private music education

Expert Advice: The Hidden Economic Consequences In Private Music Education

An expert in the field of private music education, Tim Guille owns a successful private lesson company in Los Angeles (All Play Music) and is the Co-Founder of Music Money Formula (musicmoneyformula.com). He provides business coaching and support for music educators around the world and is the co-author of the Music Money Formula book.

The First Step
When David (my business partner) and I start working with a new private music educator, our first step is to learn what they want to accomplish. What outcome do they want? In the teacher’s mind, what does their instruction business look like in one year, in five years? Our goal is to help them reach their vision of success. Part of that discovery process is the “economic consequences” discussion.

There are economic consequences to every decision private music teachers make when starting their teaching business. In this article I’m going to cover some of the biggest decisions a music educator makes when building a business and the economic consequences of those decisions. There are exceptions to every rule, but in my experience the following information has consistently held true.

The Economic Consequences Of Who You Teach
One of the first questions I ask a private music teacher is: Who are your students? Do you teach children? Do you teach adults? High school students? College students? All of them?

This is an important question, because who you choose as a customer strongly affects both your time and income.

Here’s how… When it comes to getting new students, you want to be able to determine your “cost of client acquisition”––how much time, effort and money it takes to get one new student. Then you want to compare your cost of client acquisition to the lifetime value of your students. Lifetime value is the total amount of money you earn from a single client when you combine all the lessons they have with you over time.

Here’s how this comes into play: Adults, on average, take lessons for about one year. High school students usually take lessons for two years and college students usually maintain lessons for around six months. But if you enroll a new student when they are seven years old, they will often maintain lessons for over five years. So if you spend time, effort and money to get one student… The lifetime value of the child student is the highest when compared to the cost of client acquisition. And the economic consequences of not teaching children is that you will spend more time, effort and money to maintain the same amount of students. So if you want to spend most of your time as an educator instead of a marketing and sales person you will focus on teaching kids.

The Economic Consequences Of Where You Teach
Clearly, it makes sense there would be economic differences if you have a teaching business in a large city like New York versus a small town like Walla Walla, Washington, because of the different levels of income and size of the marketplace. But the location consequences that most private educators overlook have to do with where the lessons take place. Do the lessons take place in the teacher’s home or studio? Does the teacher travel to the student’s location? Are the lessons hosted online? Let’s discuss all of these lesson locations:

• In-Studio (The teacher’s location) vs. In-home (The student’s location). When students come to the teacher’s location for lessons the students are typically middle-class clients. They have more time than money. That’s why they will take their time to drive to the teacher’s location; and if the student is a child the parent will take the time to wait until the lesson is complete.

If the lessons happen in the student’s location the student is typically on the more affluent side. They have more money than time… That is why they import services to their location. The economic consequences of teaching middle class versus wealthy is that the middle class usually don’t pay top rates, they tend to skip more lessons and, in general, have a lower lifetime value because they end up taking fewer lessons.

• Online vs. face-to-face lessons. Many people have thriving online lesson businesses, but the biggest issue economically ends up being a lower lifetime value of the client. Simply because most students who take online lessons are over the age of 14, so they tend to not take as many lessons as students who start when they are 6 or 7 years old. So again, teachers will spend more time, money and effort to maintain the same amount of students in an online studio than if they are teaching face-to-face lessons to children.

Now I want to be super-clear. I’m not saying any of these models are bad or won’t work. I’m simply saying that when it comes to efficiency and profitability these factors come into play.

The Economic Consequences Of What You Teach
Simply put, if you teach the more popular instruments, it will be easier to get clients; your cost of client acquisition will be much lower. It doesn’t mean you can’t make money teaching accordion lessons. If that is the only instrument you teach, you may want to focus on online lessons, because you can market to the entire world. But you still face the consequences of teaching online.

On the flip side, if you can teach piano, guitar and voice you will appeal to a much bigger segment of the population and the result will be more clients for less effort, time and money. These factors may seem obvious. What is less obvious, however, is that a music teacher doesn’t even need to teach lessons on the instrument they advertise. An instructor can advertise lessons for multiple instruments and then recruit a teacher for the instrument when there is a student who is interested. This is how businesses begin to scale. The economic consequence of this method of business growth is earning more money with less time and effort.

TIM GUILLE is an entrepreneur in the music industry. His compositions have been used in hundreds of television shows and networks ranging from NFL to Pawn Stars. He owns All Play Music (allplaymusic.com) a successful private lesson company in Los Angeles and is the Co-Founder of Music Money Formula (musicmoneyformula.com) where he provides business coaching and support for music educators around the world.