So, you’ve decided to hire an expert marketing consultant to take your business’s advertising protocols to a new level. This is a smart move – but how much should you be paying for these services?
Let’s discuss how much a marketing consultant should actually cost.
There are a number of different ways that consultants can choose to charge clients for their services. The most common methods include:
- Flat fees and lump sums
- Daily or hourly rates
- Results-based rates
Many consultants price their work on a day rate that’s agreed upon on a case by case basis. Fees can depend on the scale of the requirements that a business presents and a consultant should always be transparent and up-front about what clients can expect.
Consultants should never spring hidden fees or extra add-ons on their clients at the last minute. A more professional and simple method would be presenting a clear Scope of Work and agreed fees before a project takes place.
While in the discovery phase, clients and consultants should talk in-depth about any technologies, tools or professionals they might need to bring on board. This decision ultimately lies in the hands of the client and is hinged on the budget they have available.
- Flat Fees and Lump Sums
If your consultant has chosen this cost structure, you should only need to pay them once upfront for a project or task. The benefit to this structure is that you won’t need to fork over any more cash for hidden costs later down the line.
On the other hand, this could also mean that the project’s flexibility may be limited. It will be challenging to make additional changes during the process, and if this is necessary, a negotiation will need to ensue.
- Daily and Hourly Rates
This is a highly popular payment structure among marketing consultants. It’s convenient both to the consultant and the client, and it makes tracing bills much simpler. You can simply add up the number of hours or days that a project has taken up.
Any extra services will usually be highlighted in the consultant’s contract, making the process transparent and easy to understand. In this case, it is crucial to find a consultant that works quickly and efficiently so that the bill is not artificially inflated by slow progress.
- Results-Based Rates
Results-based payment structures are also gaining rapport among consultants as they offer a very fair deal to clients. These fees can be completely or partially based on results.
As an example, a completely results-based fee would entail a consultant only being paid with a fixed percentage of your company’s sales growth. A partial fee would entail a portion of the fee being fixed, and the rest based on whether or not a certain pre-set goal has been achieved.
Calculating Consultants’ Fees
Working out the calculations for consulting fees can seem tricky, but there’s a way to simplify it. Regardless of your consultant’s payment structure, convert it into an hourly rate.
For example: if your marketing consulting plans to charge a certain flat rate for a project that will take an estimated 2 months, you would calculate the hourly rate as follows.
[Flat rate] / (number of months * 4 weeks * 5 days * 8 hours) = your professional’s hourly rate
Additionally, if you are hiring a consultant who is part of an agency, there may be an overhead fee attached. This fee can be anywhere from 30% to 60%, so this needs to be borne in mind when calculating the final costs of hiring the professional.
Is My Consultant Charging Too Much?
Generally speaking, a consultant’s benchmark fee will be based on their level of experience in their field. Pre-MBA consultants will charge significantly less than partner-level consultants on average.
The rough standard fee of a consultant ranges from £75 to £250 per hour on average, but there are numerous other factors that can affect this number.
Such factors include:
- The duration and size of your project
- The reputation of the agency you’re enlisting
- The level of competition in your business’s industry, and the specific topic that your consultant will be handling
- The strategic value of your project or business to your consultant
- The business cycles
- Your budget and location
- Fee negotiations
…and a variety of other factors as well.
The benchmark fees that you should compare your consultant’s fees to are those listed by reputable agencies. Independent consultants may be significantly more affordable, as well as being more flexible with their time.
Obtaining Value from Your Consultant
Your goal should not be to nab the best bargain or the cheapest option you can find. Instead, it would serve you better to obtain the most value possible from your marketing consultant.
Firstly, try their services out before hiring them if it is possible to do so. Many agencies and consultants offer their clients free trials during which you can get a feel for their services and overall efficiency.
Keep your eye out for results-based deals. These tend to offer the most fairness to clients, meaning that you will pay significantly less if a project is not successful.
Maintain clear goals so that your consultant knows how best to keep your process efficient. This is especially important when hiring a consultant with an hourly-based rate, as not having set goals can extend your project’s timeline and end up costing you more than you bargained for.
Assess their expertise. Different consultants have different areas of expertise and different marketing experiences. Your goal should be to choose a professional with knowledge that matches your unique project.
Remember: a broader skill set doesn’t necessarily indicate a better value consultant. Focused skill sets can be just as valuable, depending on the project at hand.