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How to Regularly Increase Your Prices &Set Your Business Up for Sustainable Growth
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Today’s popular pricing advice:
“Decrease your prices and gain share…
…if your prices are the lowest on the market, you can beat your competitors…
…build up your customer base…
…and raise prices later.”
How to Regularly Raise Prices andSpur Sustainable Business Growth
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This is terrible advice.
How to Regularly Raise Prices andSpur Sustainable Business Growth
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The strategy leaves you broke.
No money for sales or marketing.
No money for R&D.
No money to go after new customers.
You’re stuck.
How to Regularly Raise Prices andSpur Sustainable Business Growth
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A Better Solution:
Raise prices methodically, carefully, regularly.
How to Regularly Raise Prices andSpur Sustainable Business Growth
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How toRaise Prices Responsibly
in 3 Steps
How to Regularly Raise Prices andSpur Sustainable Business Growth
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1. Align Prices with Value by Segment
How to Regularly Raise Prices andSpur Sustainable Business Growth
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Start by splitting up your transactions into small groups, defining them by buying situation and
customer.
Then define the main value propositions for each transaction type/group.
How to Regularly Raise Prices andSpur Sustainable Business Growth
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Build prices with the following formulafor these transaction types:
Price = Cost + $Value Prop 1 + $Value Prop 2 + $Value Prop 3
How to Regularly Raise Prices andSpur Sustainable Business Growth
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Worried your value propositionsdon’t give you an edge?
Consider adding a low-costvalue driver to your deals.
How to Regularly Raise Prices andSpur Sustainable Business Growth
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2. Give your customers thenotice they deserve
How to Regularly Raise Prices andSpur Sustainable Business Growth
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Don’t just announce a priceincrease out of the blue.
Give your customers plenty of notice first.
How to Regularly Raise Prices andSpur Sustainable Business Growth
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How to Regularly Raise Prices andSpur Sustainable Business Growth
Make the price change even easieron them by taking it slow.
A 1% price increase results in an11% profit increase on average.
If this still feels like too much, go a ½% at a time.
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3. Sell on value. Always.
How to Regularly Raise Prices andSpur Sustainable Business Growth
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During the sales process, listing product and service features won’t get you very far.
Instead sell on benefits,on the value customers receive.
How to Regularly Raise Prices andSpur Sustainable Business Growth
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When breaking the news of a price increase, always put it in terms of added value for the customer.
How to Regularly Raise Prices andSpur Sustainable Business Growth
1. Does your product and/or service save customers time? Sell efficiency.
2. Does it make their processes easier? Sell productivity and fewer headaches.
3. Does it make one segment of customers more money? Sell the economic benefit.
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Stop Lowering Your Prices to Achieve Success.
Raise Them Instead.
Automate a huge part of this process byputting your sales and pricing data to
work.
How to Regularly Raise Prices andSpur Sustainable Business Growth
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KiniMetrix helps companies determine the most profitable and successful prices for each
transaction.
Assess how your value propositions resonate across customer segments using the
software.
Evaluate how your price increases affect margins.
Click here to see how KiniMetrix
can do this for you.
How to Regularly Raise Prices andSpur Sustainable Business Growth
