Best way to charge your client on a performance basis
The burning question… “How to charge on a performance basis?”
Speaking to my students each day really does open my eyes to the struggles we all face in lead generation at one time or another, and I love sharing how we can solve these problems!
Because there is always a solution!
I was chatting to one of my students this week who wanted advice on how he could charge his client based on a performance basis.
To give you some context, here was the situation.
The client was spending $40k a month and was making a hefty $150k from that ad spend.
My student had been paid upfront for the set up which is great! But he wasn’t sure how to get paid his worth if he increased performance.
Here’s where you’d normally charge a certain amount per sale etc………..
BUT What if their CRM goes down?
What if their sales team isn’t performing for a week?
You get paid significantly less…
Don’t get me wrong this can be a really good money earner, but what if you charged further down the funnel?
Hear me out…
Say you are spending $40k ad spend and generating 200 leads a week. These 200 leads are leading to a $150k turnover for the client.
Well, what if for the same ad spend you are able to optimise the account to generate 300 leads per week? It stands to reason they will be making significantly more money.
You should get a slice of that pie. You should charge on a PERFORMANCE basis.
You should be negotiating to get 50% of that extra revenue.
For example, if they turn over $50k more at the same ad budget, you should be getting $25k. And they will bite your hand off because that’s still $25k more than they would usually be getting!
I go into detail on how this “charging on a performance basis” tactic would work in the video above.
I hope you enjoyed this blog post!
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