How to Escape the Hourly Billing Trap
The hourly billing trap is a threat to all sorts of self-employed professionals, from consultants and freelancers to public speakers. Even if you haven’t heard the term before, there’s a good chance that you’ve been affected by it. So what exactly is it?
The hourly billing trap is basically a phenomenon that happens when you charge for your time and you yourself are the business. There are only a limited number of hours in the day and so there’s no easy way for you to scale. You need to keep working if you want to keep on bringing in an income.
The problem is that when things get super busy, you often have to stop your marketing and lead generation efforts so that you can focus exclusively on the work that you already have. That works okay for a while, but then you inevitably finish your projects and things dry up again.
When that happens, you’re suddenly left with no work to do, and all of the time in the world to do your marketing, but it’s too little too late. By the time you’ve ramped things up again and brought in some new business, you’ve lost out on a whole bunch of potential revenue.
And so now you know what the problem with the hourly billing trap is, let’s take a look at what you can do to avoid it:
1. Never stop marketing
This is the bedrock you need to build on. Never, ever stop your marketing campaigns, even when it seems like you’ve got more leads than you’ll ever need. Remember that one of the challenges of the hourly billing trap is that the work will dry up again if you stop marketing.
2. Set up marketing automation
This builds on the last point, and it’s one of the best things that you can do to make sure that your marketing campaigns keep on ticking over when things get busy. If you’re automating A/B tests and running automated email marketing campaigns, you’re doing a lot of the hard work already. Automate as much as you can so that when you do have some downtime, you can focus on the things that require your input and creativity.
We’ve talked a lot about marketing, and so you might be thinking that you need to focus on bringing in as many new customers as possible. Customer acquisition is all well and good, but you should also spend some time thinking about upselling to existing customers. The goal should be to find ways to get more value from your existing clients. As a speaker, for example, if you’ve run some workshops for a client’s marketing team, you could pitch some workshops for their sales team or for senior management.
You can also reduce the risk of falling into the trap of having all your eggs in the same basket by diversifying your offering and finding other ways to add value to your clients. For speakers, this can mean offering consultancy services or publishing books on top of taking public speaking gigs. The goal is to ensure that you have various steady streams of income coming in so that you can seamlessly switch your focus between them to boost each as required.
5. Use lead nurturing
The idea behind lead nurturing is to put processes in place for people who aren’t quite ready to buy. Instead of just giving up on them or forgetting about them, you can add them to a lead nurturing program that’s designed to usher them along the buying journey until they’re ready to work with you.
6. Anticipate the troughs
As the hourly billing trap is characterized by peaks and troughs, you can minimize the impact of the troughs by anticipating them and planning your work and life accordingly. For example, if you know that there’s usually a lull in speaking engagements in January, you can plan ahead for that by booking as many as you can towards the end of each year and then spending January on admin and other tasks, or a holiday. This doesn’t help you escape the hourly billing trap, but it will help you to mitigate its impact.
7. Run referral programs
Referral programs can be useful when you’re in those peaks, because even though you’re struggling to find time of your own for marketing, other people can deliver new leads for you. The downside to this is that even when you’re providing people with a financial incentive, they’re unlikely to rely on referrals as much as you do. You’re effectively putting the fate of your business into someone else’s hands. Still, it can be a useful source of supplementary customers, as long as it doesn’t become the main focus of your marketing.
8. Follow up with previous clients
This might seem obvious, but you’d be surprised by how many people forget to do this. Following up with previous clients allows you to pick up repeat business that might not otherwise have happened. You never know when they might be organizing another event or when your contact might have moved to a different company and found themselves in need of your training and consultancy services. If you know that they host an annual event, make a note to reach out to them with plenty of time to spare so that you’re the first person they think of when they’re working on a roster of speakers.
Now that you know what the hourly billing trap is and the steps you can take to get out of it, it’s over to you so that you can put these tips into practice. Remember that it’s all about ensuring that you have a steady stream of leads coming in and that you don’t slack off your marketing, even when it seems like you’re going to be super busy for the foreseeable future.
In the meantime, we’d love to hear from you, so be sure to let us know how you’ve avoided the hourly billing trap by leaving us a comment. We’d love to keep the discussion going. And of course, you can also follow us on your social networking site of choice for more. We’ll see you soon!
This was originally posted on SpeakerHub Skillcamp.