How much should you charge a customer for a marketing funnel? In this blog post we’re going to definitively plan out what you need to charge your customers for a marketing funnel. By the end of this post, you’ll understand:
- The pricing myth that strangles your business and makes it harder for clients to work with you
- How much as a minimum you need to make per funnel and per year with your business
- The economic reason you must charge as high a price as possible (and that you deserve to make more money)
What should I charge my clients for a marketing funnel?
It’s an incredibly important question and if you’ve had a look around, you’ll see a LOT of terrible advice from people who have never run a marketing funnel business before.
They’ll give bullshit “average” costs per hour for consultants and agencies or write a well optimised blog post that ranks well, but basically finishes with “it depends”.
Pricing isn’t difficult. Like most things, it’s a fairly simple task but it’s usually ourselves who get in the way. The two things that will prevent you from knowing what you should charge customers for a marketing funnel are:
- Lack of clarity
The hard part with pricing is not deciding the price. It’s justifying the price.
When most funnel builders ask “what should I charge a customer for a marketing funnel?” What they’re really asking is “how much money can I reasonably ask the customer, before they’ll get offended?”
Our fear of pricing too high is tied to our fear of rejection and causing people to dislike you. You’d rather be liked than rich and I say, they’re not mutually exclusive.
You realise you’re not making as much as you should
If you’re reading this, you’re probably here because you’ve made the realisation that you’re not making as much as you can, should or want.
If your funnel business is anything like mine was, I used to sometimes be flush with cash and other times, struggle to make rent at the end of the month.
I had a few customers, but whatever I was doing, it was costing me as much to deliver the work as I was making. In short, I wasn’t making as much as I should have. Basically. I didn’t know what to charge a customer for a marketing funnel.
You have no idea what to say when customers ask “how much do you charge for a marketing funnel?”
It’s also terrifying when prospects and leads talk to you and ask the question “how much?”
If you don’t have a clear idea in mind, of what you’re going to charge for your funnels, customers and other businesses are going to control your pricing for you. When really, the only person the price should matter to, is you.
The problem of course is that even when I explain to you what you should charge and how much you should charge customers for a funnel, there will be fear or lack of clarity in your way.
It’s one thing for me to say “charge $25,000” and another for you to say “yep – let’s do it”.
The goal of this blog post is not only to help you decide what you want to charge, but also comfortably justifying that price to yourself and your customers.
You don’t know when to price your funnels (and it’s killing you)
That’s right. The biggest problem with deciding what you’re going to charge, isn’t WHAT you’ll decide the price will be, but WHEN you’ll decide the price.
No one decides what they’re cooking after they’ve bought the ingredients, put something in the oven and then started serving it. You know exactly what you’re going to cook before you’ve even got to the shop.
However, most people will decide the price at the wrong time. Usually too late.
Pricing during the proposal stage
It sounds obvious, even normal and sensible to decide your price during the stage when you’re writing the proposal. Doesn’t it?
Have a call and meeting with the customer. Ask them a load of questions. Understand what their needs are. Write a list of specifications. Guess what the price will be for that wishlist. Add some bullshit either side of the spec/price sheet in the proposal. Send.
Deciding the price during the proposal seems like the right thing to do. But it’s not and it’s choking your sales and revenue.
Assuming you know the customer budget, you’re asking for a list of wants and problems on their part and they want to know what it costs. At least, that’s what most people believe. Most people believe the proposal is designed to tell people what it costs to do business with you.
It’s not. The proposal is a way for the customer to see if you understand them well enough. Have you truly understood their goals and wants and desires? Are you committed enough to the project?
Customer’s don’t buy on price. I absolutely 100% agree that in order to give the best possible proposal to the customer, you should ask a ton of questions and even run paid workshops. However, the questions aren’t to find out a list of features and specifications for you to put in the proposal. It’s for you to write out the best possible and most desirable future.
We’ll come to that later.
Pricing per hour will completely kill your business
Some more GOD-AWFUL advice I’ve seen from blog posts and on webinars about how much to charge a customer for a marketing funnel, is to price per hour.
Pricing per hour is terrible for your business for many reasons.
- It forces customers to commodotise you and wonder if they can get the work done in 40 hours instead of 60
- You’re terrible at guessing and your time estimate WILL be off
- Amateurs price per hour because they don’t really know what they’re offering to the market
Let’s say you want to lose weight. You’re not happy with where you are and you want to get in better shape. Maybe you want to have more energy when playing with your kids (or your spouse 😏) or maybe you want to get back to where you where 10 years ago.
If I have an amazing imaginary machine that only takes one hour to transform you. Literally, step into the machine, and 1 hour later step out a fitter, healthier you. As if you had just spent 2 years working out in the gym 2 hours a day. What would people pay for that?
$1000? $10,000? More? But it only takes an hour? “Yes but Mike the reason this would be worth so much more, is because this is so much more convenient and fast!” And you’re absolutely right.
Therefor, you’re not paying for the hour. You’re paying for the future expectation and the speed/ease of the result. If you believe customer’s are paying for your time, call them up and ask them to go to the movies. Send them an invoice after watching Avengers: Endgame and see how stoked they are about buying your time.
People don’t buy time, they buy futures.
And just in case you still don’t believe me, here’s a list of people who say you should stop charging per hour.
If you think it’s difficult to sell a funnel now…
There are more options for building marketing funnels now than ever before. Software that would have cost tens of thousands of dollars, or have to be custom built, are now a few dollars a month.
When you’re deciding what to charge customers for a funnel, you’re competing against extremely low prices for DIY options.
Barrier’s to entry are lowering
Why would someone pay you $25,000 to build a marketing funnel for them, when they could do it themselves for $100 a month? Or get someone from India or the Philippines to do it for way less?
Unless you have a clear price AND a killer reason to justify that price, you might as well just get a job doing it for another agency.
People pay high prices when the future you describe to them is more clear, and more desirable than anything else on the market. It’s usually tied to their self identity and inner problems they’re looking to fix.
A DIY option helps me build a funnel. But what you need to sell is a future where I can tell every kid in school who bullied me, that I’m now super rich. One of those is worth 5 or 6 figures.
That’s too expensive
Something I’ve always found fascinating is the fear of loss, or the feeling of scarcity among our own industry. Too an extent, I can understand a customer’s reaction or someone outside of the industry, thinking that $25,000 is a lot of money for a marketing funnel.
I cannot however understand, when people in our own industry will baulk at high prices. What’s even weirder, is that they get angry when you explain you charge a lot.
I’ve been booed at speaking events when I’ve talked about how we should all raise our prices. Granted, it was a few years ago and the attitude is certainly changing. But it’s still pretty bad. It reminds me of the monkeys in a cage experiment.
Your network and current customers say they won’t pay that much
The fear kicks in when other people tell you that they wouldn’t pay that much. Current customers, family, friends, colleagues, even other marketers.
“Do they know something I don’t? If my prices are too high, then no one will work with me. If I then have to lower my prices I’ll be embarrassed and everyone will say ‘I told you so’. I can’t raise my prices.”
That’s the general thought pattern when it comes to high prices.
Money is a myth
However, money, is a myth. Cash, money, currency, whatever you want to call it, is a myth. It is literally a faith based agreement that two people have. £10 is worth £10 because a bank promises you it’s worth that and more than one other person believes it.
Bear with me here. I’m not going zeitgeist conspiracy on you. Ever since 1971 when Shift Nixy moved America off the gold standard, money became faith based. Literally, it’s valueless unless two or more people agree that it has value. It’s value goes up, down, stagnates and plateaus.
Therefor, your belief that $25,000 or $250,000 is a lot of money, is belief in a myth. It’s utter imagination. It literally does not exist outside of imagination. I know this was probably way deeper than you were expecting in a blog post about how much to charge a customers for a marketing funnel. But it’s important.
Environment dictates performance
Your mindset is all you have. What you believe and think is what you will experience. If you believe and think that X is a lot of money, it’s a lot of money. And in truth, $25,000 is a lot of money – for some things and some people.
If you’re constantly around people who tell you that it’s too much for a marketing funnel, or too much to charge a customer for a marketing funnel, you will begin to believe that too.
If you decide that you think $25,000 is a small sum to pay for a marketing funnel, and tell yourself that over and over, eventually you will attract customers who also believe that. If you want to surround yourself with people who already believe that, you could always join our Facebook community here.
How much to charge a client for a marketing funnel
Let’s get into the nuts and bolts of this. How do we decide what you should charge a customer for a marketing funnel?
- How much do you need to make?
- How many clients do you want to work with?
- You won’t many money with just one product
- What will you deliver for that price?
- What’s the best possible future?
How much do you need to make?
This is the most important question for any business when looking at their pricing structure. It might sound so open and vague, that you could respond with any answer. But it’s critical to the success of your business.
Before we can ask ourselves “what should I charge a customer for a marketing funnel” you must understand what you need to bring in. Diet plans have calorie intakes. Runners have distance goals. Business owners need revenue goals.
You might think that the question is so vague, you can’t answer it. So let’s look at some practical ways to understand what your total revenue needs to be.
Option 1: Double last years revenue
A great first goal, is to take this years revenue or last years, and double it. 100% growth on whatever you made last year.
100% growth in revenue, or doubling in size is no mean feat. It’s irrelevant what the starting or finishing number is. Doubling anything is hard work but possible.
Technically, growth of 20% puts you in the top 10% of businesses. Doesn’t matter the total revenue. Just adding 1/5th revenue puts you in the scale-up category. Doubling, is KILLING it.
Going from £50,000 to £100,000 is incredible growth. Going from $1m to $2m is incredible. And it’s more possible than you might think.
If you’ve decided that you want to double the size of your revenue per year, that’s the goal and that’s what you need to aim for.
£300,000/$350,000 per year
Most businesses need to generate at least £300,000 in revenue in order to be profitable, fun and effective in the market. Ideally, done with a team of between 4-8 people including you.
Will you get to £300k within a year? You could do. Although if you’ve only done £100,000 in year one, tripling in size would be hard work. Not impossible by any stretch, but it’s not going to be easy.
It might be that this goal takes 2 or 3 years to realise and achieve. If you doubled the revenue of your business every year, starting at $50,000 in year one, it would take 4 years.
Year 1: $50,000
Year 2: $100,000
Year 3: $200,000
Year 4: $400,000
That’s assuming that you can double ever year for four years straight. Again, not impossible but it requires a LOT of discipline and focus.
I believe this revenue goal is the absolute minimum that you need to aim for. I have a lot of funnel builders tell me that they don’t want a lavish lifestyle. They don’t need or want a lot of money, just enough to be comfortable and free from want.
I’ve got news for you, a business making $350,000 is not a life-changing sum of money. $100,000 per year salary is not life-changing. As sick or mad as that sounds, while you would be in the top 5% – 10% in the west (on average. Here are a couple of different articles) you aren’t living the high life.
As a rule, your business needs to earn over $350,000. It might not happen in 1 year, but it CAN happen.
$2 million per year
Fuck it. Let’s go mad. If you want to run a profitable, successful marketing funnel business without hundreds of staff, you can probably turn over around $2 million per year with 4-8 staff.
$2 million might sound like a massive number, but it’s not as high as you think. It’s around $5500 a day in revenue or $167,000 a month. Or, let’s break that down as customers.
2000 people paying $1000 a year. Or 1000 people paying $2000 a year. That’s less than $170 per month for 2000 people. If you include initial $25,000 sales and other products, $2 million isn’t a million miles away.
Hell, 1000 members paying $97 a month will do $1 million a year in sales. That’s not insane.
Year 1: $100,000
Year 2: $200,000
Year 3: $400,000
Year 3: $800,000
Year 4: $1.6 million
Year 5: $3.2 million
$2 million is a big shift in strategy and growth. But the good news is that you aren’t going to get there immediately. So you have time to plan.
Survive, Comfortable, Secure, Affluent
Lastly, what about your finances? Above I talked about how you probably need to earn $100,000 a year in personal income. After taxes that’s probably between $65,000 and $75,000. Two kids, mortgage, partner – that doesn’t go too far. But, it’s more than a lot of people have and it is a good way to live.
So what do you need to survive? What are your outgoings each month/year? What is the bare minimum that you require, each month, just to survive? This is your survival level income. Write it out below. It should be lower than your comfort level income.
How much do you require to live comfortably? This is your standard level income, plus additional items that you would like to see regularly. Think savings, holidays, houses etc. It will be roughly 50% – 100% more than your standard income level.
How much do you require to be financially secure? This is a level where your expenses are taken care of and you’re able to save regularly. This will be roughly 150% of your comfort level income.
How much do you require to be financially free? This is where your bills, expenses and additional security finances are taken care of each month.
You no longer have to work every day and can do what you want, when you want, how you want and with who you want. This is usually 300% of your financially secure number.
If you know these numbers, it’s easier to understand what you need to make.
So at the end of all that, what’s your financial goal? How much do you need to make?
How many clients do you want to work with?
Next big question. How many customers do you want to work with? Really, this is a more important question than how much do you want to make. Revenue can grow and we always want to grow. But our capacity determines the maximum number of clients we can work with.
The framing question you want to ask yourself, is “if I came to you with 100 prospects, qualified and ready to buy, with their credit cards out. How would you feel?” Most of the time, funnel businesses would be terrified.
That’s too many customers right? Well, eventually I’ll get you to have lots of products that can be delivered and bought off the shelf without you running out of capacity.
If we’re being specific, how many high value, top level customers do you want to work with per year?
If you’re building funnels, would you rather work with 10 funnel clients a year? 4? How many people do you want to work with per year? You could just consult and get on a call with 10 customers a month, once a month, for $10,000 a year. That’s a legitimate option. That would yield a $100,000 revenue.
Or you could build 4 funnels a year. Or 10 funnels a year. Or 1 a month. How many customers do you want to work with? Look at the revenue you want to make per year and divide it by the number of clients you want to work with. THAT is your marketing funnel price.
$350,000 per year / 10 clients = $35,000 per marketing funnel
You won’t make money with just one product
Speaking of “how many customers”. I’ve already alluded to a product eco-system and how $2m a year or even $350,000 in revenue probably won’t be made exclusively of one product. Nor should it be.
Using the example above, let’s look at how we could split that revenue up into different products.
$350,000 per year / 10 clients = $35,000 per marketing funnelMe, 5 minutes ago.
$35,000 per customers, per year is what we’re aiming for. But want a range of products and services to give to customers. Products don’t make money, product eco-systems make money.
Splinter products, high ticket items, consumables, subscriptions, memberships, one-shots. There are lots of different product types to sell to your customers. If I was forced to build out a set for you, it’d probably look like this.
- Blog posts
- YouTube videos
- $9 ebook
- “free” plus shipping printed book ($5)
- $19 – $47 template or training
- $197 training product
- $997 software, training
- $2500 audit or consult
- $25,000 marketing funnel
- $50,000 marketing funnel
- $97 per month care plan
- $297 per month membership/subscription
- $1000 per month consultation
Are you going to create all this overnight? Or even in a yea? Absolutely not. My advice would be to stick with a core offer and a recurring revenue product. Small splinter training products are easy to create but come naturally with time, if you are aware of them in your roadmap.
What will you deliver for that price?
We’ve got our price, and now we need to decide what we’re going to put in the marketing funnel. I’ve got another post here that talks about deciding what to put in your marketing funnel.
But, we DO have a price now. The next stage is justifying the price.
“I don’t have the experience to sell something for that much”
If you’re looking at a $35,000 price tag, or more, and thinking “there’s no way I could sell something for that much. I don’t have the experience!” I want you to think about these 3 products.
- Expensive car
Cars easily get bought and sold for $40K+, a house is anywhere from $100,000+ (ours cost £207,000). A wedding can EASILY go over $40K.
And chances are you’ll only ever buy or sell a few of these in your entire lifetime. The cost of the transaction is unrelated to your experience with the product. It’s worth what it’s worth. It doesn’t matter if you’ve done it before or lots of times, the price is the price.
If you get clear on what you are delivering to the customer, £25,000 or $35,000 is a small price to pay. The work involved to try and sell a marketing funnel for five figures is the same even if you sell a four figure funnel.
There are people who will think it’s too expensive. Our wedding was £8000 in total, which is £17,000 LESS than the UK average of £25,000. Some people might think £8000 is a lot (it is). Some people think £25,000 is cheap. It’s relative. Your job is to find people with the right budget, who see the value in what you do.
Marketing funnel businesses that are serious about growing their business, must look at the sales strategies they’re using to attract and close client.
I’ve got a free sales strategy guide below, with 7 sales strategies to sell marketing funnels.