What Your Pricing Says About You and Your Business

In this episode, Rachel Cicioni discusses the importance of pricing confidence for educators, how pricing communicates value and confidence, and strategies to set sustainable, value-based prices that reflect expertise and foster business growth.

Resources
Rachel Cicioni's T2E Mentorship Program 

Rachel Cicioni’s T2E Mindset: Claiming Your Identity as a Private Practice Teacher

Chapters
00:00 Understanding the Importance of Pricing
01:51 Communicating Confidence Through Pricing
04:04 Perceived Value and Pricing Strategies
06:09 The Impact of Pricing on Client Perception
08:25 Mindset and Money: A Teacher's Perspective
10:36 Building a Sustainable Business Model
12:30 The Distinction Between Teaching and Tutoring
14:11 Creating Access While Meeting Financial Needs
15:27 The Role of Money Mindset in Pricing
17:28 Final Thoughts on Pricing and Value

Transcript

SPEAKER_00 0:01

Welcome to the Teacher to Entrepreneur Podcast. I'm your host, Rachel Siccioni, former classroom teacher turned entrepreneur and mentor to educators building their own unique teacher businesses. This is a space for teachers who are curious about alternatives to the classroom, exploring private practice and other multifaceted work, and for those who want to know what success can look like beyond the classroom. I'm glad you're here. Now let's get into today's conversation. Let's talk about your pricing. Because this is one of those topics that makes people immediately uncomfortable. It also happens to be the reason that a lot of really good teachers either burn out or quietly shut down their businesses. And I don't say that to be dramatic. I say it because I have seen it happen over and over again. And I lived it too in the beginning. So today I don't want to just talk about how to price your services. I want to talk about what your pricing is actually communicating, whether you realize it or not. Because your pricing, it's not just a number, it's a message. Most teachers think about pricing like math. And that makes sense. Of course it does. And they'll think things like, what feels fair, or what will people pay? What are they willing to pay? What are other people charging? But that's not how other people experience your pricing. In fact, a lot of people are not pricing themselves properly or not pricing their services well, which would be one reason I would say, don't look at what other people are charging. And when I finally get Barb on here, we can talk about that. Because I would say probably halfway through her second year in business, somebody started doing what she was doing, but charging way less than she was. And we had a conversation about that. She was a little panicked about it. She's still here going strong another year and a half later. And we did not change her pricing. So the way other people experience your pricing, they experience it as information. It tells them things about who you are, what level you operate at, what kind of experience they can expect to have with you, and whether or not or to what degree they should take you seriously. So if your pricing feels all over the place or hesitant, or like you're trying to justify it either in your consultations or in your copy, in what you have written on your website or social media content, then that's the message they're receiving too. So once you land on a price that feels fair and appropriate, you also need to be confident sharing that with others and being comfortable in that place. Your pricing communicates your confidence. Kind of want to let that one sit for a minute because a lot of times when I start working with teachers, they can feel very confident in their pedagogy. But for many of us, teaching one-on-one or in small group is new. And we don't tend to be super confident in the things that are new to us. Running a business is new. All of that can have an effect on your confidence. So I want you to find a way to separate your confidence in trying this something new from the confidence you have that your price is fair and appropriate for what you have to offer. As an educated and experienced educator, your pricing communicates that confidence. Not your personality, not how nice you are, not how much you care, definitely not. In fact, a lot of teachers want to make what they have to offer so accessible because they care so much. But unfortunately, when you make your pricing too low, it communicates low value and not necessarily how much you care. Once you have met your financial needs, there are other ways to make your services more accessible to others, to show how much you care. But that doesn't need to be in your pricing. There are other ways to do that. What your pricing really communicates is your confidence in your ability to help your students. And that's what I want you to focus on. So if you have landed at a price point that feels fair and appropriate without diminishing your expertise, years of experience, and value that you are able to bring and offer, then that's where I want you to be confident. Here's what I see a lot of the time when I'm working with teachers. They'll say something along the lines during their first consultation or their first few consultations, or in my case, the first year's worth of consultations. They'll him and Haw putting off getting to the price, even though they practiced saying their price in the mirror and walking around the house, which I absolutely did, when it comes time to where they can't put off mentioning the price any longer, they'll say something along the lines of, okay, so my rate is um$60 an hour, but that also includes and um this is flexible. So if we need to discuss other options and just like that, you have talked yourself and them out of your price. In fact, you've also communicated that you are not confident, which they will read as you're not confident that you're worth that amount of money, that your time is worth that amount of money, and that you're not confident you can help their child achieve those results. All of that gets communicated in that little awkward part. And I talked about in the last episode about how having awkward consultations is what helps you get confident. But let's see if we can get this time and the awkward level of your first consultations on the lower end so you can get through those as quickly as possible. But I talked myself out of my pricing before the other person even had a chance to respond. And here's what's wild. When I started, my prices were lower. I was charging$50 an hour and providing another two and a half hours worth of asynchronous work. I had so much prep on the back end and I was only charging for that$50, that one hour of my live time. And people were asking me for discounts. I was having no shows and people rescheduling. But when I raised my prices and just said them confidently, and I didn't backpedal and I just let it hang there in the air, and I didn't try to justify it or add anything else onto it, the person just said, okay, and that was it. So it's not just the number that you're putting out there. I mean, I raised it by 33%. And the response was, okay, sounds good. It's how you hold that number and how you allow that number to be perceived. Now, here's the part that needs to be said your pricing affects how people value what you do. And I know teachers have a complicated relationship with this because of how underpaid and undervalued our profession is as a whole. But when you step into private practice, remember, I said the assumed competence, the respect that we are just given as being business owners, helps to elevate that. And we're no longer being priced by a system. And this is still a relatively new concept. So we are setting the standard. Families are not comparing what we have to offer in the private practice space to a classroom salary. They don't understand that. They don't really know how much it costs to educate their child. What they do understand and what they're comparing you to is what they pay for other enrichment for their children, other things that they invest in to help their children be successful, have these enriching experiences that make their lives better, like music lessons or athletic coaching. So if you come in pricing yourself at a low price point, like$20,$30, or$40 an hour, that doesn't read as more affordable. It comes across as less valuable, even though that's not the truth. If you really want to know what price point would work in your area, because cost of living is different all over the country, and I don't know where you're listening from and in different countries. Look at what families are already spending on those types of enrichment. When I was coming up with my pricing the first time, I looked at what I charged as a tutor when I was in undergrad and how much I think I should be able to charge now as somebody in the middle of their master's program. And that's how I ended up at the$50 price point. But when I was being asked for discounts at that price point and asking, and it wasn't necessarily because they needed that discount, it was because I had sort of priced myself in a bargain range. The very first time I was asked for that discount, I was really kind of upset. I was like, this is as low as I can go. Are you serious? You want a discount on top of this? Like, that's a steal. I realized that was something with me. And so I responded with that is the discount. And you know what the person said back? Okay, I just thought I'd ask. And that kind of blew my mind. And it got me thinking, okay, maybe I'm not thinking about this pricing properly. And so I started looking. So happened to be around the same time that I was signing my daughters up for dance class. For the two of them, it was like$300 a month each for them to take two 30-minute classes a week. And I had to pay that no matter what. Like whether they came to those classes or not. That's just what it was. If they missed a class, there were makeup sessions available. But if we weren't available during that makeup session, then they just didn't get that lesson. But I wasn't discounted for it. And so when I started thinking about my pricing and my terms and conditions along those lines, that's when everything really started shifting in my business. And I was able to see where this could be sustainable and where this could be something that could provide consistent income. Another thing that happened when I raised my price, I got less no-shows because the value of what I had to offer was higher. And I had set my terms and conditions in such a way that they still needed to pay for that. It wasn't going to be prorated, whether they made it or not. People were more likely to show up for the sessions that they scheduled with me. So again, all of that came down to perceived value. What I was actually offering didn't change. In fact, I offer less. I don't do a two and a half hours worth of asynchronous work anymore. I don't even offer an hour's worth of asynchronous work anymore. They pay for my time and what we get accomplished. I prep, of course, for them. And I provide some practice for the things that we work on. But all of that extra trying to recreate an actual classroom experience for students is not necessary. Not when you're working on one-on-one in a small group with highly motivated people. They're going to make the strides that they expect to be making on their own. So when you're thinking about your pricing, you have to think about what your price communicates about what type of service it is that you are offering. This really speaks to your positioning. Your pricing can say, hey, this is a casual like side hustle. If you're pricing yourself at$50 or$60 an hour and that's low compared to what parents are spending on private music lessons or private athletic training, then that says that this is just a side business and you might not be in it for that long. Or that this is more of homework help. Or it could be communicating that this is a professional specialized educational service that they're paying for because those are not the same thing. And this is one of the places where we'll dive into this more deeply next week when we talk about the difference between teaching and tutoring and why I make such a big deal out of this. And it's kind of controversial. I've gotten some backlash from it. But it's not because I think what a lot of tutors are offering is less valuable. I just think they should be calling it by a different name because it has more value. But again, we'll dig into that more next week. So one of the things that I'm finding in this space, when you are undercharging, they don't take it seriously, the boundaries get blurry, and or the business just doesn't feel sustainable because I've worked with teachers who come to me and are saying, okay, you know what? I built this business and it's going well. I have clients, but my schedule is full and I'm still not making enough money to meet my financial needs. What should I do? A lot of times the answer is, well, you don't have any more time. So you have to charge more or restructure your entire business or a combination of both. And that's an uncomfortable place to be. It's not an awful place to be, but all of that could have been avoided if we had started at a higher price point to begin with. And when I'm thinking about the teachers that I've worked with who have too many clients and aren't meeting their financial needs because their price point's too low. I've met just as many teachers who aren't getting enough clients or getting enough consistency in their clients because their price points are too low. I've had teachers come to me with their businesses and they keep saying, I keep lowering the price, but nobody's coming. And I have to tell them that it's because your pricing is so low that they don't see the value in it. It's it looks like that free item set out by the curb, they're not quite sure. Is this going to be worth the time? Is this something I should share with my kids? And all of it really comes down to mindset because we don't have a neutral relationship with money. It's really hard and takes work to develop a neutral relationship with money. It's something that I have had to work with. And I had to confront unconscious biases that I have with the way that I have grown up and my lived experiences. And so your pricing really is a direct reflection of what you believe about your value, the value of your expertise, your time, and like I said, money itself. And nearly every teacher I've ever worked with has had to do some level of work around their money mindset. And if you really think about it, it makes perfect sense. You can't work in a field that is undervalued and underpaid and overworked and have a really good, healthy mindset about the value of what you have to offer. And so whether you realize it or not, how you feel about money and how you feel about your own worth as an educator shows up in your pricing. So I want to give you a quick exercise to start examining your money mindset. When you hear the following phrases, what comes up for you? What do you notice? When you think of rich people, middle class people, poor people, what comes up for you? And I don't just mean what do you think? I mean what do you feel in your body? When you even just the word money, what do you feel? Price. How do different prices feel when you say them? I charge$80 an hour for teaching. It took me a long time to get to a place where I feel neutral about that and it feels fair and appropriate for what I have to offer. And what do you feel in your body? Do you tense up? Do you feel resistance, judgment, discomfort? And do a quick word association. Write down the first things that come up for you. Just, I actually have a worksheet in the workbook in the mindset portion of my program where you brain dump everything that comes up for you for rich people, middle class, poor people, words or phrases just kind of come up for you. No judgment. This is just for you, just to bring awareness as to what comes up for you. And here's why it matters. If you have negative associations with wealthy people, what's the likelihood that you're going to let yourself become one? Where might you unconsciously get in your own way? And on the other side, a lot of teachers have a really strong emotional connection and desire to make what they have to offer accessible. That's why so many of us went into teaching in the first place, is because we care about equity and opportunity. We care about leveling the playing field, and that is a beautiful thing and it's important. But when that belief goes unchecked, it shows up as underpricing, overgiving, creating something that's not sustainable, that doesn't fulfill our needs. Because as much as we want to be able to do that, we have needs as well, and so do our families. So here's the truth you cannot create access for others if you can't sustain yourself first. And there are absolutely ways to do both, but you have to take care of yourself first. You can create scholarships and sliding scales and grants. And I've mentored teachers who have created those things in their businesses, but none of it happens until your own financial needs are met, until you are in a place where you have the bandwidth to be able to do that. So we need to start building a healthier relationship with money. That's something that's really foundational to becoming an entrepreneur. And one of the ways I like to think of it is like this that money is a tool. It's neutral, like a hammer. In the right hands, it can build incredible things. And in the wrong hands, it can cause harm. So the goal is not to avoid money, the goal is to use it well. So let's call a few things out because if you're feeling stuck with your pricing, it's usually one of these things: pricing based on fear. What if no one pays this? Pricing based on time, ignoring your experience, your prep, and your ability to actually get results, trying to be quote unquote reasonable, which usually means wanting to be liked and discounting too quickly before the other person has even had a chance to say no or to ask. And I get it. You care, I care, I've been here, I've done these things. That's why I know them so well. You want to help. You don't want to exclude people. You want things to be accessible. But if your pricing leads to burnout, you're not going to be able to help anybody in the long run. So instead of asking, what should I charge? I want you to start asking, what is the value of what I'm actually providing? What kind of experience am I creating? What kind of business do I want this to be? And what needs to be true for this to be sustainable for me? Because sustainability, that's what allows you to continue to show up. That's what allows you to do your best work and to create the best experience possible for your clients. That's what allows your students to actually benefit from you in the long term. And this is where things get really interesting because a lot of the confusion around pricing actually comes from something deeper. We don't have the shared understanding of what a teacher is outside of the classroom. And because of that, teachers get lumped in with tutors. And they're not the same thing. I mean, they can be, but teaching is different from tutoring. And I know a lot of tutors who are teaching and calling it tutoring. And I think it's important that we distinguish between the two. And that's what we're going to talk about in next week's episode is the difference between teaching and tutoring, why it matters, and how that distinction directly impacts how you should be charging and what you can charge. And if that mindset piece that we talked about today really hit something for you, I want to invite you to go a little deeper because this is the part that so many people try to skip when building their business. It's also the reason that so many businesses don't last. And this is the only part of my mentorship program that I sell as a standalone. It's the T2E mindset, claiming your identity as a private practice teacher. And this is where we do all of that foundational work, the identity shift, the mindset shift, the beliefs that are shaping how you show up in your business, whether you realize it or not. Because yes, you can absolutely figure out how to build a business on your own. There is so much information out there. But if you skip this foundational part, you risk building something that is going to burn you out or something that you don't even enjoy showing up for. And if you're listening to this podcast, I'm guessing that's not what you want. You still want to teach, just not in the way that you have been doing it. So if you are ready to start, the link is in the description. And I invite you to check that out. All right, that's all I have for you today. Look at your pricing, do the mindset work, check out your real competitors, not the people offering what you offer, but what parents are already paying for for enrichment for their kids. And think about what your price that you have out there is really saying about you. I hope you have a great week. I'll see you then. Thank you for listening. If today's episode resonated with you, please share it with a colleague or leave a review. This helps the conversation reach other teachers who may need it. You can learn more about what I do and how to work with me at theprivatepracticeteacher.org. Best wishes always.