The traditional model of pricing clients can be extremely costly to the client and also cause him or her to lose faith and trust in the company. To explain a bit more about the Point Pricing Model, I would like to use our model as an example.

Veleration has adopted a pricing model based on the number of points purchased by a client instead of charging hourly rates. A point is a fixed unit of value. It’s PR 20/20’s value metric.

Veleration has adopted a pricing model based on the number of points purchased by a client instead of charging hourly rates. A point is a fixed unit of value. It’s PR 20/20’s value metric.

Point pricing ensures clients get the full value of every rand spent, regardless of how much time it takes to deliver. Points provide total transparency into pricing, progress, performance and resource allocation.

Each project within a campaign is assigned a fixed-point total (e.g. blog post = 3 points) based on value creation rather than hourly estimates. The point totals are standard across all clients and are determined using the Fibonacci sequence.

The Fibonacci sequence represents a set of numbers that increases roughly based on a fixed ratio of 1.618, also known as The Golden Ratio. Each subsequent number is the sum of the previous two—1, 2, 3, 5, 8, 13, 21, 34, 55 . . .

In general it is difficult to accurately predict the hours it takes to complete a task due to variables such as professional competency, focus, efficiency and forecaster bias. When we try to forecast time to complete an activity, the higher the number, the more uncertain the forecast becomes.

The Fibonacci sequence accounts for this uncertainty. So rather than debating whether something is worth 8, 9, 10, 11, 12 or 13 points, in our world it’s either an 8 or a 13. And since clients have access to a standard point list, and we build points into their monthly GamePlansTM, they know exactly what every project costs, and how those points are designed to achieve their goals.

HOW DOES IT WORK?

We have four standard packages: Starter – 40 points, Basic – 65 points, Pro – 80 points and Enterprise – 112 points. Each package costs R125/point. However, the more you invest each month, the more points and value-added features you get.

For example, clients at the Enterprise level get weekly Google Analytics reports at no additional cost that our team generates using artificial intelligence. We’re also able to offer extra points and discounts for workshops, referrals, add-on projects and contract renewals.

We also use points to forecast potential resource allocations when talking with prospective clients. Actual point allocation is determined during strategy sessions and then continually adjusted based on performance data and evolving client goals.

Points can be used for a diverse set of services, including (but not limited to) blog posts; consulting; data analysis; database segmentation; email marketing; lead scoring and nurturing; marketing technology integration; media relations; premium content (e.g. ebooks, webinars, infographics); sales support; social media monitoring, training and support; and strategic planning.

Available points are planned monthly and reallocated at need to capitalize on opportunities and improve performance. Points are grouped into projects, and projects are grouped into campaigns.

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