Setting your first hourly rate as a freelancer can be a daunting experience. It leaves room for anxiety and overthinking - "am I good enough to charge these rates?", "will clients want to pay this much for my service?"
If you're dealing with thoughts like this, don't worry, it's completely normal. As someone who's been freelancing for 7 years, I assure you that you will get over these feelings in due time.
For now, we'll focus on getting you one step ahead and showing you how to start building your freelance business with a healthy hourly rate from the very beginning.
You're going to hear a lot of different things about setting hourly rates online. Some people will tell you to only charge based on the value you provide, not the time you put in. Others will say you have to work practically for free for the first however many clients.
The reality is that neither of these things are true.
Sure, value-based pricing is way more efficient than time-based pricing BUT it only works if you're an already established freelancer with a long track record. If you're new to the game, hourly rates are the way to go.
But that doesn't mean you should work for free either, or set your hourly rate so low that you dread every single minute spent delivering freelance services.
The average hourly rate depends on 5 factors:
Freelance digital marketers charge anywhere between $50 per hour all the way up to $200 per hour. You will also find lots of specialized marketers charging upwards of $500 per hour for very specific in-demand services (crazy, I know!).
Naturally, you're going to start with a lower hourly rate simply because this number largely depends on your experience and proof of work, whether that's a really good portfolio or a strong list of testimonials.
Another thing to keep in mind as you're looking for new clients is the georgraphic location you're targeting. Clients in first world countries are likely to accept higher rates than those located in second or third world countries.
And lastly, your hourly rate will depend on how good you are at selling your services. At the end of the day, everything comes down to how confident you are in your ability to deliver the service.
Now, all of these skills will come with time and experience. For now, focus on setting a realistic, healthy hourly rate so that you can get the ball rolling and start building up your track record.
Here are 3 safest ways to go about choosing an hourly rate for your digital marketing services:
Step #1: Look at other freelancers with similar experience to yours
Log into Upwork or a similar freelancing platform and look up what other freelance marketers are charging for similar services. This will help you determine what an acceptable rate would be in your specific niche.
Look specifically for beginner level freelancers first, then expand your search onto more advanced marketing folks. You'll find a sweet spot somewhere in the middle, although your hourly rate for your first ever freelance project should be closer to the lower end of the scale.
Step #2 Prioritize learning over profit
Now, we're not saying you should work for free. However, it is a smart move to prioritize gaining experience and testimonials over making a lot of money at the very beginning of your freelance career.
We suggest lowering your rates down to an amount that covers your overhead expenses (if you have any) and leaves a bit of profit for you at the end of the day. A lower rate will help you land more projects in a shorter period of time so you can build up a good reputation on the platform before aiming for more green bills.
Step #3 Use our hourly rate calculator
We've put together a spreadsheet that calculates your earning potential based on your industry and experience to help you set your first ever hourly rate. Check it out and figure out your rates in a couple of minutes.
Here's an example of a decent yet lower hourly rate for digital marketing. We would not suggest going lower than $20 per hour, as that might indicate poor service quality.
Anything between $40-$80 is considered a medium hourly rate for digital marketing services. However, you'll need to have a good amount of hours and reviews on your profile to justify these rates.
This is an example of a high hourly rate that inidicates this person has a lot of relevant experience in the marketing space. Once you get to this level, you'll become the next freelance marketing rockstar in your niche.
Now that you understand how hourly rate setting works, it's time to go out there and conquer the marketplace! Remember, it all comes down to how confident you are in your service and how well you position yourself online.
Sure, you can compare your rates to what other freelance marketers are charging but, at the end of the day, what matters is that you provide value to your clients. Once you create a valuable offer that can sweep potential clients off their feet, the hourly rate will no longer be a concern.
But, until you build up the necessary experience, start with a low offer, do lots of freelance work, learn how to communicate with clients, and make sure to collect five star reviews everywhere you go.
Once you add a couple of good projects to your work history, the hourly rate will no longer be the first and only thing potential clients see when they visit your profile.