In this article Ellen addresses a big question for coaches - how much to charge for coaching. And it's not just new coaches that ask - sometimes it's coaches that have been around for a while! This is certainly a contentious topic, and there are many schools of thought. Well, Ellen has a neato solution - pricing it "just right"...
Congratulations! You're in training or a new coach and you are excited to tell the world. You're ready to change lives and make a huge difference in the world. The big roadblock? The moment your potential client asks, "How much does it cost?" You freeze, stare off into the distance and mumble 'whatever you want'. Confused, your client says they'll think about it. You feel discouraged, and wonder how you're ever going to get even one client, not to mention as many as it takes to pay rent!
There are two schools of thought around how much to charge for coaching:
The first, charge tons! Price yourself competitively, you'll work with committed clients (because they've invested so much) and you'll start re-couping your coaching school investment sooner. You'll look like more of a professional and people will treat you as such.
The second is the opposite of that. Charge a minimal fee, and see what happens. The idea is you need clients for certification and to boost your coaching hours, so just have people pay you $25 a month for the privilege of working with you.
The problem is, neither approach works. It's the Goldilocks approach to pricing. One is too high, one is too low. And I'm here to help you find the 'just right' price point, as well as when to change it.
For new coaches, it IS important to get clients for certification hours. It's also important to be paid for your work. However, if you jump into the $150 a session end of the price point pool, you'll end up overextending yourself, and perhaps feeling guilty or like a fraud for charging so much for something you're new at. But if you charge $25 a month, you'll likely end up working with people who are only marginally interested in coaching, but it seemed like 'too good a deal' to pass up.
How to Avoid Goldilocks Syndrome and Find Your Pricing Sweet Spot:
Ask yourself these questions to find your price point sweet spot:
- How much would you need your client to pay, to feel like you are being well compensated for your services?
- How much would your clients want to pay to feel like they are getting a good deal on your coaching services?
Now, where is the middle ground?
For most people just starting out, making $100 a month from a new client feels great! And as a client, paying $50 a month for personal coaching services feels awesome. So, $75 would be the sweet spot in that situation.
"But Ellen!" you're thinking "That's too low! I want to make money at this!" I hear you - and you will. But it's important to cut your chops in financially sustainable relationships with clients (less of them leave 3 months in due to 'finances' if it's $75 a month), and gain real life experience to back up your soon-to-be-market rates.
Raising Your Rates:
Then, set an alarm in your calendar for 6 months from now. When it goes off, it's time to raise your rates! You'll have been coaching for 6 months, well on your way towards completing certification, and you're a better, stronger coach. People pay for that, and they pay for longevity of experience. You have two options when the time comes: 1) give your current clients a heads up that your rates will be increasing, and let them decide to continue working with you or not or 2) you can keep your old clients at their old rates (for now) and as you get new clients, charge them your new rates.
After a year, everyone should be paying you more. You're an experienced coach now, hopefully certified, and it's important for your rates to reflect that. Plus you'll have tons of raving fans talking about how much working with you changed their lives – which always makes it easier to get new clients.
Contributing Author: Ellen Ercolini is a Business Development Coach + Decision Making Expert. She currently works with coaches who have big visions and small practices to stand out from the crowd and make more money. She also co-founded Coaching Business Jumpstart to help new coaches build stronger businesses. Learn more about her and her work at The Creative Giraffe.
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