Whenever I ask a room full of business coaches to take a guess at the #1 thing required to succeed as a business coach, I get a mixed bag of answers. Everyone has a different opinion, it seems.
Thankfully, there’s some solid, scholarly research that can shed some light on the subject. In the 1990’s, a group of Harvard University researches developed a theory and business model called the “Service Profit Chain,” which I discussed in my Amazon-category-best-seller called The Million Dollar Business Coaching Firm.
Building on this excellent theory, the premise of chapter 11 in my book is that your long term success as a business coach relies on just one thing: Personal Coaching Success. In other words, get the business coach training you need to become a business building legend. Notice that I said long term success. Great marketing and sales can get you clients, but to have a sustainable coaching business, you’ve gotta get great at keeping your clients by make them enormously successful.
For most privately-held businesses, the path to success is paved with incremental cash flow. Your job as a coach is to deliver the cash. For even the best business coach, this requires lots of training.
One great way to do this is to develop a “Perceived Value Bundling” strategy. This strategy can be salvation for your clients that are constantly getting beat up on price. Bundling involves taking the client’s original product or service and you adding other products or services to it so you end up with an entirely new package, which does a couple things:
1) It creates an apples to oranges comparison between your client and their competition.
2) It completely eliminates price competition.
The key to making this strategy work effectively for your client is to identify additional products or services that 1) perfectly compliment the original one, 2) have little to no cost to your client, and 3) have a high value to the prospect.
To invoke the well-worn axiom: prospects DON’T truly buy based on price. They buy based on VALUE. Any prospect will gladly pay twice the price if they can expect to receive ten times the value. Bundling creates a higher level value,and it makes buying from your client the only logical purchase decision for prospects to make.
Here’s another case study.
A certain restaurant offers you a 25% discount coupon to get you in the door for your favorite meal that costs $40. Our bundling-savvy restaurant client next door has your same favorite meal at the exact same price of $40 but includes with the meal a $25 bottle of wine and a $6 dessert for free. Which restaurant would you do business with? The vast majority of people select the restaurant offering the wine and dessert. After all, it’s the best deal isn’t it?
Let’s take a look at the bundling math.
The restaurant offering you the 25% off your $40 meal is saving you $10. But at the second restaurant, the bottle of wine is listed on the menu for $25 and the dessert is $6. Therefore you perceive that you’re saving $31 instead of $10. That’s quite a deal!
So, you ask, how can our client restauranteur afford to make such a lucrative offer? They can do it because they know their costs. That $25 bottle of wine only costs them just $8 wholesale. And the $6 dessert cost them $1 wholesale. The first restaurant by offering a discount physically loses $10 in hard cash. Our client spent just $9 and yet created the perception that their customer was receiving much more value for their money. In this example, both the restaurant and the customer come away as winners and our client dominates his market.
And this is just one of many fast-cash-flow strategies that you can learn to deliver as a business coach IF you give yourself to studying the subject with the right business coach training. To learn more, click HERE for our free ebook Secrets of a Business Coaching Rock Star and enjoy!