Return On Investment: 3 Types of ROI That Wins Architecture Clients

Speaking to a room of investors, company leaders, or families always brings a brief moment of anxiety, fear, or hesitation. Especially when the time comes to present your fee. You hope that you’ve done everything in your power to justify the number that you say next.

But it doesn’t always pan out the way that we want it to, right? Sometimes you get crickets. Other times? Surprised looks, objections, disappointment - you name it.

There’s a lot of nuance to discussing money with prospective clients. If the conversation isn’t primed appropriately, then it usually won’t end well. But if you’ve taken the time to build up the value that you’re providing for your client, the fee will be seen as a necessary and affordable step toward their goals.

Architects provide a premium and unmatched service to their clients. As a result, every architect should feel confident and justified in their fee. One of the best ways to do this is by understanding the Return on Investment (ROI) that your prospective client can expect.

ROI puts your fee in terms that your client can understand. You shouldn’t be surprised to discover that prospective clients have a steady flow of questions running through their minds like:

• “What do I get out of paying you?”

• “What impact will this have on my life?”

• “Is this a decision that I’m going to regret?”

And you can alleviate these questions and concerns (before they’re even uttered) by being upfront with a discussion about ROI.

Many architects make the mistake of only considering ROI from a financial perspective. But you shouldn’t limit yourself to the types of returns that you provide for your clients. Many returns go beyond finances. There are tremendous lifestyle and mental returns to your service, as well. You can choose the best way to utilize ROI in your conversations based on your client’s goals and ambitions.

Here are 3 ways to frame ROI for your clients:

01 // Financial ROI

As previously mentioned, most people think about finances when they consider ROI.

How much money will the client make on this investment?

There are many different ways to calculate financial ROI given the vast amount of variables at play. My recommendation? Don’t overcomplicate it. It doesn’t have to be a complex, itemized table. And you don’t want to overstimulate your client with numbers.

Here are the 3 questions that financial ROI should address:

1. What’s the total estimated cost of this project? (inclusive of construction, your fees, permitting, etc.)

2. What’s the estimated final value of the project upon completion?

3. What’s the difference/delta/equity the owner can expect upon completion?

Presenting these answers in a simple format is an easy way to alleviate financial concerns from prospective clients. Financial ROI also contextualizes services fees, making them appear as an obvious step toward a beneficial outcome.

02 // Lifestyle ROI

Addressing Lifestyle ROI is about answering one simple question:

What will the client be able to do in their new space that they can’t do now?

Architects that focus on a deep discovery process that uncovers pain points from prospects will find Lifestyle ROI most useful. When you understand the obstacles that prevent a prospect from living or working in their ideal way, then you can better position your service as the solution.

Examples of Lifestyle ROI for residential clients would be:

• Enough space to easily host the entire family in their home for the holidays.

• The ability to cook with the entire family in the kitchen.

• Quieter working or learning environments.

• Significantly more access to natural light.

• More access to privacy.

Examples of Lifestyle ROI for commercial clients would be:

• Leadership office locations that make it easier to monitor team performance.

• Gathering spaces that can effectively host the entire team.

• Increased efficiency and collaboration from open spaces.

• Separate conference rooms for client conversations.

• Small spaces for private conversations.

This is more about the qualitative return that your clients can expect in their daily lives or those of their team or family. Making these benefits clear will help prospective clients imagine the positive impact of your work.

03 // Mental ROI

The last type of ROI focuses on mental return by answering the question:

How and where in this project can you free up headspace for your client?

Or, to ask the question another way:

What stressors are you able to minimize or remove completely for your client?

There are two components to these questions. The first is the owner’s mental state during a project. The second is the owner’s mental state after a project is complete.

During a project, architects minimize the owner’s stressors through:

• Reduced legal risk

• Reduced management

• Effective communication

• Reduced construction costs

• Staying on time and on budget

All of the above factors make the owner feel as though they’re riding your coattails into the sunset.

After a project is complete, architect-led projects reduce stressors through:

• Reduced building maintenance (which also has a financial ROI…)

• Increased energy (through more natural light, for example)

• Adaptability to future needs

• Ease of use

These factors should not be overlooked. They are huge benefits that positively impact your client’s life by doing your job well and making their job easier.

Lead with ROI

In the realm of fees and finances, the concept of ROI becomes your most reliable ally. It’s not just about numbers and costs; it’s about framing the true value of your architectural expertise. Consider how each type of ROI — Financial, Lifestyle, and Mental — plays a pivotal role in your narrative:

1. Financial ROI: This is the bread and butter of any investment conversation. It's where you demystify the financial aspect, breaking it down into a simple, digestible format. Answer the question: How much money will the client make on this investment?

2. Lifestyle ROI: Here’s where you paint the picture of the daily life enhancements your design brings. It’s about turning spaces into experiences, showing how your solutions enrich and facilitate new ways of living and working. Answer the question: What will the client be able to do in their new space that they can’t do now?

3. Mental ROI: Often overlooked but immensely vital, this aspect covers the peace of mind and ease that your involvement guarantees. Highlight how, by entrusting you with their project, clients are buying into a worry-free process and a future of reduced stressors. Answer the question: What stressors are you able to minimize or remove completely for your client?

By leading with an ROI-centric dialogue, you're not just talking fees; you're communicating the essence of your value. It’s about making the clients see that your fee goes beyond architecture — it’s a commitment to enhancing their lives on multiple fronts.

Your expertise isn’t just a service; it’s a key to unlocking a more efficient, enjoyable, and stress-free way of living and working. And that’s where your fee stops being just a number and becomes a part of a larger, more compelling story of value and transformation.