Sometimes you just have to raise your prices, and while that’s never a bad thing in your book, some customers may find themselves upset that they suddenly owe you more money monthly than they did before. A classic example of this is when Netflix increased their prices by almost 60%. Was it still a good value? Yes, but that doesn’t mean they didn’t have to suddenly face thousands and thousands of upset cancellations the next day as angry customers did not enjoy that surprise. While you can’t always completely negate the blow, you can soften it if you follow the tips below.
Don’t Hide Anything
Don’t be afraid to be 100% honest and upfront about your price jump. Tell them why, how, when, and then why again. It makes sense that as your company obtains new features, gains experience, and becomes an established service in the field that your prices will go up to reflect the wider, more interested market. It’s okay to tell them that, or whatever other reason you have for raising your prices—they’ll either understand or they won’t, but you’ll at least have told the truth.
Thank Your Customers Profusely
This doesn’t always help, but you should attempt to get every bit of help possible, especially when it comes to raising prices. Tell them that you appreciate that they started out with you and your little company and that you really do want them to stay forever because they’re legacy clients. This should all be true—remember, we’re trying to be honest—and you really should appreciate your customers, so your thanks should be personal and from the heart.
Introduce New Features with the Price Raise
When you’re raising prices, it’s important to justify your price raise—and usually not with “because we’d like to profit more.” Usually, this is because you’ve added a lot of value to your service, or you plan to do so more in the future. One of the ways you can do this is when you introduce your price increase, introduce a new service at the same time. If you can’t manage a duel release, talk about all the new features you’ll be bringing to the table shortly after the hike.
Whatever your reasons for increasing your prices, your reasoning is enough. As long as you are honest, upfront, and offer the value that is expected with such a price increase, then you’re on the right track. Definitely explain your actions if someone asks. Be sincere and direct, but don’t apologize. If they don’t understand that higher prices will better serve their needs – or they won’t, in some instances – there are other companies they can go to, and your customer base will be tighter than ever.
A little bit of honesty, gratitude a few new features can make all the difference when you need to raise your prices.