkey to these clients. And prospect clients like me will read the first sentence of your site and barf “….. you could assume”. Wow, you’ve instantly put it into my head that I am insure whether you’re serious or not.
If you want to be a pure webdesign studio, you need to sell templates. Simple as that. If you want to be the go-to man for web-development for clients who just hand you what they want your website needs to be clean, concise, conform to all usability standards, best coding practices and ditch the joke.
The clients who know what they want
These clients are me and my clients. My clients go to me because they know what they want, and I project manage what they want to ensure they get that.
That means they’ve handed me the layout, they’ve handed me the market research that shows what works and doesn’t work. They’ve handed me the data analysis of their business and what information they need to keep and what they don’t need to keep (demographics to serious businesses is very-very important for a web business) and I just go out and get what they need.
Taking a look at your website, you give the clients who know what they want nothing.
You’re website show cases poor interface design, poor coding standards, you use flash which is a sin, you have poor choice of language “… you could ASSUME that I like what I do?”. The only thing I can assume from your website is your praying on clueless people to take up your services – and again, let me remind you if I’ve stumbled across your services, I would have certainty stumbled across 100 others who are 100 times cheaper then you.
If you want to stay in the web-design field, you need to modernise and realise you’re selling $100 designs to people willing to only pay $18 for them – because that’s what I can get from somewhere like themeforest.com.
If you want to target clients who are willing to pay big bucks, you need to prove that you understand the net. You understand standards, that you understand that the web is iPhones, Macs, Windows, smart phones, tablets so make your website all platforms friendly. You need to showcase that you understand web usability, best practices and don’t use gimmicks.
But honestly, you need to realise you’re in a very competitive market and unless you adjust to the times – you’ll be buried in a few years, I can guarantee it.
March 22, 2011 at 2:35 am #1056475Up::0the following may offend…
This industry is not that competitive.
It’s only competitive for those who have no real reason for being in that industry.
If you see yourself as a “website designer” you’re in trouble…big trouble because your prospects are going to position you just like they would a bottle of milk and they’re going to price accordingly.
“Website Designers” are a commodity. Period.
You’re not the only website designer there are hundreds of you guys and your prospects know this so the last thing you ever want to be seen as is another “website designer.”
I keep placing “Website Designer” in quotes because it’s a label…and at the moment you have chosen the label website designer.
Stepping away from the price game can be as easy as changing your label.
Here’s how I would go about doing this:
Where is a valuable specific need that I can focus my solution on.
Let’s say that I want to target Salon Owners who’s biggest need is generating more “phone-ins” and “walk-ins” and already understand the value of marketing and are actively marketing in various forms to create more “phone-ins” and “walk-ins” like grabone, facbook/twitter existing website that is piss poor etc
I change my label from website designer to “Online Salon Lead Generation Specialist.”
Now I understand that Online Salon Lead Generation Specialist is an ugly name but who has the potential to not only command higher fees but do so in a less competitive space?
The “Website Designer” Or The Online Salon Lead Generation Specialist?
My money’s is on the OSLGS folks!
(Of course your solution needs to deliver the results.)
When someone asks me ‘what I do’ I may respond with:
“I help salon owners get more phone-ins and walk-ins by designing smart online marketing campaigns with 90% less costs than traditional marketing methods.”
Look, commanding higher fees means that you have to increase your value by thinking about who your prospect is and what they will actually value and pay more money for.
…and you do this by helping them get what they really want.
March 22, 2011 at 3:10 am #1056476Up::0Jay-T, post: 69511 wrote:Stepping away from the price game can be as easy as changing your label.
As much as I am loathe to do anything that sounds like “Gaming The System”, I’m finding this to be very true.I’m no designer, but I’m lots of things web, and I’ve been lots of things web for a long time. I can make people’s businesses better in lots of different ways web. But you know what they all ask for?
The only things they know how to ask for: SEO. Rankings. Etc.
Daneil, I completely relate to your pain about wanting to educate the clients on what’s good value and what isn’t, and I sincerely wish I had an answer for you.
When/If you get one, please share it here, I reckon we could all use it.
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