How To Raise Your Prices Without Driving Customers Away

 

The cost of living is continuing to rise, and chances are you are feeling it in your business as well.

There are many reasons why you might consider a price increase, as many factors are outside of our control. Inflation, supply chain issues, wage increases or competitors’ increased rates. Price hikes are never popular and there’s always a risk of losing some customers. But you don’t need to dread raising your prices.

Here are some simple suggestions of how to communicate price changes to your customers in a way that makes them easier to understand and accept.

Let Your Customers Know Well In Advance

Most people do like surprises, but not one that will have a negative impact.

You should provide your customers with plenty of time to come to terms with the price increase. They may need to re-access their budget or consider alternative options, so it’s best to keep them in the loop once you are aware that your pricing strategy needs to change.

Choose a date for your price increase and let people know the date it will officially be changing. It’s also a good idea to remind them that they can purchase at the old price until the new price kicks in.

 

Explain But No Need For Apologies

It’s tempting to apologise for a price increase. Even when raising prices in a must and completely justified, we still feel the need to apologise.

But there is no need. Apologising can come off as a feeling of regret and that you are uneasy about your decision. If you come across as tentative or nervous about your price increase, customers can pick up on this and may try to negotiate.

Instead, focus on the benefits to customers that accompany the price increase, such as expanded product offerings or additional services now on offer.

 

Tell Your Customers Why

To make it clear that you’re raising the prices to maintain the quality of the product, you should explain what caused the price increase.

For example, if the cost of a material you need to make your products has gone up, let your customers know this is why your prices have to go up, too.

If a customer can see why it is necessary for you to raise your prices, they will be more understanding. Try to avoid going into lengthy detail about your reasons why. Try keeping is simple, short and to the point.

Allow Customers To Reach Out With Further Questions Or Concerns

You want to be sure your customers receive all the information they require. A lack of information could cause them to leave and look at your competitors instead.

Reassure them that they can always reach out to your business with any questions or concerns that may have regarding the price increase. This communication can be done through direct email, social media or even through your website.

Some businesses even create a FAQ’s page, as your customers will likely have similar questions about your increasing prices.

 

Lead With Your Value

Now is a great time to remind your clients why they chose to work with you and what they can expect from your business moving forward.

It’s best to use this opportunity to focus on selling the value your product adds to your customers more than the idea of hiking your prices. Think about things such as what do they care about? What do they value? And how can you make them the heart of your message?

If you have any upcoming releases, services, products, or new features your clients would be excited about, this is a great time to announce that too.

You can’t keep all your customers happy. Some people may not like your new prices and will leave. If this is the case, that’s okay – they were never really your ideal client anyway.

Often, small business owners discover that raising prices attracts new, more profitable customers who are willing to pay a higher price for better quality. These are the customers you want.