Here's a question about pricing I received from a reader named Lucas. Lucas runs a web development company named TwoStep.
Lucas asks: What do you say if a customer asks why a corporate identity cost so much more for a big business, compared to a small business?
The answer is, it's a matter of value. The value of creating a logo, website, etc. for a company like Starbucks is much higher than for a coffee shop down the street. More at risk, more reputation to protect, bigger stakes, more research to do, more deliverables, equals more value created. And anytime the value goes up, the price also goes up.
The reality of it is that the value of design is not all the same. Good design is not a commodity, so you can't charge a small business, the same thing you would charge a large business. They have totally different needs, and they have a different set of values they are working from.
A man who goes to a hardware store to buy a power drill doesn’t really need a drill—he needs holes. - Jay Abraham
Another way to look at it is to know what’s actually being purchased. (If you are a service provider, know what it is you are selling). People purchase design services (or anything really) for different needs or results. You might be purchasing a logo or website, but businesses don't buy a logo or website just to have. They buy them for the result it can get for their business. More traffic, more customers, more money. And often the results (both good and bad) are much greater for a large business compared to a small one and therefore should be priced accordingly.
Think about the scenario where a person pays $75, $100, $150 for a haircut while others will only pay $15. If you are risk-averse, you’ll purchase the higher-priced haircut. You might end up with the same or similar haircut as if you bought the $15 hair cut, but you are paying for a guarantee of sorts that it's not going to be a total disaster. You know that by investing more, there's a level of certainty in the outcome that you are willing to pay more for.
Larger companies tend to be more risk-averse because they have more at stake and more to protect and for that they should, and are happy to pay more.