let’s talk money mindset!

I had the privilege of talking with Alejandra McPherson, the strategist and designer behind Ale Now Design, about money mindset for creatives. Check out the video below of our conversation to find out how we as creative entrepreneurs can overcome common misconceptions about money, be confident in our pricing, and stop undervaluing our work in the design industry.

What do you do and what kind of clients do you serve? how long have you been in business for?

1. Alejandra: 6 years unofficially, (freelancing and full-time designer). In May, I launched my business focusing in brand strategy and brand identity. I love working and interacting with creative entrepreneurs! I have also worked with some different industries such as baby clothing, food, and beauty industries.

Why do designers tend to undervalue their work?

Common Misconceptions:

• “Design isn’t necessary…” It is a luxury that only a few can afford.

• “Design is subjective…” There is no set way to talk about design; there is no rule book on how to price yourself as a designer. So many different elements come into consideration when pricing yourself- experience, value/results delivered, aesthetic, demand, niche/expertise etc.

• “Anyone can design…” There are so many free online apps, programs, and do-it-yourself templates (This one is probably true…but can everyone communicate through design? Probably not).

Saturated Industry:

• Newer designers often do not quote a higher price for the fear that someone else will come along with a cheaper quote and, therefore, lose the client.

• Some assume that spending money on design is a luxury that only a few people can afford. All of the templates and DIY methods out there really contribute to many designers and creatives doubting their pricing and worth.

• When starting out, many creatives feel an immense pressure to build an impressive portfolio. In order to gain more experience with actual clients, they feel they have to charge much less in exchange for the benefit of a more robust portfolio…and they undermine their finances as a result.

Scarcity Mindset:

Getting clients when you’re starting out is hard… it takes years to build up a healthy client roster. So when I was first starting out, I needed every single client and project and was in constant fear of losing a client. But that’s no way to do business for the long-haul!

• In order to overcome the scarcity mindset, you need to think community over competition! Yes, there are a lot of creatives and designers out there and we all meet the same or similar needs. But, we meet those needs and goals in different ways. When you approach the industry with a community mindset, you’re able to see that there is room for everyone and all of us have something different and unique to offer that someone else has a need for.

• Realizing that we are not always the best fit for every client is important too. They have unique needs and our unique services/products may not be the right fit for them. And that’s OK! That client will be able to find the help they need elsewhere in the industry and you will have the opportunity to find clients that need exactly what you offer.

Rejection/People Pleasing:

I am an enneagram 1, so I love to please everyone all of the time. At the beginning of my career, the fear of my work not being liked was paralyzing. I tied my personal worth to my work and it ruined me.

Emotional Pricing:

• It can be hard booking clients at a high ticket price point because they really have to understand the value of design. A mistake that happens A LOT in the design industry is designers booking at a lower price point and they don’t take any deliverables off of the proposal because they want to book the work so badly.

• You have to approach a potential working relationship with the mindset that you don’t actually need to book the work… DO NOT PERSONALLY ATTACH YOURSELF to booking the job. I used to make it mean all of these different things if someone didn’t move forward with their project. Just remember that it’s not personal!

How to Price Yourself as a Designer

Different Pricing Structures:

• Hourly Rate

• Packaged/Flat Rates

  • Based on certain deliverables, not the time spent on the project (this can be tricky if you don’t know how long things take you).

  • Things are often requested when they are out of scope. I actually put a line in my proposal saying ‘this quote is for the work outlined above, anything that falls outside this scope, we are happy to requote’.

• Retainer

  • Bucketed Hours System

• Value Based Pricing (not something we touched on in the video above)

Basing Design Pricing On Time Spent:

A word of caution on doing this: If you base your work on time spent and you are a fast worker, you may end up “punishing” yourself financially. Pricing hourly as a senior designer can be so tough because the better you get at your job, the less you are paid.

It is good to know the time spent on a project so you can put the correct flat rate on it and ensure that you are being fairly compensated. Use time tracking at the beginning of your career and throughout so that you know how long it takes you to complete certain projects.

What are the biggest pricing mistakes you have made or seen in the creative industry?

• Artists and makers not charging for their time and only factoring in the materials used.

• Continuing to charge hourly when they are senior designers and efficient at their work, therefore punishing themselves financially instead of rewarding themselves.

• Charging less just to gain more experience and build up an impressive portfolio.

• Allowing themselves to become personally attached to the design job.

how do we compete with Websites like upwork and logo-for-a-dollar that charge very little?

Well, we don’t. We offer different services. It’s like sitting in a massage chair in the mall and paying $1 for a 15 minute massage compared to going to a spa and paying $100 for an hour long massage. NOT the same thing, right?

This is truly such a huge problem in the design industry. I absolutely cringe when I see designers charging $100 for a logo.

why is it important to have these conversations about money? why is it a “taboo” topic?

A little over a year ago, this is a conversation I would have avoided completely! But having these conversations about money and pricing is so important. Yes, money talk is uncomfortable…but why should it be? How and why have we been influenced to feel that way about financial compensation and that it’s a “taboo” topic?

Some Food For Thought:

• Is it because in the corporate world, money talk is something that is viewed as “prohibited” or “inappropriate” and is that something that favors designers or big corporations?

• Is it because that, as women, we’re conditioned not to talk about money or even want to have it or make more of it?

I would love to know your thoughts! Leave a comment below and tell me why you think money is such a “taboo” topic in the design industry and in our society.

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