This Week In Business

You Make How Much Per Hour?!

timevsmoneyIt’s everyone’s dream to get paid more to do less, or nothing at all (which is why everyone was clambering for Powerball tickets recently). You’ve probably heard the statistics of corporate CEOs and how their salaries translate to an hourly rate. If I just had their job for ONE hour, I could rule the world…or at least pay off my student loans.

Part of you thinks it’s obscene for one person to have all that money, but another part of you wonders how you can reach this higher plane of financial glory.

Just for fun, let’s take a look at the astronomical figures some people are pulling in each year. One of Chipotle’s CEOs, Montgomery Moran, makes about $13,500 an hour. Don’t get me wrong, I love a good burrito, but that number seems pretty steep for convenience food. Moran’s hourly wage is utterly eclipsed by Larry Ellison’s (CEO of data sharing service Oracle) $267,779. To put this in a bit of perspective, Ellison is making more per hour than the average American brings home in a year (roughly 5 times more, in fact). He’s making more per hour than the cost of 4 years of college tuition.

Moving away from CEOs, what do some of our favorite celebrities bring home? In spite of griping about Spotify ripping her off, Taylor Swift had an excellent year. It’s estimated that she makes about $40,000 per hour, putting her slightly behind Katy Perry who makes $67,500 per hour. (Interesting fact: both ladies are ahead of Beyonce now.) The highest paying celebrity in 2015 according to Forbes is Floyd Mayweather, mainly because of the boxing match this past spring.

Each of these high-rollers offer us entertainment or run companies that contribute to our quality of life as we know it. But what are CEOs or celebrities doing that contributes thousands upon thousands of dollars an hour? Checking email? Traveling? Writing songs? Singing? When you consider many of these tasks are actually handled by someone else, maybe some CEOs and celebrities just get paid to exist. It’s difficult to say. As Gigi Hadid recently pointed out to us on The Real Housewives of Beverly Hills, “Modelling is hard. You have to look good and be nice to people.”

What about the blue-collar end of the spectrum? Anesthesiologists (not quite blue collar in the traditional sense, but not quite at the CEO/celebrity level) usually make around $100/hour. This position is high-stakes with a clearer value to their contribution. Tattoo artists, commercial pilots, and underwater welders all make about $120/hour per project. Even though these jobs usually only require 15-20 hours of work per week, it still averages out to a decent hourly rate.

But, what about you? Using some of the ideas below, you can develop a strategy for making more per hour without necessarily working more.

Idea #1: Charge according to value from the start. Say you’re a freelance sandwich maker. You’ve been doing this for awhile, so you have your routine down to a science, and as a result you’ve significantly whittled down your production time (4 minutes per sandwich). When you get an order for 5 sandwiches, it’s only going to take 20 minutes of your time. If you charge by the hour, you might be selling yourself short. Charging per sandwich (or per project) is the way to go. For other sorts of projects, you’re better off charging per hour.

Clearly as a freelancer, there are going to be some five foot long party subs in your life but the greater percentage of standard sandwiches you can make with your time, the greater your hourly take home pay.

Idea #2: Be on retainer. There is a cost to being available and let’s face it, there are some clients who want you to be available. Getting paid for a set amount of time to be available (and not needing to necessarily be doing something) is a great way to increase your take home… but beware when all your retainer clients need you in the same week! (This is why you don’t want to take on too many of these.)

Idea #3: Profitshare your pay. Take a cue from some of our CEO friends and, instead of getting paid a large base salary, get paid a percentage of profits. There is plenty of revenue sharing softwares out there but, maybe in building that up and coming software company a free online shopping cart and taking 10% gross revenue for 5 years will mean a higher hourly rate than they would have paid you up front. Note: only do this when you truly believe in the company.

Idea #4: Sell people the same thing. Let’s say you get really good at making flyers for musical theater. If you have clients spread out around the country, why not use the same layout for multiple events? This is clearly something only applicable in some instances but if you’ve packaged something together that works for a certain type of client or job, why reinvent the wheel? Please note that we’re talking more along the lines of systematizing than producing carbon copies for clients (depending on your line of business).

Idea #5: Outsource. (Full disclosure: Nicole hates this idea but it exists so we’ll talk about it.) One way to make money off something is to find someone else who will do it for cheaper and be the middle man between them and your customer. Many people make six figure incomes by finding freelancers and designing processes that use their skills effectively. The freelancers get to do what they like at a cost they agree with, the middle man gets to build a team for a fraction of what an employee would cost, and the customer gets a good product. Or at least that’s the idea.

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If Paris Hilton is able to get paid $374,00 an hour to DJ in Ibiza, you should be able to gain a little something for your work, too.

Kassie is a distance runner and a distance reader really. She lives in Ellsworth Maine and, while she might be quiet when you meet her, will throw out something witty when you least expect it.

Consultant Not Equal To Commission

When you pay for advice, you should get something that's the best for you. Photo via: http://peanuts.wikia.com/wiki/Lucy's_psychiatry_booth

When you pay for advice, you should get something that’s the best for you. Photo via: http://peanuts.wikia.com/wiki/Lucy’s_psychiatry_booth

I had a client pass me on someone’s business card recently. The person works for a local radio station and I am 99% sure makes his money based on the ads he sells. Title on the business card? ‘Marketing Consultant’

Um, no.

To me if someone gives advice to buy a product so they make money, they need to disclose that. Because it is the right thing to do.

It also in my mind makes them not a consultant. Put ‘sales’ proudly on your business card, my radio friend. In a world of Internet information, sales is no longer a scary word to many of us.

To me, a consultant:

1) Has more than one option to offer you from more than one provider.
2) Has a good idea of the whole picture.
3) Is being paid by you to give them good advice.
4) If they are selling you a product/service they make money on indirectly, they disclose it.

Here is an example that keeps all this in mind.

I work with Svaha web hosting. I am a partner in the organization. My ‘share’ is worth about $13 this tax year so, yeah, not earth shattering. I do get free web hosting from them ($130/year value in my case) and while I get $0 when someone new signs up, if more people sign up over time, my share value will increase, maybe to $20 this tax year. 🙂

The benefit I get when a client uses Svaha is 1) the client gets a good deal on hosting and 2) I can get in the server and know how it is set up, making things like making email addresses, etc. easier to do for my clients.

Yet when someone asks me about web hosting, despite under $200 worth of financial gain a year, I still disclose my involvement, tell them what costs are, and give them a couple other hosting providers I don’t hate along with Svaha. I let the client make a choice. Svaha is never the only choice.

When selling a product benefits us financially, it is hard to step back and think about a client’s needs in complete isolation of that.

Now those who sell ads, there is nothing wrong with you educating your consumer about the benefits of your product. I have zero problem with sales. Educating people and believing in your product or service makes you a good salesperson and a trusted partner to those you work with. But you are not surveying the whole field and giving your best advice. You are an expert in your market but you are not a consultant.

My measure of a good consultant?
1) Being able to tell someone not to buy something that is clearly wrong for them.
2) Not saying there is only one option (I can’t even think of an example where that would be true!)
3) When someone pays for your advice versus you getting paid on commission (this is like a fee only financial planner versus one that represents a specific brokerage).
4) You are knowledgable about your field generally, not just the companies you work with regularly. (Ex: You can talk about email marketing concepts, not just Constant Contact’s packages.)
5) The conversation you have goes in both directions equally or the client talks more than you. (This is the most important one. Is it a conversation or a pitch? Much like Supreme Court Justice Potter Stewart said about obscenity in a famous court case, “I know it when I see it.”)

So if you ask me to ‘sell myself’ and I become instantly uncomfortable, you’ll know why.

Not that there’s anything at all wrong with sales. There isn’t. I just want to know who I’m talking to. I’m sure we all do.

So next time, ask yourself if you are talking to a consultant or a sales person, and make your decisions accordingly.

Nicole runs Breaking Even Communications, an internet marketing company in Bar Harbor Maine. When she’s not online, she enjoys walking her short dog, cooking with bacon, and trying to be outdoorsy in Acadia National Park.

Why We Don’t Do it All

Occasionally, we have clients and non-clients ask if Breaking Even can help them with certain services that, as a company, we’ve decided not to get into (like logos, print design, and video production). “But we know some people who do exactly _____.” “Is there anyone who does all of this stuff in-house?” Well…not really.

I suppose there are some larger companies that will churn out all these services for you, and that in theory, keeping all these services in one place sounds like less work to manage. In theory. There’s something to be said for small businesses that specialize, though, so don’t write them off just yet (especially since their choice to specialize can be beneficial to you).

The “divide and conquer” method was helpful when it came to getting more done in early civilization, and it’s clearly successful. Humans who knew what was what in the plant world grew and gathered. More athletic types with lots of stamina and endurance, not to mention weapon wielding abilities, were in charge of hunting. Some people learned how to build houses, others to make jewelry and clothing. Division of labor also had a pretty significant role in the Industrial Revolution and mass production in factories, but that’s probably enough of a history lesson. Throughout human history, division of labor has been present in some capacity, and generally, we agree that this specialization allows society to move forward.

That’s not to say we shouldn’t know how to do certain things just because we don’t have to. For instance, I can (and have) changed the oil in my own car. It’s not something I need to know how to do, but it helps me understand the basics of how my car works. And what the underbelly looks like. Based on my level of skill (very little), frequency of the task (once every few months), time it takes (way too long), and my level of interest (non-existent, I am only interested in having a running car), 98% of the time, I just take it to a mechanic.

This more or less looks like what we’ve done here at Breaking Even Communications. Yes, we can code a bit. Yes, we know about fonts and can dabble in Photoshop. But we’d rather leave that stuff to the people who are actually passionate about them, while we work on the stuff we’re passionate about. And that’s good for you, too:

You Get the Best Service.  I’m hardly the best candidate for changing the oil in my own car. Yes, we can code a bit. We could probably photoshop some rack cards for you, if you asked us. Not to boast, but we’re pretty intelligent people, and could probably tackle almost any problem our clients came to us with. Then why do we refer people? Simple. Just because we’re capable of performing a task doesn’t ensure that it’s in the best interest of our clients.

In other words, “Just because you can, doesn’t mean you should.” And if we refer to our graphic designer friends, they can refer internet marketing work to us. And we can all do more of what we like best.

It Spreads Risk. Let’s go back to my hunter-gatherer example. A mastodon has been seen nearby, so the hunters are going to go on a trip to hunt it down. No one is really sure how long this hunting trip will take, but it’s cool, because the gatherers are still around to provide food for everyone.

Spreading the risk benefits the business side of things, sure, but customers also reap the benefits. For instance, if our web hosts  away on vacation and one of our mutual clients is having an email problem, we can tag in. Working with other companies that have overlapping skills means you have a team working for you, even if geographically or otherwise separated in different companies.

Smaller Companies Have Lower Turnover. Smaller businesses and their employees generally have higher mental/emotional stakes in their work. There’s a different dynamic than what you’ll find at a large company or corporation. We really get into our work and finding solutions for our clients, and it’s pretty amazing that we get to collaborate with like-minded small businesses during some projects. And at the end of the day, that means you’re getting the best product we can deliver.

By contrast, we’ve gone through four payroll reps in four years at our larger local payroll company. So asking yourself if you want to deal with the same COMPANY or the same PERSON month to month may be a good distinction to make.

There Is A Lot Of Information To Keep Up With. The idea here that it’s hard to stay ahead on all technology. 95% of the world’s data has been created in the last two years and it’s not typically data about the Macedonians. We can be smarter faster by specializing.

Kassie is a distance runner and a distance reader really. She lives in Ellsworth Maine and, while she might be quiet when you meet her, will throw out something witty when you least expect it.

Welcoming The Tire Kickers

herestothetirekickers(I can now publish this blog post because we’ve had more paying customers in 3 weeks than the entire 3 month period before it… but I’ll be honest, the last three months were a dark place that had me questioning my whole freaking life. More below.)

April 1, I opened our new coworking space (which will also be where Breaking Even works from). I bulk bought coffee, rush ordered the rack cards, and cleaned the whole place top to bottom. We had built up the excitement, we began targeting our customers months earlier. We were ready.

And no one came.

Well, that’s not true. A few friends stopped in to drop off goodies and well wishes. But no paying customers came through that day.

We had one paying customer in April.

One.

In classic Nicole fashion, I internally (and slightly outwardly) began panicking. It seemed like everyone had wanted to come by while I was covered in paint or when there was no heat on… and over 125 people came through our open house (nothing like free booze on an otherwise boring April evening!) But where is everyone now that the place actually is looking and functioning like a coworking space? Where were the paying customers?

I had a glass of wine and called my mom. You know, what any adult would do.

Give it time, my Mom said. Others have said.

Despite the fact that 300ish people have come through the space, we have had about 30 total customers. Most people are not customers but they’ve come by to see. I see their eyes go up to the security cameras, down to the fancy desks, around the conference room. They ask me questions, they smile, they leave.

Part of me wants to be the needy girl with the crush. Do you like me? Why not? How can I make you like me more? Don’t you get how cool I am?

I have decided that, starting now, and looking back at the last three months, I need to take a deep breath and appreciate the tire kickers* who have come through Anchorspace. (Please read the very bottom of this post before you decide to be offended.) The people who have stopped in and, while they seem very interested, have not bought a damn thing. And here’s why:

Tire kickers aren’t customers… yet. 

Most people can take a bit of time to be your customers (see our post about sales funnels for further justification). People change jobs, neighborhoods, service providers all the time. So that person who has NEVER bought from you? Let them look at your menu. Let them talk to your staff. Let them get familiar because they may become your customer later. If you are in it for the long game, this tire kicking process won’t frustrate you. I was looking at Anchorspace in a very shortsighted way most of this spring. Not good. “Not yet” is different than “no”, in the way it behaves and the way it feels.

Tire kickers need time. 

A variation on the above point, some industries don’t have much of a lag time between research and purchase. It’s not like you are going to walk around and price 16 ounce beers at all the local establishments before ordering one, for example. But if you’re asking someone to make any decision that is a bit more involved, people are going to need to think on it. They’re going to need to talk to their wife/husband. They’re going to need to run some numbers. Let them. If you have done your research and know your product and market, you can be confident while you wait.

Tire kickers have friends… and talk to other people.

If you run a steak house and the tire kicker is vegetarian, you may not ever get this person as a customer. And that’s ok. That person has carnivore friends who want a big steak on Friday night… and guess where the tire kicker will send them if they had a good interaction with you? Paying customers don’t have to be your only brand ambassadors. I’ll take a paying customer whether they are from the $1000 monthly retainer client or a guy I went to high school with telling his brother to call me.

 

Ticker kickers are online too. 

I have a friend who designed her website tenish years ago. “I don’t want to get leads through my site.” she always tells me when we see each other. That’s fine but what I want to tell her (and everyone who thinks this way) even if you don’t want a gazillion dollar website with all the bells and whistles, your customer feels a lot more comfortable silently kicking tires online than doing it right in front of you. That’s why we take care to put a lot of helpful information on this website. So you can kick our tires until your heart is content without us creepily watching you. The virtual tire kickers can be easier to ignore, since we aren’t shaking their hand but instead seeing them recorded as a visit in Google Analytics. The good with the bad.

Running an online business has shielded me from the tire kickers (since they just lurk on my site). A physical business has made me know them by name.

Anchorspace has given me more anxiety about tire kickers but also it has been more rewarding. I have had things pointed out to me by the slightly skeptical I would have NEVER noticed, and I am thankful for it. I do hope people keep pointing things out and asking questions, even if they aren’t buying because tire kicker feedback is going to make me better.

Here’s to the tire kickers. The mullers. The ‘I’ll be in touch’ smiles. The lookie-loos. Here’s to the individuals I hadn’t gotten to meet in real life until owning a business with a physical location. After some thought, revenue, Mom wisdom, and a glass of wine, I’m here to say I’m sorry I panicked over you. I’m grateful you’re here. Keep kicking, my tires and I are ready.

*I sometimes get in trouble for using words that other people seem to think have a negative connotation. Urban Dictionary tells me ‘tire kicker’ is much more negative a word than I mean for example. For tire kicker, I mean someone who needs to really understand something before the purchase, who needs to ask questions, test things out, waits before buying and may never buy, etc. Here’s hoping this covers my bases from hate mail but if you have a better term for what I am trying to say, please comment below!

Nicole runs Breaking Even Communications, an internet marketing company in Bar Harbor Maine. When she’s not online, she enjoys walking her short dog, cooking with bacon, and trying to be outdoorsy in Acadia National Park.

Free Reading: Why We Give It Away Online

Three years ago, I wrote a book for National Novel Writing Month. It’s been sitting in Google Drive, and I’ve been wondering what I do with it.

I’ve kind of edited about half of it but I think I’d have the motivation to finish if I knew what next. (I sometimes am paralyzed by choice. Not my best quality.)

The beginning of my terrible novel, sitting in Google Drive, wondering its fate.

The beginning of my terrible novel, sitting in Google Drive, wondering its fate.

Option 1: Do I send it to 50-100 publishers, hoping one will like it enough to rip it apart and await my rewrites?

Option 2: Do I self publish it, making my friends pay $1-$10 for the ‘pleasure’ of reading it, probably making all of a few hundred bucks?

Option 3: Or do I just format it as an ebook and give it away?

I’ve been leaning toward Option 3. Sure, it seems like the least amount of hoops to jump through but it is also the world I know best: the internet is all about giving stuff away. I’ve been writing this blog ‘for free’ since 2007 for example.

I was reading a great article about Why Give Away Your Work For Free. To paraphrase Cory Doctorow, he says people who download the free book wouldn’t have bought the book anyway. Really by giving things away for free he’s increasing his audience. To quote: “My problem isn’t piracy, it’s obscurity, and free ebooks generate more sales than they displace.”

It actually got me to thinking of something completely different I read from Elizabeth Gilbert (read the photo caption- it’s long like a blog entry). But to paraphrase, basically you can’t make creativity show up and earn you money. You need to give it room to breathe. To quote: “I adore Creativity. I love her. I have devoted my life to her, because she brings me joy. But I do not suggest relying upon her to pay the oil bill. She is not very reliable. Creativity has no idea what the words “oil bill” even mean.”

My whole life the last seven years has been building two businesses, in other words the laser focused pursuit of money. Creativity showed up and I have this kind of terrible, moderately personal 124 page story sitting in my files without a purpose. Do I demand it make me money… or put it out there for free?

(Aside, I get that I should stop calling my novel terrible. But I’m one of those ‘plan for rain, be happy when it doesn’t’ kind of people so I am just managing my own expectations- and yours- by doing that.)

So do I enter into a world of a million rejections? Do I ask my creativity to make me some money now with this novel (which you see doesn’t even have a title but ‘Novel.doc)? Or do I give this novel away in hopes that my ideas will get out there and in turn generate others?

Now I’d be a liar if I said this ‘give it away and get more later’ idea was a writing only idea. Musicians give away albums, companies swag… every industry has a ‘something for free’ component so this idea is far from original.

But somehow reading those two articles in a row made me realize why I wanted to give it away… and the gut instinct wasn’t one of general laziness! If you are similarly on the fence with something you’ve made, let me know if reading those two relatively short posts helps clarify what you should do like it did for me.

(By the way, if you want to read my yet to be titled novel, just leave a comment on here and I’ll make sure you get the information for it.)

 

Nicole runs Breaking Even Communications, an internet marketing company in Bar Harbor Maine. When she’s not online, she enjoys walking her short dog, cooking with bacon, and trying to be outdoorsy in Acadia National Park.

Crystal: Creepy Or Helpful?

I listen to a few podcasts related to technology, one of them being “Note To Self” (formerly called New Tech City). The last episode I listened to, it talked about a service called Crystal Knows. When you go to email someone, Crystal analyzes things they have written online and generates a sort of personality profile for them.

So I decided to start the free trial. I installed it within Gmail. During this trial period, I’ve gotten a new client (someone I have never met) and also have dealt with a few touchy customer service situations. You know, the kind of thing where it would be nice to have an email coach for.

Crystal: Confirming What I Already Knew

Of course naturally, the first thing you do when you get a piece of software like this is test it with people you know. In fairness to others, I’ll use myself as the example here:

crystalmyfirstscreen

First of all, I’ve done this analysis with about ten people and each summary sentence was pretty different. (Not one of those online quizzes that has one of five outcomes.)

My accuracy level is 85%. As someone who has been blogging for seven years, this is higher than most people I tested for. Still, even when someone had a 45% accuracy rate, it was better than having 0% knowledge (ie going in cold with the new client.)

The thing I think is funny with this is how it thinks I like conversation. My tone on our blog is quite conversational but if it was socially acceptable, all my emails would be like. “Can you send me this file? Thanks.” I have cultivated this friendly, approachable personality online so that… well, I seem friendly and approachable. I am very much so in real life but in terms of online/texting interactions, I prefer to be really utilitarian. Ask my husband about our texting relationship.

Now this isn’t the only thing it gives you. Scrolling leads to deeper:

crystalhowtoemailme

 

It’s true, I do seek consensus. If I am working in groups, I want to agree then move forward. Nothing drives me more nuts than having to redo work because all the stakeholders weren’t consulted before I proceeded. I also appreciate feedback but it needs to be given to me in a certain way (again, ask my poor husband.) Crystal Knows, indeed.

Now, I keep scrolling and this is where it for some people may get creepy. It tells you how you can sell to me and what NOT to say to me. If you have a paid account, it will help you write an email to me:

crystalpaidaccount

Understanding My Relationships Better

While Crystal couldn’t find my husband (he’s difficult to find on the internet, you should have seen how panicked I was before our first date when I saw his lack of public record online) but it did find my coworkers. It is interesting how I subconsciously write differently to the different people I work with. Crystal confirmed my style with each.

It was also nice to put in my new client’s name and have it say “If your email is over 250 words he won’t read it, try to be concise.” I would have rambled on, as I tend to do. With a new colleague, it urged me to be specific and break things down into steps, something I wouldn’t have normally done in that case but seemed to please him. Hmph.

I found this lovely blog (which has more about Crystal) but also has this compelling animation showing how Crystal coaches you as you write an email:

crystal-gmail

Please appreciate that at first, as Crystal was saying ‘Good job’, I thought I was supposed to give the person I was writing to a pat on the back. Apparently it just meant keep going. So if you got a compliment from me via email in the last two weeks that seemed odd, that may have been it.

There is a relationship analysis feature in Crystal available to premium (paying members)… but Crystal will let you try it for 2 weeks. Then you can decide for yourself if this tool is creepy or helpful.

Is it creepy?

I’m still on the fence personally but I did ask to extend my trial another two weeks. In a world where he who has the most information wins, it seems like this tool may be good, especially if we are in contact with someone who has done a fair bit of online writing (so Crystal has data on them).

I guess I’m on my own with my husband. But maybe some relationships shouldn’t be coached by an algorithm anyway. But for those people who I don’t know well, I thank Crystal for making me at least feel like I am not going in blind.

Nicole runs Breaking Even Communications, an internet marketing company in Bar Harbor Maine. When she’s not online, she enjoys walking her short dog, cooking with bacon, and trying to be outdoorsy in Acadia National Park.