12 Ways To Raise Prices Without Cool Down Your Customers
Sometimes we have to raise prices. But we are afraid of living in a customer container. Therefore, we researched what is the way to increase the prices without upsetting the customers.
As a business manager, you sometimes need to raise the service you offer or the products you sell. What could be more natural than that, given that today's inflation is constantly rising and the world is being swept by global crises? Based on this, we have developed 12 different methods and recommendations that will enable you to increase prices without putting your customers in the cube. We wish you all pleasant reading!
As you know, material and labor costs are increasing all over the world. So it is quite normal to increase the prices of services or products at the same rate, right? Here, let's examine exactly this subject, we came across a recent study and we were really surprised by the results: According to the research, 70% of the enterprises cannot increase their prices despite their increasing expenses, so only 30% of them can update their prices according to the current economic conditions. Many companies that cannot afford their costs eventually go bankrupt.
So you say, "I need more income but what if I lose my customers?" Are you worried and worried? It is normal for you to worry because price increases can always be a risk. However, we have to say that there are ways to reduce these risks.
So let's take a look at the 12 strategies we have prepared for you without further ado:
1. Set your timing well.
Are your customers extremely satisfied with your product or service? In other words, are they unable to replace you with another business? If this is the case, you can increase your prices by considering your timing well. However, months before you raise, you should prove yourself well and make sure that you have reached the indispensable position in the eyes of many customers.
2. Offer your customers additional benefits.
If you offer various additional advantages to customers, their chances of accepting the hikes you make will increase significantly. Think about what you can add to the services or products you currently offer with only a small cost, so try to create the perception of "free for one space". For example, if you can gift 100 grams of olives to a customer who buys a kilo of quality cheese from you, do not avoid this cost. In this way, the customer will think that the amount he has paid will provide him with more value.
3. Reduce the quantity or dimensions.
This tactic, which is also known as "stealing from material" among the people, is used frequently in restaurants. Many restaurants eliminate the need to raise prices by reducing the portions. Most of the time, it does this gradually, preventing customers from noticing. You can save money by reducing volumes on many retail products, from cosmetics to candles, cornflakes to toothpaste. Of course, if customers notice this and get angry, wow! If you have questions about this strategy, you can try a different way: You can significantly reduce the portions or the amount of products and charge a fee accordingly. Let's say you are a cafe operator and you're serving 250 grams of mushroom pasta for $ 20. Normally, if you need to lower this price to $ 22-23 due to increased expenses, but if you are afraid of customer reactions, reduce the portion and go for a small discount of $ 1-2 in the price. Thus, even if the customer realizes that the portion has shrunk, "At least it has made a good deal in the price!" and will not be affected negatively from this increase.
4. Play with the numbers.
The example we gave above for meals is actually valid for other products. For example, you have a stationery and you buy a 10-pack of toner for $ 200 and sell it for $ 300. One day, your supplier made a $ 25 increase in your purchase price, citing the increase in costs. You would normally try to compensate for this hike by increasing your selling price to $ 325, right? But instead of doing this, you can also create 5 or 7-packs, and adjust the price accordingly to feed the cost increases. You do not give up the 10-pack, it will seem advantageous compared to the 5-pack or 7-pack no matter what. In this way, you create a good perception in the eyes of the customer.
5. Charge additional fees for ancillary services instead of increasing prices.
Increasing the prices on the label will often cause you to fall out of favor. However, if you ask for ancillary fees without touching the prices, your perception can change completely. Public service companies often resort to this method. In addition, small businesses apply the same strategy when infrastructure costs such as natural gas, electricity and water increase. If you believe the cost increases are temporary, you can get money under the name of additional fees by using this method.
6. Make improvements.
You started to give the product you sold for 10 units at 12 units at a time. Naturally, the reactions will not be very positive. So what happens if you improve any product related element and increase that way? Let's say right away, your chances of tearing customers' eyes are at least double. If you sell clothes, increase your fabric quality very slightly, if you are in the food sector, add small appetizers or french fries to portions, if you are a retailer, make your packaging beautiful. In this way, consumers may think that something has changed in the product and will be willing to pay you more money.
7. Apply discounts to reduce the impact of price increases.
If we think in a straightforward way, when you increase the prices, you alert the customers who think money-oriented and push them to other searches. However, if you do not neglect to offer advantageous discounts and tariffs when you raise prices, you can reverse the wind and maintain the loyalty of your customers who care about their budget. In this way, while pleasing your frugal customers with discounts, generous individuals also say, "Oh, what about the three cents hike?" Thanks to the point of view, you maintain your overall profitability.
8. Combine multiple products or services.
Do you necessarily need to increase the price? Then change the perception of your customers by starting to offer different products or services as packages. Let's say you are a hairdresser and you had to increase the cost of hair cutting. So try to create an advantageous recipe that combines haircuts and blow dry. If this package is more profitable than the two services alone, your customers will not take the hike into consideration.
9. Target a different customer base.
Sometimes you can't get the job done in three or five cents increments. You have to make serious hikes when appropriate. As such, you have to change your target audience and pursue the relatively better segment. In fact, even if you go for quite reasonable increases in your prices, try to include slightly higher income segments in your target audience as much as possible. Thanks to this, even with the slightest increase, "This brand is over for me!" You can fill the place of customers who say, with new ones.
10. Try to raise at regular intervals.
What if you have a cleaning company that sells B2B, ie business to business. In such a scenario, your customers will find it normal for you to raise occasionally. Because they know well that the prices of materials increase and labor costs increase every year. Indeed, if you are going to raise inflation and rising expenses, choose a specific period for yourself. For example, you can check your prices at the beginning of each year. If you wish, you can use a different method, and you can apply a raise to your customers who work with you for a year at the end of this period. If you offer services on a monthly basis, you can make contracts valid for six months or a year, so you can offer more advantageous prices. You revise the price in each contract period. You will surely have customers to be told, but at least they will act accordingly, knowing that increases will only occur in certain periods.
11. Prepare yourself for adverse reactions.
Of course, there is no rule that you will make everyone happy. As soon as you increase your prices, you will have customers who will roar at you. Nevertheless, be in a position to answer questions to be asked about the hikes you have made. It is very important that you can make a statement to your customers, both face to face and on social media. This way, even if you lose some of your customers, you protect your reputation. In fact, if you can justify your hikes on a justifiable reason such as quality increase, your customers may be willing to continue with you.
12. When making a raise, consider the future.
Before you raise your prices, try to take into account not only your current costs but also possible future fluctuations. Always try to plan at least one year ahead of time, if possible, in the raise period. Of course, the account at home does not fit the market, but with this method, you will make wiser decisions, albeit a little. Let's explain our idea with an example like this: Let's say you have a bakery. A 5% raise has come to flour and you have to reflect this on your cakes. In these turbulent days, it may not be very wise to raise only 5%, as the price of sugar, cocoa, milk or fruit is quite likely to increase after three months. Therefore, try to guarantee yourself at once in order not to raise many times during the year.
We have come to the end of another article. We all know that it is not easy to increase prices. However, there is no doubt that if you take advantage of the tactics we discussed above, you will be able to get through this process with relatively little casualties. Good luck to you all!