Since we started as a B2B agency in mid-2014, pricing has always been an interesting challenge. We tend to engage most of our clients on a retained basis which means that they pay us each month for a block of hours. The challenge is the changing nature of B2B marketing. Whereas much of our time was spent trying to pitch a small pool of journalists with client stories, the reality is that B2B PR has changed. Now, we’re faced with a much more integrated approach which requires a more sophisticated way of working.
This change now means that a ‘media-first’ approach is being replaced with content marketing and inbound marketing methods. Ebooks, landing pages, email blasts, live events, webinars and long-form blogs have all come to the fore. Our clients’ needs vary widely from month to month, and the hours-based system isn’t suited to this way of working. We need a consistent approach to pricing the work that our clients require across all these different activities. We also need the flexibility to allocate their funds to this work each month.
Clients also need value, accountability and transparency. All this ultimately meant that the timesheet-based system of charging clients didn’t work for us anymore. So, we sat down, looked around and came up with an alternative.
The Credit-based system – how it works
We’ve noticed a few other agencies moving to a points-based system. This type of system made an enormous amount of sense to us because it shifts the focus from timesheets to outcomes. Instead of clients buying a block of time from us each month, they now buy credits. Each potential activity has a credit value, and no matter how long it takes, we deliver that outcome.
We’ve worked out that one credit is roughly one hour of our time and that each credit is £125. A client who pays us £4,000 GBP per month will have an allocation of 32 credits. Many clients pay us more than that, but it’s an example.
So, instead of trying to allocate hours to a task each month we now know how many credits it takes. Below is an example of what can be done on our monthly Boost Plan. You can see more of our monthly pricing packages here.
The benefits of the credit system for you
We think this makes much more sense for clients. Let’s take this analogy. You hire someone to fit your new kitchen, and you expect a fixed price. You wouldn’t be happy if two weeks later the fitter said it was taking longer than expected and they would be charging you extra. We believe the same applies to what we do. If we say a press release will take 4 points to write then, that’s it. If we take longer, then it’s our problem – not yours. It’s a bit like making each piece of work into a mini project.
The same applies to creating a landing page, writing an email blast or writing an ebook. We’ve also ditched timesheets around client calls and meetings. Clients don’t like it when we tell them 20% of their monthly fee is on admin. Now, customers see 100% of their money going towards specific tasks.
We firmly believe that the credit-based system is a winner for customers.
Here are the main advantages:
- Value. The focus shifts from hours to outcomes. Bye, bye timesheets. We deliver a set series of tasks each month. Like we said, if it takes longer then it’s our problem, not yours. Oh, and we don’t charge time for client calls and emails which are essential to run the account.
- Transparency. No more opaque timesheets, no more questions over how long a task took. We agree to allocate the points each month, and you see them delivered.
- Flexibility. Each month we can shift the credits to where they’re needed. Why allocate hours each month to writing a press release that never happens? Why assign monthly time to tasks you will never need? If we need to write an ebook per quarter, then we can even stretch credits across several months.
- Accountability. We keep a credits tracker to plan for the monthly allocation, and we then report on what we have achieved.
- Everybody wins. Clients win in multiple ways, and we win because it gives us a fixed and well-defined scope of work from one month to the next. If something falls out of the agreed scope, then we adapt to meet the challenge.
We’re getting good feedback when we speak to clients, and we think the system makes a whole lot of sense. We hope you do too.