How to choose your expert network consulting rate?
How do you choose what hourly rate to set for consultations through GLG, Alphasights, Guidepoint, Third Bridge and other expert networks?
- 3 replies
- EMitchel @expertopportunities
"What should my rate be?" is probably the top question asked by people new (and not so new) to expert network consulting.
When associates reach out to recruit you for a project, they usually boast that you can set your own rate, but don’t necessarily provide much guidance as to what that should be. Price yourself too low, you could miss out on hundreds of dollars an hour in fees, while setting it too high will knock you out of the running for many projects.
Your ideal rate is going to be a combination of your experience and qualifications, how much competition there is for the project, and the client’s budget and how many people the client wants to speak with.
So let’s break it down:
Your Experience and Qualifications - The stronger your experience is and the more specialized skills that you have, the more you are going to get paid, just like any other role. I've been doing some specialized financial services marketing for the past 20 years and have been a VP at a couple semi-notable firms and now charge $500/hour on most networks. But it took me a while to reach that rate. When I started doing expert network calls over a decade ago, I obviously had much less experience and charged just $150/hour. So while a C-level executive at a S&P 500 company may stay busy while charging $1,000/hour or more, $100 - $200/hour might be the appropriate rate for someone earlier in their career.
Competition - Expert networks are all marketplace businesses, so the laws of supply and demand are in full effect. The harder it is to find experts for a project, the higher the rate an expert network is willing to pay. Of course, the opposite is obviously true as well. If the client wants to speak with a few customers of a widely popular software package, it probably won’t be hard to find them and they aren’t going to pay top dollar to speak with specialists with widely available expertise. However, if they are eager to get perspectives from brain surgeons with experience completing a new experimental procedure…well, they know that they are going need to pay top dollar. Keep in mind that clients typically review several dozen candidate profiles when deciding whom they speak to, as well. So while you be a perfect fit, they client may have elected to go with someone else who looks very similar to you (or better) on paper.
Budget - Experts often provide enormously valuable insights to clients, but ultimately every project has a budget that needs to be allocated across multiple resources. If your rate is on the high end, it may not fit with the project budget and your profile may not even be presented to the client. Most expert network associates have profit margin as one of their top KPIs, so they work hard to manage payouts to experts. Clients are generally paying the same price whether an expert charges $250 or $500 per call, so lower priced consultants result in higher profits for the project. Nudging clients towards experts with lower rates can help improve the associate's performance numbers.
So, unfortunately there is no one-size-fits-all number but hopefully these factors help you hone in on what rate to target.
Don’t be afraid to ask your expert network associate for some guidance as well. Ultimately, they want you to land the project so they can move on to the next one and will generally steer you in the right (though slightly low) direction.
On my blog about starting and growing your expert network consulting practice, we recently featured a great guest post from an associate on how to set your Third Bridge consulting rate.
- DIn reply togediminas⬆:David Rosén @David_Rosen
I have chatted with many expert network employees and all of them say that experts tend to get a bit confused when it comes to choosing the rate. Some give unreasonably high sums, others sell their knowledge for too little. Choosing your rate is not very straightforward, but there are a few common sense guidelines that should help you:
· A good place to start when setting your rate is to ask the expert network recruiter what the other experts on this project are charging. They will give you a reasonable number (maybe $100-$250). Then you can negotiate upwards from there.
· Remember that you aren’t really giving just one hour of your time here. The gig consists of chatting with the recruiter, going over the Terms and Conditions, potentially taking some time to prepare for the consultation and then finally participating in it. Therefore, you should certainly be charging a bit more than your hourly rate at work.
· The other reply in this thread says that competition and the market laws determine your price. To an extent that’s true, but my experience is that most expert network clients have quite an “inelastic” demand curve, i.e., they won’t pick another profile over yours just because that one is $100 cheaper if you are a good fit for what they are looking for. If you realize that you have a really good understanding of the topic the client is interested in, you should feel comfortable negotiating a higher rate.
Oftentimes, experts simply don’t care about those $300 of additional income. Note that in such cases taking an expert call could still be fun – you will likely not only teach but also learn a lot about the trends in the industry you are familiar with, and the expert network payment can always be donated to charity (you’d be surprised how many people do that!). Hope you find this useful!
- PIn reply togediminas⬆:Pedro Oliani @pedro
I used to get this question a lot back when I used to work at a top expert network. To be honest, there’s no straightforward answer to this. However, I’m happy to share some insights and give you some tips
*As mentioned previously in this thread, profit margins are one of our KPIs, meaning that we will work to negotiate you down, regardless if you’re to be engaged in a niche project or not
*We often pitch rates between $100-$230 as the initial hourly rate. We usually argue that this is just for the first consultation and we can revisit it later. However, we’d never bring this point in any other moment, meaning that once you negotiate your fee with the expert network, they’ll hardly ever touch on this point unless you do. The only cases where they’d mention this would be to negotiate you down in case your fee is too high for a project and the client has a budget constraint
Having mentioned the above, there are some venues that you can take to set your rate.
*Ask what’s the average hourly rate that the expert network uses. You can start with that and see how it goes. After a few successful interactions, you can increase your rate until you reach a fee that you’re comfortable with.
*Alternatively, you can think of an hourly rate range that you’d genuinely be happy to work with. For projects that don’t require preparation on your end or if you have a free schedule, use the lower fee. For projects that are niche or require some preparation work (which btw you won’t be compensated for if you tell them), use your higher fee so you feel it's worth your time.
Keep in mind that a high rate can lead to a low number of interactions as some clients might be price sensitive. Also, make sure to set the rate during the initial project alignment call with the associate. Once this is agreed, don’t change it later down the road – it will look unprofessional.
Hope these insights help!