How to ask a client for a budget

The topic of this post is one of the most asked and discussed questions in the entire freelancing and creative industry.

Whether you just got started in design (or another creative profession) or already have some experience in the field, you probably had those questions bothering your mind.

What's more, I've also been there (surprise!). I lived through the tough times of not being able to say the price and as a result - doing cheap projects and working for almost nothing.

But as we grow we always get experience along the way. So in this article, I wanted to share my experience of how I grew from a $20 per hour freelance designer to a $250 per hour design mentor.

Get to know the clients business

Before you even tell the price to the client you should study his business from the customer and market point of view.

  • Who are the customers of the product or service your client provides?
  • How much do they pay to use the product or service?
  • What problems and pain points the product or services cover?

When you have this data on your hands - you’ll be able to move to the next step, which is...

Show the value of your work for his business

We all love fancy designs, how clean and minimalistic they look, and all the tiny and shiny animations of the interfaces. But designers often forget about the main goal of the design - to help the business grow. Design is just one of the tools that businesses use to create better customer experiences, provide clarity of information, and all other benefits. But in the end, the goal is the same - make customers spend more money with the product or service they already use.

Once you’ve explained everything I said above to your client and you’re sure he understands this - you can show what the value of your work can be. Explain to the client how the engagement rate will improve the business health, how the easier to use navigation will help to lower bounce rate, and how the clear and prominent call-to-action will increase the conversion from visitor to customer. And if you don’t know what all of that means - the next point is especially for you.

Talk numbers

If your client is a business owner, he only understands the business language – numbers. He doesn’t care about the customer experience until it’s represented with numbers. Be prepared and learn those numbers before meeting with a client. Learn about conversions, product lines, marketing funnels, and how they work, what is the bounce rate and how to do A/B testing.

With this, you’ll be able to explain the value of the work you do using the client’s “native” language.

Learn the cost, the price, and the value

“Price is what you pay, value is what you get.” — Warren Buffet said that.

“When the value exceeds the price, people buy.” — Grand Cardone

Cost is the amount incurred on the inputs (raw materials, salaries, rent, interest, taxes, duties, etc.) for producing any product or service. It’s the amount of money spent by the company in the manufacturing of a product or creating a service.

Price is the amount of money paid by the buyer to the seller in exchange for any product or service. The seller determines the price, which includes cost and the profit margin.

Value is the usefulness of any product or service to a customer. It can never be determined in terms of money and varies from customer to customer.

Let the client say the price

When you’re able to explain the value of your work to the client, the next thing to do is to figure out from him how he thinks this value will be translated into business profit.

Let’s say, your value will be improving the conversion rate of the landing page by 20% from the current level.

Ask a client how much money that will be for them?

Let’s say they have a 12% conversion rate. 20% of that will be 2.4% which will be around $10,000 in revenue for the company. So when you do your work and the conversion rate improves the company will start making $10k per month more.

Based on those numbers you can determine the price for the value. Ask a client, how much they’re ready to invest in design to improve the conversion rate which, in result, will bring $120,000 to the company annually?

If he’s not stupid he’ll say YES!

Chris Do said once “When you tell the price - you sell. When the client tells the price - you close.”

Closing notes

On this note, I'd like to wrap up what we just went through:

  • Get to know the clients business
  • Show the value of your work for his business
  • Talk numbers
  • Learn the cost, the price, and the value
  • Let the client say the price

If you find those steps useful or applied some (or all of them) in your experience - don't hesitate to share your thoughts in this Twitter thread.