After I started teaching online and learning more than I’d ever imagined on things like marketing, pricing and positioning, I began taking note of how small and large businesses in the US were able to raise fees creatively.


They were doing it without losing customers, and were actually gaining more.


In this post I’d like to share three examples from the corporate world of America and show the principles they used to generate more clients after raising their fees.


#coaches and #entrepreneurs: raise your fees organically and creatively, like these businessesClick To Tweet


I have to give a disclaimer that all of my observations and conclusions are subjective, because I’m not really a marketing analyst. I am however a teacher turned teacherpreneur, so I easily notice the things I didn’t used to pay attention to.


These days whenever I see a new catalog being released or a new event in town, I always assess the marketing and see what I can apply in my business.


3 Tips to Raise Fees Creatively.


In the previous post I’ve talked about the actual pricing philosophy that goes beyond placing a price tag and focuses on value. Here I want to zoom in on raising your fees in a way that makes your client happy.


It’s hard enough to think through pricing, let alone change it. Making it a win-win is a challenge. Let’s see how the big business in the US have done it and what we as coaches or small business owners who teach online can learn and apply (don’t forget to sign up for the my free pricing tutorial + workbook below).


#1: Netflix (the concept of “dividing services”).


Most of the people reading this post are probably familiar with Netflix, Inc., a US-based company that provides on-demand Internet streaming videos in the US and other countries, as well as a flat-rate DVD-by-mail in the US. There’s 1 simple principle I learned from their marketing strategy.


A few years ago Netflix was offering the online video streaming + the DVD-by-mail service at a flat rate of, let’s say, $10 a month. People loved watching videos online and/or receiving DVDs by mail at such a low rate!


This lasted for a few months or a year, and then their smart marketing team decided to make two separate services out of one. They switched to charging a flat fee of $7.99 for streaming subscription and perhaps the same amount for the other service. This is a very smart way of raising your fees organically and peacefully.


Let’s say Mr. Johnson loved Netflix, but enjoyed watching movies online more than getting them in the mail. So he was happy when the prices were reduced to $7.99.


Then Ms Jackson would normally get DVDs because she was old-fashioned and didn’t have the internet and didn’t want to pay extra $$ to install it. So she must have been delighted when the price went down for her as well!


Now, of course, there were families that liked both, so they weren’t happy to be paying $15 instead of $10, and perhaps they were even among those hundreds thousands of subscribers who actually decided to quit Netflix altogether.


Amazingly though, such figures didn’t lower their income, and Netflix ended up making more, just as they had forecast.


3 simple tips to raise your fees organically and creatively. For #coaches and #solopreneurs.Click To Tweet


Now let’s see how this applies to our online businesses. 


We all offer private coaching services of some sort, but whether we want it or not it’s not the only thing that we offer (hence my encouragement in the previous post to package your services).


For example, I usually create a personalized program for each client with assignments for their entire month so they know where they are going and can do something in advance. It also helps me to be organized and know that my clients always have their program mapped out in a separate document, not somewhere in a chat window.


Let’s say I also create a customized assessment at the end of the month, all on top of the 1:1 sessions. So if I separate these services I’m actually offering

  1. a program;
  2. the 1:1 meetings;
  3. a final test and charging a flat fee of let’s 100 units a month for this package.


Now I want to increase my rates, but I need to do it creatively. I write to my clients (who by now love this routine of having their programs and their tests) and tell them, “I’m going to give a special discount to the first 5 of you who subscribe for a “just sessions” package, and you no longer have to pay 100, but only 90, for just the sessions without your program and your final test.


However, if you wish to retain the same service I have a 2-in-1 package (a program + sessions) for a fee of 125 a month and a 3-in-1 package (all three) for a sweet price of 150.


Let’s say you have 10 clients, who used to pay you 100. Now the first 5 will jump on the special offer (you get 450) and the rest will choose either $125 or $150 (or they will unsubscribe which is fine still because you’ll get more money by raising your fees and in addition gain more time).


Raise your teaching fees organically and creatively. Learn from retail marketers. Check out this guide!Click To Tweet



Want to learn more about raising your prices? Check out my mini-course with actionable strategies:


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#2: Organic vs. regular produce (the concept of smaller packaging). 


I buy a lot of groceries and home supplies at organic stores and local farmers markets, and I’ve noticed one peculiar price tendency. While everything with the label “organic” on it is definitely more expensive, the marketing guys do their research well to make us think that we’re actually getting a “great deal” for the price.


Though some people are convinced that quality food is already a great deal regardless of the price, there’re those out there who might love comparing. So I can give you one really simple illustration. A regular store-bought mayonnaise (a most common brand and a popular size – 48 oz) costs around $6.


To counter that, the organic companies make their own healthy mayo, package it small and charge less per jar (while actually charging more per unit). A much smaller, 16 oz jar of such organic mayo costs $5.


Some customers are really keen on comparing the size and price per unit, while others just take it and think, “Man, I’ve got a real deal!”


So here’s a lesson to learn. 


Let’s go back to the same example of 100-a-month that includes, say, 4 sessions +a final assessment at the price of 25 per hour. You want to adjust your prices to 30 per hour, so you craft

a new monthly rate of 90 for 3 sessions + a more detailed final test and then offer the reasons why 3 lessons are better than 4 (they have more time to prepare, they have more tasks – perhaps, etc.) This helps you raise your price more subtly than just saying, “I’m raising them by 20%”).


Obviously, the same person would want to keep the 4 lessons +, but then they’ll be paying more (which is actually fine with a number of students, we just don’t realize it).


#3: Loyalty programs. 


This is a way to reward the people who have been your best students by crafting more additional services for them and encouraging them to engage to get even better results. We know the airlines that offer great loyalty programs (including additional services and perks) encouraging people to stick with them instead of flying with another company.


Here’s how we can apply it (loosely, of course). 


Hopefully all of us have a small group of ideal clients that we enjoy working with because their learning style fits extremely well with our teaching style. They are also our ideal clients because they never complain that our fees are too high and pay whatever we say without whining and arguing.


Those are hard to come by in the beginning but by focusing on serving ideal clients only and by weeding those who are less than ideal, we will one day work only with the people that make the best of our services.


But while we’re still on this journey, why not write to our best clients and tell them that they have been chosen for a VIP program and give them a list of things that they can gain by switching from a standard package of 100 a month for 4 sessions to 180 a month for 4 sessions + a program + a test + extra tasks and feedback in-between lessons + a group support.


Why not give a chance of even better service to a select few and delivering it in the same way you would like somebody to deliver it to you?


You can likewise combine principle 2 and 3 and offer fewer sessions at the same price along with more support and creative assignments. You can also create and add a small product to the package to boost its value.


Hopefully, I’ve given all of us enough food for thought this week, and if you find it helpful and useful, feel free to share this post with you colleagues or friends!



The post was updated in March, 2021.


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