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The Downside of Publishing Service Pricing

In our most recent post, we shared information on “Why Publishing Your Service Pricing Is Such A Good Idea”. If you missed it, please view it here.

In this post, we follow it up with the reasons why it may not always be the best path to follow.

John McTigue, President of Indianapolis-based Element Three, puts it this way:

We don’t want people to buy the things we do; we want them to buy the impact we have. Published pricing makes the conversation with the prospect too focused on tactics from the onset, and we all become tactically obsessed and strategically blind.

The team at Element Three prefers to have a conversation with a prospect before arriving at the pricing discussion. That way, when the work begins, they can focus on achieving results instead of checking off a list of tasks. Furthermore, they avoid leaving money on the table from potential clients who might be willing to pay more. If a client has a budget for an ongoing retainer that happens to be twice as large as your agency’s biggest offering, would you want them to turn away before talking to you? Probably not.

Below are a few points to consider:

Published Pricing Sets A Limit On Profit Margin

Some dissidents argue that when you set even a base price for a particular service, you immediately place a cap on potential profit. Blair Enns, agency consultant and author of The Win Without Pitching Manifesto, puts it this way:

Would you charge the Chevrolet division of General Motors the same for a logo redesign as you would charge Bob’s Chevrolet Dealership in Des Moines, Iowa? The answer is no. Or it should be no. The reason the answer should be no is because the impact of your work would have more value, and there needs to be a certain amount of sting with your pricing. Just the right amount. One of the challenges with charging too little is that it becomes easy for your clients to lose respect for you, and afford to pay for your advice and not take it.

Published Pricing Exposes You Price Shoppers and Competitors

If you put your pricing out in the open, you do run the risk of competitors copying your approach. Additionally, prospects can shop around and compare; giving them ammo for strongarming you into decreasing your price. Transparent prices may also invite the wrong conversation with the wrong people, wasting your sales team’s time on qualifying people who care less about outcomes and more about getting a good deal.

One reason Todd Hockenberry, founder of marketing firm Top Line Results, doesn’t publish his pricing is to avoid these types of conversations:

If somebody leads a conversation with me about pricing and says, ‘This agency was going to charge this much for this service; will you change your price?’ I’m not really interested in that conversation because that person is obviously just price shopping. I’m looking for people to come to me and say, ‘I’m not growing my business fast enough; my sales team is not being effective enough; our marketing dollars aren’t giving us a good return; how can you help us grow our business in an expanding global market?’ Those are the problems we solve.

Published Pricing Commoditizes the Marketing Services Business

Dissenters of published pricing also insist that revealed pricing sets the stage for the agency to play the role of a vendor instead of a trusted partner. The health of the client-agency relationship becomes too heavily dependent on the completion of a defined volume of tasks (a certain number of blog posts, ebooks, or hours managing social media channels, for example) instead of doing whatever necessary to create value and drive results.

Here’s what Todd had to say about it:

[My job is] all about business results first. My job as a consultant is to figure out what tasks we need to do. If I can do two blog posts for a clients a month to get them the leads and results they’re looking for, why would I sell them seven or eight blog posts? I wouldn’t. But if I decided to, I would base my fee increase on the results, not on the work I was doing. As soon as you base your fees on the work you do, it’s a task checklist, which lets your client focus on whether you did everything you said you were going to do instead of the results and value and benefit to the client.

So, if you want the flexibility to only do what’s required to meet a goal, itemized published pricing might not be ideal.

After exploring the most common pros and cons of publishing agency pricing, hopefully it has become much more clear whether your firm should or shouldn’t reveal what you charge. If not, here’s a simple way to think about it.

You May Want to Publish If…

  • You think transparency and openness outweighs your competition’s ability to price competitively;
  • You make a large enough margin on your established prices;
  • You mostly offer repeatable inbound marketing services, and find that you’re offering a similar service package to more than 3-5 clients.

You May Not Want to Publish If…

  • You don’t yet know what to charge;
  • You aren’t currently offering easily bundled, ongoing inbound marketing services;
  • You play more of a consultative role and offer higher-level strategic work rather than execution.

No matter what you decide, just remember that placing price tags on your website does not replace the need for an upfront inbound marketing assessment or an effective sales methodology. Selling is essential, even if published pricing minimizes the length of the sales cycle.

Adopted from Shannon Johnson’s Inbound Agency Pricing Series. You can follow her @Shannopop

Suraj is Business Development Manager at He holds MBA from Regent Business School and has extensive knowledge in education and communications.

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