This was too tempting a subject to pass because of the reaction to the revelation that Chris Brogan (celebrity blogger and author of book; Trust Agents”) gets a consulting fee of $22,000 a day.
My initial reaction to the news was a simple “A bi gazhunt” to Chris which is Yiddish for “be well”, but really means “My hats off to you”. Why shouldn’t a company pay him $22,000 if it will save them 10x that if they try and learn about this stuff blind.
But this revelation from Chris launched a vibrant conversation with a diverse range of opinions from indignation to envy to those who shared my personal reaction; “well done”.
The topic was quickly losing interest for me except Chris himself came out to declare this was the; “smartest post yet about my pricing post:http://bit.ly/aP4l9w (anchoring. Neat term!)”. I was curious so I went to check it out and in this post, the author believes that Chris now set the “anchor point” – a water mark for what “this stuff goes for”.
Whoa Nellie – this is when this conversation went silly for me.
I don’t buy for a second that Chris’ rate establishes anything, and certainly not an anchor point unless of course you want to be totally self serving. Chris is able to garner these fees TODAY because expertise in this area is still at a premium and there are few credible sources. In about a year, when there will be more “supply”, the rates will adjust accordingly.
And oh BTW – here’s another reality. Chris has to charge so much for a day of consulting because there’s not a lot of repeat business consulting on social marketing. This stuff is not hard and after you’ve told them the basics they are usually good to go. He has to extract as much as he can from them because it’s probably a 1x only appearance.
If you doubt this truth of this conclusion – think about it for a moment. Would Chris have to create the “The Third Tribe” service or his New Marketing Labs or all his other self promotion stuff if he could regularly snag “two or three” gigs like that a month? I don’t know about you, but if I could reliably do $500K/ year by working 24 days – I wouldn’t be doing all the other stuff or maybe I wouldn’t be charging anything at all to most, (and I cheerfully congratulate Chris on how much of his smarts is freely available).
Chris was clever to have cultivated credibility in a space that became very important very quickly. This is a quintessential case of right place at the right time and he is milking it for every thing it is worth. I congratulate him on his skill and luck. But let’s not see his fee success as anything more than a temporarily aberrant blimp in time and it is certainly no anchor point. Hey, if tomorrow someone figures out that they can substantially grow their business learning the secrets of Hasidic philosophical spirituality – then I’ll be worth $42,000 a day! But only for a while. I know I’ll milk it as long as I can.
Judy Shapiro
Filed under: Consulting, Corporate business models, direct marketing, profitable business model, social media, Spirituality | Tagged: blogging, Chris Brogan, judy shapiro, social media |
Trenchwars Weblog 
All great points, Judy. I really like what you had to say and I think you’re right that my rate doesn’t make a good watermark. The rates I tend to see from other people consulting range closer to $5K – 10K a day. Mind you, my offering is a bit different, as I tend to help companies integrate into their existing enterprise practices and the like, whereas most folks just show a company how to set up a facebook page or tweet.
The reason for the other projects is that I can’t sit still (1), that I wanted to have more than one price point to access me (2), and that I’m saving to buy a little bit bigger home for my family (ours is only 955 sq feet of loft space, and we have two kids). As my credit isn’t top shelf (due to leveraging my mortgage payments to get to conferences in the early days), I fear that I’m going to have to put down a substantial amount of my own money to buy my next place. Thus, I have to earn more than most people typically would need in a year. Make sense?
Keep fighting the wars, and thanks again for the post.
Great perspective – tx
Appreciate the linkage – and you’re right on – the anchor I mentioned is time-sensitive – it will change.
That anchor is for now. As the SM space matures that price point will drop.
To clarify my point of view on this – did not say that this is the anchor point for “what this stuff goes for” – I said it became an anchor point for what the very top of the scale is. My point was that if nothing else – this price point provides a public point of reference for those in the SM space – coming from arguably the best in the biz.
Anchors are simply points of reference – not rules to follow. I wasn’t saying that all SM consultants should charge 22K per day. What I attempted to communicate is that without a public anchor, the prices tend to be what the two people in the room decide it is.
But now we have a third person to consider. And that provides the parties with more info – no different than buying a flat screen – you see the Mfg suggested retail price, the price your friend paid and the “online” price. These all become anchors for the final price. No different than Chris’s revelation.
Whether we believe it sets the anchor or not – I guarantee a few SM consultants took a look at their pricing and using that number as a reference point started talking about how to revise their pricing.
…a one time fee for instant news you can use, implement with long term benefits that integrate seamlessly into your current marketing strategies – it’s the way it should be. great article once again.
Hi Paul –
Thanks for your clarification.
But I am not sure how to think about Chris as the MSRP which is another way of saying “anchor point”.
Chris’ rate to me is just Chris being really clever and not much else. I don’t think it sets any level off of which anything else can be based.
But I’d like you to be right — $22,000/ day is not a bad way to earn your keep :).
Judy
I’m not suggesting Chris is MSRP – I’m saying in the world of SM there is a range of pricing – from very, very low to very, very high. Chris – I believe – is setting the upper limit of the pricing scale. Since he is so well known, and considered an “authority” on the subject matter – that is the anchor for the upper limit.
Anchors are simply psychological things – things that come into play when we begin to make decisions.
If I told you that the “BEST” TV in the world costs $100,000 but I you see another one for $1,000 you’ll start to compare features/benefits and what not to determine the value.
Think in terms of the housing market – every house sold in a neighborhood influences the sale of other houses. That is why they do “comps” – to set anchors.