TL;DR: It’s better for you and it’s better for us.
Ten reasons why we made the switch.
- Both clients and agencies hate change orders. Fixed-fee pricing eliminates most of them because we agree up front to both the price and the scope.
- Hourly billing creates a misalignment between us (the agency) and you (the client). How? The agency wants to make more money by working more hours. The client wants the agency to do more work in fewer hours. Neither of those desires is focused on what should be the mutually agreed upon main objective: delivering economic value for the you (the client).
- Fixed-fee pricing creates alignment between us (the agency) and you (the client) and allows both of us to rally around a solution or a result, instead of arguing over the time it takes to do something creative. (Which is sometimes a lot, and sometimes a little. Creativity is messy.)
- Hourly billing places all of the importance on efforts instead of results. That’s backwards. Results are what matter.
- Hourly billing is a practice rooted in the Industrial Age. That was a million years ago!
- Selling outputs (solutions) or outcomes (results) is far more beneficial (and valuable) to a client than selling inputs (time).
- Fixed-fee pricing reduces risk for the client. (And increases risk for us, the agency, which creates a more balanced risk profile.)
- Fixed-fee pricing forces us to stay sharp.
- Fixed-fee pricing allows us to be as creative as possible without penalizing you by billing you more.
- Fixed-fee pricing allows us to focus on innovation.
In the end, it’s better for you, and it’s better for us. Which is a classic win/win scenario.