And even though the numbers didn’t work out quite as well as I’d hoped, they’re still pretty impressive, and I’m very proud of Stacey’s progress so far. So I totally stand by that comment.

As you might remember, a week ago today I referred a gig to Stacey. A client of mine needed two 1000 word articles on military topics — not my area, but Stacey happens to run Army-related sites. She was a natural fit. He hired her ($350 for the two blog posts). While it’s not quite her target rate yet, it’s a hell of a lot better than her $15 Demand Studios articles.

Of course we always get the glum folks who come in saying the low pay is better because the articles are quick to write (to which I always respond that they’re essentially full of shit to assume decent pay means days or even weeks per article and that they’re making out better hourly).

Private Client vs Content Mill: The Numbers

Stacey did spend more time on these articles — they were about 2.5 times the length of most of her Demand articles, and she needed to find some photos for each (which took up more time than the writing — but which from experience I know gets quicker as you become more familiar with your image sources). She spent 4 hours total on those two posts. That equals an hourly rate of $87.50.

“But that’s only two articles,” I can hear some of you mumbling. Yes, it was. But those two articles paid Stacey in less than a few hours’ worth of work what she was averaging with Demand (having to write slightly over 23 articles per month to reach the same payout).

Of course, I’m sure you want a comparison. So how long does Stacey spend on that Demand content? She told me about 20 minutes per article (around 400 words) in a best case scenario where she can write about topics that require no research of her. She estimates around 30 minutes per article for ones requiring quick research. That doesn’t include any edit requests (she said about 1 in 10 get them in her experience). It also doesn’t include the articles with such ridiculous edit requests that Stacey pulls them from Demand altogether, therefore putting in the time but not getting that direct payout. For example, one editor asked if military insurance was Army sponsored or government sponsored. I’ll let you ponder the sheer stupidity of that waste of Stacey’s time for a moment.

…

Yeah. I’ve heard of some pretty absurd editor requests with Demand, but that one literally made me snort with laughter (and that’s not easy). But hey… at least content mills are good for amusement.

So let’s go back and assume a worst case scenario where Stacey might write those 23 articles at 30 minutes each (not even accounting for any edit requests or articles she’d rather lose pay on than subject herself to the aforementioned brand of ignorance). That would involve Stacey writing 11.5 hours to earn that same $350 (actually slightly less since that average really comes to 23.33 articles per month, but we’ll leave it in their favor — they need it).

Four hours writing versus 11.5 hours writing for the same pay. Hmmm.

But okay. Let’s be even nicer to the mill and say she can whip them out at 20 minutes per article with no edit requests. That’s still 7 hours and 40 minutes of writing for the same pay as those four hours where Stacey didn’t have to bounce around mentally from one topic to another. The winner here is clear.

Personally I was hoping her articles would be a bit closer to the one hour mark (around where mine usually fall for this same client). But even though they weren’t, I have no doubt she’ll be able to gain speed if and when she does future work for this client. And oh yeah…. She was already assigned another post by them.

Time to Diversify

That new blog post assignment already puts her at a 50% increase in income over her averages with Demand. On top of that, another prospect contacted me and the gig was referred on as I’m not taking on new clients. With a little bit of luck, Stacey might land it. If not, that’s okay too. She’s well ahead of the game.

We’re not going to stop there just because she’s replacing her content mill income. I’ll be standing by working with Stacey until she’s increased that income much more, reached her target rates, and is consistently pulling in decent-paying freelance writing jobs without having to resort to content mills. And that takes us to Stacey’s coaching progress since last week….

What’s Stacey Been up To?

This week Stacey primarily worked on some plans for the future marketing of her site and services. For example, I had her brainstorm some ideas for projects like e-books, article marketing, and post ideas for her new business writing blog. Without having the list in front of me, I believe she’s working on her first two blog posts and outlining the e-book right now. I’ll let Stacey fill you in with more details if she wants to, or you can also follow her personal updates at YieldToHappiness.com.  Better yet, why not read her personal farewell to content mills?

What’s Next?

We’ll be working Stacey ragged this coming week. She’ll be kicking off her new blog. She’ll be finishing the outline for her e-book (the following week her primary project will be putting that together — a short one to give away as a marketing tool). We’ll be working on bulking up her website copy. We’ll be making sure she’s on the right path SEO-wise. She’ll be spending more time networking with others — both from her target market and her base of colleagues. She’ll be a busy lady to say the least. But once we finish up her website and have the basics of her blog established, we’ll be moving to more directly pursue some additional regular gigs for her.

I have always been surprised by the writers who argue that cheap writers, cheap clients and mills are pulling down the pay that everyone in the industry receives. As someone who has been lucky enough to manage a comfortable transition from content mill writer to full time writer with clients who pay well, I have a different take on the situation—I think the content mills, low paying gigs and the writers who take on these gigs are actually helping your business.

Reason 1: Client Differentiation

The existence of low paying clients has made it easier than ever to define your market. I fully realized this last week when I got the invitation from Bright Hub. The content they were commissioned to create was for a website that has a forum dedicated to discussion of a certain popular movie that is about to come out on DVD. All the article titles had the name of the movie in them and were very repetitive. The site owner was obviously trying to create SEO fodder.

Writing just a few of these 500 word articles at $20 a pop would have been monotonous and terrible. But I also realized that it is exactly the type of assignment I would never take on within my current business model. No matter what kind of topic I write about, I take on gigs that need articles with intrinsic value. Articles that teach, entertain and promote authority–not articles that simply bring in clicks–and that is what gives your articles a value that cheap clients can’t afford, which is why they are not your target market.

Reason 2: Some Good Writers are Out of Your Pool

These low paying gigs keep the hobbyists and uncommitted busy which means they aren’t competing with you. I’m not saying that content mill writers aren’t real writers or that they don’t have a burning desire to create–I’m saying that they are not business people. Many of them don’t know how or where to market themselves, but if you are going to run a successful business you have to either figure out how to do this or hire someone who can do it for you.

Now, I’ve read enough of your blog posts to know that many of you think that “cheap” writers are bad writers and are, therefore, not competition. This is incorrect. They are not competition because many of them don’t know just how much they could be making or how to get there–not because they suck.  That’s why blogs like this one are so important–there are good writers out there who need to stop being coddled and instead need a life preserver. We are that life preserver.

Reason 3: It’s Hard To Make It

Let’s say you need to gross at least $55,000 per year to live comfortably. If you were to try to make this working for an average of .04 per word (which is more than many content mills and low paying clients pay) then you would need to write an average of 52 articles per week every week of the year (which means no vacation or sick time). I don’t know about you, but if I had to write about 10 articles every day 5 days per week with no break ever I wouldn’t last very long. That means that not only are the writers who are doing this not out there competing with you but they will probably give up sooner than they would if they found the same success as you, which again keeps them from ever reaching your market.

What You Should be Worried About

Just because your business is safe, that doesn’t mean that content mills, low paying clients and the writers who encourage them aren’t damaging the industry in some form or another. The net is filled with crap content that somehow manages to rank highly, all-purpose websites like Ehow show up in Google search results as though they are topic experts while they bury real authority content, article writers are using Wiki or some other single source to create their own derivative (and basically plagiarized) content, there is little fact checking going on, and traditional journalistic standards are not being followed. (As an example of this, one Demand-produced USA Today piece featured a health and technology writer writing about getting hotel upgrades. This could have been saved by the addition of in-article citations, interviews or something kind of , oh, journalism-y). These are things that I personally think more of us should be upset about and complaining about. But that’s just me.

I’d like to congratulate Stacey Abler who I chose for the free one-on-one coaching. I’ll be devoting several weeks to several months (however long it takes in her individual case) to help her leave behind mills and residual work for others in favor of something better. Here’s some background on Stacey, why I chose her, and what goals we’ll be working towards.

Specialty / Credentials — Stacey can take on business writing in many of its forms, but also write about army issues (she’s an army wife who has her own site devoted to army families) and parenting . She also has an MBA.

Where She Writes Now — Stacey writes primarily for three different content mills / networks — for eHow directly (I believe they recently either cut this direct program or announced they were going to supposedly for consistency’s sake in quality between that and eHow content from Demand), Demand Studios, and Suite101.

Current Pay Per Article — Her current articles earn anywhere from $15 down to less than a dollar per month in residual earnings on other sites.

Earnings Goal — Stacey would like to increase her rates to $.25 per word. Given her specialty area, credentials, and general writing ability from what I’ve seen so far, I think this is more than reasonable. In fact, I think when we get Stacey to her goal she’ll move beyond that level fairly quickly on her own.

Stacey currently writes part-time but wants to move to more of a full-time schedule.

Why I Chose Stacey

It really wasn’t an easy decision with so many amazingly qualified people writing for so much less than they could be earning. I was actually leaning towards choosing someone else when I got a Google alert for my name. That link took me to a post on Stacey’s blog where she mentioned the coaching offer. That’s not why I chose her though. It was what she said beyond that that set her apart.

Her post made it clear that she was willing to take some initiative (I’m sure others would have as well). She made it clear that she understood how to crunch the numbers and not mistake freelancing for employee-like compensation. She clearly understood the importance of a sustainable writing career and not one where you’re constantly pushing yourself to burn out levels just to earn a mediocre income. She also understood that there’s no room for excuses when it comes to running your own business (and you ought to know by now how I feel about excuses).

So there you have it. That’s how Stacey was chosen for the coaching project. You’ll be able to follow along with her progress over coming weeks here on the blog. The first step I suggested is overhauling her business site (which is new anyway, so it won’t affect old rankings and such), and making that site work harder for her.

As for other writers who applied, I’ll email a few of you next week to see if you’re willing to let me share your stories and some personalized suggestions in a blog post. There were several writers I felt were really ready for something better, they obviously wanted to work for it, and I could identify some specific potential problems just from their emails. So even though it’s not possible for me to work one-on-one with everyone, I’ll reach out during the work week to see if you’d like some advice on moving forward to make those changes. Hopefully those posts will also help other readers of the blog.

On a related note, there were a couple of people who I was able to immediately rule out, and for similar reasons I haven’t hired certain bloggers to write for me directly after they applied in the past. So I’m going to offer two general tips:

1. Never assume the person you’re pitching thinks highly of a competitor unless you know for a fact it’s true. Glowing comments about someone they have little to no respect for won’t score you points. That said, if you’ve worked with or are a reader of someone you do know they’re close to, by all means mention it especially if there was a referral from that person.

2. It’s great to mention that you’re a long-time reader of the site. It’s not so great if you then mention your favorite series, but that series happens to be from another site. Probably not going to get you what you want. ;)

How would you feel about having your freelance writing schedule booked weeks or months in advance? Do you wish you had the luxury to be more selective in the freelance writing jobs you take on, able to turn down anything that doesn’t appeal to you?  Plenty of freelancers are already in that boat, myself included. It’s a great place to be, but a reader brought up a good question a while back in a comment — if your schedule is constantly full, doesn’t that mean it’s time to raise your rates?

The short answer is “no.” Demand alone isn’t enough of a reason to raise your rates. Today I want to talk about why, before you rush off to raise rates for 2010 just because you have adequate demand at your current rates.

Not All Work is Created Equal

Credit: alxm (stockxpert.com)

It’s true that constant demand is one sign that it might be a good time to raise rates. But that doesn’t mean it’s always true. For example, the bulk of my work comes from regular clients who place relatively large orders every month. I have a booked schedule well into the New Year. This year I only took on about five new clients due to the existing commitments. I don’t expect that to change in 2010. Yet I turn down multiple offers every single week (referring those buyers to colleagues).

Does that mean I should raise my rates with my other clients, or replace them with higher paying ones? No. Why? Because an influx of offers in no way means those working relationships would be equal to my existing client relationships. I have long-term contracts. There’s no guarantee of that with a new client. I’ve found an amazing balance between great rates and stability rivaling that of a regular full-time job. Hypothetically I could drop client A (who orders $2000 worth of content a month) and replace them with client B (who will pay a bit more). But client B might not stick around beyond a month or two, meaning I’d then have to replace them again with someone new.

Stability and long-term contracts are a huge factor you can’t afford to ignore.

New Clients Equal More Work (and Sometimes Less Money Hourly)

You also have to look beyond your base rates. You can’t think of it as “client A will pay me $450 for the project and client B will pay me $600 for the project, so I should go with the new client B.” When it comes to freelance writing rates, you have to revert everything back to hourly levels.

If you’ve been working with client A for a year, chances are good that you’re already intimately familiar with their business, products, or services. You probably know who their target market or target readers include, and you know how to tackle the project to appeal to those people. You might be able to turn that project around in 5 billable hours, meaning you’ll earn $90 per hour.

With client B, you don’t know any of that information up front. If you truly want to do your job well you’ll have to invest more time into research. You’ll review the client’s website thoroughly. You’ll look at other documentation they send you. You’ll have phone or in-person consultations with the client. You’ll research the target market / readers and how the competition successfully appeals to them. It might take you 9 hours overall with that additional work. Even at the higher per project rate, you would only be making around $67 per hour.

Unless you know up front that client B plans to be a long-term repeat client (meaning that initial time investment will pay off over time as their projects become faster to complete), the better business decision is to stick with client A. The lower rate is actually more pay per hour (and more hours to devote to other projects).

Changing Rates Sometimes Means Starting Over

Credit: Ivan Petrov (sxc.hu)

Unfortunately, there’s always the possibility that you’re at the maximum rates your current target market will pay. Therefore, if you want to raise your rates, you’ll have to change your target market. That means starting over. You’ll need to tailor your services and your value proposition to an entirely new group of potential clients, re-think your marketing strategies, and revamp your network. Do you really want to do that?

If you’re not happy with what you’re earning (such as being stuck at content mill rates and wanting to double or triple them), then do it. You have to change your market to change your career path. But in a case like mine, when you’re already earning a very comfortable hourly rate, overhauling your career targets (and all of the unpaid marketing and administrative time involved in doing that) doesn’t make sense.

So no, demand isn’t enough to signal that it’s time to raise your rates. Hating your current work, feeling taken advantage of, and being pushed to the burnout point cranking out content just to make a livable hourly wage… those are reasons to raise rates (if you can offer the value to back it up).

That said, don’t ignore the demand either. A sudden influx doesn’t always mean something. But if that increased demand sticks around for six months or more with no signs of letting up, take it as a sign that it might be time to evaluate your overall situation as a freelance writer. Only that will tell you whether or not it’s really time to increase your freelance writing fees. In the end what you should strive for is balance — rates that allow you to pay your bills, set money aside for savings or investments or leisure activities, and still enjoy enough free time that you can pursue your own hobbies and projects or spend more time with friends and family.

Finding that balance might seem like a dream to some, but I can tell you it’s absolutely attainable. As with most things freelancing, all it takes is a bit of business sense and planning.