I can hear it now.
"Wait. What? Jenn, for years you've been encouraging freelance writers to raise their rates. And now you're saying we should lower them?"
When I see a colleague unhappy with their careers, 9 times out of 10 raising rates would be a solution. It might be about bringing in more income. Or it might be about weeding out cheapskate clients who they're miserable working with.
But after doing some thorough and careful evaluation of my own rate experiments a while back, I realized I needed to lower mine for a few types of freelance writing jobs. And I think it's important to look at legitimate cases for lowering your freelance rates so we can all make better, more informed decisions.
Remember. Pricing is one of the fundamentals of marketing. And as such, testing and adaptation are vital.
3 Reasons to Lower Your Freelance Writing Rates
Let's explore some situations when lowering your freelance writing rates might be the smartest option, or at least something worth testing.
1. Your higher freelance writing rates put you in a market you dislike working in.
A point I've tried to make with newer freelancers over the years is that you can't simply raise your rates and expect existing clients to stick around. Raising your rates will often mean moving into an entirely different market.
There's nothing wrong with that.
But sometimes the new market isn't right for you despite the higher rates.
For example, you might be a professional blogger making $100-200 per post, writing in a particular niche you love. Raising your rates to the $300-400 range might open doors with other types of clients. But it might be work you don't enjoy -- such as writing more technical content than you're used to or writing for larger corporate clients and dealing with the bureaucracy involved.
Sometimes a higher project rate can work out to being a similar, or even lower, hourly rate. That can be a result of you working more slowly when you dislike the work, or because of different policies and groups of client reps you have to deal with or seek approval from.
If you hate the work you're able to get at your higher rate, you don't have to stick with it.
Maybe your old rate was already the top rate in your ideal target market. That's why it's important to know what target market you want to work with up front. You need to tailor rates to them as much as your rates need to be tailored to your own financial goals.
This happened to me when I raised rates once in the past. I've always preferred working with small businesses (mostly online businesses) and independent professionals. At the start of that year, a 1000 word blog post would cost somewhere in the $400-500 range for posts in my specialty area, and more for longer content. Those posts were a mix of tutorial-style posts and opinion / commentary posts -- both of which I love writing. These were relatively quick posts for me to write, often earning me anywhere from $200-300 per hour.
When I raised rates later, it drastically changed the type of prospects who found me online looking to hire me. Instead of hearing from the smaller and mid-sized online businesses I loved working with, I started hearing more from corporate clients.
The changes didn't work for me.
This isn't my ideal market, and the work expectations can be drastically different. For example, I used to have much more freedom in choosing what to write about and how to approach each topic. I was brought in because of my expertise in certain areas, so clients put a lot of trust in me to make the right calls.
With larger clients willing to spend even more, they tended to have more rigid plans and expectations, leaving very little flexibility. And, as with many corporate blogging jobs, I wouldn't even get a byline in most cases. Bloggers are brought in to write on behalf of the company or management, and it's often your job to simply take their talking points and turn them into articles. That's fine if you love that kind of work or if the pay increase is big enough to make you prefer it over work you enjoy more. That wasn't the case for me. While I do a lot of ghostwriting, posts directly in my specialty areas are ones where I prefer to avoid it.
2. The higher project rate doesn't equal a higher hourly rate.
Even worse than me not enjoying larger corporate writing work as much, these clients tended to have a hierarchy that could be difficult to work with. It's a "too many cooks in the kitchen" situation. And while it helps to have what Lori Widmer likes to call a "no posse clause," where you only take feedback from one contact person, it's not always enough.
Sometimes you don't get feedback and edit requests from third parties, but your contact person does and then passes them along as their own suggestions. This happens when you have a point person who needs approval from parties X, Y, and Z.
This doesn't happen much with smaller businesses because you'll often work with the owners -- the people in a position to make direct decisions. But with corporate clients the approval hierarchies can be more involved. It can be frustrating. And it can be time-consuming.
The increased payout didn't match the increased committment.
Overall, it's nice being paid more on a per project basis. But these projects frequently took more time partly because of office politics and partly because I didn't enjoy the work as much. While I could hit my target hourly rate, there wasn't a reliable increase, which is the point of raising your rates. And if you can make as much per hour by charging less per project and taking on gigs you enjoy, then that's the sensible choice. It also means projects move along faster, opening up more billable hours.
It's all about finding balance. You have to look at your rates not just on a project basis, but also an hourly basis. And you have to balance that with workflow changes that can come with changing target markets. It's not just an issue of article length (why a 2000 word blog post based on your own expertise can pay much more hourly than an interview-heavy 2000 word print piece). Sometimes it's best to stick with the higher rates. And sometimes you're better off lowering them.
3. Your higher freelance writing rates were just an experiment.
Like I mentioned earlier in this post, pricing is a key component of any marketing plan.
That means it should be subjected to testing just like any other part of your marketing strategy.
If you raise your rates on new clients as a test, but things don't work out as you'd hoped, you shouldn't be afraid to tweak things further even if that means lowering rates again. And keep in mind that lowering rates doesn't necessarily mean you have to lower them back to their previous levels. Sometimes a middle ground rate is best.
Project rates aren't always directly comparable when working with different markets. And sometimes your testing will demonstrate that.
If you end up in a position like mine where the target market changed drastically to accommodate the higher rates, and you aren't happy about it, you can always revert to a lower rate and experiment with other things. For example, you might keep the lower rates but try targeting a different niche or industry without completely overhauling the type of clients you work with.
When Not to Lower Your Freelance Writing Rates
While there are legitimate reasons to lower your freelance writing rates, please don't rush into this decision. It's not a panacea for your freelance woes. And taking this move lightly can lead to more problems than it might otherwise resolve.
Here are some examples of times when you shouldn't lower your freelance writing rates:
Because a client's budget dwindles
Again, so what? You shouldn't expect any client to stick around forever. Eventually your rates will go up as your experience increases, and that will price you out of some clients' budgets.
If they can't afford you, refer them to a newer writer and move on, or offer to tweak the scope of their projects so your work fits within their lower budget.
Because work is slow right now
Hey. It happens. But when it does, your first move should be to improve your marketing. And marketing on price doesn't make sense in freelancing.
Reevaluate your target market. Put yourself out there more. Reach out to more prospects. Look to increase demand in other ways before assuming pricing is the problem.
If you need money quickly and you feel lowering prices is the only option, market it as a limited time sale, and stick to it. Make sure new clients know what your real rates are, and make sure they understand their rates will increase on subsequent projects.
Because so-and-so says you charge too much
So, they can't afford you. And it's easier for them to insult you by saying you're not worth what you're charging than it is for them to admit they're cheap or can't afford to hire a pro. Not your problem. Keep your focus on the prospects and clients who do value you enough to pay your rates, and forget about everyone else.
Freelance writing rates aren't a static thing. They're a part of your ever-evolving marketing mix, and it's important to stay open to different approaches. How you set your project rates or per-word rates can dramatically affect your hourly earnings, and not always in the ways you'd expect.
This post was originally published on August 25, 2014 at All Freelance Writing. It has since been updated for Freelance Writing Pros readers.