Most businesses don’t have the resources and expertise to manage social media. And they prefer outsourcing it as it isn’t a strategic task. As an agency, it is challenging to create a pricing model that will suit all of your clients. How much to charge for social media management is the most common question that both agencies and individual freelancers ask.
The fact is: Social media marketing is growing at an alarming rate.
The total social media advertising spend in the US is expected to reach $49 billion towards the end of 2021. The average daily social media budget is between $200 to $350 per day. This shows businesses are spending on social media to market their business. As a social media marketing agency, you need to have the right pricing model to charge your clients appropriately.
How Much to Charge for Social Media Management
Before you decide what to charge your clients for social media management, you need to decide on the pricing model. There are different pricing models that you can use to charge for social media management including:
- Monthly retainer
- Fixed price
- Mixed pricing.
Let’s discuss each model and see how much to charge for social media management under each pricing model:
This is the simplest pricing model. It is ideal for new agencies and freelancers who don’t know yet how much time they’ll spend on a project. In such a case, it is best to charge an hourly rate to your clients for social media management.
Here is how it works:
- You and the client agree on a fixed hourly rate and the number of hours allowed per week
- The scope of the project is discussed
- Either you or your client describes how hours need to be utilized
- You can use a tool like Time Doctor to bill hours that keeps a full record of screen activity including clicks, keystrokes, and screenshots.
The hourly rate works best in the following cases:
- You are new and don’t know how things will work out
- The social media management project requires a lot of research or problem solving that might need more time than you usually require to manage social media accounts
- Your client has variable requirements that change too often even in the middle of the project.
How much to charge per hour for social media management?
Well, the average hourly rate according to Upwork is between $14 and $35 per hour:
The hourly rate is based on experience. Beginners usually charge low while experienced agencies charge more per hour. Here is a breakdown of the hourly rate based on experience:
- Beginners (less than 2 years of experience) charge $15 to $35 per hour
- Intermediate or mid-career (2-7 years of experience) charge $35 to $100 per hour
- Expert (7+ years of experience) charge $100+ per hour.
2. Monthly Retainer
The monthly retainer is an advanced (or somewhat complex) agency pricing model where you negotiate a fee that is payable every month. You have to offer a certain deliverable (as agreed) every month.
For example, you can manage 5 social media accounts and publish one new post on each account every day of the week. It is your responsibility to create, design, and schedule posts. In this case, your client will pay you a monthly fee for posting 150 posts every month on 5 different accounts.
Here is an example of a monthly retainer:
This is the most popular pricing model used by 59% of agencies:
Because it ensures recurring income for your agency and the client pays in advance.
It is, however, not easy to determine a monthly retainer fee for your client unless you have ample experience in the field. New agencies might end up quoting too low or too high retainer prices to clients due to lack of experience.
Here is how you need to determine monthly retainer cost for social media management services:
In simple words, you have to add the total cost and divide it by the total number of months to drive the monthly retainer fee to charge.
3. Fixed Price
It is a project-based pricing model that’s much easier than a monthly retainer to calculate and execute. You’ll charge a fixed price for social media management services. It is best to earn a fixed profit per project.
Here is how it works:
- Determine the total cost of the project
- Add your profit and quote the price to your client.
Here is an example:
The cost of the project is determined by the hourly rate you’ll charge and the number of hours you expect to bill. This requires identifying an hourly rate for your agency based on your experience.
Fixed pricing is more flexible and easier to manage than any other agency pricing model.
- It is flexible and scalable
- You earn a fixed profit per project based on your estimation
- You can offer add-ons for an additional price.
4. Mixed Pricing
You’ll soon realize that one size doesn’t fit all. Clients have different requirements when it comes to social media management. Even a single client might require multiple services and will be willing to pay in different ways.
This is why you need to have a mixed pricing model where you offer hourly, retainer, and fixed price projects together.
Here is an example:
You might have to offer a fixed initial cost (setup cost) and then a monthly retainer. And you can use hourly billing to offer add-ons and additional services such as social media post designing.
How much to charge for social media management in this model?
You’ll have to refer to your hourly rate to create fixed price and monthly retainers that you can couple together after adding your profit.
What’s the Right Price for Social Media Management?
There is no right or wrong way to charge for social media management. It all comes down to testing and tweaking.
However, you need to identify your agency’s hourly rate upfront. As it determines fixed price projects and monthly retainers. If you don’t know how much time you need to complete a task and how much your time is worth, you can’t create fixed price projects and monthly retainers either.
And if you are new to social media management, make sure your hourly rate is well under $30 per hour. If you find it hard to get clients, consider lowering your hourly rate and see how it goes for you.
Featured Image: Pexels