Getting Your Pricing Right -- Mamba

Earlier this week, Cindy Moon, one of our creators, reached out to the community for guidance on negotiating her salary for a Content Lead role she was approached for.

That became the main focus of our support call, and when combined with valuable suggestions from the community, Cindy went from having an unfavourable initial offer to confidently securing her counter-offer, one that fairly valued her skillset and expertise.

Pricing our own skillsets, or sought-after expertise, is a challenge I've heard nearly everybody struggle with, whether it's for their business or career.

Me included.

🤔 What's Your Price?

When asked to price ourselves or our services, 99% of us underprice ourselves because we often have deeply ingrained beliefs or narratives about our self-worth as it relates to money or wealth.

It could be because your parents have subconsciously carried a scarcity mindset and unintentionally projected it onto you during your upbringing.

Or it could be a result of the environment or people you spend the most time with, who constantly use and reinforce language that distances you from the abundance of money in this world, such as:

💭 "Money doesn't grow on trees"

Yes it doesn't...but it gets printed by global central banks on the daily.

💭 "It'd be great to see how the 1% live"

You could become the 1% yourself if you truly believed it and acted accordingly.

💭 "I'll never be able to afford that"

You're right...with that mindset, you'll never take the actions that would enable you to afford it.

💭 "You have to save for a rainy day"

If you're the kind of person with that pessimistic mindset, then your energy of anticipating those "rainy days" will attract more bad events happening to you. Ever notice those types of people in your life that always seem to be attracting bad people, events and outcomes?

💭 "Those wealthy people must've gotten lucky"

Attributing wealth to "luck" dismisses the actions you can take to achieve it yourself.

👉🏽 What phrases or beliefs around money have been deeply reinforced and have impacted your views on what's possible for your life?

🏷️ You Sell How You Buy

You may or may not know where your money mindset comes from.

But it's often noted that how you price or sell yourself, or your products, directly reflects how you buy.

🤔 Think about it:

Do you tend to opt for the "cheapest" price, or focus on purchasing things when they're on sale/discount?

Then, when it comes to your offers or products, you'll also default to lowering your prices because that's your approach towards purchasing decisions.

I definitely did...for years.

Don't believe me?

Here's the story of my first retainer (i.e. recurring monthly) client.

And I've gotta be honest here...I'm actually starting to cringe just typing this.

I even considered excluding this story from this newsletter (as I've never shared it publicly), but as I value honesty and want to ensure that you avoid or learn from my mistakes, here goes...

🤦🏽‍♂️ My $40/hour retainer client

At the start of January 2021, I handed in my resignation to leave my full-time Marketing & Comms role at Google.

I already had a handful of clients for whom I was doing ad-hoc projects on the weekends in my at-home studio:

I felt confident I could secure 3-4 monthly retainer clients that would (at least) equal what I earned in my full-time role.

✅ I was right about being confident in my ability to secure 3-4 monthly retainers, but

❌ I was (terribly) wrong about my ability to immediately equal what I previously earned.

Why?

I didn't have any method or maths to value my services.

And because I didn't know my value, I didn't know how to reverse-engineer my previous salary.

So when it came to pitching clients, I just plucked a number out of the sky, that I thought was low enough for clients to say "yes" to.

sigh

Here's an excerpt from a pricing proposal I sent to one of my earliest retainer clients, which priced my services at a whopping:

$40 per hour.

I created my own hard ceiling on my earning potential, by charging:

Based on my time; and
At a lower hourly rate than the rate of my full-time salary

See the issue here?

I created multiple "jobs" for myself at a lower hourly rate

$40 per hour with 3-4 clients
Vs. $65 per hour with 1 employer

From a financial perspective, this made no sense as I was now:

Earning less per hour; and
Working fewer overall hours; and
Stretched across multiple "employers" (i.e. clients)

And because I had poor boundaries, I allowed my clients to get me to complete work that was outside of the scope of work we initially agreed upon, also known as "scope creep".

As a result, I felt increasingly underappreciated and resentful towards them, even though it was 100% my fault.

💬 "F*ck this, Mamba"

After the first few months of draining my sanity and savings, I had a "f*ck this" moment.

I knew there had to be another way of pricing myself, but I didn't know it...yet.

Fortunately, I knew the value of paying for the expertise of others to shortcut a learning curve, instead of struggling for months (or years) doing the same thing and yielding the same results.

So, I made one of the biggest investments in myself by getting a business coach and mentor that completely shifted my mindset towards self-worth, pricing and my relationship with myself & others.

Tommy 'Mantastic' Bellman - my business coach and mentor

Tommy introduced me to the principle of fair exchange, which goes along the lines of:

Any exchange that you walk away from feeling emotionally balanced or positive, you've understood to be a fair one.

It doesn't necessarily relate to what is actually being exchanged (i.e. product, service etc) but the intuitive "gut" feeling that either party has after the exchange has been done.

"If you GIVE more than you TAKE, you feel RESENTFUL.

If you TAKE more than you GIVE, you feel GUILTY"

— Christen Killick

The resentment I felt towards my clients were intuitive signals that I was underpriced or/and underappreciated.

I just didn't know what to do about it.

Fortunately, Tommy helped me completely overhaul my mindset and method towards pricing.

And 2 years later, I truly feel that all of my clients, and the projects we collaborate on, embody the principle of fair exchange.

To save you from 2 years of guesswork, resentment or investing in a business coach, this guide will help you better price your skills or expertise to the marketplace, whether for your side hustle or full-time venture.

It consists of just 2 methods, with a breakdown of what they are, when you'd use them & how to use them (with examples from our creator community).

Method 1: Input-Based
Method 2: Output-Based

Ready to get your pricing right, my friend?

💰 Let's go.

🕖 Method 1: Input-Based (Time)

What?

This is the most common approach we're all familiar with - it's pricing based on your time (input).

Due to our societally ingrained mindset of valuing ourselves based on time, we'll default to valuing ourselves as the hourly rate we've been paid at our current, or latest role.

The reality is that your per-hour value is actually much higher, especially if someone is seeking you out for a specific set of skills and unique knowledge that you've accumulated.

That's because, unlike when you're an employee that can be replaced (i.e. commodified), when someone seeks you out it's because you've got an inherent value they probably can't find easily or readily (i.e. rare/unique).

That's your leverage.