- Charging hourly allows you to have a clear stop point so you’re not over servicing and you can clearly define the amount of work performed each month
- Upselling is much easier when charging hourly because you can add more hours for clients that want results faster
- SEO’s should not be selling silly deliverables such as x number of keywords, or x number of blog posts
- Be sure to focus on revenue, not rankings as a clear performance indicator (outcome/objective)
John: I think that conversation definitely fits in better with when you become a specialist and you have that level of predictability, but definitely for SEO, because SEO is so open ended. We’ve had this discussion so many times now, that it’d be nice to think, “Here’s a start point; Here’s an end point with SEO.” And I think there’s probably a large percentage of people running around the internet selling SEO services that just don’t have any clarity at all. And it’s hard enough for the people that do know what they’re doing to get to that end point. And they’re discussion’s typically based around goals, objectives, key performance indicators, metrics, like, “We want to increase that revenue by fucking 30% within six months.” And they’ve got hard data sets based around factual fucking data and numbers, tangible results in order to get to that end point. But unfortunately, as you know, a lot of people are running around the internet saying, “Oh, we’re going to get you on the first page with fucking skate skateboarding elephants.”
Byron: I can see you’re looking for a John Romaine keyword in there. So …
John: Yeah. But you know what I mean?
John: It’s just it’s so easy to find yourself in that situation. And I guess we’re sort of trending towards how to price. You said something the other day about, you weren’t in favour of charging an hourly rate for SEO. And I understand why you say that, because I think, and just correct me if I’m wrong, you’re doing more paid-
John: … than SEO these days.
Byron: Definitely a lot more paid clients.
John: It’s just too hard to try and quantify, I find, with SEO. Because I’ve spoken with a lot of freelancers, and, “What are you doing on this campaign?” “Oh, I’m doing a bit here.” “Okay. How much time you spent doing?” “Oh, I’ll probably do about two or three hours a day.” “What, every day for a month? Yeah.” “How much did you charge your client?” “900 a month.” “Fuck me dead. That works out to be $4.60 an hour. What the fuck are you doing?”
Byron: And that’s it? It’s a bit like, I think I use the car service mentality again. When you go in and do the car service, they’ll probably give you an estimate of how long it’s going to take. They’ll say, “Hey, look, John, go and get a coffee in and an eggs Benedict down at the local cafe while we do this. We’ll probably be about three hours while we work on this maybe.” So they’ll probably give you an estimate. But if you look in your log book, for example, I don’t believe it shows the time that it’s going to take. They just show that you’re going to get your oil changed, your oil and air filters; you get your tyres rotated, window washers is filled up, et cetera.
And they might say, “Look, John, It’ll take probably roughly four hours.” Well, you’ve been probably down at the shops for 4 hours. They probably did it in two, and they’re sitting there having a mocha choca-latte and putting their feet up for a couple of hours until you come back and pick the car up. And I think the other flip side is that I had an interesting conversation the other day where a client came to me. This was for paid advertising. And they said, “Oh, how much will it cost to manage X amount of spend?” and I said, “Oh, it’ll cost,” I think it was four grand per month that I mentioned. And I hadn’t mentioned the hourly rate at that time, and they said, “Oh, well, what’s your hourly rate?” And I said, Oh, it’s $150.” And so then on the phone they reversed it, and they said, “All right. 4,000 divided by 150. Oh no, that’s not enough hours for me to work. I’ve got someone that’s working full time on it now.” So the hours almost went against me in that scenario.
John: Yeah. What service was that for?
Byron: That was an e-commerce lead, I think. So-
John: So that was paid traffic though, right?
Byron: Yeah, for Google ads. And so in their head, it was a bit like when someone says, “Oh, well, why should I use you, John, when I can get 80 hours worth of two offshore guys based in the Philippines.” I’ve had that conversation a million times, and-
John: That’s fine. I don’t want to work with those people.
Byron: No. But-
John: I want to work with those people.
Byron: … we all know that an hour of our time is easily worth 10 or 15 of someone else’s hours as well. So it’s not necessarily a great indicator when somebody uses it like that. I think, like you say, I like it from a point of view where you set the standards you’ve aligned their beliefs in terms of what we’ve got to do. But it’s one of those ones, it’s gets a bit of a grey area for me. So …
John: Yeah. There’s so many different ways of pricing SEO. I know I’ve seen, what’s his name? Is it Sabri Subi, or what’s that guy from .
Byron: Sabri Subi?
John: Yeah. I’ve seen him talk about charging a percentage of, I can’t remember his exact wording, but he said it was a 10% of the cost of the problem they’re going to solve. In other words, “What’s this worth to you as a business owner. Okay. It’s worth $300,000? Our fee is $30,000.” I’m not sure how they quantify that, and that’s kind of why I chose the hourly rate, because you can quantify it and you have a definitive pump the brakes and stop work. And I think there’s a lot of, maybe not agencies. Agencies, who knows how they operate. The whole hourly thing probably doesn’t come into play. But one of my biggest frustrations, when you got someone on the phone and they ask you, “How much is this going to cost?” and you say, “That’s going to cost $2,500 a month,” the first thing they ask is, “What do I get for that?”
I always follow that up with, “If you’re willing to move forward, I’d be happy to put a presentation together, and I’ll explain all of the deliverables in the presentation where I pitch.” And this is something that, we had that discussion the other day, and one of the members has really taken it fucking literally, even though I’m saying $165 an hour. For anyone that’s watching this video, they’re going to be shocked. $165 an hour for a minimum of 15 hours doesn’t necessarily mean that I’m watching the fucking clock. I know what my costs are to generate four blog post articles and pay my guy that does my outreach and everything else. So I just reverse engineer that cost and deduct the time out of that.
But more importantly, I’m not fucking sitting here doing 15 hours. And you’ve even said this yourself once before, Byron. You said, “Even though I’m charging an hourly,” I can’t remember what we were talking about at the time; “It doesn’t mean that I’m sitting here doing the fucking work. So I’ve got staff. I’m charging $165 an hour, but I’ve got staff that might only be working at $20 an hour, $25 an hour.”
Byron: That’s it, yeah.
John: But look, there’s so many different ways to price it.