Setting Coaching Fees

The third in a series of four articles summarizing results from my conversations with 14 established coaches. See this link for Part I, and this link for Part II.

How did you set your initial fees, and how has your pricing evolved as you gained experience?

This was not a question I had initially planned to ask for the research paper. However, during the final months of my ICA coaching program, I encountered distress around how to set fees in so many peer coaching sessions with my fellow student coaches that I felt compelled to go back to my initial set of interviewees and add this as a written response, and then included the question in subsequent interviews.

One interesting point: even the established coaches I spoke with were intensely curious to hear what their peers were saying about fees. It seems this question-mark around how to set fees is not fully resolved even after five or more years in the profession.

While I had hoped to gather some clear direction on how one should set coaching fees, the responses were so diverse that after analysis, it seems the best approach is to simply outline a general set of criteria or variables by which coaches make their decisions about what to charge for their services.

These decision criteria for how to set fees included:

• Amount of coaching experience of the coach
• Amount invested by the coach in coaching training and other previous professional training
• Amount and type of relevant previous (non-coaching) professional experience
• Previous (non-coaching) pay-ranges
• Geography where coaching is provided
• Ability of target / niche demographic to pay (e.g. corporate clients could pay more than those in other fields)
• Who is paying (e.g. third party corporate coaching vs. individual)
• In-person vs. virtual / phone coaching; individual vs. group coaching
• Type of coaching offered (e.g., executive coaching vs. creativity coaching)
• Focus and scope of an offering (e.g. packages, programs, or group coaching; number of months and/or number of sessions in aggregate)
• Lifestyle / level of needed or intended income of the coach him/her/them-self
• Number of coaching clients a coach plans to take on (or thinks is reasonable to take on, which can be stated as number of clients per X time period; number of calls per day; clients per week, etc.)
• Increasing the fee/ rate after any of:

1. X number of additional clients served
2. Additional months or years of coaching experience
3. Moving from ACC to PCC or MCC certification
4. After any new relevant training or certifications

NOTE: Several established coaches reported holding between one and three initial sessions with a potential client before ever discussing packages or pricing (the “creating the client” process).

Ranges of fees charged: Coaches interviewed reported charging everything from $10/hr-$35/hr (as a student coach) to $50,000/year or more per packaged offering as an established coach. The lowest fees were reported while still in student coach status, and highest fees began to peak after as little as a year or two of coaching. One coach reported simply basing their pricing on market research (having done the analysis and arrived at average ACC/PCC fees charged, roughly equal to $200/$350 per hour, respectively). One established coach admonished that we should charge no less than the most we had ever been paid in any previous role. Several coaches set sliding scales for pricing, either based on the number of sessions offered, or on ability to pay – for instance when charging more to higher-ability-to-pay clients (corporations) allowed them to charge less for individual clients in certain populations with less economic means. The relative nature of what we choose to set as our fee was summed up this way by one interviewee: “I have met extraordinary coaches who charge less than me, and I’ve also met ordinary coaches who charge double what I charge.”

Advice and reflections around fees: a compilation of thoughts from across the interview cohort.

“When I was still in training, what helped me is what I heard from my coaching instructor: “Charge as much as you can get out of your mouth without choking.” It sounds glib but makes a lot of sense. Everyone is different, there is no formula, every niche is different, your background, history, your reputation and street cred in that niche may mean you can command a higher fee. It is about trusting ourselves, about how much we feel we are credibly worth at that moment in time and the perceived value of the outcome to the client.”

“Only sell packages. I don’t think coaches should quote hourly fees, it is not healthy for our profession to go down that commodification road. And not good for the client. Because the client doesn’t understand what they are getting, they need to have a different kind of value conversation. We don’t sell ourselves, or our time, we are selling the change the client wants – what is that worth to them?”

“As a profession, we need to be careful about not under-pricing our services. There is a trend towards cheap, 'on demand' coaching via things like SMS text that has a potential ripple effect of diminishing coaching's value.” 

“We coaches are paid for results. Best if we do not charge by the hour but instead by the package.” And similarly: “I hired a marketing coach who said you need to sell an ultimate result.”

“If you do the exercise of comparing to your peers [e.g. market research] try not to set not too high, not too low: price competition will drive the market to the bottom and that doesn’t help anyone.”

“After every six clients at a given fee/rate, raise your rate again.”

“Stop assuming what you think any given client can pay – simply ask your price and see what happens. They will often surprise you.”

“Add…up the cost of tuition, fees, and … the number of labor hours … spent on coaching classes, study, and reading. [Start with the rate you earned at your last job]. Please keep in mind no company will be able to fully compensate us for what we are worth based on the value we bring to an organization, but it is a good baseline. We all know we are worth far more than what we are getting paid!”

“Many coaches set their price based on a feeling. For instance, they think they can’t charge much because they are “new.” This doesn’t take into account their life experience, and everything they bring to the table. It is not based on truth.”

Regarding the example of setting lower fees for creatives (artists, dancers, writers): “Maybe this is something to re-examine, for instance if creatives themselves are not setting fees for what they are really worth, can paying a coach more help them realize they also need to charge more for their services?”

“Ask yourself, what is your floor, and what is your ceiling? How much is the least I would accept, and what is the most I could imagine ever asking? What is the minimum you can charge where in two months you won’t say to yourself, “it is not fair to myself that I charged so little.” Don’t go below that.”

“Consider that our fees are subject to change. Because each day, each week, each month I spend coaching and investing in my development, the value I can provide definitely increases.”

“Five rules of coaching, which build on each other:

1.    Be Coaching

2.    Charge something, charge anything – the difference between zero and $1 is massive for some people.

3.    Charge more.

4.    Charge more than you ever thought you could to do coaching.

5.    Hire a coach you couldn’t possibly afford.”

“I recommend early pricing at $500 for two sessions a month – most people will say yes to that because it’s less than rent or a mortgage payment. This also allows you to get started with clients with no big commitment, that builds your confidence -- you get money flowing in, your confidence grows. Then you can move on to packages, such as $10K/ year. In coaching, reaching a fee level of $1000/month per client is the big threshold.”

“Most coaches are averse to selling when it is the most important skill you have other than coaching. It is not different from coaching. Really great coaching is no different from really great sales. When you coach, you coach for resolution through insight. When you sell, you coach for resolution through commitment.”

“I have a philosophy that I’m not an ‘hourly’ service. If I have a client mention that a particular book is informing their thinking, I’ll read the book so I can coach them with that in mind. If I have a client that needs me to custom-design an exercise for them, I’ll do that…. I take calls between sessions, texting, e-mails, I will extend beyond the number of sessions to achieve a milestone, etc. So I knew I needed to charge a ‘package’ price, not by the hour.”

“If you are a coach you are always underestimating your worth, so work on it. Ultimately “Charge what feels right.” At that time, for that client. Balanced by “you’re probably underestimating what you’re worth.” You can play with this dynamic – you don’t have to charge anything in particular – it is up to you. Experiment.”

“Don’t get stuck thinking about this from a perspective of lack and scarcity, instead consider it a place of possibility and excitement. Think about it. Are clients really paying you for your time? No. they are paying you to get them where they want to be. Massive change, insights, events, What is that worth?”

As asserted by three interviewees, what is clear from a coaching standpoint is that the issue of setting and paying fees is intimately bound up in the coach’s own issues around money and self-esteem (“what am I worth = what can I charge?”), and the client’s issues around money and self-esteem (“what am I willing to pay; what can I afford; what is my growth worth to me when considered in terms of money?”). As one established coach put it: “when a client first commits to pay for coaching at a certain level, there, the journey of change has already begun.”

For a list of coaches interviewed please see Part I.