He wants to know how to negotiate a pay raise, from a past/current client…
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Roy – Hi,
I thought this question might be pertinent to a lot of beginners in copywriting who are looking to find new clients – and consolidate their relationships with existing ones.
I’m in a bit of a pickle, as we say in the UK.
I have been working with a gold company in California now, for just over two years.
They were a start-up, and they were only able to pay me $500 a month, initially, as a sort of retainer. After a year we agreed that that would be upped to $1,000 a month.
The problem is that the workload has gradually crept up to the point where I’m spending the majority of my working week on their projects. I have written webpages, blogs, video sales letters, I have produced charts for them to display returns on investment and write articles for several high-powered financial websites for them, oh, and I have also written two e-books …
They are beginning to do well. I get on with them – and they are great to work for. My dilemma is, that because of the increased workload, and the fact that I have had to buy several software programs for charting, and copy-pasting (like Snagit) I am beginning to feel that I need to up the rates I am charging.
The problem is, that they are based in Los Angeles. Why is this a problem? Well I can think of nowhere on earth that has more writers per square mile than LA! This makes me very nervous that if I go into hard, or at too high a rate, they could very easily find somebody else.
They are always telling me that they are very pleased with my work, and that it has brought in lots of business for them.
Although I am good at the writing side of this – I have to confess that I am a bit rubbish when it comes to the business side – so I just wanted to ask how you would approach this and the kind of things that I need to cover? Are there any general guidelines as to what I should be charging – or some kind of reference I can show them to persuade them as to what a bargain they have been getting?
I would appreciate any suggestions or advice as to how to tackle this.
First, an embarrassing story…
Back when I was a couple years into marketing for the IT training company, I was getting pretty cocky…
The business was growing fast. I’d helped a lot with their AdWords profitability. I help them launch a new subscription program that was quickly becoming the profit centerpiece of the entire company.
So I did some research.
I was able to run reports off the database, and I calculated about how much in sales I could argue that I was directly responsible for over the past year.
I tried to be fair about it.
Then, I took it to the president of the company, who I knew I could have frank discussions with.
He knew, from the moment he hired me, that I’d been interested in freelance copywriting. He knew I thought of myself as a salesperson first, who just happened to do marketing to make sales. He knew I was very ROI-oriented, and believed everyone should be paid based on their contribution.
So when we sat down, I showed him the numbers. Then I explained — maybe arrogantly, in hindsight — how freelance copywriters got paid a percentage of sales generated. And based on the numbers I put together, I was worth something like 40% more than they were paying me.
To his credit, he didn’t just run me out of his office right then.
Rather, he explained to me that, yes, that would be fair if I were a freelancer. But an employee comes with extra expenses, which he proceeded to break down. There were tax obligations he had as an employer, that would’ve been on my shoulders if I were independent. Then there were benefits, such as the fully-paid health insurance plan they offered. And so on.
Then, he did the math for me.
Turns out they were investing in me pretty much exactly what I was worth to the company as a freelancer.
He then explained to me how he could actually pay me more if I moved to sales, but in marketing I’d pretty much reached my cap for the time being.
Which is how I ended up in sales for the last bit of my time at that company!
I see two lessons in that little story:
— The first is that if you are negotiating a pay raise, make sure you’re worth it to that particular client/employer. I was pretty sure I was, but was quickly given perspective to make it clear I was being compensated pretty fairly.
— The second lesson is that you don’t know unless you ask. I actually did end up getting paid quite a bit more when I moved to sales. But if I hadn’t been ambitious enough to ask, the opportunity would’ve have been mine for the taking.
Which leads us to…
You need to have the “Come to Jesus” talk…
First and foremost, you’re not going to get paid more unless you ask for it. Simple as that. It’s pretty much a rule of business.
Your boss — or client, or whomever — is probably NOT thinking about how they can pay you more. While it would probably benefit them to do so, 99% of bosses in 99.99% of circumstances are thinking about just about anything except how to pay you more.
If you want something from someone — in business, or in any part of life — you have to make your wants known.
You can’t expect them to read your mind. You can’t expect it to happen automatically. You can’t expect magic.
If you want something, speak up for yourself.
This is one of the biggest things in life that creates separation between who gets the promotion, or the pay raise, or whatever upgrade from those who don’t.
(And note to women: it really sucks that in most cultures, you’re actually taught not to ask for things, and often punished far more when you do. This doesn’t mean you should give up. If anything, unfortunately, it means you should ask twice as much.)
(And note to men, regarding the note to women: you suck and you’re doing yourself a disservice if you make it harder on women, or pay them less, or give them less opportunities. When they ask, they should have an equal shot at all the opportunities that a man in their situation would get.)
(And a note to all RE minorities: the same women/men imbalance applies to minorities, too. Unfortunately there’s a lot of people who have to work twice as hard for half as much. Not only is it the right thing to do to hire a diverse workforce and compensate based on compensation, the research actually says you build a better, healthier organization by doing so.)
When you ask, really you’re going to get one of two answers: yes, or no.
There may be conditions attached to either. And a maybe is simply a no with conditions.
But when it comes down to it, having that answer is a TON more valuable than being stuck with the question. So ask.
Be willing to walk away…
You can’t effectively ask for anything in a negotiation unless you’re willing to walk away.
If you’re completely tied to the outcome, it will eventually be clear in the context of the negotiation.
The other party will know it, and use it against you. (Whether intentionally or unintentionally, consciously or subconsciously, it will influence how they negotiate.)
And so the only effective way that you can approach any negotiation is being willing to walk away.
Which leads us to…
Will they go to other writers? Maybe…
In the context of G’s negotiation above, he argues that there are a ton of starving writers in Los Angeles.
That company is clearly willing to look outside LA to get writers. And have you seen the cost of living in LA? While writers do occasionally work for peanuts there, they’re going to find it even less sustainable than you do.
The company could also hop on fiverr today and hire writers at $5 per article. But they’re not.
The actual physical act of putting words on paper has already been commoditized.
Done. Finalized. Yesterday’s news.
Words on paper are effectively worth nothing. And that value will only go down.
What hasn’t been commoditized is thinking, and relationships. The human factor.
Making their life easier. Being a consistent resource.
There’s always someone who can take all of our places. But companies value you for more than your skill, if you’re doing anything right.
And so while they could immediately turn around and go with someone else, don’t assume that’s the only outcome.
Decide what you’re willing to write for, and go find those clients…
Another story. Once upon a time, I had a dinner with a bunch of top copywriters and marketers from one of the biggest companies in direct response in the 90s and early 2000s.
I still don’t know how I ended up at that dinner. (Actually, I do — thanks especially to Brendan for the invite.)
Anyway, I was talking to one of the writers. She asked who I was working with. I mentioned a client name. She said she’d worked with them at one point. But then she said something that hit me like a ton of bricks…
“Oh they’re too small for me.”
At the time, I thought they were a pretty major player. And at least within their niche, they still were.
But I realized that I wasn’t stuck working with that company. And I wasn’t stuck working with clients of that size.
And, in fact, if I was creating about the same level of performance in a bigger company, I could probably be getting paid a bunch more.
There’s a real danger in working with startups (and I speak from personal experience). What’s a lot to them is peanuts to others. To ask for and get higher fees, it might just be a matter of who you’re asking.
Also, make sure you’re clear about what you’re willing to do and for how much. If you don’t set clear boundaries, nobody will. It benefits them to just ask for more and more. So you need to be willing to say “no” or to establish some clear cut-off point at which you ask for more fees.
If appropriate, it can be time. Or it can be scope of work. Or it can be anything appropriate to you and the client. But you need to draw a clear line, and be vocal when they cross it. Then, have a method for pricing any additional work beyond that point.
My parting thought…
Ultimately, what it all comes down to the simple skill of being able to ask.
It’s not necessarily easy. But it is simple.
Ask, and accept the fact that the answer may not be what you want it to be.
If it is, great. If not, see if you can find a good middle ground, or be willing to move on.
You may be surprised.
Yours for bigger breakthroughs,