“Price is what you pay. Value is what you get.”
– Warren Buffett
I’m currently doing a series of Facebook Lives about ‘money beliefs’ in the Profitable Coaches Group. Last night’s video will be relevant to you if you charge for your services (or if you wish to charge for them). In this excerpt, I answer a question from Doreen Ritchie who said, “There seems to be a median price charged round here for coaching. It would be very difficult for me to charge a lot more than that…” If you want to watch the full video this excerpt came from, you can see it in the group here.
Here’s what I replied:
So first of all what incentives or disincentives are built into your pricing model? Here’s one of the big ones that is huge for a lot of coaches. Doreen for instance posted a question about ‘there’s a median price that most coaches charge around here and
it’s like between 70 and 100 euros an hour’ but right there is half the half the problem. One of the one of the issues if you think about it charging by the hour; if you think about
relatively expensive ‘hourly cost’ people, who is that? So off the top of my head; plumbers, electricians, lawyers and here’s an example:
My car; I’ve got an Audi A5 and I had a problem with the headlights so I take it into the Audi garage and they say “Okay; it’s gonna be a hundred and twenty five pounds for the first hour. And then if we can’t figure out in the first hour there’s gonna be a second hour and it’s going to be another hundred and twenty five to diagnose it. Then when we figure out what needs doing it’s a hundred and twenty five pounds per hour to do the labor, plus the parts and all that sort of thing.”
So they’ve told me that’s their price; it’s 125 an hour so what am I thinking? Right away this morning I’m thinking, “Jeez! I hope they manage to fix it fast because the clock is ticking.” Now that’s what’s going on for me with getting my car repaired, and that’s what’s going
on for most people if they call a plumber or an electrician. That’s what’s going on for most people if they have to hire a lawyer they’re looking at the the meter running -the per hour meter – and then they do exactly what I wanted to do today. I want to minimize my exposure, I want to minimize the amount that their clock’s gonna take so I’m hoping, hoping, hoping that the mechanic manages to figure it out and fix it as quickly as possible.
Now here’s the thing if you’re wanting to get into client relationships. Now I don’t know about you, but I I like working with people over a long period of time (like a whole year) because I want to go for profound transformation. I want my clients to be massively
committed to what they’re doing. If someone’s coming to work with me to grow their practice I want to be asking them okay what do you what do you want to get from this?
So Krista for instance you and Reed (creators and owners of Centered Recovery, a drug and alcohol treatment facility in Atlanta, GA) they’ve got clients who want to get sober, they want to get their family off their backs and get out of trouble with a lot all the different things that they might have going on so you want them to be massively committed to that outcome and to doing whatever it takes to reach that. You don’t want them watching the clock and going, “I hope it doesn’t take another hour” and so that to me is one of the massive either incentives or disincentives that’s built into pricing.
So for instance, if I enroll a client to do a three-day intensive with me, the three-day intensive costs 30,000 pounds and then they get 12 months of follow-up coaching with me. They pay that money upfront and so I know they’re massively incentivized to show up for their coaching calls, to show up for the three-day intensive to really take the things that I’m offering them and reflect on them and put them into practice. And really they’re massively incentivized to get the most from our time together. Now if I was charging by the hour for that if I said you know what? I’m not gonna charge thirty thousand up front; I’m just gonna charge a thousand pounds an hour say or five hundred pounds an hour six hundred pounds an hour or something like that, and we’ll just keep the clock ticking…
They would try and minimize their exposure and they would likely to be leaving at the very point where we’re about to get somewhere! Because I may be shooting myself in the foot by saying this, but often when I’m working with someone over the course of a year there will be times when it’s a bit of a rough ride. There are all kinds of things that can happen but I want to know that that we’ve got that commitment and that container where we
can do whatever it takes to help them get what they came for.
Next week, I’ll be sharing an interview with Christina Cooper, a coach who shifted from ‘charge-by-the-hour’ to a package model after joining me for the Thriving Coaches Blueprint last November.
By the way, we’re going to be opening the doors to the next intake of the Thriving Coaches Blueprint programme next month. The whole domain of pricing and packages is something we cover in-depth on this programme. If you’re a coach, therapist or other transformation professional and you want to get clients and grow your practice in a way that fits with who you are, it could be a good fit for you (and vice versa). You can find out more about the programme on our new webpage here: https://www.jamiesmart.com/thriving/
Sunday Times Bestselling Author, Speaker and Executive Coach
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