Why Ghostwriting Fees Are Like Fine Art Prices

My talented father, Richard C. Layton, was a fine artist, working primarily in watercolor, oils, and pastels. He drew and painted landscapes, seascapes, and portraits. I always marveled at how quickly his paintings would take shape. He would labor for hours in his studio, concertos and symphonies playing in the background, carefully applying layers of color to his pieces.

He often had commissions from clients for portraits, but on top of that, he loved to sketch and paint outdoors. It might take him days or weeks to finish a scene.

My dad was a true artist in that he paid much less attention, I suspect, to the business side of his craft.

In particular, I have no idea how he determined his prices. Was it based on the size of the canvas? The amount of paint he applied? The number of brushes used or containers of turpentine he went through? Was his time a factor? Or maybe the cost of gasoline when he and his dear friend Andrew Wyeth went out painting together?

When I’d go to a gallery exhibition of his paintings, I had no sense of whether the prices typed on little white circles affixed to the walls next to his pieces were reasonable, too high, or too low. The paintings frequently sold, so I’m guessing they weren’t too high. Or at least the price he was asking was what the market expected to pay.

That’s a skill many of us ghostwriters are still trying to master. What is the “right” price for our work?

Optimizing Your Ghostwriting Rate

Because what we offer is a service, rather than a product with well-defined raw materials costs, figuring out where the line is between losing and making money can be difficult. But even knowing our costs doesn’t necessarily lead to a fair price for what we do.

That is due to the unquantifiable factors of reputation, experience, and perceived value — but mostly perceived value.

As with artists, the right fee for our work often comes down to what clients are willing to pay us and which we are willing to accept. Figuring out the sweet spot of what rate is profitable for us and still within the range of what our clientele is willing to pay can come down to trial and error.

What is the Market Rate?

When pricing goods and services, the common advice is to start by studying the market rate. That is, what is everyone else charging? Once you’re clear on that, you can determine if you can make money charging what everyone else is charging.

However, an even smarter tactic is to figure out how much more you can charge.

Granted, you may need to add some services or leverage your experience, expertise, or connections, but don’t just settle for the market rate.

As many of you have already learned, in book ghostwriting, there is no “market rate.” There is no one number that everyone can agree is typical or average. In fact, the range for book ghostwriting rates seems to range from $500 to $500,000.

Fortunately, there are clues to what some firms charge their clients that you can use as a starting point.

For example, one hybrid publisher shared that the majority of its clients pay between $20,000 and $60,000 for book projects. Some pay a little less than $20,000 and others pay far more than $60,000, but most are within that range.

A ghostwriting agency offers projects that generally have a minimum fee of around $50,000, so that seems to be its market rate.

And another agency deals only in six-figure fees.

You can set your rate anywhere you want, understanding that the higher the price the fewer the people who may be able to afford your rates. And yet some clients associate price with quality and immediately disqualify ghostwriters whose rates are at the low end.

What Fee Can You Command?

The problem with charging too low a fee is that in addition to signally that you are less experienced or less qualified, it’s hard to make any money. Charging less for your work puts pressure on your personal finances. If you charge too little, you will probably have to take on multiple projects in order to pay your mortgage and keep your lights on.

There’s no shame in taking on more work, of course. However, the risk is that over time you can become burned out.

From the client’s perspective, you won’t be able to give them your full attention because you’ll be juggling several other projects out of necessity.

Charging too little is not in your best interest or your clients’.

Granted, there are times when charging less can make business sense. Such as if you’re just getting started and need to get some experience. In that case, yes, be willing to negotiate if you must.

But don’t stay at that price forever.

Moving Upmarket

The truth is that you can charge whatever you want. You can charge $150,000 or $250,000 or even more for your first ghostwriting project. That is totally your decision. And if you’ve already made a name for yourself in a specialized industry or you have a bestseller credit, convincing a client to pay you that fee is certainly possible.

There is a scorecard that some agencies and publishers use when determining what they expect you to charge. You may want to use it to help justify your fee, or to set goals for yourself. But use these as guidelines, not restrictions. Some of the factors agencies consider are the:

• Number of books you’ve written under your name
• Number of books you’ve ghostwritten
• Number of traditionally published books you’ve worked on
• Number of NYT bestsellers you’ve written or ghosted
• Number of WSJ or USA Today bestsellers you’ve written or ghosted
• Number of books that have been commercial successes
• Other well-known media outlets you’ve written for
• Celebrities or big-name clients you’ve collaborated with

You don’t have to have all of these qualifications, or even some of them, to ask for a high fee, however. You can charge what you wish. But do keep in mind that your prospects are likely shopping around. If they can find a ghostwriter they like who is charging significantly less than you, you may find yourself at a disadvantage.

The good news is that if any client pushes back, you don’t have to explain how you came up with your price. No one asks management consultants how they decided on their project fees or how attorneys devised their hourly rates. It’s what their time is worth to them and clients can decide if they want to pay it.

By the same token, you get to decide for yourself what your time is worth.