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How to Keep Your Customers Happy With Price Increases

customers pricing Mar 04, 2020

Price increases are inevitable and all consumers know that, but they don't want to be treated like idiots. Keep your customers informed and they're more likely to accept without a fight.

In this article you'll discover:

  1. Why you need to keep your customers informed.
  2. Ways to write to them.
  3. The 7 Deadly Sins to avoid.

 

You must explain to existing customers just why the price is going up. When people have information, they can turn the situation over in their own minds and come to the same conclusion as you – that you had to raise your prices.

 

Pay Attention to the fact That Customers are Not Dumb

They know what's going on in the world and they are realists. As consumers, none of us likes price hikes but they've become inevitable so we expect them.

Your customers are probably well aware of global and national price changes  due to:

  • Fluctuation in the price of raw materials.
  • Increased safety and security measures.
  • Rise in postal and delivery charges.
  • Increase in labour costs.

 If these are relevant to your price increase, then say so. If there are other changes, if, for example, you want to provide a more ecologically responsible product, then the costs of this are higher.

People know that 'going green' costs more at present and many are prepared to pay the price.

Prepare your facts in advance so you can justify the price increase to your customer. This will help you if you are speaking to them or writing to them (see below).

Sure, they won't be exactly happy when they find out you are raising your prices, but if the message is delivered right, then they'll probably understand.

Even if they don't buy from you this time, you will have maintained your good relationship with them so they can soon come back!

How to Write Your Letter to Them

Well, the 'letter' might be a letter or it might be an email or something else you write to tell your customers about your upcoming price increase. Whatever it is, what goes into communication is really important.  

 It needs to be:

  • Customer oriented - remember to think like the customer.
  • Results oriented - paint a picture of how the results will benefit the buyer.
  • Value specific – outline the value of your product or service before you talk about price increases.
  • Enthusiastic – to keep up your relationship with your customer.
  • At the end give the name and 'phone number of someone they can call (preferably YOU). They probably won't bother but it makes them feel better to know they could ring up and shout at you!

 

The Seven Deadly Price Rise Sins to Avoid

  1. Don't rush into any increase you can't justify.
  2. Don't spring a price rise on your customers (or your staff).
  3. Don't convey a take-it-or-leave-it attitude to customers.
  4. Don't make concessions – if you say "buy before the price goes up at midnight on Friday", stick to it OR make it very clear to the customer that you are making an exception in their case this once.
  5. Don't focus on price discussions at the expense of talking about value.
  6. Don't treat your customers like idiots.
  7. Don't get into arguments about the increase.

 

What are some of your ideas? Let me know in the comment box below.

 

Geoff Vautier is an 80-20 guru and pricing specialist.  He successfully helps businesses of all sizes to find ways to increase their profits and grow.

“Boost your profit: Understand, and charge for, the value you provide”

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