Why Coaches Don’t Charge Enough
Having coached coaches and consultants for over 13 years now, I keep hearing the reasons coaches and consultants aren’t comfortable charging more than a piddling little fee, or especially charging enough for their coaching fees.
Let’s dive in to explore the why they don’t charge more, why that’s soooo wrong, and maybe even what coaches should charge and how to make more than a comfortable coaching fee.
Reasons why most coaches charge too little for coaching, and most likely why you charge too little.
- You don’t see, or don’t understand the value of coaching. Actually I’d say that 90% of all coaches don’t understand what “the value of coaching is”, or, more specifically what their value is to a client. I have frequently asked this question of coaches, “Why should anyone hire you instead of the 10 coaches on the top of Google right now?” Or what are the coaches in your field around your city worth? Obviously the reason to hire any coach instead of another is that you have to be more valuable. However, do you even know what those others are worth, or what you are worth in comparison?” What you are worth is how much value you deliver to your client. Do you even know what an average coach is worth, or delivers in value to his clients, let alone what you are worth?
- You have your own vision, a totally downgraded vision of why people won’t pay you more. When I ask a coach what he is worth, I usually get a blank stare, and after a long hesitation, I hear things like, “I’m not focused on money. My clients just want to be better.” Better at what? How much better? When a coach, or anyone for that matter cannot answer the question of what they are worth, then they choose a value that is worth less, or worthless in convincing a client to buy. The truth is that when your prospects SEES THE HUGE VALUE he would get, how much further he would go quickly, he WILL FIND SOME WAY to pay for it.
- You are trying to sell coaching to people who don’t see the value and would never buy coaching even if you could prove the value. Many of you have heard me say that the belief system of your ideal target client determines IF and HOW MUCH he will spend, once you have layed a specific value out for him. So, if you are reaching out to a type of client who has NEVER spent money to get ahead, either you have a long road ahead of you to convince someone who’s belief system blocks him from EVER doing it, or by simply stepping up to the ideal client who has already regularly hired to get LOTS more, then the only thing you have to do is lay a value in front of him that he seriously wants.
- You are sure you aren’t worth more. Let’s say you are a coach that doesn’t have the history of delivering a huge value before, and you have seen either credentials or value your competition delivers. Is that intimidating to you? Well that usually means that a coach starts by turning his price down, and sometimes down, down, down, until he can get a sale. Or he does a lot of freebies. But the desparate thought is, “get more sales at any price”. I’d suggest that your first goal is to get HUGE MEASURABLE RESULTS as quickly as you can. So, set a goal of coaching so many people, even if it is for free, and for a testimonial that includes a measurable outcome, your value. However, one big warning I’d throw out there is that people who you get for free, quite often will not make the commitment to themselves, and to you to do the necessary work to get that value. So one of your requests should also be that they MUST commit to doing the work, and actually getting the value. Set weekly goals, and hold them accountable. If I have a client, even a paying one, that doesn’t follow through, I will very quickly be telling him, “I WILL help you get that X times bigger outcome as long as you do what we agree upon weekly. But I CAN’T help you move even an inch without commitment and follow through with the actions we agree upon. So, even free, this must be your ideal client, one that is committed to both his success and yours.
- You are trying to coach too many people. When I first started coaching I thought that I needed a LOT of clients, 20 to 40 or so. And because I was not charging enough, it would have taken that much to make as much as I used to make working for an employer. That also creates another problem, that is constantly having to marketing to acquire new clients. Well, if you are trying to fill your work week doing nothing but coaching, you don’t have time to market, sell, to get out there to acquire clients. That’s another reason that you need to charge more than a measly hourly rate. If you spend half your time acquiring clients, and half your time coaching, you have to at least make 2 times your hourly needs while coaching. But that is only a minimum when you believe that you should charge an hourly rate. The average successful coach has only about 6 to 10 clien
- You are charging by the hour, and are judging hourly rates by people who can’t earn much.
- You want to coach low income people who desparately need what you target, but desparate people don’t have the money, nor have they EVER paid for getting results, so it isn’t starting now. I discovered something about low income versus high income, and low success vs highly successful people. The lower the income, and the lower the level of success history, the less likely they can be convinced to ever spend money as an investment in getting better at anything. Why? Their core belief system, the way they manage their life and their money is about cutting expenses in order to stay within a budget. That means when you give them a great promise to help them get even what they want, they will reply, “Wow, I wish I could afford you.” But when you move to ore successful people as your ideal target market they have already experienced that spending a $1 with a target ROI of 10 times, or whatever times gets the further ahead quickly, and they are already looking for help to do it. That is the number one difference between unsuccessful and successful people. So why waste your time trying to convince the unconvinceable when all you have to do to multiply your success several times is to go after those who are already looking for what you do?
Why charging low fees hasn’t worked for you before?
- People perceive life and business coaching as a high end expensive service. Your job is not to lower your fee, but to find those who WILL buy something that delivers more than it costs. Low end, unsuccessful people don’t buy outside of their low perceived budget. Hi end, successful people are already looking for help that delivers high ROI no matter what the cost.
- Your prospects don’t look at coaching as a high return on investment, rather a high cost to be avoided. Only choose people who want a high return, and show them the HUGE VALUE you are providing.
- When anyone is convinced to buy a high end service, they say to themselves, “I am worth it”, “I am worth the big return on investment”. Otherwise they will never spend it. Make sure your target ideal client thinks that way.
- People want their money’s worth so the more they pay the more value they expect to get. You must lay the value you provide in front of them so that they perceive your fee as an investment that returns HIGH ROI.
- Your clients deserve better service from you. Do you provide the highest value of any coach you know of? Why not?
Your Real Value — The Reality Check
- Coaches worldwide average around $200 per coaching hour. And that is AVERAGE. I do NOT believe I am average, do you? So what does it take to be above average? And to be worth it? Delivering higher value than anyone else…delivering higher and higher value the longer you work with someone, and the more valuable you become to them and future clients.
- An average coach delivers a result that is about 5 times whatever their fee is. And as I said in #1, if you consider that you are above average, that means you have to focus on delivering more than 5 times you fee. That also means have a measurable result for your clients.
- According to Sherpa Coaching most professional coaches average just six clients per week. So for you to make a “living wage” or even better, what you are worth, you have to charge enough that you earn a decent weekly fee. You make work only 6 hours that week, but you should be making MORE, sometimes LOTS MORE, than you used to make when working for an employer.
- If you are a very valuable coach, frequently you will spend more time doing some research to help your client. A lot of coaches tell me I shouldn’t do that. However, early in your coaching, the more time you spend on looking up ways to help your client to even higher levels, the more valuable you will become over time. This is yet one more reason that you shouldn’t be spreading yourself over too many different types of clients. Become THE TOP coach in your field. The #1 reason you should be making the highest fee in your field.
- Even if you have only 5 to 10 coaching clients, you will need to spend some time and expense on marketing and sales. Make sure that your fee, which is only a small percentage of your value is made in the few hours you do coaching.
- When you add up what it costs to be in business, marketing expenses, other business expenses, income tax, retirement investments, and if you live in the U.S., health insurance premiums, your Social Security and Medicare payments, saving for things you want and your children’s education, you will find that earning a $100K take-home salary from coaching ay easily require $150K in income.
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