Breaking News | Worldwide Coaching Revenue Reaches $1.5 Billion
Although I had previously understood this news was carefully under wraps until February 4, 2007, to herald this year’s International Coaching Week, I saw it released today via the Coach2Coach Network at Yahoo Groups. (Thank you to John Agno who runs this long-standing group.)
It’s news at once too appropos of a previous post (Prediction #7) and too worthy of analysis and absorption not to share. And I’m sure there will be LOTS of ink and discussion within the community in days to come, so for now, just the facts (as published to date) first:
“Results of the first-ever global survey of coaches demonstrate how the young profession of coaching has gained a strong foothold in the marketplace and now contributes more than $1.5 billion (USD) to the global economy.”
Side Note: One billion equals one thousand million or a 1 with 9 zeroes behind it.
“The International Coach Federation (ICF) commissioned independent research firm PricewaterhouseCoopers to conduct this groundbreaking study of coaches worldwide in order to evaluate the magnitude of the coaching profession.
From September to December 2006, nearly 6,000 coaches (both ICF members and non-members) in 74 countries were surveyed on their coaching practice and client demographic information, as well as revenue details.
The highlights of the survey findings include:
> The approximate annual worldwide revenue produced by coaching is $1.5 billion (USD).
> Coaches earn an average of $50,510 (USD) per year.
> 69% percent of coaches are female.
> The average coach is 46-55 years old, has coached for 5-10 years, and 53 percent of coaches have acquired an advanced level of education (i.e., Master’s Degree or Ph.D).
> The majority of coaches maintain 11 active clients at any given time.
> Coaching clients tend to be 56 percent female/44 percent male, and between 38 and 45 years of age. Sources: International Coach Federation, February 5, 2007 press release and www.Forbes.com, January 12, 2007
—-end excerpt from the Coach2Coach Network
So….how do you measure up? Where are you relative to these 6000-ish colleagues?
Here are a few deductions (trying to make some meaning here while not distorting the picture too much):
(1) If the average earning amount per annum is $50,000, and the average number of clients at any given time is 11…
$50,000 divided by 11 clients divided by 12 months = $379 per month per client, seems about right…
(2) With the average coach’s age given at 46-55 and the average client’s age between 38 and 45…
Coaches are generally speaking at least slightly older than their clients.
(3) Back to the average number of clients at 11. Assuming for a moment that each client meets with their coach 3 times a month for an hour each time…
11 clients times 3 times a month = 33 hours of coaching per month
33 divided by 4 weeks = 8.25 hours per week
That’s a pretty light week, even understanding that obviously this time doesn’t include administration, finance and of course, marketing.
(4) This one’s just for fun, and maybe to stir the pot a little, but if 69% percent of coaches are female. And 56% of clients are female, doesn’t this say something over time about the relative growth and advancement of women?
Forgive me, my feminist colours are showing.
On the other what does this mean is happening in China, one of the biggest growth areas for coaching, where the population is so skewed towards males due to the 1-child policy there?
Statistics are such interesting beasts. And I know there will be some conversation about the soundness of the survey due to figures, survey process and overall science of the thing.
That being said, a definite and genuine salute to the ICF for the leadership taken here. It’s a giant amount of work to bring this together, and so very needed.
—end deductions—
Alright, that’s enough for one night. Enjoy the statistics for what they are worth. I’m sure when the formal release comes out on February 4, 2007 we will see and hear a lot more context.
In the meantime, a few points to ponder:
Is this a lot of money really, relative to other service industries? (Who has a handle on statistical analysis and can do some comparisons for us?)
We may not have historical data yet, but what happens between now and the next comparable survey? In other words, are we growing? How ‘in motion’ are we?
Does having these numbers make us feel more wealthy? How much is enough money for each of us?
If this is the new state of the nation, does this mean all the fear-based marketing will stop? 
That’s it for me for the moment. I’m sure I’ll have some thoughts overnight.
In the meantime, what do you make of these numbers?
I love seeing this information. I’m transitioning from one-on-one personal fitness training and coaching to group training and group coaching. What this means is the numbers for myself and others working groups is even higher, or I work even less. I’ll decide.
)
Yeah! This is great news!
You know Andrea, before I signed up for Coaching school I did some research and the only survey results I found in 2004 was that 80% of coaches made $20,000 or less on Coaching! Scary! I still signed up and was determined to make it.
I’m glad to see coaches are doing well! If $50,000 is the average of what Coaches are making and they don’t have a commute, they have time for family, they have a great lifestyle, they get to work from their couch and more, that’s worth $100,000 to me!
Hi Andrea,
Thanks for the sneak preview of the survey results. On the one hand, I agree that the numbers are much higher than what we’ve heard in the past. That’s good news.
On the other hand, the experience level of the survey respondents (5-10 yrs)makes me think that these are the coaches who are in this for the long haul. It’s not a hobby. They’re the ones who have done a decent job at making coaching at least a part of their business and have stuck it out. And from that perspective, even knowing that actual delivery time is 8 hours a week, I’d want to see this number much higher. I know from my experience that the 8 hours of delivery time represents alot more hours in working on the business–the whole point of the E-myth stuff.
Maybe I’m biased. As a former engineer, if you are 5-10 years into your career, you’re making pretty good money. And yes, the quality of life is so much better for me now as a solopreneur. But I look at it in terms of the value that I’m providing. I don’t want to settle for less than that.
I think your work of helping coaches turn into true business owners is still sorely needed in this industry. The numbers are a marker. We have much more road to travel before the true value of coaching is realized.
Thanks again for this post.
Fabulous news! Thanks for sharing. I’m very excited about these prospects.
Deni, Halelly,
Yes it’s worth celebrating for sure. Just the fact the survey exists is a proverbial Good Thing.
I’m glad you are letting this energy give you some ‘lift’ and I hope you have even bigger smiles on your faces as you go forth and conquer.
In regards to Carol’s comments about coaches becoming business owners, you asked if anyone else has more thoughts on how to do this, and how to reach (emotionally and from a marketing point of view) coaches.
I took my first coaching course a few years back and was devouring Thomas Leonard’s information (and was very saddened with his passing). I believe he was on the fast-track to helping coaches become business owners, and since his passing, there has been a huge void where no one has stepped up to fill the void.
I’ve searched, bought, and asked many for information on this, and just recently I found something that made sense. It’s the Strategic Investment Manifesto that Brad Wozny created. He created it for real estate investors to become business owners, but I think it’s a great compilation of everything every business owner needs to hear. I’ve been coaching his affiliates for the past few months, and the response to this document has been overwhelming.
All coaches will want to check it out at
http://www.kickstartcart.com/app/aftrack.asp?afid=540528
and can use this password: BW677
I’d be interested to know what you think of it, and what other coaches think. It truly is the start of what coaches need to create a business.
Tracey Fieber
nutone@sasktel.net
Folks, let’s make sure we keep the reality in this.
The 60+% of full-time life and personal coaches making less than $20,000 is REAL.
The ICF average is just that – and high income earners (if they’re not removed from the majority of the survey sample) throw everything off.
One individual making $1,000,000 offsets 32 other coaches making $20,000 to give us an average of $50,000.
At the least, the ICF needs to provide a more detailed view of the data.
And the more senior members of this profession OWE it to the junior members to tell the truth about building a practice. It’s hard work, oftentimes takes years to build it up, expertise is ENTIRELY relevant, and not everyone is cut out to be an entrepreneur.
Let’s combine possibility AND reality so that everyone can have the best of both worlds, and so that people coming in really know what they’re getting themselves into.
Hi A ~ Happy New Year, er, that is February!
To Lawrence’s point, I hope the ICF can share – in addition to average earnings – the median and mode, plus maybe even some standard deviation info, too.
And wouldn’t it be nice to know how coaches are doing on the Multiple Streams front, as well? I think the ‘how’ behind the numbers could be quite enlightening, don’t cha think?!
Hey Tracey, I thank you for the suggestion. Although it wasn’t specifically my intent to solicit products and service links here, you submitted one and that’s just fine.
For the record, I don’t know anything about Tracey’s suggestion and decided to have a quick look for myself. FWIW, the link is definitely targetted to real estate professionals – so whoever tries the system will need to have their ‘simultaneous translator’ turned on full.
Small businesses are certainly all just small businesses at heart, so they may well be something to Tracey’s suggestion. Do let us know if you can confirm this, should you click the link.
Hey BZ! Great to read ya.
I have the ‘Gimmes’ too, when it comes to more detail from the ICF.
Here is the latest from their email today:
“In addition to these global coaching statistics, regional and country-specific information is available for those areas from which the necessary sample sizes were received. Regional-specific information is available for Africa, Asia Pacific, Australia and New Zealand, Europe, North America and South America. Country-specific information is available for Australia, Canada, Denmark, France, Germany, Ireland, New Zealand, Norway, South Africa, Sweden, Switzerland, the United Kingdom and the United States.
You can access this information by going to the ICF Web site and clicking on the International Coaching Week link located in the “In The Spotlight” section found in the top right-hand corner. (You will need to use your e-mail address and password to access this member-only section of the Web site.) You will also find speaking points to assist you in working with your local media. ”
It looks very much to me like they are keeping the rest of the details under lock and key as you have to have be a member of the ICF to access this, and I don’t know how much I’d be allowed, for example, to go in and then post here, lol.
In any case, if you are a member, you probably know, but in case this makes non-member readers want to see the ICF site, it is http://www.CoachFederation.org
Hey Barry – there is a TON going on in the corporate world, isn’t there????? Are you seeing a surge with your fabulous website and such? That’s an area I’m just not plugged into much. Give us the scoop wouldja?
Lots of good new year vibes to you too. BTW Chinese New Year – the chance to do it all again six weeks later – is Feb 18 this year.
Love the perspectives in your response!
Just had a few things I wanted to address directly. The first being the power of negative marketing. I actually don’t think that negative spin is the better path to effective marketing, and am pretty sure that most of the marketing greats don’t either. I’ve been a student lately of Claude Hopkins, John Caples, David Ogilvy, and Ken McCarthy (that latter still alive, and thanks to a recommendation by you!), and selling possibility and success seems to be more effective in getting people interested.
I don’t think that coaches who use fear to sell are doing anyone a favor. My own particular position (probably a result of a past life in financial analysis and marketing research) is to give people the ‘truth’, or at least as much of it as we can get to.
I completely support the notion that starting a business doesn’t have to be a struggle, but it DOES require a lot of work. And mental toughness and discipline. And habits that support business development etc. In my world, I’m fine saying that it’s hard work – and I actually love it!
And people really do need to decide whether or not it’s for them. If they get a sense of what true entrepreneurship and business building will require of them and choose it, wonderful. If it gets them to think twice and to reframe their coaching practice as a ‘hobby’, then that’s great as well.
Just recently, I was working the a client who had a tremendous breakthrough with regard to his own practice. he realized he actually loved his jobby job, that it was positioning him (and his wife) for a great and comfortable retirement in another 8 years, and that he really didn’t want to do the things it would take to build a successful coaching practice. For him, once he took a look at where he was at in life, he decided it was far better to have some fun working with clients on the side.
So…while I love the possibility peace and get a lot out of challenging and championing my clients to go where they’ve never gone before, and to explore infinite possibilities…the grounding in ‘reality’ is important. And it may be critical to their well-being.
Also, it’s not that I prefer the older survey results to the just-released information by ICF. I’m just not convinced yet that the data says anything different. The devil, in this case, is in the details and in having the right interpretation of the data.
I would guess over the past few years that there are a larger percentage of coaches making higher incomes, but until we get more information on the actual data, it could just be ICF spin.
The fact that coaching is evolving and growing is cause for celebration. AND…I just want to make sure the real story is being told!
This is great! Thanks for engaging, Andrea. I’m an even bigger fan now!
This is a great dialogue and I’m happy I dove in. To answer Andrea’s questions to me and clarify my previous response:
When I said I’d like to see the number higher, I was referring to the average salary, not the number of delivery hours. In looking at the additional details from the ICF survey just released to ICF members, the $50K is revenue.
I make a big distinction between revenue and what’s left over to pay the mortgage. $50K in revenue as a solopreneur is nowhere near $50K in salary working for large companies (which I did for 19 years). As a solopreneur, I pay for my own training, health care insurance, office setup. That doesn’t even include the stuff related to being a business owner–e.g, marketing expenses.
I remember being on a teleclass with Chris Barrows where he said that the rule of thumb to consistently grow your business is to take a 1/3 of your revenues for your salary, 1/3 to pay others who provide services to you and 1/3 is invested back into the business.
According to this guideline, to make a salary of $50K in the solopreneur world, you need revenues of $150K! I don’t follow this guideline (if I did, my family wouldn’t have eaten for the last few years. Okay,that’s an exaggeration but you get the gist.) But it has stuck in my mind.
In terms of coaches being business owners, I’ll use an example from my own life. I was an engineer for over 15 years. Good at making plans, tracking results, figuring out what wasn’t working. When I started my own business in 2003, I did the business planning thing and put some effort into my brand–colors, logo, website. I had some financial goals. What I failed to do was go back to the plan, see what I was learning in the doing, and make adjustments. I was very happy being a creative, free-wheeling, just got out of the corporate jail and now doing my own thing, entrepreneur. Or so I thought I was an entrepreneur.
By mid-2004, I could see I wasn’t cutting it and a business mentor of mine was calling me on the carpet. Sure, I was doing work. But the work was not profitable enough for the time it took to make a living. The numbers didn’t work in the business model I was using and I wasn’t willng to acknowledge that.
My mentor asked me who I was targeting for coaching. I said something like “enlightened, self-aware people.” I’m embarrassed to even write that today. She asked me what my financial goals were for the year. I didn’t have any. And if I did, I didn’t have a plan for how to reach my goals. I told her quite smugly that I could last another 2-3 year, living on savings.
And then she said something that stirred the deepest parts of me:
“When you go back into the corporate world 2 years from now, because you couldn’t make it as a solopreneur, will you be able to say that you gave it your best?”
Holy cow. Seeing that image of working for someone else, in a cubicle, doing work that didn’t interest me, was enough to move me into action.
Actually what it did for me was engage BOTH sides of the brain–not just the creative right side, but the analytical left side. I had left behind that logical, track the results side of me. Since 2004, I’ve brought much more rigor to how I run my business.
I do follow my creative energy, and I put it into the larger picture of what it means to the overall business. In the last year, I’ve taken on projects that had no obvious financial gain but I’ve also made sure that my core revenue streams were not affected (in terms of my energy and time for them.)
I really resonate with Lawrence’s last post. What I’ve learned is that to be a successful business owner, I need to be grounded in both possibility and reality. My coach helps me dream big, to see opportunities where I can’t see them. I’m willing to jump in and create out of nothing, to co-create with others in a way that makes it easy. My business mentors have taught me to see the landscape clearly–what the numbers are telling me, who my best clients are (in terms of profitability and ease of working), how clients are finding me, what revenues streams are best growing and which ones I need to let go of.
Sorry for the length of this comment, but I hope my own story has been useful.
Does the survey specify whether the $50,000 salary is for self-employed coaches, those employed by organizations, or both?
Considering the statistics concerning the majority of those earning this median salary, then $50,000 USD is not a lot of money. They’ve been in the industry 5-10 years, are 46-55 years old and more than half have advanced degrees which require considerable time and money to acquire.
Most professionals that I know with advanced degrees in that age group make much, much more than $50,000 per year. And again, it depends whether they’re self-employed or not.
While Sandra brings up an interesting point about commuting costs and you (Andrea) bring up the ancillary costs of working outside your home, the reality is that being employed offers fringe benefits like 401K’s (some companies still contribute towards employees plans), expense accounts, health insurance, paid association dues for industry groups, education reimbursement, etc.
And unless you have a spouse or significant other who can include you on their company’s policy, then health insurance (at least in the US) is an extremely expensive proposition.
Thank you for sharing this information Andrea. And it’s been great reading the other perspectives on this data.
I studied the actual questions of the survey and how it was administered and felt it was skewed to anyone (no exclusions for non coaches) who wanted to brag about the money they supposedly made. I am concerned about the accuracy of the results. That the results were not skewed to be more positive than they really are to entice more people to pay for more coaching training expecting to at least achieve the average. The details are very important, and should be openly provided for all to see and digest on their own. For example, an average of 5-10 years is an exceptional spread. This is especially true when you consider all of the first, second, third, and fourth year coaches who may or may not have taken the survey.
Let’s see, if the approximately 220 for profit coach training schools produced only 50 new coaches per year, they would generate over 11,000 new coaches per year. Yet only 6,000 supposed coaches took the survey, and they averaged 5-10 years coaching.
Undoubtedly, most for profit training schools will be touting this report, and certainly the $50,000 per year average to anyone who is considering paying for coach training.
Unfortunately, this survey has focused much of the attention on the supposed incomes of coaches. What about the wonderful things that coaching clients achieve through coaching? Seems like the client’s perspective has once again taken a back seat.
In the meantime, I will wait until the details of the survey are published before I consider placing any value on this survey.