How to Raise Prices Without Losing Customers

Within the evolution phase of your firm’s span, you presumably commence constructing your brand name and buyer base. Nonetheless, one of the most prominent details often overlooked during this crucial stage is the equitable amount you should charge your clients. Now, the mere thought of raising prices on your loyal clients may surface a spike of unease in your mind, as you want to preserve loyalty and a stable connection with each buyer. However, this does not mean raising your rates has to negatively impact your consumer base. By concentrating on your utility and value, you can ultimately position your product or service as a desired solution worth substantially more than your current low price. Here are some tips on how to raise prices without losing customers.

Identify Consumer Consent

It is understandable for a firm to be hesitant towards raising its prices while your company is still getting its feet wet. Nevertheless, if your customers’ actions assures that your firm proudly differentiates amongst the competition, use this response to your advantage. When you begin to notice any green lights associated with a price increase, always pay attention to them. These vital signs can determine the form of beneficial steps to move forward, like swift contract signing. When your customers are eager to utilize your services regardless of your most recent price increase, maintain confidence your rates can still be raised.

Raise Rates Until Rejection

Chances are, the first time your firm increases its rates, clients will not bat an eye. By doing so, you can actually detect where your breaking point is and learn you can actually charge a higher rate than you were previously. In fact, if your firm’s value proposition is solid in a consumer’s mind, raising prices a second time will not cause a fuss either. Some customers may comment that the price hike was acceptable to the quality of the service you were providing. Ultimately, it is essential to understand where your company is meeting buyer resistance and adjust rates as such.

Harness Valuable Data

Observing volume and cost to rule if your firm is equipped to increase prices is a good way to forecast if raising prices will be effective. Instruct your customer service team to frequently convey feedback to the sales and marketing team. This will assess your clients’ happiness and create efficient competitive data. Keep in mind, you may not be fortunate enough to have customers convey word-for-word if your price is exceptionally low and may have to interpret their financial concerns through negative reviews on your product or services.

Add Incentives

One of the best techniques to win customers over with a price increase is to add a little something extra to the mix. These additions can include loyalty programs, free samples, as well as free trial periods. When spotting added exciting features attached to your goods and services, clients will automatically deem your offer as one of exceptionally-high value and therefore will accept the high price. Take time to consider what your distinct customer base would want with your current product or service to build higher perceived value.

Tread Carefully

Regardless of size, companies should consistently extend integrity and fair play to their clients. When building your firm’s pricing strategy, it is never a bright idea to secure consumers to an agreement only to later raise rates, even if it is legal. Doing so can cause negativity to your quarterly reviews and become embarrassing as you compile data to further your unethical cause. It is commonly welcomed and accepted to raise prices roughly once a year and only when your firm can decide if its rational. When contract renewals arrive with your present customers, sustain certainty your current prices match the value  of your products or services. It is ideal to inform your clients prior to signing the annual contract about any future price increases. There may be some wiggle-room regarding price; nonetheless, stand your ground on the current going-rate.

Penetrate Your Existing Market with Lendr

Raising prices is a delicate task, but one that must be executed to drive business growth.  Scope out your surrounding competition and marketplace and select the right pricing technique for your goods or services. Lendr can help your small business or startup be successful. We will work to determine the correct funding needed to launch your business. Learn how our cash advances have helped hundreds of companies flourish. Apply now to make the first move towards expanding your prospects!

 

More articles and case studies...

The Small Business Owner’s Newsletter

Join the list for stories, articles and resources to help you grow your business.

It only takes one click to subscribe.