Pricing can be a massive mind monkey for coaches. In this article I talk about the 4 most common problems coaches have with pricing. I also explain why it’s far better to be transparent about your pricing than coy.
There’s a gorgeous dress shop in Turin. It’s got the most amazing, cool clothes on breathtakingly skinny mannequins in the window. The dresses are gauzy and opulent. Diaphanous frocks that are probably much more suited to a younger version of me abound in this shop, but I went in anyway.
Once inside, the shop was spacious and modern. It had a bone-thin, achingly trendy Italian woman working there. She was beautiful and friendly, and all of the things that make for a delightful shopping experience.
But after a few moments of browsing, something felt wrong. I couldn’t put my finger on it at first, but I was definitely feeling uneasy. Then I realised. Not one item in that shop had a price on it.
As J P Morgan once famously said ‘if you have to ask, you can’t afford it’. I turned and left. I don’t like being put in the position of having to ask the price of something unless I’m on a market stall buying vegetables. It makes me feel ‘back-footed’ and uncomfortable.
People who provide professional services have fees. Lawyers, accountants, architects, dentists, physiotherapists and counsellors – they all charge fees and they are open about what they charge. It’s perfectly normal for us to want to know what fees are before we spend time with the professional concerned. We understand that there’s a financial transaction that will happen. We want to understand what our part in that transaction will be.
For some reason those in coaching profession think that what we do is somehow exempt from this rule of transparency. It’s not.
Coaching is notoriously difficult to describe to those who aren’t coaches, and equally misunderstood by the same people. There are two problems with being a coach, one is that no one knows what we do, the other is that they think they know what we do and they’re wrong. If you think about it, we are in the only professional service that this applies to. There is no other professional service that what they deliver is utterly misunderstood.
Demonstrate The Value Before Revealing The Fee
As a result of this misunderstanding, a practice has evolved. It has coaches determined to keep their fees secret until the potential client has had the value demonstrated to them, usually by way of a strategy/discovery/chemistry (whatever you want to call it) session. These are free coaching sessions intended to show the value of coaching by experience.
The problem with this is that if a client has no clue what coaching is and equally no clue what price point a particular coach has chosen, then there is a problem. No matter how fabulous a strategy session you deliver, if the potential client can’t – or won’t – pay the fee you’ve set once you reveal it to them, then both of you have wasted an hour.
Surely it’s far better to only have strategy sessions with people who a) know what you do and b) know what your fees are?
As pricing is part of marketing, this is something we cover in our programmes at The Coaching Revolution and so it’s something I talk about on a regular basis.
Pricing is one of the topics that almost every single coach I’ve worked with has squirmed about, or struggled with. These are the top four questions I’m asked about pricing:
- How do I know what to charge?
- I have a different price for individuals and organisations, how can I be transparent about that?
- Where do I talk about my prices?
- If I tell people what my prices are, it might put them off!
Let me address them one at a time.
1 – How Do I Know What To Charge?
The answer to ‘what do I charge?’ is this; you charge the price that is equal to the value that the solution the potential client wants is worth to them. The outcome that a client seeks has a value to them based on the improvement in a particular area of their life. This could be that they have more time, more money, a career move or better relationships at home and at work for example. Your job is to understand what outcome your particular kind of client wants, and what value that outcome has to them.
As a rule of thumb, if the client is paying their own fees then the fees are lower than if an organisation is paying them. This is because the work done within an organisation inevitably has a higher positive financial outcome for the organisation and the fee reflects that outcome.
As a rule of thumb for private client work a professional fee for a coach starting out should be in the region of £125-£150 per session. If the value of the outcome to your potential client isn’t that much, then you need to change your potential client. You can’t build a financially viable coaching business with clients who can’t afford a professional rate.
2 – Different Prices For Organisations and Individuals
It’s perfectly normal to have a different price for individuals and organisations. There’s no need to be shy about it.
Stating that you have a fee of, say, £150 per session for private clients, but packages starting at £5,000 for organisations is perfectly acceptable.
3 – Where Do I Talk About My Prices?
Being coy about talking about rates is unique to coaches. Lawyers don’t struggle with it, therapists and counsellors don’t struggle with it. No, it’s just us coaches.
The answer to where do I talk about pricing is ‘everywhere’. You need to get used to being clear about your fees. We teach coaches to put their fees on their website if they have one, on their LinkedIn profile and to state fees (every now and again) in their social media posts.
4 – If I Tell People My Prices, It Might Put Them Off!
The other place that we teach coaches to state their fees is in the confirmation email for a strategy call.
Our coaches market in such a way that the people who book into their diaries have clarity. They schedule a call because they understand what the coach does. They have chosen to talk to this coach for the simple reason that this coach has demonstrated, through their marketing, that they understand the problem the individual is struggling with. Not only does the coach understand, they also know how it’s impact the life of the potential client and what a massive problem it is to them. This individual has recognised that this particular coach may be the answer to their problems. They’ve recognised themselves in the messaging that the coach uses and they want to find out more.
When the potential client books into your diary, then you send them information about the call and your pricing. If the fees are more than the client can (or wants to) afford, they’ll cancel the strategy call. Whilst initially that might feel heart-breaking, in truth it’s saved both of you an hour of your lives. The other thing that being transparent has done is removed the potential for the client to gasp ‘how much!?‘ when you reveal your fees.
If we as coaches want to be taken seriously as a provider of a professional service, we need to be more professional with our pricing. Not only in the amount we charge, but in how and where we talk about it.
Failure to provide clarity will result in the same feelings and outcome that the dress shop in Turin brought out in me. Yes, I probably could afford it, but I don’t like being made to ask for information to help me make a purchase. It’s the purveyor’s responsibility to provide all the information required so that the potential client is informed, comfortable and in the position to make a decision.