2) What are the usual fees for executive coaching?



    I. Bricks and Mortar

        - Coaching for Multinationals

        - Marshall Goldsmith example

        - Fee comparison with strategy consultancies

        - European fees

        - SMB (Small and Medium-sized Business) fees, U.S.

        - SMB coaching fees, Germany


    II. Rings and Clicks (telephone, on-line)

        - Internet Guru coaching fees

        - Virtual Coaching

        - Glenn Livingston example



    The Goldsmith and Livingston examples were chosen because of their results orientation.


I. Bricks and mortar (face to face meetings)  

Coaching for Multinationals (the Fortune 500)

    In the HBR Research Report “What Can Coaches Do for You?” by Diane Coutu and Carol Kaufman in January, 2009 there is a survey of fees, asked of coaches in the U.S. and the UK (almost half of whom were women). "Compensation rates vary widely: from between $200 to $3,500, though most of you are clustered between $500 and $725 per hour." The high above is less than that for management consultants who work independently. The U.S. marketing consultant Jay Abraham,* for instance, charges $5,000 an hour, as alledgedly also do some of the Internet gurus do for one-on-one coaching (cf. II Rings and Clicks).

    The surveyed executive coaches work primarily with senior managers of major organizations, e.g. the C-suites of the Fortune 500. These are "bricks and mortar" coaches, as distinguished from virtual (on-line) coaching. The virtual range for the commonly used method of hourly billing is between $50 and $5000 per hour, as discussed at Part II. 


Marshall Goldsmith example

    Probably the leading "soft" coach in the U.S. is Marshall Goldsmith, who allegedly receives $100,000 and up per coaching assignment for a Fortune 500 CEO. (The link is to the section about him at "Eminent Referrrals" at About Us.) Notable is that he works on a performance basis, accepting a maximum of eight clients at any one time. He only gets paid if his clients achieve by upon objectives, as measured not by themselves, but by outside stakeholders. Marshall Goldsmith´s fees are modest compared to that of the premier strategy consulting firms (the "Big Three" being McKinsey, Bain and BCG).


Fee comparison with strategy consultancies

    "It will cost you $150,000 a week to get in a team from BCG or McKinsey," one incredulous pioneer told me.  "Four or five million dollars for a six-month project!" another marveled." Walter Kiechel III, The Lords of Strategy, Harvard Business Press, 2010, Note 5 to Chapter 14, p. 330.


European fees

    Consulting fees, especially for major engagements, have a global price. However coaching does not. In continental Europe, where coaching is not as well established as in the U.S. or UK, the fees are generally lower. For instance in Germany, the airline Lufthansa has an extensive "soft" coaching program. The fees the coaches for Lufthansa receive have been reported in the press as ranging from 200€ to 320€ an hour.


Small and Medium Sized Business (SMB) fees, U.S.

    The 2010 survey by Sherpa Executive Coaching of 500 "soft" (behavioral and leadership) coaches in the U.S. and Canada, most of whom serve the "middle market," showed the majority of rates as falling between $220 and $340 an hour.

    A coach engaged over a franchise such as The Growth Coach (www.thegrowthcoach.com), a U.S. firm, or Action Coach (www.actioncoach.com), an Australian firm would also charge less than those who work with the Fortune 500. At Action Coach the fee (2010) for an Alignment Consultation and Training Day is between $1295 and $5000, typically followed by billing of between $995 and $10,000 a month for the next 12 months.


SMB coaching fees, Germany

    In Germany coaches for SMBs charge somewhat less. In 2007 Middendorf and DBVC conducted a survey of this market, which also included a large number of people receiving coaching on a private basis (e.g. switching careers). The survey, reported in the Jan. 2008 issue of Coaching Magazine, listed an average fee of 155€ an hour.


* Jay Abraham is a legitimate "make-it-happen" entrepreneur. Although apparently he never went to college at all, he writes well. His recent book is excellent for entrepreneurs and also for people running SMBs: The Sticking Point Solution, 9 Ways to Move Your Business From Stagnation to Stunning Growth In Tough Economic Times, 2009. In it he emphasizes delegation and imaginative ways to partner with other businesses. 


II. Rings and Clicks (telephone, on-line)  

Internet Guru coaching fees

    A number of the Internet gurus offer coaching for high fees. The business model is to use on-line sales (e.g. E-books, DVDs, webinars) to funnel people into more expensive live seminars, group training and one-on-one coaching. Sometimes the fees reflect the low level celebrity status of the guru. However one has the impression that sometimes these coaching fees are advertising puffery to make another (on-line) offer appear good value for the money.

    An example is a recent promotion (2010) for a business seminar by Brian Tracy, a self-help and motivational author. In it he mentions charging $5,000 an hour for one-on-one coaching. However the entire promotion was about the seminar, with no further information about coaching at all.

    At the other extreme, the Internet also offers the cheapest business coaching available. On outsourcing sites offering virtual employees, e.g. www.elance.com, one can find business plan coaches (among others) for well under $100 an hour, perhaps for less than $50.

    Further discussion (with nine examples) is on the subpage "Internet Gurus Who Coach" of Instant Internet Empires at Papers.  


Glenn Livingston example

    "Hard" (pure business) coaches who emphasize working on a results basis on their websites are rare. Although he has a Ph.D in clinical psychology and a website for weight loss counseling, Glenn Livingston focues on "hard" business coaching for entrepreneurs, not "soft" psychological advice about, say, balance of life issues for the stressed out executive. He too is treated in the subpage "Internet Gurus Who Coach," linked above. As the CEO of two consulting firms and owner of half-a-dozen Internet businesses, his focus on business coaching is not surprising.

    None of his websites mention anything directly about a willingness to work on a results basis. However one may infer that from the paragraph below, which is why I decided to use him as an example. The paragraph below appears about 3/4 of the way down of the Home page on his website about pay per click search marketing. That website offers telephone coaching: $334 for 20 minutes, $500 for 30 min. and $1,000 for 60 min. Or you may talk to a student of his who will reveal his last name upon your actually talking to him at rates of $200 for 20 min., $300 for 30 min. and $600 for an hour.


    "Sell results, not procedures: (Thanks to Perry Marshall1 for this one.) For example, my wife's been developing a web-video infomercial service for entrepreneurs. She really is among the best in the world at her craft. . . but the problem is, people don't want infomercials. They want CUSTOMERS. So I'm helping her develop a model where the client simply covers her costs of production (usually just a few thousand dollars), and then pay for phone calls and sales instead."

    At Glenn Livingston's coaching website he limits himself to 30 clients, with the options given below (2011). He mentions on the website that he usually charges $1,000 per hour for coaching on the telephone. The programs below entail his spending, on average, "more than 90 minutes per month" with each client, which includes preparation time. He states that as being "15 minutes prep time to review materials you send before each phone or Skype session." An entire quarter hour to review, say, a website with embedded videos, or an attached file about new software, a product introduction, the allocation of an international advertising campaign among different media, competing outsourcing bids, or alternative debt/equity funding proposals? (Hmmm, why so long - slow reader?)

    The service of "Private Coaching Board" below means that you can ask ONE question per week and he will respond within 24 hours (if posted Monday through Thursday). The service does not include additional E-Mail or "chat" exchanges. The Strategy Sessions and Mastermind Conferences are once per month. 


                 Services (on a monthly basis)                                  Fee (monthly)

SILVER -     Private Coaching Board (PCB) - 4 per month                                 $697


GOLD -       4 PCB + 1 telephone (Skype) strategy 45 min. session (StrtSes.) $1,000


PLATINUM - 4 PCB + 3 StrtSes. + 1 group Q&A Mastermind Conference        $2,496


Platinum coaching is limited to eight clients who are full time Internet entrepreneurs with gross sales of at least $12,000 a month. The three options are all sold out (July, 2011).


1 Perry Marshall is an Internet entrepreneur based in Chicago. He offers several Internet products for keywords and list building. He also offers for $1997 on-line access to seminar he held on Google Adwords. His virtual coaching fee is $725 for 60 minutes.



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