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This article was submitted by John Stevens and does not constitute the views or opinions of Upwork.


I’d like to tell you a tale of two freelancers. Both Bob and Sarah are writers with roughly equal years of experience, and neither one has a problem getting clients. Sarah, however, routinely earns five times the amount Bob earns for roughly the same service. No matter how much Bob tries, he can’t seem to persuade clients that his experience is worth more.

Sarah markets herself as a “content specialist and a thought leader in the real estate industry” and regularly highlights awards and media mentions she has received. Bob markets himself as a “freelance writer.”

Bob is earning less not because he is unqualified. He is earning less because he does not understand the importance of how clients perceive him, and as a result, he does nothing to improve his perceived value. Sarah, on the other hand, has mastered how to position herself in a way that she is valued and taken very seriously.

You shouldn’t be Bob. You should be Sarah!

To command better rates, every freelancer should understand the difference between actual value and perceived value.

Actual value refers to the objective value clients receive when they use your services. Perceived value refers to the value clients feel they will receive when they use your services—it is their subjective opinion of how much you are worth.

These are entirely different things. Your perceived value could be higher than your actual value (in which case you earn more than you’re worth), lower than your actual value (in which case you earn less than you’re worth—many freelancers fall into this camp), or equal to your actual value.

Your perceived value, however, is what will determine how much clients are willing to pay you.

To sustain long-term client relationships, it is best if your perceived value is equal to your actual value. It is worst, however, if your perceived value is lower than your actual value, as that will doom you to earn less than you deserve.

For example, while many freelancers complain about clients being unwilling to pay them what they want, this freelancer earned $10,000 in one month. And this freelancer earned six figures in one year. Oh, and this freelancer has earned more than $1 million on the Upwork site since launching his freelance business, charging $75 per hour.

There’s certainly no shortage of available work and eager clients, if that’s what is preventing you from trying to command higher rates. To capture a greater share of the marketplace, however, you want to increase your perceived value. Here are five ways to do just that:

1. Leverage social proof to increase your perceived value

Talking about your successes might be difficult, but it can serve as a competitive advantage for you as a freelancer.

You can leverage social proof by highlighting successes you’ve achieved for clients (this could be in the form of ROI or other metrics that potential clients find important), major clients you’ve worked for, media attention you’ve received, or major publications you’ve written for.

You can also increase your perceived value by showcasing customer testimonials or reviews of your services. Research shows that reviews from other customers are trusted 12 times more than anything you can write about your offering.

When you showcase external validation of your ability in the form of social proof, potential clients will take you more seriously and value you more.

The freelancer mentioned earlier who has earned more than $1 million with Upwork does this well on his profile:

Upwork profile: Ron Z., Premium WordPress Development

As you can see in the above screenshot, Ron highlights his work for Fortune 500 companies such as Verizon, Google, and Cisco. With such strong social proof, it’s not very difficult to command premium rates.

2. Create a professional freelancer website

Another action you can take to give yourself a leg up, increase your perceived value, and command better rates is to create a professional website for your freelancing business.

Having a professional website communicates that you are not freelancing merely as a hobby but that you take your work as a freelancer seriously and are willing to invest in looking professional.

That said, the emphasis is on creating a “professional” website. Creating a website on a free platform such as Blogger or WordPress.com, where your website is an extension of the platform (e.g. yourfreelancewebsite.wordpress.com), doesn’t count. You want to have a website that uses your own domain name (e.g. yourfreelancewebsite.com). You don’t have to shell out thousands of dollars for a custom-designed website; you can use a website builder without breaking the bank.

That said, once your website is set up, doing the following will make you appear even more professional:

  • Set up a professional email. Clients will take you more seriously if you’re communicating with them from a branded email address (e.g. yourname@yourdomain.com) instead of from a free email such as Gmail or Hotmail.
  • Start a blog. Give yourself an edge by starting a blog as an extension of your website. Not only will the blog serve as a source of exposure for your freelancing business when your content gets shared or ranks in search engines, but it can also position you as an industry thought leader, further increasing your perceived value.

3. Reduce the risk associated with using your service

According to a study by researchers at Ohio State University and the University of Oklahoma, the perceived risk associated with using a service can influence its perceived value: When potential clients perceive the risk of using your services to be high, they are likely to value them less. When potential clients consider your services to be less risky, however, they are willing to pay more for them.

You can, therefore, increase your perceived value by reducing the risk associated with using your service. Some ways to do this include:

  • Make yourself accessible. Encourage potential clients to contact you, and make it easy for them to do so. Ensure your contact information is visible at all times.
  • Set out a clear policy regarding what happens if clients are not satisfied with your services. How do you make it up to them?
  • Highlight relevant information that increases your credibility—go back to point #1 on social proof.

4. Use scarcity to enhance your value

Researchers at the University of Missouri confirmed that when an item appears to be scarce, people tend to perceive it as more valuable. Ways to use scarcity to include your perceived value include:

  • Limit your service offerings to a select group of people. You can decide to work only with clients in a particular niche (for example, clients in the renewable energy niche), clients who share certain values (for example, clients who value saving the environment as much as they value profitability), or clients of a certain size (for example, clients who have a budget of $5,000 or more). Make sure that potential clients are aware of this fact before they contact you.
  • Make people wait. If you are regularly booked, keep a wait list of people interested in working with you. Those who have to wait are likely to take you more seriously when the opportunity arises to use your services.
  • Continually raise your prices as demand for your service increases.

5. Charge more

Countless studies have found a link between the cost of a product or service and its perceived value. More often than not, when you demand really high rates for your service, people tend to believe you’re worth more than average. This fact was validated by a study in which research subjects were asked to taste a $5 wine and a $45 wine, then asked which of the wines they found most satisfactory. The subjects reported finding the $45 wine more satisfactory, not knowing that both the $45 wine and the $5 wine were the same.

Luxury brands such as Apple do not just command better rates because of how much effort goes into their products; they demand better rates—repeatedly. If you want clients to take you seriously and start paying you more, you have to start demanding more.


This article was submitted by John Stevens and does not constitute the views or opinions of Upwork. Find out how you can publish your content on Upwork.

The post 5 Ways to Increase Your Perceived Value and Command Higher Rates appeared first on Upwork Blog.

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