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3 Approaches to Pricing When Outsourcing Content Creation

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Negotiating pricing with freelancers doesn’t need to feel like a competition. With the right approach you can ensure you stay within budget while tapping into a limitless pool of talent.

Easy Budgeting with Output Based Pricing

You’ll encounter this pricing model often when looking for freelance writers.

Prices are determined based on the number of words in an article or another similar metric. Instead of worrying about tracking hours–and trusting your freelancer to track time honestly–you look at the word count, do a bit of multiplication and you’re done. 

The simplicity of this payment arrangement also makes it perfect for trying out new content creators to see if their skills and style meet what your business needs.

Place an order for a few small pieces of content and if you like the results, you can stick with the payment system, switch to one of the other methods listed below or continue your search for the perfect creator for your needs.

By basing cost on the product delivered instead of time, you also remove any possibility for your freelance talent padding their time on invoices.

Of course, that also opens the door for them to pad word counts or other metrics just to meet a certain pay level. Then there is the complication of revisions and future maintenance for content. How creators handle this will vary.

Most will offer a round of simple revisions but be sure to lay out any expectations upfront so there are no surprises come invoice time. 

If you’re planning a living content system with frequent updates or changes, you might find that an hourly or per-project system works better.

We’ll dig into those in a moment.

The Upside to Output Based Pricing:

  • With a good contract, you know exactly what to budget for each piece
  • You can test the fit of a writer or other content creator without committing to long-term work or large orders
  • Easy to monitor and measure productivity to avoid paying for work that isn’t done

The Downside to Output Based Pricing:

  • Revisions or future edits to work might increase costs
  • The model encourages writers to fill a page instead of cover a topic (though a good writer avoids fluff and filler)
  • Doesn’t apply well to work that isn’t easy to quantify

Project Based Pricing Offers Consistency for One-Time Gigs

Project based pricing combines many of the best elements of output based pricing and hourly rates.

This price structure is flexible enough for nearly any type of content yet also provides a reliable and consistent means of budgeting.

The key to project based pricing is planning and communication. As a project grows in size, the importance of planning grows as well.

Establishing milestones is a simple way to track progress within the project. Milestones also offer reassurance for the freelancer that they’ll receive payment.

Many freelancers will ask for a deposit upfront. Then all you need to do is divide the remaining balance by the number of milestones and you have an instant look at the costs of the project over time.

Of course, this is only as good as your contract and the planning skills of both you AND your freelancer. Start asking for frequent edits or changing plans and the road map for the project is pointless. If the freelancer you are considering cannot provide an estimate of the time needed to complete the project, this could be a red flag as well.

Reliance on planning is both the biggest strength and weakness of this pricing structure.

Again, if you’re planning on on-going project or require content management and maintenance, hourly rates might be the preferred option.

The Upside to Project Based Pricing:

  • Flexibility provides easy pricing for content of all formats
  • Milestones provide simple methods of tracking progress and establishing accountability
  • The ability to bundle tasks allows for simplified invoicing and cost estimation

The Downside to Project Based Pricing:

  • Cost projections are only as accurate as your contract or road map
  • Requires in-depth planning before content creation begins
  • Doesn’t work well for living content or on-going projects

Keep Talent on Tap with Hourly Pricing

Much like with project based payments, the biggest strength of hourly rates–flexibility–is also the biggest weakness.

Paying a freelancer by the hour is no different than hiring an in-house content creator. Just the fact that most times the freelancer will never report to the office or your place of business means they’ll never punch your time clock in person.

Fortunately, there are plenty of options out there to make time tracking simple.

My personal favorite is Toggl. It integrates with a ton of other web-based applications, it’s simple to use and creates time sheets with a click of the mouse.

Looking for a way to keep your freelance teams accountable for their time? HubStaff offers basic activity tracking and screenshot captures. Other options include Harvest, Paymo and TSheets.

When first starting out with hourly billing, be sure to account for a little flex in your budget.

While you can always cap the number of hours a freelancer is allowed to invoice, this could leave you without the content you need for your email marketing, content marketing or social media campaigns.

Occasional overages happen. As long as they’re infrequent, it isn’t necessarily a cause for concern. If it becomes a regular occurrence, you might need to talk with your team about what is causing issues and find ways to either adjust the workflow process or adjust rates to better suit your budget.

If you stay on top of progress and costs, hourly wages are an excellent way to keep your content teams happy, provide infinite flexibility and maintain on-going projects.

Want to enjoy the flexibility of hourly rates but not sure you enough needs to keep your favorite freelancers busy? Retainer contracts are a great way to keep your business a priority during slow periods.

The Upside to Hourly Rates:

  • The ability to assign multiple hourly rates based on the job performed provides limitless flexibility
  • Maintaining existing projects or implementing on-going projects is simple
  • Web-based time tracking keeps everyone accountable and payroll quick and easy

The Downside to Hourly Rates:

  • Without focus, costs can spiral out of control
  • Payroll and invoicing requires more upkeep
  • Fluctuating price based on hours worked

So there you have it! Three different ways to approach pricing when hiring new freelance talent.

Picking an option might seem intimidating at first, but it is this flexibility that makes outsourcing content creation and other creative efforts so beneficial for businesses. Just be sure once you’ve found a team that meets your needs that you come back and analyze your pricing.

Treat freelancers with respect, offer competitive pay and get them involved with your business and you’ll have a loyal brand ambassador to help you reach any goal you might have.

How do you approach pricing when it comes to contract work? Do you have a favorite from this list? Perhaps I missed an option you love? Let me know in the comments below! I love hearing from everyone out there who finds my posts useful.

If you’re looking for content like this for your business website, blog or other online platform, don’t hesitate to get in touch!

Jon Stone

Jon Stone

Content Marketer/Web Content Creator

When Jon isn't busy coming up with content ideas or building new projects, he's usually busy drinking way too much coffee and enjoying time with his kids. He's also a fan of writing about himself in the third-person. Jon Stone thinks that's fun. Other things Jon Stone thinks are fun include MMOs, cooking and reading fantasy novels.

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