Maximizing Profit and Success
Updated: Jul 25, 2023
Maximizing Profit and Success with Effective Pricing and Business Strategies for Community Consulting
Maximizing Profit and Success: Many consultants need help structuring their business to fit their needs and income goals. The Community Consultants Collective, a group of community professionals in different phases of consultancy, hosted a pricing mastermind to offer members a chance to have an open discussion about pricing, something that most consultants would never have shared in the past.
Most traditional consultants see others in their field as competitors and compete on price, value, or diversification of services, which leads to a race to the bottom and leaves everyone fighting for a "top few" clients that are able to pay the extremely high price that the few top consultants can charge.
The future of consultancy is based on collaboration and diversification of resources with the understanding that we all serve different clients and help different audiences. With so many specialty and niche communities becoming the norm, this is the beginning of what we envision.
New Consultants can benefit from figuring out their ideal client and defining a signature consulting offer.
Giving space to share how we work with clients provides a place to talk about our experiences and ensures that we build an ecosystem that will support our future. The opportunity to speak about how we are working with clients allows us to help each of us improve and earn more by knowing that what we do is valuable.
Most of the time, consultants struggle with two things - the first one is finding the right clients, and the second is setting boundaries, processes, and procedures in place.
Here are a few questions to help get you started to find the right clients:
Do you want to help a company, individual, or organization?
Do you want to guide strategy, help with a launch, or support an existing community?
What skills do you have right now, and how can they be used to help your clients?
Do you want to work with people in a specific place or one particular phase of life?
Who was your favorite boss or leader that you'd love to work with, and what are their qualities? What makes this person inspirational to you?
The next challenge, figuring out what to charge, is based on the services you'll offer. Some could call this your business "niche," defined by identifying your innate strengths, skills, and values and how that align with the market needs.
When you notice many of your peers are getting stuck with a specific challenge, and you've managed to help others overcome that same challenge, it's an opportunity to identify if that's a good service designed as a "signature," - meaning this is how people separate you from others in the field.
Here are a few questions to help you find and identify your "Signature Consulting Offer."
What are you best at, and can you identify a need in the marketplace?
How can your background experiences transfer to your consulting business?
What pain points do your clients have, and how can you help solve these problems?
Are you helping clients who are beginners, intermediates, or advanced in their understanding of this subject matter?
Will your role be a visionary giving guidance to leadership, or are you planning to roll up your sleeves and do some work for a client? Are you willing to do both?
Resources and Tips from fellow consultants
During our monthly meeting, members shared resources and tips about community consultants and what they've learned. Members asked questions and provided some thought-provoking conversations that will continue in the following days, weeks, and months.
Consultants can take examples from larger companies that have offered bundles on a subscription basis. They vary from including designer, developer, strategy, and full-time moderator. Create "points" or "strip" cards and let clients use the flexibility to decide how to use the service for upselling.
Consultants tend to be familiar with charging by the hour or having a "retainer" client, which means that a client would pay you monthly to have the ability to meet with a consultant regularly.
The challenge with having a consulting business set up with hourly rates is that it limits how to work as a consultant and how the client can leverage your skills.
If you are hourly and a client only needs you for 1-4 hours a month, that doesn't add up to much revenue to cover expenses. In addition, if the client is too busy to meet with you, they will not use your services, even if they need them.
Our consultants all shared that they all want to step away from hourly client billing and shift to packages, bundles, and offerings focused on outcomes and results instead of time put into a project.
Pricing Guides
Ece Kurtaraner shared a pricing guide resource that she found helpful for pricing services.
Deb shared a link to this blog, Consulting Success, outlining the differences between hourly, project-based, and value-based pricing and another set of examples.
One of the groups during the breakout sessions discussed how the online community industry continues to evolve, and consumers are looking for community design to support their community strategy.
Some different ways consultants have approached or worked with clients:
Offer a VIP day to serve clients who want fast solutions (and charge for this as you would any expedited service.)
A "Power Hour" consulting rate for strategic sessions with an impact on the leader or business owner with a plan of action as the outcome.
Give clients a chance to "Ask Me (you) Anything" (AMA) in a group setting for team meetings and those who want to have several people weigh in on the community design, development, or strategy.
Fractional roles are becoming more prevalent in this challenging economy. While companies may want to hire a community team or leader, they may need to learn who the right person is or do some work before hiring someone.
Entrepreneurs are starting to see value in forming partnerships with peers and finding ways to pitch offers together because when two people bring their skills together, they offer more to the client.
Consultants who productize services keep clients longer by serving them in different phases of the community-building journey. Consider offering support for the discovery, development, implementation, launch, post-launch, integration, adoption, and growth phases.
How much is too much to give for "free"?
Another hot topic is the challenges of getting and retaining clients. Several consultants mention that they meet clients through social media, networking, or referrals and then set up a free 30-discovery or introduction virtual call to understand the project scope of work and the client's needs. Sometimes consultants do several "free" calls to convert a client.
A few consultants said they receive emails, direct messages, and communications from potential clients but shared that it is difficult to find the line between when to bill a client and when to offer something for free.
It takes courage to draw a line between what is acceptable and what isn't for you and your time, energy, and resources. You can always say no to those who don't respect your time.
Most consultants in our group said they offer hourly and monthly rates and have offered clients a retainer option after finishing a project. The challenge is how much to charge and whether a consultant should track their time with clients when on a retainer.
If you are a consultant spending a ton of time answering client questions via email or taking many phone calls or meetings, this may be necessary.
However, this should be fine if you set your business up with structured programs.
There are tons of programs for tracking time. Here are a few:
The key takeaway for most of our group of community consultants is that it depends on the individual needs, personal experiences, and developing an understanding of what works best for each individual. The best part of being a consultant is that you get to design the business for yourself!
The next CCC meeting is on June 7th at 12 PM Eastern; you can register here.