Kathy Mallary | Coaching Biz Tips

10 Tips for a Profitable and Sustainable Business Model

An earlier article explored how to tell if your business model is broken; today I want to share ten tips for building a profitable and sustainable business model.

First, a few words about what I mean by "business model", and why you should care.

Basically, a business model defines the problem your business solves and describes how it does so profitably.

By "problem", I mean the gap between where your customer is now and where they want to go. Every customer wants something that they don't yet have; your business helps them close that gap.

The "profitably" part is the key to why you should care – because if your business doesn't operate profitably, you're not going to be able to help many clients! When your business makes more money than it takes to operate, you can reinvest your profits back into the business in order to grow. But if you're spending more than you're making – for example, needing to use your credit cards to pay your bills -- you're probably going to run out of resources pretty quick.

What does a profitable business look like?

Imagine two coaches who are starting out on the same path: Coach Alison and Coach Brenda.

• They have similar experience and education
• They live in the same city
• They have similar financial situations
• They're both going after the same type of client -- baby boomer women
• After 18 months, one business is healthy and growing, while the other is teetering on the edge of collapse

Coach Alison is following the well-worn path that many coaches follow right out of training. (See "Is Your Business Model Broken?") After working diligently for 18 months, she's got a lovely web site; 157 people on her mailing list; 5 clients (2 are pro bono; another isn't really a baby boomer woman, but she can't afford to be picky); a maxed-out line of credit; and a husband who is starting to wonder what she's doing all day. Alison is starting to wonder that, herself.

Coach Brenda is having a very different experience. She's getting new subscribers every day, and virtually all of them are in her target market; many on her list have already purchased her new ebook, and almost everyone who buys the ebook goes on to buy something else (an audio program, a teleclass or a  coaching package); she has a waitlist of people who want to work with her at her new rate; and her husband is starting to wonder if he should quit his day job to become a coach, too.

Why is one business struggling while the other is succeeding?

What's Brenda's secret? It's not a secret so much as a winning strategy. Alison is using a one-size-fits-all business model, while Brenda's is custom-designed for success and sustainability. Here are ten tips for creating your own profitable and sustainable business model:

1. Start with a relationship-building mindset. Customers tend to buy from people that they know, like and trust; the best way to do that is to show them that you understand what they're struggling with and that you have a proven track record of success with their issue. (Hint: they're not struggling with coaching, so stop talking about coaching and start listening for the real problem.)
2. Define the problem that your business solves so that you can talk about your clients' coachable goals with clarity and credibility. To see some examples of coachable goals, see this article.
3. Identify a viable market segment that is already spending money on the problem that your business solves. The segment should be specific enough to share certain buying behaviors, yet large enough to support your business.
4. Aim your marketing promotions directly at the target market. Don't try to be all things to all people; you'll only frustrate yourself and confuse your prospects. For example, while Coach Brenda is narrowly targeting (and attracting) female baby boomer executives who are facing a major career transition such as retirement, Coach Alison is having less luck finding and connecting with a broader, less exclusive market (baby boomers who want to thrive.)
5. Create a sales funnel so your customers have a natural, easy path to follow, from joining your mailing list to making their first purchase to hiring you as their coach. Click here to see an example of a sales funnel for coaches.
6. Differentiate yourself from other coaching businesses so that your brand stands out in a memorable way. There are many ways to differentiate yourself other than pricing, by the way -- for example, packaging, service, expertise, positioning, etc.
7. Don't trade time for money. Switch to a monthly retainer or package rate, rather than quoting an hourly or monthly rate. Stop selling your time and start promoting the value of your services.
8. Expand your revenue base by creating multiple channels of income – info products, audio products, group coaching programs, paid membership programs, etc. When you spread your profits over a range of income streams, your cash flow tends to be much more consistent and stable (and LARGER).
9. Automate your marketing system to free yourself up to do what you truly love (coaching!). At the very least, use a reputable list management system with auto responders  -- Aweber, iContact and 1Shoppingcart are three popular choices.
10. Take a stand for the value you provide; offer options instead of discounts. If a prospect balks at your premium coaching package, point them towards a less-comprehensive coaching package, a group coaching program or a coach-yourself homestudy kit.

With the right business model, you'll get more business, more easily and be able to make a bigger difference with more people. And isn't making a difference with more people the whole point?

©2008 by Kathleen L. Mallary. All Rights Reserved.

Coaching News for February 2008

A sampling of recent articles, press releases and news items on the coaching profession:

A Coaching Mentality
Smart Business Network, Cleveland, OH, USA – Feb 2008
Smart Business spoke with Spangler about how to be a cheerleader and coach for your team to help it keep reaching goals. Develop and encourage teamwork. ...

Curves Introduces Digital Workout Coach
SooToday.com, USA – Feb 4, 2008
Imagine having the world's most advanced fitness coach at your disposal. This coach customizes workouts based on your body structure and endurance and adjusts each exercise machine's intensity based on your recent progression or regression…

Coaching Flagged as a Business Essential
HRZone.co.uk, UK - Feb 5, 2008
Business now sees coaching as an essential part of training and talent management programmes - with real commercial benefits…

PowerPoint: My New Secret Weapon

I'm up to my eyebrows in a book called Beyond Bullet Points: Using Microsoft Office PowerPoint 2007 to Create Presentations That Inform, Motivate and Inspire, by Cliff Atkinson.

It's not that I have that many opportunities to make PowerPoint presentations these days – they tend to take place in office-like places where people are expected to wear things like pantyhose, which I've sworn off. Because they are evil. (The pantyhose, not the people!)

No, I'm reading this book because it was recommended over at Teaching Sells. Teaching Sells is an online learning program by Brian Clark of CopyBlogger and Tony Clark (not related, but a smart guy nevertheless) on how to develop and market online learning membership sites. (It's a fantastic program, by the way – worth WAY more than what they're charging for it.)

Anyway, one of the tools that Tony recommends for creating online tutorials is PowerPoint, and Cliff Atkinson's book is all about how to avoid boring your participants into a coma with the usual PowerPoint presentation-from-hell approach.

(That's not the only neat thing I've learned about PowerPoint recently—for instance, did you know you can use it to edit Microsoft clip art? You can do everything from changing the color scheme of a clip art composition to adding and removing all or part of an object. I learned that from Tom Kuhlmann at The Rapid eLearning Blog.)

But back to the PowerPoint book: Atkinson writes that the whole secret to making your PowerPoint presentation engaging is to develop the presentation using a simple story-writing approach with very little text (and no bullet points, of course). And as I was playing around with the template, it suddenly occurred to me that the Beyond Bullet Points method might be easily adapted for things other than PowerPoint presentations.

The first five slides set the stage and answer the audience's most pressing questions:

• Setting: Where am I and when is it?
  Example: Across the industry today, returns are declining
  
• Role: Who am I here in this setting?
  Example: You're looking for solutions
  
• Point A: What challenge do I face?
  Example: Your returns will stay flat if you do nothing
  
• Point B: Where do I want to be?
  Example: You want your returns to improve
  
• Call to Action: How do I get from Point A to Point B?
  Example: Hire us to help you find the returns you seek

And then the rest of the presentation expands on the call to action.

This same approach seems like it would be a shortcut for developing a clear, concise core marketing message for a coaching program or product.

In fact, that's exactly what I'm going to try next. I'll let you know how it turns out.

Weekly Roundup

 

I am very excited to see that The Coaching Commons has launched. Funded and organized by the Harnisch Family Foundation, the Coaching Commons is "A non-partisan 'big tent' under which coaches can freely create the future together in a non-commercial setting on the world-wide-web."

More than just a forum for discussion, The Coaching Commons proactively encourages and supports innovative coaching projects that make a real difference in the world. I expect we'll see BIG achievements that will shape the future of coaching from this amazing community. (With a tagline like "Where radical possibilities are explored and pursued", how could it NOT be big?!)

Browse the site, sign up for the mailing list and join the discussion – it's as easy as leaving a comment.

P.S. They're looking for a Community Content Manager (part-time, volunteer) – if you want to contribute AND get some great visibility in the coaching community, check it out.

While I was wandering around on The Coaching Commons' site, I happened to click a link that took me to CoachesMakeADifference.com, where I found a free PR kit for coaches. It includes all kinds of helpful pieces, like tip sheets, sample wording for your press releases and website, and a whole collection of articles with statistics and quotes about the value of coaching.

 

The 2008 Sherpa Executive Coaching Survey was recently released.  Now in it's third year, the Sherpa Coaching survey gathered information about executive coaching from over 1300 North American executive coaches and the people who hire them, asking:

• What is executive coaching?
• Who gets a coach?
• How are services delivered?
• Who becomes a coach?
• How do they get their training?
• How much does coaching cost?
• Is it worth the money?

 

To get a free copy of the 15-page report, click here.

And lastly – do you just need to chill for a few? Check out the meditation room at Lime.com – download one of the themes to your computer or iPod or listen (and watch the entrancing slide show) right at the site. It's free!

 

10 Coachable Goals (and 3 That are Not)

 

In this article, I want to share ten examples of coachable goals, along with 3 examples that are not coachable.

Knowing what your client's agenda is and identifying whether it's a coachable goal or not is critical if you want your clients to get the results they're looking for. If you don't take time to identify a coachable goal, you could end up with a generic, light-weight coaching program that misses the mark with your target market, or worse – you could find yourself spinning your wheels trying to coach when what the client actually needs is counseling or therapy.

First, I should explain what I mean by "coachable goal." A coachable goal is a life or business objective that a customer is ready, willing and motivated to accomplish, but which he or she perceives to be beyond his/her current level of experience or ability. In short, they want to do or be something new.

Some keys to keep in mind about coachable goals:

• The client should be able to see himself/herself succeeding. It may feel like it's going to be a stretch, but they should feel they have the potential to achieve the goal with encouragement, skilled facilitation and the right tools and resources.
• Coachable goals are accomplished through the client, not through the coach or anyone else.  If the goal is beyond the client's control or if they feel powerless in the face of it, it's not a coachable issue.
• The issue must be emotionally charged for the client right now. Idle interest isn't enough; they must feel urgently compelled to change the status quo: "I can't keep on going this way much longer! I have to figure this out NOW." If they aren't emotionally invested, or if you find yourself trying to persuade them that they should want to go for the goal, the issue probably hasn't reached a coachable point yet.

10 Coachable Goals…

OK, so without further ado, here are ten coachable goals (not in any particular order):

1. Making and/or saving money
2. Saving time
3. Making their work easier or better
4. Improving themselves/their relationships
5. Overcoming a major life challenge
6. Reducing stress or learning how to handle it better
7. Feeling healthier or younger
8. Communicating better
9. Making a transition
10. Finding more joy, meaning and purpose in life

…Plus 3 that are NOT

These are the types of goals that are beyond the scope of coaching:

• Changing someone else's behavior or thinking (other than the client's). Coaching can help the client change their own perspective ABOUT how someone else behaves or thinks, but the coachable goal must be about the client's beliefs and behaviors, not a third party's.
• Overcoming compulsive or addictive behavior. If the client feels powerless in the face of the issue, therapy or counseling would probably be more appropriate than coaching.
• Healing painful memories.  Again, therapy or counseling might be more effective than coaching.

Ideally, you would target a market segment that shares a common agenda and/or have similar coachable goals—it makes finding clients SO much easier! It also makes it a snap to put together a signature coaching program and products when you use the client's coachable goal as the unifying theme. Everything just kind of falls into place.                              

If you've been working with clients for any length of time, you may be able to discover a pattern of coachable goals by going back over your coaching notes. See if you can pick out a theme or common agenda to build your marketing materials and products around.

Weekly Round Up

Coaching in the news

Is Coaching the New Management? Steve Bruce at The HR Daily Advisor explores how managers are using coaching as a tool to manage employee performance, motivation and participation.

Coaches Wanted in the Game of Life, by Eve Tahmincioglu. (NY Times, Jan 13, 2008)

Found while surfing

Be sure to check out SlideShare.com. It's like YouTube for PowerPoint presentations. You can create and save a presentation there and then paste a little HTML code to your blog or website and voila! Your customers can view your presentation right on your page. And yes, it's FREE.

I was going to suggest that you check out The 25 Basic Styles of Blogging while you’re at SlideShare, but then I thought, “Duh!” Why not just grab the code and put it right here on the blog so you can see how SlideShare works?  So here goes with a short slide presentation that outlines 25 different approaches to blogging, including tips on how many times per week to use a style, plus how buzz-worthy and how difficult each style is.

| View | Upload your own

Chris Garrett's 5 Items Your Blog Sidebar Must Have will help you make sure your readers can find what they're looking for where they expect to find it (in the sidebar). (I've got 4 out of 5 in my sidebar – need to find a widget for my flagship content or update my pages section.)

I'm always looking for good quality, free images, so I was delighted to find Thirty Free Image Resources on the Web, by Wendy Boswell over at About.com.

 

Doin’ the Happy Girl Dance

I'm so blasted happy right this very minute that I actually have a huge grin on my face as I type this. I'm going to have carpal facial syndrome if this continues.

Here's the (big) deal: I got a new 'puter for Christmas, and it came with Office 2007. And Office 2007 is way, way, way cool. (My absolute favorite part of that whole package is actually OneNote 2007, which Microsoft tends to treat like a poor cousin from the wrong side of the tracks for some weird reason, but I'll save that for another post). The reason I'm grinning at the moment is because I just discovered that I can blog right from Word.

That might not seem like such a big deal, since Typepad has a pretty good WYSIWYG editor, but blogging from Word makes it easy to compose when I'm offline, and I can save my posts to my hard drive, which means my blog content is backed up. I also have more control over how my posts look now. (Notice the nifty shadow under the pretty picture.)

I'm doin' the happy girl dance.

P.S. Thanks, Dad!

No is not a word

I came across this poem while searching for something on my computer -- I had forgotten that I'd written it, but I find that it still resonates today. It's a good reminder to say YES to life without reservation.

No is not a word

Asked to put another first,
No matter how I try
"Of course" springs from my careless lips
While in my heart, I sigh

No is not a word I know
So I hear me saying yes
Of course no problem you bet OK
I'd be glad to clean the mess

This lesson, shamed into me young
For the sake of being good --
It leaves a bitter aftertaste
And smothers me in should

No is not a word I know
But I love it all the same
Each time I tell You yes that's fine
I play a little game

Alright I say with these careless lips
That came with this stoic face
Going doing fussing fuming
I fasten my grudge in place

Careless lips say yeah, you bet
While to myself I keep
A stingy little sullen "but"
So sour it makes me weep

I was winning at yes (,but..) you betcha!
Until one day I woke - alone -
My love? My heart my dearest my God?!
The silence shattered by a moan

My lips are now more careful
In prayer they beg for this:
Just one more chance I pray, my Love
To gladly tell you YES

Of course no problem you bet OK
Your need is a gift to me
I'm glad You asked I really am
To serve with love -- it sets me free

The lesson is bitter it cuts so deep
That others cannot see:
When no is not a word
The one who pays is me

Weekly Round-up

This week is a real grab bag:

<-- Finally, someone figured out how to recycle spam for the good of all humankind (art)!

I love About.com. In fact, I probably definitely spend more time reading About.com articles than I do reading the newspaper these days (it's so much more interesting and LESS depressing). Check out Scott Allen's recent article on whether to host your own blog or go with a platform.

There's a treasure-trove of coaching-related news on the Coaching Chronicle page over at The Foundation of Coaching. The Chronicle is updated every Thursday, so it's always fresh.

Well, I can't pass up the chance to make it into my own Weekly Round-up, so be sure to check out the blog over at New Coach Connections -- your's truly is the new gal behind the curtain, pulling levers and pushing pedals to make smoke and noise come out. (In English: I'm managing the blog and will be posting regularly there.) New Coach Connection is a terrific virtual coaching community with about 750 members. Be sure to check out the discussion forum, the main website with all kinds of goodies, and of course the blog.

Got a goodie for the Weekly Round-up? Let me know and I'll post it!

Tags: About.com, Scott Allen, The Foundation of Coaching, New Coach Connection, Weekly Round-up, recycle spam

Get your business on track in 2008

If you're having trouble remembering why you ever thought being self-employed was a good idea, it might be because you're so overwhelmed that you can't get any traction.

The problem is that working solo makes you vulnerable to your own blind spots.

The answer? Join a Success Circle - it will give you x-ray vision! Well, not literally, but with eight other pairs of eyes watching out for you, you're bound to make headway.

Two new 6-month group coaching programs coming in January:

Success Circle on Blogging
Wednesdays from 12:00-1:30pm Pacific starting Jan 9
This group is for coaches who want help developing high-quality blog content that educates and inspires customers and attracts qualified leads.

Success Circle on Sales Funnels
Thursdays from 11:00am - 12:30pm Pacific starting Jan 10
This group is open to any coach who's working on developing their sales funnel, including a creating a system for generating and staying in touch with leads, and developing samples and introductory products that convert prospects to customers.

To find out more, including dates and pricing, visit my website or come to a free tele-clinic on Wednesday, Dec 19.