HOURLY PRICING & PUBLIC RELATIONS
Sunday’s article in The New York Times addresses a relevant concern for not only lawyers, but many of us in the professional service industry, such as myself who owns a PR agency. Whether during good times or bad, pricing by the hour has never been a favorite practice of mine as a general rule. (There are exceptions, primarily when it comes to crisis communications work).
For example, does a client who prioritizes media relations care if we secure Fox News or CNN in 10 minutes rather than in 3 hours? Should that client be billed for the time or should they only be billed for the results?
The NY Times is accurate when it states that “firms that charge by the hour can suffer if they are too successful.” And it’s one of the reasons 5WPR primarily charges a flat retainer, which is “estimated” against time spent.
I welcome your feedback privately.
Ronn Torossian
February 3rd, 2009 at 6:32 pm
Couldn’t agree with you more. I’ve had my own firm for nearly six years now, and my resolution for this year and beyond is never to quote an hourly charge again.
That said, I’ve been moving toward a professional day rate (I define a professional day as between 8 and 10 hours, and yes, I sometimes bill for fractional days), or a retainer, as you do.
Emphasizing a professional day rate pulls clients away from counting hours, and also encourages them to view me as a true consultant/professional, and not as “hired help.”
If I am pressed into a discussion of hourly pricing, I have increasingly pointed toward variable pricing. This, too, works well. In other words, I tell the client that some activities, such as media list development and online research, might be priced at $125/hour, whereas pitching media and developing written materials is $175/hour, and interviews/meetings with the client and/or key constituencies (media, legislators, etc.) is $200/hour.
Would be interested in your views on this.
Thanks for the blog entry.
Steve Drake
Steven Drake Associates, LLC