HCPC Ep 63: Pricing & Packaging Your Services To SellMay 31, 2019
Are you getting hung up on pricing your programs? It feels like a financial decision but it’s really all about…marketing. Same thing goes for how you package up your services. In this episode Michelle answers some tough, important questions so you can move forward.
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Hello there health coaches! Nice to see you today. I am curious because I’ve been getting a lot of questions. If you’re getting hung up on your pricing and how are you going to package up your program? Is it 6 months? Is it 12 sessions? Is it 3 sessions, et cetera. Should you offer monthly payments? Should you offer, pay in full plans? You know, all the questions that come up when we start to actually offer our services. Hey, and this is like a good problem to have. It means that you’re at the point where you are asking for money in exchange for your services. So congratulations for getting here. I know when you’re pricing, it feels like you’re making a financial decision. You know, it’s kind of like you’re buying a car and you’re like, well, you know the car, it’s got a steering wheel and four wheels, so it’s worth this amount of money.
I don’t actually know very much about cars if you can’t tell, but you know, you might be thinking the same thing. All Right, well this health coaching package, it has, you know, this many sessions and blah blah blah, and you’re trying to put a dollar amount to it. But pricing really is not about any of that. Pricing is actually a subset of marketing if you can believe it. So if we, you know, if your business was in a building and the financial department was over here and the left wing and the marketing department is over here and the right wing pricing boom, that goes under marketing. So start thinking about it that way and you just put yourself into the position of your prospective client and you’ll probably start making sense, more smarter decisions, especially after I share with you a whole bunch of tips today.
So, like I said, lots of questions about this. I want to hit the hard topics with you so that you can move forward and not just get stuck with the like, I don’t know what to charge or I don’t know how to do this. Who Does? None of us do. We all just kind of make it up as we go along and get the best advice that we can from whoever we can and get smarter as we go through our career. I’ve been doing this for 10 years you guys, so I’ll share with you what I’ve learned so far. I do actually have a free guide that you can download that’s going to go a little bit more in depth about three particular pricing strategies that I have found to be particularly effective. It’s called, pricing strategies, what’s working now for health coaches and you can grab that at healthcoachpower.com/pricing check it out.
As I mentioned, I’ve been doing this work for 10 years. If we haven’t met before, I would just want to say, hello, my name’s Michelle Pfennighaus. I do still to this day work with private clients in my health coaching package and of course I act as a mentor for my fellow health coaches. Thousands and thousands and thousands of you and if you’ve been a student at the Institute for Integrative Nutrition, you may have seen me because I am part of the curriculum there where I teach about marketing.
So, let’s get into the first question today, which came from Alexis and she said, pricing, how often or how soon can you increase your pricing? As my business grows, I’m realizing just how much work goes into my amazing programs and how low I feel my price actually is. I know people in the market are charging much more and I want to find a price that feels really good for me and reflective of how much I do and all of the extras that I provide. In the past. I compared myself to a nutritionist or a therapist in terms of pricing, but I realized that they do none of the extra work that I do outside of sessions and my prices need to reflect that I provide a ridiculous amount of support. So, any tips on how to increase pricing and how to go about letting old clients know their next program will cost more? I have several clients who will be continuing on a new program and I don’t know whether I should keep them at the same price.
Whew. a whole lot in there, Alexis. I want to address all of it. So let’s just start with the idea of raising your prices for whatever reason and however much you raise them. What do you do with the clients that you currently have? What if somebody has is already working with you and you’re telling them it’s sort of like a landlord raising the rent?
How do you break the news? So Alexis, a very common thing to do is to not raise the prices on your current clients, but rather to sort of grandfather them in at the rate that they’re currently paying. There may be good reasons for exceptions here. Like if someone started working with you in the year 2000 and now it’s 2019 yeah, you might raise your rate on them after the first couple of years at least. But if it’s, that’s usually not going to happen, right? We usually have somebody who does one program with us and then maybe they re-sign again maybe three times. I don’t know. I think the longest I’ve ever worked with a private client was about a year and a half, so I personally would always grandfather them in at the same rate. However, if they stop working with you and maybe come back six months later or a year later as people will sometimes I think at that point it’s perfectly fair to say this is my current pricing and that makes sense.
Right, and I think that you’re just doing a, you’re doing a sort of a courtesy by grandfathering in your old pricing for them, but when they come back, they’re no longer privy to that grandfathered in pricing. So I hope that helps with, let’s do with the current folks that you have on your roster and by the way, congratulations that they want to keep working with you and that you have clients that are clearly happy and that this is even a problem. I would call this one of those good problems. As for raising your rates in general, you said how often or how soon can you increase your pricing girl, you can increase your pricing any time you feel like it every day of the week it is up to you. That is the beauty of running your own business. You do not have like run it through a whole lot of higher ups or red tape.
You would get to make these decisions. So when I know when I started my business I would literally be on the phone with one prospective client and think, oh that didn’t go very well. I have another consultation this afternoon. All right, let me try again and change my price because I felt so insecure about what my pricing should be. I don’t necessarily recommend that, but the point is you can continuously change, adjust your pricing and your packages unless you have all this information published to your website, which is one reason I don’t. That way I can change my pricing anytime I want and I don’t have to worry about what somebody read on my website last week or earlier today. Right. So I do suggest keeping pricing sort of behind the closed door. Something that you talk about once you have somebody on a phone call with you, that’s just one reason why.
But uh, yeah, you can increase however and whenever you see fit or even decrease. Sometimes there’s good reasons to decrease your pricing as well. Maybe you’ve been working with people for 12 month program and you’re realizing, I don’t want to do that anymore. Uh, I think people are getting really great results in the first six months. So you’re going to do a shorter program and it’s going to be less expensive. So it’s a different package and it has a different price. The other thing that you’re saying is that you’re feeling that for the time and the support that you put in, you should be getting paid more. That may well be true and that is something that we have to consider. If you’re breaking down how many hours you’re spending with the client and it’s coming out to like you’re making 10 bucks an hour, that’s no good, that’s not sustainable for you, your business, and then you’re going to have to quit and nobody’s going to get your help.
So definitely do consider that. However, I’m going to encourage you to think about praising, not so much in terms of how much effort you put in, but how much results or what are the results that your clients see and what are those results worth to them? Because actually let’s say you put in like a lot of effort. Let’s say you spent like 40 hours a week helping your client and supporting your client, emailing them and texting them, and you did this for like a year. I mean, oh my gosh, you should get paid a lot for that, right? But let’s say at the end of the day that you helped them lose five pounds, how much is that worth? Is that worth all those hours? You know what I mean? Like there’s a disconnect there. On the other hand, if you could help somebody meet their weight goals or whatever their goals are in like six weeks, even though you didn’t put in all those hours, maybe you only met with them once or twice, you actually did a whole lot less work, but they got great results.
You could charge more for that. So you really want to think more about pricing from your client’s perspective. What is their big problem? What is it worth it for them to solve? How can you help them solve it as quickly as possible because that is actually more valuable than taking a long time to solve the problem and price from there.
What was the last thing I wanted to comment on here? Oh yes. You said something about comparing yourself to nutritionists, or therapists, um, in terms of pricing. So that’s a little bit tricky. Also, I wouldn’t necessarily recommend that anybody compares themselves to a licensed medical practitioner. Um, like let’s say somebody who has a, you know, a, a PhD or has a registered Dietitian, um, or somebody, a doctor or anything like that, number one, because straight up those people did a whole lot more schooling than you have.
I don’t know about you Alexis. I’m saying you like collectively all of us have as health coaches. So like there’s a good argument to be made for why they should be charging more than a health coach. That’s not necessarily always going to be the case, but it’s just not apples to apples, you know what I mean? And then the other thing is that a lot of these practitioners are accepting insurance. So while they may make x number of dollars per hour, their clients, patients, whatever they would be called and that situation are paying like a $20 copay. So it’s all weird. Like it’s just not something that you can really compare yourself to. I usually say try to compare, compare yourself to a practitioner who has about the same level of training as you do. Like when you’re first starting out, you can raise your prices like through the roof later, but if you want like a point of comparison, it’s like massage therapists, a yoga teachers who’ve done like a 200 hour training, things like this.
And when they’re working one on one with a client, how much are they charging? Like an hourly rate? Like that’s something that I might compare myself to. Um, but again, this is all so flexible. If you’re solving a huge problem for somebody and you’re good at it and you can get it done fast for them, you could charge $10,000 for your health coaching program. Right? So it really goes back to what is it worth to your clients to get the results that they want to get? How big of a problem do they have and how quickly can you help them solve it? That was a lot. I know. Did you guys get all that? If you’re here with me live, by the way, I know a bunch of you are. Go ahead and put any questions that you have into the comments. I am looking for them.
I see Brenda is here. She says hello. She’s excited to listen in. Brenda, we’re happy to have you. Anyway, I’ve got more, but let me know what you’re thinking if you are here with me live.
Okay, next question. This one comes from Jennifer. She said, I just finished getting my 12 weeks signature program ready to launch. I’m going to have two different packages. Should I price them per month or post a certain amount total for each program?
So this kind of comes down to like the structure of the pricing regardless of the number, you know, the dollar figure. It’s like, should you talk about your programs in terms of how much does it cost per month or per week or per hour or just the whole big, the big, uh, lump sum for the whole thing. So Jennifer usually, and you can always break these rules, but usually what’s done is that you have two prices.
One would be the pay in full price and one would be a monthly price. And typically you’re paying full price is less than if they paid monthly. So they would get some sort of discount or some sort of incentive for them to pay in full because trust me, it is a pain in the ass. Sorry, going to have to bleep that. It Is a real pain to have to hunt people down for money every month and then their card expires and then blah blah blah. You waste a lot of time. So incentivize people to pay in full. Absolutely. However, to tell someone, Oh and this program costs, you know, $1,800 could be like, whoa, that’s a lot of money. That can feel like a lot. So depending who you’re talking to, your target market, you can sometimes choose to say the lower number. So if you were telling me how much the program costs, you could say, oh, it’s $249 a month.
And then that just sounds like a smaller dollar figure. So sometimes it’s beneficial to phrase it that way. And then say if you pay in full, there’s a 10% discount or something like that. Um, you can also do it the opposite. I was recently talking to members of my program, healthy profit university and all of the health coaches in there are often talking about what to do when you have a client, you’re doing a consultation, they think, oh, this sounds great. I really want to do this, but I have to check with my husband or, but I have to run it by my whatever. And I said another way to talk about your pricing is to give them the full amount up front. If they ask about a payment plan, absolutely tell them about your monthly price, which is essentially a payment plan. But if they don’t ask, just give them the full price because hopefully they will give you the full amount and then boom, you never have to deal with collecting money from them again.
Yes, they need to go think about it when you follow up with them as a great time to offer the monthly installment plan as an option that can help grease the wheels a little bit if they’re feeling stuck and being able to move forward with you. So I know there’s no one way to do this. I’m giving you lots of options, but at the heart of it, I think you would have one price for your 12 weeks signature program and then because it’s 12 weeks, that would be a three, three monthly payments of such and such a payment plan that had three payments out. That helps.
All right. And here’s another question. This also gets to packaging, right? Cause part of packaging is how long will your program be? How many times are you going to meet with them, how are you going to break up the payments? And Annette is asking when you make a special offer like a discount or a bonus, how long do you give people to take advantage of the offer? Five days, 10 days. What’s a good length of time to motivate them to take action but not so long that I have to write dozens of follow up emails.
I laughed when I read that and that I know what you’re talking about. So I’m not sure exactly what you’re offering in this situation and that. So let me just answer it from the perspective of private coaching. You could make an offer like a discount or a bonus if somebody signs up with you that day.
Right? So you could say, oh, that’s great. You have to go think about it or whatever. But like, and if you sign up now, we’ve all heard that term. If you sign up today, you’ll get XYZ or you’ll save x, y, z. Um, or you know, you could say a different way, you know, oh, knock $200 off the price if you want to sign up right now. So that’s one way to do it. I’ve never personally done it that way, but I’ve heard of that approach. The other thing would be a little bit more like if you’re launching a group program or people are, you know, you’re going to make an offer maybe on a Webinar and you’re getting to give a deadline for how long they have to sign up. That’s usually when you see like all of these emails going out in between when the offers made and the, the cart closes or the discount ends or the bonus period ends.
So Annette when it comes to something like that, you know, again, you have some flexibility here. Some people will do a 48 hour window, so you have 48 hours to take advantage of this special bonus with this special discount. And then after that it goes back to the regular price or the regular package that doesn’t have a bonus. Um, you could do something that’s one week that usually works because let’s say you’re holding a Webinar or you’re making the offer in person, whatever on a Wednesday. It’s kind of just easy to remember. Like the next Wednesday is when it expires. So I will often do a week. Um, 10 days starts to be a little bit long. You know, that’s a long time to be following up with people. And when people are like, oh, I have time, oh I have 10 days, or oh I have two weeks to do this, they don’t move.
But if you say you have 48 hours, they’re more likely to like sit down and complete the transaction now cause you’re always going to lose people who are just like, I’ll do it later. Right now. I also want to just comment on this idea of writing dozens of follow-up emails. I know that it feels intense and sometimes overkill. When you start receiving so many emails from somebody after you’ve attended the Webinar or whatever, there’s a really good reason for you to write emails to your list. Not everybody on your list, but everybody who has signed up for your event, like a webinar following up with them is how you make most of your sales truth. So, um, with my healthy profit university students actually give them templates and that they can kind of customize and use and they know what to send out on day one.
On Day two, on day three, um, and the last day you actually send multiple emails and the reason is you will sell more. I know, I know nobody likes to be annoying with their emails, but I am a strong believer that if someone is annoyed with your emails, they’re not your buyers, right? Like they’re the ones who are going to unsubscribe. I always put a link at the bottom that says, hey, not interested in this right now. Like click here, you’ll stay on my list, but you won’t hear from me about this offer. Again, that way they can like opt out but most people don’t. Most people will continue to read those emails because they’re interested. So when you’re getting annoyed with someone who’s following up a lot, it’s because you have no intention of buying and so frankly as a marketer we don’t care about those people. We care about those people who are like hemming and hawing and they’re talking it over with their friend and they’re thinking about it and you send that email, it just the right time. Then they’re like, that’s what I needed to hear. So a net, that’s what the dozens of emails are all about and truthfully they work so don’t, don’t write off writing the emails.
All right, what other questions you guys have for me today? I’m very happy to continue talking about pricing and packaging. There’s so much to say here and again, if you want to get my free guide to some pricing strategies that I think are really working right now, you can go to healthcoachpower.com/pricing and pick that up for free.
I have a question here from Lexi and Lexi said, I’m currently taking the IIN Health coaching course. We’re almost to the midpoint where I feel like I should be beginning to interview more people and start coaching, but I’m feeling behind and though I set goals for myself weekly, I’m searching for any tips or reminders about from new health coaches and beginning practices. Were you nervous? How did you overcome it? What steps do you feel are important to take looking back when you began your own practice?
Lexi, when I started I was very nervous. I never thought I would ever do any of this. I thought I was just learning for myself. I’ve refused to even think about holding a workshop, pitching my services, pricing, packaging, none of it like I was never going to do it. So here we are 10 years later. How did I overcome it? You know what, I lost my job. I used to work in advertising and I got laid off back in like 2008 when the whole economy thing happened and I needed to make money. What was I going to do? Babysit. I had this health coaching business that I was just sitting on and that motivated me. So I think it’s really important to know what’s motivating you. Is it, I was just talking to a health coach this morning and she was saying like, she’s really motivated by getting out of the house because she’s been a stay at home mom for a very long time to kind of lives in an isolated area.
She’s probably motivated by like having a thing that she goes out into the world to do. The money is less important, but that connection with people is very important. So whatever is motivating you, Lexi, I, I would say tap into that because otherwise, uh, you can just stay in your safety net of like, oh, I don’t know. I’m scared. Oh, I don’t know what to price myself, etc. The other thing that I wanted to suggest is that you go back and listen to episode number nine of this podcast because that one is titled Things I wish I knew when I started my health coaching practice. Something like that. And then you’ll probably get a lot out of episode number nine.
What else do we got here? I have a question from hope. Hope said. I have my first client. Yay. And I wondered if anyone uses the handout checklist as part of their program or if they just sort of wing it. Also, any and all advice would be great.
You know what Hope, I think you should use any tool that makes you feel more comfortable when you’re starting out. When I had my first clients, I remember sitting at my desk and I had like everything in front of me. I had like their health history form. I had like some sort of outline back in those days. IIN would give us an outline of what to cover during each session. So I would have the outline right in front of me, you know, I would just have like, um, a list of open ended questions over here, you know, like all my coaching tools and it helped.
It didn’t so much help because I was, you know, reading the question that I just perfectly matched to the conversation on the fly and, or because I followed this outline and if I just follow the outline perfectly, I’m going to have a great coaching session. It didn’t help the way I thought it would help, but it helped. She just made me feel better to have some of these things cushioning me cause I felt nervous. Right? So if you want to use a handout checklist, use a handout, checklist, use whatever you’ve got to just make you feel more supported as you start working with your first clients. Now these days, I actually got to a point where I stopped taking notes during my client sessions. I know, isn’t that crazy? What kind of coach doesn’t take notes? A terrible one. But I found that when I was writing and I was sort of intellectualizing what was hearing and I was writing down words, part of my brain wasn’t turned on.
Like my intuition wasn’t turned on. Maybe I should say part of my heart, I was listening too much for the facts and too little for what the client wasn’t saying. And I remember the day I was like scribbling like all this stuff in my notebook and then I just was like, oh, I put it down and actually lie down on the floor of my office. It was carpeted at the time. Now it’s not, that would be rough, but I just laid down on the floor and I took the rest of the call with my eyes closed, letting my intuition guide and it was amazing. And now that is the only way that I coach. Okay. Not always lying flat on my back, but I do much less note taking and much more deep listening. So you’ll find your way. But definitely start out with the checklist if that helps.
Alrighty, one more. Let’s do one more. I have one here from Colleen and this is sort of an interesting conundrum that I bet a lot of you will resonate with it. I certainly did. She said, I live in Fort Wayne, Indiana. I’ve tried to get involved in my kids’ schools and be a leader for change. I became ostracized as a food Nazi and gave up. Literally, I am not involved. My youngest is now entering high school and I want to try again like be the change you want to see. I could offer workshops, classes, I could be on committees, I could start a school garden. I am required to work seven concessions for the show choir or the band or whatever her kids involved with, so she has to, she says, I have to smile while serving hotdogs, pop and Laffy Taffy. The last few years I have refused and I’m known as the jerk who doesn’t carry my weight.
This is not good for business nor does it make a difference. Other people just work harder, but no one gets it. Tonight’s meeting included an argument about whether or not concession workers should get a free pop and candy bar while working. Do I sign up for my duty or continue to protest on moral high ground? I can’t change the system from the outside, but I don’t want to be seen doing this or condemn my fellow workers with the comments that will surely fall from my mouth and a four hour shift. Is there any positive way to promote myself and my business without smelling like hypocritical, hypocritical hotdog?
Coleen, I laugh. I’m there with you. I know the pain very well. I have kids in the school system as well and there are times when I want to get up on my high horse and let them all know that the last thing these kids need is another sugary blah, blah, blah.
It’s not helpful. Right? It’s not helpful. We pushed people away when we are on our high horse about stuff. The I’m better than you. I know that’s not what’s in your heart. I know how aggravating it can be. I get so aggravated with what goes on in my kid’s school, but it just isn’t helpful. So it’s kind of like with clients, if you’re like, no, don’t eat that. No, that’s terrible. We get a cut that out, don’t eat McDonald’s anymore, you know, cut out all gluten. It’s demoralizing. It tends to push them away. So if, if you went to IIN, but for those of you who went to IIN, I can’t speak to other schools, but we’re typically taught to add in, right? Add in the good stuff. Don’t comment too much on the bad stuff. Right? So you’re saying like bring in the leafy Greens, bring in the whole grains and crowd it out.
And I think that’s kind of what we have to do at this level as well. So for example, when it’s my turn to bring snack to the soccer game, I bring fruit. I can’t control what the other parents do, right? And I’m not going to tell them that, you know, they shouldn’t be bringing this or how awful it is that they brought that. But I might tell my son, he’s not going to have snack today and we’re going to go home and have snack and just quietly leave. But I bring fruit. Um, same thing with the birthdays. Oh my God. The cupcakes. Right. Constant with the cupcakes. So, so you know what? When it’s my kid’s birthday, I make something from scratch that has no artificial colors in it, no corn syrup and all the rest. But I can’t change what other people do. So I’m just sort of leading by example.
And when I bring something in for birthdays, it looks awesome and everybody’s talking about it. And that’s how you drum up business for yourself, by people thinking you’re awesome. So you put what you have, something that’s really great about you, what you can do. You bring that to the table so we can be admired instead of making everyone feel bad about what they’re doing wrong. I know it’s hard and I want to stand in solidarity. And I know we’re not the only ones having the struggle. There’s so many ways to make change, but I think just ultimately it’s an energy shift that needs to happen here for you.
Well today you guys, we spent a lot of time talking about pricing, although we did meander over to other topics, but I did just want to remind you once again to get my pricing strategies freebie at healthcoachpower.com/pricing and I would like to thank Kia Digsby for this five star review and rating on iTunes.
It says, I look forward to Tuesdays when Michelle comes on Facebook live to offer her tried and true wisdom about health coaching. I enjoy the wide range of topics she discusses and I always come away learning something new. I appreciate these ‘Aha’ moments, so glad to see this as a podcast so I can listen on the go now. Yeah, Kia Digsby, whoever you are, please send your mailing address to email@example.com and reference episode number 63 so we can send you a little thank you gift. And for everybody listening, I would be more than grateful if you would take a moment to leave a star rating and written review as well, because this is what allows me to reach more health coaches and frankly continue doing this work. So thanks in advance for that. I will be back next week. Keep asking great questions and I will keep answering them. Take care.