Commission-Based Payment for Web Design
I an effort to smooth out the monthly income stream, I have forgone the traditional lump payment in favor of a long-term, commission-based income based on ad performance.
Lately I have been reevaluating the “me create, you pay” arrangement. Perhaps by accident, perhaps by subconscious intention, I am trying to gently alter the course of my design business.
As any freelancer will attest, too often it’s feast or famine. Checks seem to come in waves, with uncomfortable dry spells between. We work hard every day but only get paid when the client’s accounts payable department gets around to it. I’m not complaining—it’s the nature of any business in any industry.
As an experiment to help smooth out the income stream, I’ve taken on a project where payment has bucked the following traditional structure:
- Initial payment, before work is done (25%)
- Landmark point (25%)
- Delivery of final files (50%)
Instead, I’m working straight commission, forgoing the “paycheck” in favor of performance-based income from advertising sales. The site in question has a mixture of Adsense and affiliate links that make some money now, but I have enough faith in my SEO and Adsense optimization skills that I believe I can boost the income of the site by 200% or more. The client has enough faith in me that he is willing to take a short-term cut from his advertisement income in order to achieve a higher rate of return down the road.
It’s easy to focus on the legitimate risks of this arrangement. If I can’t boost the performance of the ads, or if the SEO techniques don’t return an increase in organic traffic, or if the advertiser’s rates drop, or if the internet explodes, I am screwed.
However, those are risks I am willing to take. For the next twelve months, I will get paid. Not a once or twice deal, but a monthly check. Smoothing out the income stream, remember? And the amount I get paid (and whether the contract gets renewed) hinges on how hard I work. The deal is potentially lucrative for both parties—it’s far more than I would make through a normal contract.
This is a new venture for me, so I can’t recommend it to any other freelancer. Obviously, the arrangement wouldn’t work on all sites—the best situation would be a client with a great idea but little startup capital who is willing to share profits. I imagine some (if not most) clients will simply not be interested—they just want to pay you once and that’s it. And I would imagine there are an equal number of uninterested designers who just want the lump sum up front.
The arrangement is actually more of a symbiotic partnership than a traditional client-designer relationship. The client trusts you to convert ad space into cash, and you trust the client to keep the site updated with new content that will bring in traffic.
I will report back on how it is going around the six month mark. (Obviously I’m under NDA to not reveal the client or the details of the contract, but I will tell you what I can.) Has anyone else worked out a deal like this?