No one likes paying more money. But price increases happen, and are necessary. The question is, how do you break the news to your regular customers? Here are some strategies to consider.
Strategies for developing your message:
- Make sure you understand the reason for the increase. This might sound like a no-brainer, but it’s important for you and your employees to be able to articulate a reason for an increase (beyond “it’s time”). Are you increasing prices because costs are going up? To be more in line with competitors? Because you haven’t increased prices in X years? We’re not suggesting you question your motives or that you feel guilty for raising prices. Instead, we’re recommending that you can clearly articulate your reasons because this will help with the next strategy.
- Determine which of these reasons, if any, you’ll share with your customers. Your customers might not necessarily care that you haven’t raised prices in two years or that your costs for x, y, z have gone up. Price increases always hurt because, as consumers, we’re thinking about our pocketbooks first. Still, depending on your customer base, certain reasons might be more compelling than others. For example, if you run a local coffee shop, and you need to increase prices to compete with the large chain that moved in down the street, that message might resonate with certain customers who are committed to buying from local-based businesses.
- Think about how you’ll handle negative reactions, questions, and concerns. Once you’ve developed your message and set your prices, you’ll want to make sure you’ve gotten your staff up to speed on the changes, including suggestions for dealing with negative reactions, the process for helping customers cancel their products or services, and answers to commonly asked questions.
Strategies for letting your customers know about price increases:
- If you have a storefront or office where customers visit, be sure to post notices, specifically at any reception and/or checkout area. The notice should include what services/products are being affected, the price increase, and the date the increase will take effect. Try giving as much notice as possible, ideally 30 days. After the rate increase, post slightly different notices that explain you’ve recently increased your rates. Another recommendation: at the end of the notice, have a “for more information” line along with a dedicated landing page on your website.