The Economics of Personal Development

Yesterday, I argued that premium-priced information marketing products didn’t provide any value over what’s freely available or what’s available for the price of a standard book or audiobook.

The only reasons to pay a premium price are to give back to the producer if they already provided an immense amount of value for free or to increase one’s engagement to the material due to the investment.

Then, why do information marketers provide premium-priced products? The obvious answer is to make money, but isn’t it better to publish a book or an audiobook, to reach more people, and make the same amount of money?

That seems to be a legitimate argument, and it might be true in some cases. But in most cases, the reach of these information marketers are limited.

They have to extract as much money as possible from their limited reach to make a living. First, not everybody in their already limited reach would purchase a product from them. Selling is already a tough business. If you get into that business once, you might as well ask a premium price.

For a customer, there’s a huge difference between getting a product for free and buying it for 99 cents. Once that chasm is crossed, the product might as well be a premium price product.

As irrational as this sounds, this is the economics of personal development, and you can read more about this in the book Free: The Future of a Radical Price by Chris Anderson.

Coaching, Seminars, and Workshops

There’s another side of the personal development business. This is what I like to call services because unlike products, services involve interaction with the producer.

Coaching and workshops provide some value on top of the products. So, the amounts charged for these services can be justified.

The value in coaching and workshops is the interaction between the coach or the trainer and the coachee or trainee.

When I read a self-help question in Quora, it’s almost impossible for me to answer it accurately. I need to ask questions to that person to clarify their problem.

Otherwise, I’ll make an assumption about the problem of the person, and give a completely irrelevant answer. The personal interaction in coaching sessions and workshops facilitate this clarification process and personalization of the advice provided.

There’s a pitfall to coaching or workshops though. Most of the time, a single coaching session won’t make much of a difference in your life. Most coaching sessions are sold in packages of ten sessions. I’m pretty confident that a package of ten sessions won’t make any difference either.

After ten sessions, you’re barely scratching the surface. You and your coach are getting to know each other. The real results are achieved after 12 to 18 months of coaching.

So, if you see someone offering a premium-priced coaching session, don’t bet your last thousand dollars on a single coaching session with the hope of it changing your life.

Coaching is a process that requires time between sessions to apply the teachings in life and to do the exercises and then repeat the same process week after week for a year or two.