How I Sold a $6,000 Website to a Non-Profit Using Value-Based Pricing
There are several well-known non-profit organizations that serve college students across the country. Recently, one such organization asked me to redesign its outdated WordPress website.
The organization held 3 main events each year and used its website to share information with students. After a brief conversation, it became clear that there were 2 main goals for the new website:
- To encourage more students to attend these 3 main events
- To make important information more accessible to students and staff
I used their existing website to reveal that each event cost an average of $250 per student. I also learned that many students attended weekly club meetings to hear about the events. This is where they would be most attentive, but the website was not mobile-friendly. This made it difficult for the students to find relevant information in the context they heard it.
Definition: Value-based pricing is simply a fixed-pricing strategy where the price is anchored to the value of the solution you’re providing rather than the number of hours it will take to complete.
I used all of this information to write a value-based proposal for the organization. That means I was selling them on the value of a new website rather than how many hours it would take me to complete. We never discussed hours, but we did discuss the features and functionality required to establish a scope of work.
As a result, my proposal was concise, void of legal jargon, and offered 2 possible options for my prospective client to consider:
- Option 1: Redesign the existing website
- Option 2: Redesign the existing website and make it 100% mobile-friendly
In the proposal, I explained that option 1 would highlight the main events while giving students easier access to information. This would help increase traffic and event attendance.
However, option 2 would allow students to register for events from their seats during a weekly meeting. Then, I further emphasized that a mobile-optimized website would further increase event attendance.
To illustrate the value of this solution, I explained that if the new website could encourage just 20 new students to attend any of the 3 events, the organization would see an increase of $5,000 in the first year alone (20*250).
If just 5 additional students continued to attend over the next 2 years, that number would increase to $6,250 (25*250) and $7,500 (30*250) respectively. That’s an extra $18,750 in the first 3 years after launching a new website!
I confirmed with the client that an increase of 20 students at any of these 3 events over a 1 year period was realistic.
You might have noticed that I didn’t stop at the first year when predicting the value of the project. I wanted to show them what the solution looked like for years to come. Doing so reinforced the fact that this one-time investment can yield years of financial increase.
This data-driven approach makes it easier for the client to justify the cost of the project.
Then (and only then), did I outline the cost of each solution:
- Option 1 would cost $4,000 and take 2-3 weeks to complete
- Option 2 would cost $6,000 and take 3-4 weeks to complete
At this point, the client could easily deduce that my rate was about $2,000 per week. If I had told them that upfront, they may have balked at my effective rate and the conversation would have become immediately focused on rates, hours, and cost.
But when I anchored the $4k and $6k prices against a $18,750 financial upside, they were happy to pay me 100% upfront even though I charged a premium rate.
It’s important to remember that anyone who spends money on a website is ultimately looking for a return on their investment. Put another way, they want to get more money out of it than they put in.
So, even though my client didn’t tell me the goal was to make money, the proposal still felt familiar and appealing to them.
Why not use a ~$50 WordPress theme?
I could have! If I found a good template to use as a base theme and save myself time, that would’ve been awesome. Better yet, my client wouldn’t care because I didn’t sell them my time. Instead, I sold them a solution that would increase event attendance and make information more accessible.
A pre-made theme could have done this, but I chose to do a custom design to help maximize event attendance.
In my experience, pre-made themes and templates are often difficult to configure, customize, and maintain
How multiple options helped
I could have pitched only one option, but non-profits are often hesitant to spend money. Offering 2 options gave them financial flexibility and made them feel like they were in control. It also encouraged them to compare my options to each other instead of comparing my prices to another freelancer.
Offering a single option would have demonstrated a take-it-or-leave-it approach and added a small barrier between myself and the client. So, while option 2 was more expensive, it was most closely aligned with their goals. After showing them the financial upside, option 2 was the clear winner.
You can do it too
It’s all about how you position yourself. Most freelancers waste time justifying their rates and selling experience, but a simple shift in your positioning can lead to a lucrative career. The key is pitching value instead of time, even if you still have an hourly rate. Want to learn how that works?
In summary, here’s the approach I used to write winning proposals and close deals at premium rates:
- Ask the right questions to understand the goals
- Identify/deduce the problem
- Identify the financial upside
- Anchor your price against the possible outcomes
- Write a concise proposal with multiple options
It won’t take long for your freelancing business to flourish when you understand how to position yourself and your services.
Last updated on March 8th, 2023