The Gift Economy vs Traditional Business Model

productivity relationships self-love tools
I realize not everyone has the desire for details, so I'll give the short version up front, and anyone who wants to know the full story can keep reading. Deal?

The traditional business model in the healing/coaching industry is not one of service but of sales and marketing. Plain and simple.

How do I know? 


Cuz I took courses on it, built my business in it with the help of a top coach and ran my business under it up until September 2019. Yes, I, too, did each and every one of the tactics discussed below. And it felt gross every step of the way. 

The traditional business model is designed to capture and serve the 1-2% and is skillfully masked to appear to serve the whole. When in fact, it is a lose-lose-lose (which you can read more of below).
The gift economy removes the mask and ditches the grime. Because there are no sales, there are no sales tactics. The healer is financially supported by the community whom she directly serves. Contributions are only made once value has already been gained. If her content/connection does not give someone value, they don't support it. 
 

To put it another way:

The traditional model gives you little tastes with the goal of getting you to purchase a big meal, or better yet an expensive on-going meal plan, which in turn, pays for the little tastes everyone gets.

The gift economy feeds you a delicious, nourishing meal, and in return you support the chef so she can eat too. 

Can you dig it?!
 
If you'd like to see behind the curtain, learn how nothing is free and expand your perspective, raise your hand (and read on)! I know it's long, but it's important stuff. It surrounds you every day, so you might as well know about it.  
 
 

Here is what the traditional business model looks like in the healing/coaching industry:

The healer/coach is required to put out endless content on a consistent basis for free to grow/build a following. Initially this may sound like a major win; who doesn't love free stuff?! But as you likely know by now, nothing is free. I'll explain this in more detail below. 
Why are they required to do it? Because this industry is not one of coaching or healing but one of sales, and sales is a numbers game.
The chances of converting some of those free followers into paying customers is super small - on average 1-2%. So you gotta have a lot of people to make that 1-2% profitable, and you've got to be putting out a lot of stuff to build that list.
This means the coach/healer is spending 50% or more of her time on sales and marketing, 30% on admin and maybe 20% on the actual coaching/healing she loves. Most people in this industry work for themselves which means they do their own websites, customer service, accounting, research/development, management, IT, correspondence, HR, basically everything there is a department for in a regular company is all manned by the healer/coach herself, which makes up that 30% admin stuff.  
 

Tough cookies for the coach/healer, right?

 
 
Well, the problem with this system is that she has to charge really high prices in order to cover the business expenses and pay herself (which for most people in this industry is a wage/salary below the poverty line). Those necessary really high prices mean the services are not accessible to most people, so 98-99% of the followers who feel they could benefit from them can't actually afford to pay for them and have to settle with whatever "free" stuff comes out. Are you starting to see why this isn't such a great deal for you either? 
In short, the coach/healer loses because she is only able to actually work with a very small number of people and spends the rest of the time trying to get those very few people. Those very few people lose because they have to pay super high prices to get the help. And everyone else loses because this system means they will not be able to afford the help.
 
On top of all that, the "free" stuff is wildly limited. Though it can, and does, help some people, it is truly just marketing at its core - what is called content marketing. This marketing material has three purposes:
  1. Positioning the coach/healer as an expert in their area.
  2. Giving you just enough to get you interested in getting more. 
  3. Building a "relationship" with you so you are more likely to buy something.


It looks like this:

  • Coach/healer puts out content that speaks directly to you - you are referred to as a "client avatar" behind the scenes. The hope is that you'll think "Wow! It's like he's talking directly to me! This guy knows his stuff. I need more of his content." So you follow/subscribe.
  • At some point he offers you something else for "free". This is referred to as a "lead magnet" because it attracts leads - as in leading to a sale. But remember, nothing is free. 
  • To get this "free" stuff you exchange your email address. This is what one top industry leader refers to as "the homepage ATM". Why? Because...
  • Now your email address goes into a database where you will be put through a "sales cycle" via email campaigns. There are specific formats for these that show how to push people's "pain points" and then ask for the sale while they are at the peak of hurting. That's putting it in very simple terms, and most would argue that's not what they're doing (and some really aren't intending to), but "pain points" is a standard term used behind the scenes in marketing to make consumers feel like they are understood and can trust the seller and purchase while in that hurt/fear state.
  • These emails are how and when the "relationship" building takes place. Marketers know that the standard person isn't going to just make a purchase right away from someone they "just met" - especially not a big purchase, which most are in this industry for those reasons listed above.
  • Email software tracks your engagement (or lack thereof) and sorts you so that you can be targeted most effectively for products/services. 
  • You'd think this would all end once you actually buy something, but oh no! Now you are a verified customer with money. You go on a special list. In the business world it is much cheaper to keep an existing customer than capture a new one, so you'll be hit with sales just as hard only in a different way. 
 

Well this all pretty much sucks.

 
 
It sucks for everyone involved. It is a system that has proven highly successful for some, but most people working in this industry struggle financially and tend to burn out. On the other end, people are sick of always being sold to and are growing increasingly aware of the sales tactics listed above. 
So far the "solution" has been to stay one step ahead of the consumer with new marketing techniques. This is where content marketing emerged from as well as every other form of marketing in existence. It's like computer hackers. As soon as a security solution has been created to block the hack, they just create a new hack.

Those who have "hacked" this system are naturally in favor of keeping it because it works for them. They make A LOT of money from it. 



My questions is, why are the rest of us still adhering to it? As we looked at before, it is a lose-lose-lose situation for the common persons. I can't help but be reminded of our economic state in general where 99% are supporting the 1%, and the 1% is dictating the system for the 99% to keep the 1% in control. Sheer madness!
 

This is where the gift economy model comes in.

It is a win-win-win situation with none of the grime the traditional model seems to leave on everyone.
And lucky for us (and the sake of this lengthy post), it is much simpler!

It looks like this:

  • The coach/healer puts out pure content - this has a MAJOR difference from the content in the traditional model. Remember that the sole purpose of that content was to get you to eventually make a big purchase. Now the sole purpose is to provide pure value - right then and there. 
  • People who gain value from that content contribute to the healer/coach for three reasons:
  1. They directly benefited from it already - no later sale needed.
  2. They want to ensure the healer/coach can keep putting out value-based content so they can keep benefiting from it, and they know that the healer/coach has to have money to live just like everyone else (as far as I know, no landlord has accepted "Likes" for rent yet).
  3. They want to make sure the healer/coach can keep putting out value-based content so that OTHERS can benefit from it because they recognize we are all a community and can't rely on the 1% to take care of us if we don't want to operate under their rules. 
  • The healer/coach is supported by the community she directly serves, and therefore, can continue to serve that community - not just the wealthy but everyone.

Lather. Rinse. Repeat.

Now she can spend 30% of her time on admin (cuz reality didn't just magically go away all of a sudden) and 70% on serving the community instead of the 20% in the traditional system. 
She wins because she can serve the community she loves while being supported by that community. You win because you're actually getting value instead of constant sales tactics. Those who engage her for deeper services win because now they aren't having to pay MEGO prices to support the other 98-99% of the community.

Win. Win. Win!
 

The main objection I get to this is "Yeah, but not everyone will contribute. Some people will just mooch off of others."

 

And that's likely true. This has been present in every society since the beginning of time. 
But here's the reality with that: If the healer/coach doesn't get financial support from the community, she cannot continue to serve it. Not because she is a jerk but because she can't do the work without money. Of course there are the expenses that go into it, but also she still has to be able to pay for housing and food and heat and healthcare and all the same stuff everyone else has to pay for. No amount of good deeds gets her a clearance on the cost of life. 
Without the community's support she would have to work a standard job, which means less time and energy to serve. That means the community - you - get less or nothing at all. Or she lives outside of standard expenses (i.e. homeless beggar), which also means less time and energy to serve (take it from me, being homeless takes a lot of energy) and no place to do it (or internet to get it to you). 
Basically, everyone eats or no on can.
 

Does the gift economy work?

I have no idea. We're gonna find out together!
What I do know is that the traditional business model feels real gross, does not align with my heart and doesn't work for me (financially or spiritually). 
So, let's give this thing a try and see what happens! 

 

If you are interested in learning more about the gift economy and the potential it has to heal the entire world, here are three ways to learn more from someone who has been engaged in this for a lot longer than me:

1.) Check out this short video: http://sacred-economics.com/

2.) Take a course: https://charleseisenstein.org/programs/#courses

3.) Read this book: https://charleseisenstein.org/books/sacred-economics/

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Cras sed sapien quam. Sed dapibus est id enim facilisis, at posuere turpis adipiscing. Quisque sit amet dui dui.

Call To Action

Stay connected with news and updates!

Join our mailing list to receive the latest news and updates from our team.
Don't worry, your information will not be shared.

We hate SPAM. We will never sell your information, for any reason.