Price is one of the most sensitive points of any business. The rate that you charge customers for goods and services is a delicate proposition as you want to charge what you’re worth, but still have enough business to earn what you need to live.
If you’ve been running the numbers and know you need to raise your rates at the end of the year, how can you do it successfully? There are three key points of approach that can help you move ahead with your new rates and still keep a full calendar.
1. Give Notice
One key tip for easing customers into a new pricing structure is to eliminate the element of surprise. Springing a rate change on a client will elicit the greatest negative reaction, but breaking the news well before a change will help give your clients time to adjust and plan.
After all, at year end everyone is planning out their finances for the year ahead, and with sufficient notice it will be easier for your clients to build their budgets around your new rates.
Notice can also allow clients to buy now at the current rate, or to book projects ahead of your pricing change. If you don’t want to allow this, that’s fine, but for some pricing moves allowing pre-booking during the notice period before a rate change can have the same business boosting effect as having a sale.
2. Keep Your Wording Neutral
You know you’re raising your prices, and your customers know you are raising your prices. This doesn’t mean you need to run out and scream it in the bluntest manner possible, or imply that you’re going to be unaffordable in the future. Instead, adopt a relatively professional and neutral tone as you share the news about your new price points.
As you lay out your new rate details for your clients (including the date they start to apply) remember that the more neutral the wording, the better. It’s not introducing a “higher rate,” but rather introducing a “new rate.” Your price points aren’t “increasing,” but rather “moving in line with market conditions.” Try out multiple drafts so that you feel comfortable with the blend of your brand personality and the professionally neutral tone of the price change.
3. Reiterate Your Value Proposition
A change in your prices is an opportunity for you to reiterate your value proposition to your customer base. You know why you’re worth your fees . . . but when was the last time you reminded your clients of all the specific benefits of partnership with you?
Don’t be afraid to use specifics. If your prices are based on traffic volumes, share some of your numbers and trends. Where you have direct examples, put the spotlight on them. Work to end your communication with data that gets your customers focused on all of the ways that what you do helps them, builds them up, and makes them money.
With adequate notice, a professional approach, and a strong statement of value, it is simple to announce a year-end price hike. Your customers will know what to expect, and complaints can be kept to a minimum. There will always be someone who doesn’t like something about what you’re doing, but with a strategic approach you can ensure that your core tribe of clients is informed, planning for you, and looking forward to what you will achieve together.