Are you working for cost-clients or value-clients?

Knowing the difference will mean everything to your freelance business.

Benek LisefskiBlockedUnblockFollowFollowing

Sep 3, 2018

Are the riches in the niches?

Finding your niche, they say, is the key to freelance consulting success. Pick an industry or type of project that you can specialise in, practice giving tremendous value to those specific clients, become an expert, and reap the rewards of focused work at high rates.

That’s all true, but I would argue there’s a better kind of niche to be found.

I don’t pigeonhole myself into too narrow a type of project. I do a lot of responsive web app design and complex UX/UI work for startups and tech businesses, but I also do minimal portfolio sites for boutique architecture practices. I like working on big, meaningful ecommerce projects with socially-conscious companies, but I also do branding and design for charitable or cultural organisations.

Of course there are types of businesses and design challenges that I’m more interested and passionate about being involved with, however the niche is rarely my primary concern when choosing new projects.

My niche is simple: good clients

I doesn’t matter too much what their industry, product, or service is. What matters is how much they value my experience, how prepared and easy they are to work with, and how invested I can get into the success of their business.

The way I see it, there are two types of clients:

1. Cost-clients

Cost-clients care first and foremost about price. They always want quality and speed too, but the primary drive for deciding who to hire for their project is who can do it the cheapest.

Cost-clients ask right up front what your rate is, because that concern is more important that figuring out if you’re actually the best-fit for the task. Or they propose how much they can spend right away: “This shouldn’t take long, so I’ll pay $500.”

They don’t care how much doing the job well will actually cost, because they’ve already decided how much they are willing to spend — and this spend can have little or no connection to how much work the job requires or how much the result is worth. If you cannot do the job within their randomly surmised budget, they’ll move on to someone else who promises they can.

They’ll be sure to mention they’re “bootstrapped”. They might promise you “exposure” in exchange for discounted work. They’ll use every trick in the book to squeeze their way into below-market-rate work. They are the Walmart shoppers of the client world.

It should be noted that some clients are genuinely bootstrapped and have tight budgets to match, and they may have no choice but to settle for the cheapest option, because it’s a choice of that or nothing at all. You may wish to avoid those clients unless you like them enough to do them a favour. However, the clients to really avoid are the ones who do have money, but still act like cost-clients. Then you know for sure they don’t put much value in your work.

Cost-clients are more likely to think of you as a temporary keyboard monkey hired to do their bidding, rather than a valued business partner offering to help them grow.

2. Value-clients

Value-clients want the best outcome for their project. Finding the right person for the job — who will deliver the best results — is paramount to finding the cheapest option. They probably want speed and low-cost too, but they won’t sacrifice too much quality for it.

Value-clients prioritise finding the person with the right skills and experience for the job. Sorting out price becomes a mandatory formality after the real discussions have taken place. They’ll ask you how much time and money the job will take to get done well, because they know you know more about that then they do.

Value-clients look to form long-term strategic business partners with everyone they work with, because they know finding and keeping the right people are the keys to business success.

Value clients are generally successful businesses who have cashflow enough to invest in good design. Or, if they are startups, they’re funded. Both kinds recognise the value in making an investment into design.

Value-clients want good value! They’re smart enough not to overpay, because they can recognise the difference between a bullshit-artist digital cowboy and a genuine professional who can offer them valuable insights and experience.

Try this: Think through all of your current and recent past clients. How many of them would you describe more like cost-clients, and how many are value-clients? How has the proportion of them changed over your career?

How to attract the the right kind

Reading the definitions above, you must have had a few cringe-worthy moments where you thought: “Yep, some of my clients are definitely cost-clients! No wonder they are so frustrating to work with.” Or some satisfying realisations: “Yes! value-clients sound like just the type of businesses I love working with the most.”

The distinction is obvious to see when you know how to frame it. The bigger question is, how do you get more value-clients?

• Where do you look for clients? The answer will say a lot about which type of clients will be available to you. Hint: Upwork and Fiverr are not the answer.
• How much do you charge? Your rate is a powerful tool for attracting one kind or the other.
• How do you market your service? Discussing your unique offering in the right terms is like a bright light to a moth. Use the right language and you’ll be a irresistible to potential value-clients.

1. Where do you look for clients?

If global freelance marketplaces (a.k.a. race-to-the-bottom bidding sites) like Upwork and Fiverr are your game, I’m sorry to tell you that you’re getting little access to value-clients. Those sites are magnets for cost-clients because their entire business model is based around creating a competitive atmosphere that delivers dirt-cheap prices. There are always exceptions, of course — there may be a good job for a honest client here or there — but it’s not worth the effort to find the needles in that haystack.

Value-clients live in the real world. They run thriving businesses based around teams of expert people. They find their freelance talent through a trusted network of colleagues and advisors. Trust is the key word here. Remember, value-clients care first and foremost about getting the best result, and if a project is that important to them they want to be confident they’re getting the right person for the job. So they rely heavily on personal recommendations from their connections. Exceeding your client’s expectations — which creates strong word-of-mouth referrals — is key to building this trust and landing value-client jobs.

And of course networking. You need to know enough people to be no more than a few degrees of separation from the clients you want to land. Then you have a chance that someone they know also knows you, and the connection is born. Cold-email dream clients if you need to. Get out and meet people over coffee and build up a network of business acquaintances. You never know when those new connections will eventually turn into new project leads.

Try this: Assess where your last few years of clients have come from. What is the source of the best ones? Which source brings clients that are easier to work with, and create more successful and fulfilling projects?

2. How much do you charge?

This may seem counter-intuitive, but the simple act of raising your freelance prices may be the quickest thing you can do to attract better clients. Value-clients know that you get what you pay for. They see a cheap price and they will assume you provide a lower quality service. They see an expensive fee and they are more likely to believe you must deliver better value for your time.

Of course you need to be able to justify higher rates with more experience and ever-improving skills. A first-year freelancer fresh out of school can’t fake industry-topping rates, because value-clients will see right through that game.

However a large percentage of freelancers — myself included, at times in the past — have undervalued themselves and their services. It’s easy to get complacent and forget to always reconsider your rates as you build more experience. To combat this, I recommend scheduling in your own personal rate review every year (or even 6 months) to give yourself a moment to reflect on it and see if you can justify a rate increase.

Generally, if you’re busy, raise your rates. Even if you’re struggling to find enough work, you may still want to raise them (see “counter-intuitive” above).

One last benefit of raising your rates (aside form the obvious fact that you’ll earn more money) is that your rate will be an automatic filter for crappy cost-clients. They’ll hear your rate and quickly move on, which saves you the hassle of getting excited about their job only to learn that they’re willing to pay half of what you require. A high rate is the perfect kryptonite for tire-kickers.

Try this: Do you know how your rates compare to others with similar skills and experience in your area? When was the last time you raised your rates? What happened when you did? Have you noticed a correlation between your rates and the types of clients you attract?

3. How do you market your services?

This one is important, yet often ignored. So many creatives use the same meaningless buzzwords to describe what they do. How often have you heard intros like this:

We use innovative design-thinking to create meaningful brand stories.

Or

I craft empathetic user experiences with clean, minimal design.

I admit I’ve done this myself. It’s an easy trap to fall into, because it may be absolutely true that that’s what you do!

But think about this from your potential client’s perspective for a moment. If you remove all the buzzwords and adjectives, you’re left with an extremely bland, generic statement. You’re telling them nothing interesting or different about what you do. You’re not helping them learn why working with you is any better than working with another freelancer or larger agency. What really makes you special?

Instead, learn to talk about your services and processes in a language your clients will understand. Talk in business terms. Talk about the improved experience your work will create for their customers, or how you’ll help make their jobs easier or more profitable. Talk about your work process and set expectations for how easy and professional your relationship will be. Don’t tell them how proficient you are at certain software — tell them how experienced you are at creating concrete business results.

Imagine you’re a client and you’re looking through 10 portfolios of potential freelancers to hire for an important project. 9 out of 10 all trumpet the same on-trend design buzzwords, and all list the same design services and proficiencies. By the time you reach the 3rd one you’re already starting to yawn and skim through it. Then one pops up that actually talks about what he or she can do for your business. Which one do you think you’ll remember?

Try this: Read over your website or other marketing materials from the perspective of a potential client who’s not familiar with design or tech jargon. How much are you saying about what makes working with you unique? How are you building confidence in your potential client that hiring you will lead to a valuable long-term partnership?

Freelancing actually feels free

…when you start working exclusively for value-clients. Gone are the days when you dread dealing with unreasonable client demands, at all hours of the day. No more haggling over a few more dollars just so you can finish mediocre work rather than rushed crap you’re ashamed to put your name to.

Your client’s no longer feel like your boss, because you’re their partners.

Your concerns focus on how you can deliver the best result for your client-partner. How you can maximise the value they get from your time, experience, and effort.

You see the bigger picture of how choosing the right clients and projects can start shaping the direction of your freelance business. Client selection becomes an important form of business development — not just a necessity for work acquisition.

Freelancers early in their careers may find it difficult to completely remove cost-clients from their work, because while they’re still building experience they may not have the ability to attract their ideal clientele. But even at the cheaper levels there are plenty of clients who don’t act like cost-clients.

I can remember quite a few of my early clients who, although paying me relatively little, were still looking for ideal outcomes over lowest cost. Clients who had respect for my skills and experience — even though I had only a few years under my belt — because they could appreciate that I knew far more than they did about design, even if I didn’t know as much as some others. Working ultra-locally helps land these clients, because you aren’t compared with a global marketplace.

The lesson here is that you don’t have to have a decade of experience and world-class skills to start transforming your client-base away from cost-clients. You don’t have to be able to attract big, rich companies to enjoy the fruitful working relationships that value-clients offer. While there is no hack or shortcut to climbing to the top of your industry, there are plenty of steps you can take to get there more quickly.

All you have to do is start recognising the difference between cost and value-client, and learning how to connect with the better ones. Then, constantly tweak your client acquisition processes as you learn more about where they come from and what brings them most value. You can do this from freelancing day one, and you’ll still be doing it on day 5,000. It’s a never-ending quest, but you may as well start now.