If you pay your designer by the hour, you're getting ripped off.
You should be paying for business outcomes instead.
The value of design can’t be quantified in hours.
Unlike mowing your lawn or your Netflix subscription, the value that design creates is challenging to see immediately, let alone quantify, but if done right, design can have a profound impact on the success of your business.
Time ≠ value
Instead of measuring its value (output), the tech industry has relied on estimating the cost of design in terms of time (input) for decades. E.g., how many hours did I pay my wife’s cousin, Josh, for redesigning my marketing website? It doesn’t even look that great.
A good developer can spend 6 months coding and end up something worth either ten million dollars or absolute zero.
And just like code, the value of design is hugely disproportionate to the effort put into it:
In just a few days, a good designer can turn your broken onboarding flow into a gigafactory of revenue-generating customers.
However, a lousy designer can also spend six months redesigning your onboarding flow and still end up with nothing to show for it. And that would probably be your fault.
“Wait, what? How is that my fault?”
Promoting laziness by measuring the wrong thing
When you’re caught up in the pay-by-the-hour mentality, you’re going to be thrifty about the person you work with.
When you’re not measuring value created, you define success by how cheaply can you get something done.
The problem with that is that it leads you to search for and hire an inexpensive option, i.e., your wife’s cousin, Josh, who’s a junior designer, because that is going to give you the best bang for your buck.
What you don’t realize is that an inexperienced designer will charge you for every hour they spend learning –and sort of guessing– how to solve your problem.
And that is fine if all you’re trying to do is get some commodity-type services like social media comps or some slides for your quarterly presentation. But it’s hazardous if you’re trying to fix the one conversion funnel that generates all the revenue for your company.
Even worse, you might be paying Josh to take a nap.
Transcription of the deal you made with Josh:
You: My marketing website needs a facelift. I need you to redesign it.
Josh: Sure thing, it’ll take me 20 hours.
You: Alright, great.
A couple of weeks later, you receive the results, they took 10 hours more than you agreed for, and they are underwhelming. What’s worse, a few months after, your conversion rate is not getting any better.
But are all designers lazy and unethical creatures? No, they’re not.
When you hire by the hour you are promoting a race to the bottom, price-war on hourly rates that incentivizes designers to cut corners and charge you more hours.
What’s the alternative? You ask. Try to work with a great designer who truly understands your problem.
Focusing on value
A great designer doesn’t bill by the hour.
A great designer understands the business value of his or her craft and will help your solve the root cause of your problem as quickly and efficiently as possible.
Identifying a great designer
You can identify a great designer from the very first time you talk to them. Your initial conversation with Lauren, a great designer, might look very different from the one you had with Josh:
Transcription of your conversation with Lauren:
You: My marketing website needs a facelift. I need you to redesign it.
Lauren: Ok. What’s the role of your website in your revenue model and current covnersion rate?
You: Oh, well. We drive traffic to our website through paid ads hoping to get visitors to sign up for a paid membership of our club for tech entrepreneurs. Only one in every hundred visitors become a paying customer.
Lauren: Keep in mind conversion rate depends on other factors beyond the website, but just by providing info about the benefits of the membership with a clear call to action and some testimonials should at least double your current conversion which is pretty low.
I’m going to prototype a solution and interview some of the people from your target group to validate or reject my assumptions.
Lauren spent a few weeks validating and refining her assumptions before handing over the design to your company. A couple of months after the implementation, your website’s conversion rate tripled. Some of your new customers love it:
“The new website makes it easy for me to decide if this course is for me.”
“Once I made my decision, purchasing the membership was simple and fast.”
At a glance, Lauren might seem more expensive than Josh. But she was swift and methodical about finding out which things moved the needle in the right direction and created value for your customers. More importantly, her work tripled your revenue in just a few months.
If you could triple your revenue by paying 10% of that increase, would you make that deal?
The business value of great design
I know I would. A 290% increase in revenue is still a pretty sweet deal. And what’s also sweet is the peace of mind of knowing you are paying for a solution rather than for someone wasting your time.
The benefits of design do not end with increasing revenue. In a large study conducted by Invision on 2,229 companies across the globe, they found a profound correlation between the level design maturity of an organization and the success they’ve had on multiple business indicators.
Final thoughts
Great designers can very quickly create an enormous amount of value for your business by identifying the specific pain points in your product.
A PBTH (pay-by-the-hour) mentality focuses on the wrong part of the equation. You should always place your focus on results instead of input. And for that, you want to make sure the designer you work with understands the root causes of your problems and charges you a fair price to solve it.
