Is It Crazy For You To Keep Charging By The Hour?

In my work as a consultant and mentor for online teachers, there's a set of points that come up on a regular basis. Our stories go through similar storylines, and our lives unravel with the same grinding points that gradually push you towards the point where you feel the need to DO SOMETHING.

One of those points is that moment where you look up from your computer screen after hours of teaching online, examine your notes and realize you're exhausted. Your ears are ringing from the tinny sound of Skype calls in your headphones. Your notebook is full. Your students made a bit of progress. You have 4 hours to go, a blog article to write, and need to get your taxes done.

This wasn't quite how you planned it. When you started offering online lessons, taking your first students seemed like a miracle. You thought that getting 20 more students would mean 20x more income, and you'd be set for life. But in all that, you forgot all the extra things that surround 20 extra students. Admin, invoicing, marketing, and ultimately denying yourself the chance to work with people at your own best level.

If reading this description has you nodding along, I say it's time to break out of charging by the hour for a generic language lesson. The following five steps are how you can grow into an invaluable resource, help people more than ever before, and become a true specialist.

5 Simple Steps to Packaging Your Services

A package is a bundled version of the things you already do, put together for one specific purpose. For example, if you know your students get stressed before exams you could offer a focused package of study plan + mock exam + coaching session about how to stay calm. This allows you to improve how you express the full 360 degress of work you do for students.

Sound good? Let's get into the 5 steps.

1. Focus, Focus, Focus

Package deals are best when you really focus on one specific goal that your customers might have. Of course you have enormous potential and capacities to work with a range of people, several languages, perhaps to offer thousands of scenarios. But for the purpose of this one deal, just focus on one goal that a customer will have.

For example, a vague package might be "5 lessons for the price of 4". But a specific and focused one could be "IELTS test prep - 3 mock exams, a booklet of success secrets and detailed writing coaching to get you to IELTS 8.0 guaranteed!". See the difference?

2. Automate Set Pieces

When there is a part of your work that you repeat many times over, it could be time to automate it. If you teach online or coach with clients, you are likely to do this already by recycling the best learning materials. What if you collected them all in a small guide or created a recording that is exclusive to your clients? This can become a valuable and exclusive part of your new and shiny package.

3. Keep an Open Mind

After creating an awesome idea for a package deal, it's tempting to think the product is finished already, but it may help you to get a little bit of feedback and work through it with one or two testers. These guys are often called beta clients, and will be ready to give you

4. Set a Short-Term Goal

What do you think you could achieve for your shiny new package (hah!) in 2 weeks?

Some ideas:

  • Promote it on a podcast, in a newspaper or on your blog (check out the end of this article)
  • Get your first paying client through the door
  • Conduct a free trial run

5. Promote Small and Close

I think every one-person business dreams of being bigger, having a video editor, a copywriter, a blog writer, perhaps someone just to focus on running your Facebook page. But at this stage, you might be just flying solo out in the professional world. Not a problem!

Forget a huge marketing campaign and try to reach out to your closest allies, people you usually hang out with, places where your customers are. If you need to make money NOW, it's a good idea to offer the package to your mailing list or even ask an influential blogger or teacher whether they can help you promote. For long-term thinking, nothing beats building your own platform.

Package Magic - An Intro Offer

If you dream abandoning money-per-hour and don't even know where to get started, I have a deal for you. I am in the process of designing a package ;) that will help service providers just like you get started with packaging their services.

Step 1: You bring me all your current processes, prices, products and problems.

Step 2: We go through a creative and thorough process to help you create a new package idea that fits in with your target client and has some great earnings potential.

Step 3: I'll help you shape your brand new package page and draw up a 2 week marketing plan.

This offer is perfect for you if you're an independent service provider. You want to try something new, work with my experience and marketing skill, and get accountability for yourself by working with a mentor.

Curious about this deal? Then book a slot in my diary and let's chat about your individual requirements.

How Much Should You Charge For An Online Lesson?

price cash

Today, I want to talk about every entrepreneur’s favourite topic: Pricing! There are so many ways and angles from which we can look at pricing.

In my Branding course full of smart entrepreneurs, we encountered pricing as a hot topic straight away. Online teachers have a hard time getting the rates right. On the one hand, there’s a crowded market full of cheaper alternatives. On the other hand, there’s a huge demand from students. Today I want to address the "my clients can't pay me more" objection that lots of my course participants struggled with.

Set Fair Rates That Work For You And Your Clients

If you have ever had to set the price for a product or service you provide, you are going to recognise the feeling of fear that this generates. Money just has this way of drawing out all the judgement and ideas that you have about yourself, what you're entitled to and what you're worth. The lesson I am beginning to learn here, after years of self-employment, is that no one cares about my price as much as I do.

Key Question 1: How Do You Know If You're Good?

You have to believe that you are pretty good at providing your service in order to charge a fair price for it. So my first advice to many of my coaching clients is to ignore their rate and consider if they think they're providing a good service.

For example, an online teacher will often provide the following services in addition to the hour of contact time charged:

  • Homework Assignments and Revision
  • Book Recommendations
  • Goal Setting and Coaching Assistance by Email
  • Creating Bespoke Worksheets and Materials
  • Researching Exams and Education Standards around the Globe

If each of these services was charged separately, they would amount to a lot more than an online teacher's typical hourly rate. So my advice is to consider all that you provide: your "Teach Plus".

The second step is to look for external, fact-based evidence of your high standards. Qualifications, teaching awards, blog comments, testimonials and years of experience are not just in your head: They truly add value to your service.

Key Question 2: Who Are You Targeting?

Even when all of the above processes are worked through (and in the Savvy Brand process, we approach this in a lot of depth), I often find that the real obstacle to charging fair rates is that my clients tell me "no one can afford a rate higher than this." This prompts me to ask: If someone cannot afford a rate that is fair to you, how can they be your ideal client?

At first sight, such a thought may feel uncharitable. But then, remember that you are not actually running a charity. Being able to continue running a tiny one-person business is a situation in which you must make money. The same clients that struggle to afford a service you provide will often happily spend equal amounts on luxury goods such as a smartphone or holiday home. If you catch yourself feeling sorry for a client who cannot afford you, consider their situation closely. Will they value your service enough to invest? If not, you may be better off limiting what you can provide to them and referring them to a real charity.

Remember that there is such a thing as charging too little. * mind boggles *

Key Question 3: What Is The Charge To You?

In this exercise, you must be ruthless and take the time to conduct a realistic analysis of all your expenses. How much is the hourly rate you would like to earn? How many hours do you get paid for? And how can you make a profit?

Profit is not a bad word for a home-based freelancer. Your profits are what allows you to continue to grow and develop as a service provider, to attend conferences, stay relevant and move with the times.

There are many good calculators available online to help you determine your hourly freelance rates. Here is a good guide from Creative Boom for more detailed information.

Key Question 4: How Will You Tell Them?

Once you have set up all of the above, you're likely to face that horrible moment of truth. You list your prices on your website. They don't look right to you, you figure reducing by 10% can't hurt. Or a potential customer sends you an email asking how much it will cost to take 5 lessons, and you instantly discount your fair rate. Because it's uncomfortable to tell them, right? Because they can get cheaper elsewhere.

Here's how I summed up my thoughts about the $5/hour teaching phenomenon for my language learning friends: 

Self-employed language teachers will price themselves as low as they can because they really love working with you. But when they are taking on 50 students a week because the price per lesson is very low, they become mediocre teachers. If you are able to approach the exchange with a mindset that considers both payment and benefits, you will not be ripped off.

You can read the full article on the Fluent blog.

So the next time you feel awkward about posting your rate, why not just double it for one day and see how that feels? After all, the way to make a $800 watch look cheap is to put it next to a $1700 watch.

I'd love to hear from you about how you feel and how you price. Come and share your thoughts on Facebook or comment here if you have ever felt the need to explain why you're so "expensive" or "cheap".