We have a friend who supplements his income plowing driveways in the wintertime.
I discussed his financing with him once. He stated that he prefers to have customers who hire him “for the season”. They pay a certain amount for the year and he promises to plow their driveways every time it snows. When the winter is rough, he may be around far more times than if the winter is mild. Either way, the cost is the same.
It stands to reasons that this retainer fee has benefits and drawbacks for the “plower” and the “residents”.
The snow plow owner may in fact have very high costs, both labor and supplies, in colder, snowier years. Residents, on the other hand, may feel like they are not getting a good deal in warmer winters, when they are paying the same amount, but aren’t requiring the same amount of service.
The snow plow owner is aware of these nuances. For him, the most important thing is for the homeowner to feel like they are “covered” for snow removal and not feel like they have to call every time the skies darken. Furthermore, for his small business model, it’s much easier to collect a seasonal or monthly check as opposed to trying to chase down his fees for snow removal on a “per event” basis.
We struggle with the same issues as a small, but growing marketing company. For some of our larger clients, it makes perfect sense for us to be “on retainer” all the time, knowing that there are regular tasks that we do like social media posting, blog writing, website management and updating, press releases and being a part of the fabric of these businesses. These companies would probably spend too much precious time (as would we) if we treated each service as an a la carte item, billing separately, and keeping track of what could be quite onerous paperwork. Of course, the onus is on us, the marketing professionals, to make sure our fees represent what we spend in time and staffing on the client.
However, not everybody needs monthly attention. Some people truly have “term limited” projects, like a website that needs to built or refurbished, an event that needs to be marketed and managed, flyers, email marketing or press releases that need doing.
We try very hard to spend our clients’ dollars efficiently and fairly. Although we understand the snow plow model, not all weather patterns are the same, not all driveways are the same, and no two clients’ needs are alike.