Do we charge for value or time? We charge for value. But you can’t charge for value until you know how much you cost.

I’m often asked how much social media should cost. I’m also asked how much  you should charge. But just like Alex Vasquez says to charge for value the opposite is also true. If you don’t know how much you cost, do you even know your own value?

How much is your time worth?

How much is my time worth?

These are the questions we ask ourselves when we decide to outsource. Does it make sense to do $18/hour bookkeeping work when your time is worth $100? No. You outsource.

I talked a bit about why it costs so much to outsource your social media in this post, but let’s dig deeper.

Pricing by Time or Value?

Most of my peers believe we are worth more than a dollar amount per hour.

Last year at WordCamp, Alex Vasquez said,

“We price by the service, we price by the value we bring, not our time.”

There’s a lot of truth to that. We care about value, but we also care about our time. After all, there are only 24 hours in a day, no matter what you charge.

But for the sake of this post, let’s talk about dollars per hour to gain perspective.

How much time?

It’s important to know how much time it takes you to perform a task.

You do want to make a profit, right?

So, use a timer. How long are you spending on any given task? Write it down. That just gives you a baseline of what it costs you to do the task. Now, decide how much you want to charge.

Pricing by Platform or Skill

Many of my friends have package pricing, often broken out according to Olympic metal colors. You can also price by platform or skill.

You may decide you don’t want to do a platform. For example, I recommend anyone who wants Pinterest to Carol Stephen and SEO to Pam Aungst.

If you’re just starting out you should ask yourself some questions. What platforms or digital skills are your strengths? Which are your weaknesses?

Is Tweeting Just Tweeting?

Do you count the time actually Tweeting as working a Twitter account?

What about reading other tweets?

What about reading articles to tweet and other research?

What about follower maintenance including unfollowing spammers, keeping the ratio social (1:1, IMHO), and putting them on lists?

Does tweeting include Twitter chats?

Does tweeting for a client include client communication time? If you were a lawyer or an accountant, all of that client communication time would be billable.

All of these tasks combined take at least one hour a day, depending upon the Twitter account. The more followers you have, the more time it takes to engage.

Per Hour Comparisons

For the sake of this post, let’s presume you’re going to spend a combined time of one hour a day in a 28-day month for your new Twitter Client.

In California, the minimum wage is $9/hour.

If you worked for 1 hour a day for 28 days in a month, that would be $252.

We haven’t even accounted for the self-employment tax.

Some quick Googling brought more wages for the sake of comparison. Feel free to refute.

  • The starting wage for In-N-Out Burger is $10.50/hour. A 28-hour month would equal $294 before taxes (gross).
  • The starting wage for Costco is $11.50/hour. For 28 hours, that would be $322.
  • The average wage for an administrative assistant in the Los Angeles area is $21/hour. That would be $588 for 28 hours.
  • The average wage for a marketer in the Los Angeles area is $26/hour. That would be $728 for 28 hours.

Let’s summarize the 28-hour month by category:

  • Minimum Wage $252
  • In-N-Out $294
  • Costco $322
  • Admin $588
  • Marketing $728

A Question of Value

The question to you is, as a social media manager, where does your worth lie?

The question to you as a client is, what value does your social media manager bring. Is it more or less than a Costco worker?

15 Comments

  1. Carol Stephen on May 27, 2015 at 4:39 am

    Wow. I’ve never seen it broken down quite that way before. Really puts things into perspective, doesn’t it? Thank you for this post.

    • Bridget Willard on May 27, 2015 at 1:00 pm

      Oh for sure. You know me. I was like. Wait a minute.

  2. Roxanne R. Roark on May 27, 2015 at 5:22 pm

    Wow, Bridget! What a great breakdown! It really does put it into perspective, like Carol said. Great post!

  3. ruby on May 27, 2015 at 9:57 pm

    Love the break down, Bridget.

    I spoke with a friend who runs his own business. Basically, our agreement boiled down to our answer to your question, “Where does your worth lie?”

    Thanks!

    • Bridget Willard on May 27, 2015 at 10:01 pm

      Thank you. I guess construction job costing has changed the way I think.

  4. Tess Wittler on May 28, 2015 at 3:13 pm

    This is an amazing post, Bridget! Thank you for breaking it down like this.

    • Bridget Willard on May 28, 2015 at 3:41 pm

      Thank you so much, Tess. That means a lot coming from you!

  5. Kittie on June 1, 2015 at 10:35 pm

    Great post Bridget!

    I think many social media managers undervalue themselves. Many that I know are undertaking not only the interaction side, but also helping guide business strategy. Definitely worth a heck of a lot more than the minimum wage.

    But unfortunately people seem to want to get something for nothing these days. They get some amazing bargains and sometimes so really badly managed social accounts. I certainly wouldn’t want to put my business reputation at risk just to save a few bucks.

    • Bridget Willard on June 1, 2015 at 10:37 pm

      Well-said.

      I started thinking about time. Being in construction, job costing is always on my mind.

  6. D. Scott Smith on June 5, 2015 at 3:33 pm

    Bridget – I work with many businesses about the business of business. There are several business models that stink. Reselling products is a race to the bottom (you only compete on price with commodities); and trading hours for dollars is terrible, and only leads to an artificial cap on revenue.

    A friend of mine has a very simple model for understanding the value of social media; examine the sales traffic, what is the lifetime value of a customer; now, how many new customers did your social work generate. If a client is worth $2,000 of lifetime revenue, any client gained (or retained) is worth the $2,000.

    In your business, the value is significantly greater.

    Author Geoffrey Moore talks about Core and Context. Core are items that differentiate your business; Context are those you need just to participate. Websites were novel (in 1989) and a differentiator (Core); today it is expected (Context).

    Participation in Social Channels is no longer Core, it has become Context – customers expect businesses to have a relevant, active, and monitored set of social channels. The voice on a social channel is that of the company.

    Companies spend large sums on developing brands; hire professionals to design logos, messaging, and represent the brand promise effectively. Then their execution on social channels is poor and does not truly represent the company. These channels are full of “dead-air”, messages from clients go unanswered; this can undermine much of what has been accomplished.

    This leads to the value provided – and what you should charge. What is the value of a marketing manager or director of marketing? This is the target income goal. Likely, not from one client; rather, from a combination of accounts.

    Enjoy your vacation…I look forward to further conversations. Thank you for this excellent post!

    Scott

    • Bridget Willard on June 5, 2015 at 3:35 pm

      Thanks, Scott.

      Your answer is above my pay grade but correct.

      I just wanted people to think.

      I appreciate your input.

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