20 Effective Ways for Communicating the Increase in Price

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20 Effective Ways for Communicating the Increase
in Price
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Introduction

• Increase in the price of a product or service is
  a natural occurrence at some point in its life
  cycle.
• Very few businesses are able to provide constant
  prices, since stagnation in the price of
  commodity often directly indicates stagnation in
  business, which would almost certainly have fatal
  consequences as far as the organization, is
  concerned.
• Given such a scenario, it becomes important to
  communicate properly when informed customers of a
  price increase.
• Because price increases are so commonplace, a
  percentage of customers generally understand.
  However, this is true only if the customer knows
  beforehand the reasons that lead to the eventual
  hike in prices.

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• There are telemarketing software solutions
  available that can be implemented to predict
  circumstances in the larger market that would
  lead to an upscale of prices.
• Using the help of the software, it is possible to
  feed in enough data, to compute at which points
  an inflation can occur in the future, based on
  the real time events.
• This is why, it is essential to let your
  customers know well in advance about a jump in
  prices. Nobody wants to fall into a position
  where they suddenly have to pay more than they
  used to for the same service without prior
  notice.
• Mark Cox of Toronto Sales Consulting says in the
  March 2016 issue of Canadian Business Magazine,
  If youre business-to-business, every one of
  your clients has built their company by running a
  smart commercial entity, and they dont give away
  products for free. If you have a fact-based
  conversation to explain the rationale for a price
  increase, they will get it.

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• The difficulty in communicating price increase to
  customers lies in sales representatives taking an
  unnecessarily apologetic tone and trying to
  soften the blow with roundabout ways of stating
  the inevitable.
• If a call center agent talking directly to a
  consumer can get rid of the impulse to apologize
  in case of a price increase for the commodity in
  question, the process becomes much smoother.
• In fact, it can be looked upon as a valuable
  opportunity to remind the client why your company
  is the right choice and the sort of value it can
  provide.
• Price increases are inevitable, and communicating
  such a price increase becomes an important part
  of the operations of the call center hired to
  provide telemarketing services for that company.

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• It is important to have proper strategies in
  place to communicate price increases effectively
  and without the possibility of spooking the
  client.
• Keeping that in mind, here are a few tips to
  handle that conversation with the customer in the
  best of ways.

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Transparency is the key to any dealing involving
money

• Pricing transparency dictates that you let the
  customer know clearly of the price increase
  before it actually occurs.
• Trying to slip it in, in a manner that you hope
  the client will not immediately notice, is a
  terrible strategy and always leads to loss in
  sales.

Prioritize your clients and let your most
important customers know of the price increase
first, directly.
It creates a negative impression if these
customers find out about it after word has spread
in the market, or through a general announcement.
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Be honest in announcing your reason for
increasing the prices.

• Substantiate your requirements with facts to
  convince customers that the move was indeed
  necessary.
• Customers understand that price increases are
  bound to occur, but they do not want to be fed an
  obvious lie as a reason for the same.

Avoid frequent price increases aimed solely at
profitability

• For a business to flourish, profit is important.
  However, no customer wants to be paying more for
  no reason other than to see the company grow.
• Even a suggestion that the price increase is
  meant to help increase profits can negatively
  affect your business.

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Focus on the positives during such an announcement
Instead of explaining only the reasons for the
increase in price, stress on what the customer
can now get in exchange for the extra money.
 In all cases, avoid making your announcement
sound like an apology

• Because that would make it seem like this
  increase in price came about because your profits
  and losses are not under your control.
• This would send out a very wrong message, and
  would lead to customers losing faith in your
  business.

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Build a lasting impression with your customers

• Events like a price increase cannot hamper the
  trust they have placed in your company.
• Thank customers for their continued support of
  your organization, and for their continued
  businesses. This brings out a positive tone and
  helps generate more business.

 .    Provide ample time to the customer to deal
with the price increase
Because that would make it seem like this
increase in price came about because your profits
and losses are not under your control. This
would send out a very wrong message, and would
lead to customers losing faith in your business.
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With a timeline in place, use the time between
the announcement and implementation of price
increase to listen to the queries of customers
and address them so that they retain their
business with you after the increase.

• Drive demand with this timeline by making your
  reasons and your plans transparent.
• Address the worries of the customers and remind
  them of the extended services that you will now
  provide.

Add new features to the existing services that
you offer in order to justify the hike in the
mind of a customer.
These services do not have to be time-consuming
processes, but it is a good practice to offer
something more once you are taking in extra money.
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    Focus on the logic behind a price increase

• Remind your customers that it allows you to
  continue offering a service that has greater
  value than your competitors.
• Sustainability is essential for the survival of a
  business, and for the sake of sustainability
  different fluctuating market factors must be
  considered, Price increases are a reaction to
  these factors.

Bear in mind there is no reason to be nervous
about a relatively small price hike.

• Customers who are not willing to pay 5 extra for
  a better service are customers who are not loyal
  to your brand.
• This means you need to pay more attention to your
  sales tactics first, before you can progress to
  selling a more expensive product.

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   Another common strategy is to give customers a
choice of opting for a lower-priced service as
well as a premium service.
If the customer is willing to compromise on the
sort of services he requires, he should have the
choice of not paying extra for a host of
unnecessary services.
The feeling of being given a choice is important
to generate sales out of a consumer
If the customer feels that he can get more or
better services, he is more likely to pay extra
than he would if he were not told of the extra
services.
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  In your timeline for announcement and
implementation of the price increase, you must
make the change easy to adopt for your customers
Making any sort of change can be difficult and
customers could be hesitant to implement it
unless you provide clear guidelines.
It is helpful to provide customers with specific
details of the increased prices rather than just
stating an overview, so that communication is
more effectively established.
This helps them communicate with their company in
an easier manner as well.
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  When changes are framed in such a manner that
they are easy to implement, customers are not
frustrated with the proceedings during the
changes being made.
This prevents the customers from making emotional
decisions and helps retain their trust above all
else.
Ensure that all sales personnel are well-versed
with the changes so that any queries by customers
can be effectively answered
Customers want to be reassured that they have all
the facts at hand in order to take their decision.
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      You might want to implement a system where
you lag the increase for current customers as
compared to new customers
This again goes a long way in communicating to
the client that you value the faith they have
placed in you.
Remind your customer above everything that
switching vendors at a time of market
fluctuations will definitely cost them even more.
They are far better off sticking with your new
and advanced services because you value them as a
loyal customer.
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