November 29th 2010
Training your customers for regular price increases. Pricing part 12
- Image by Getty Images via @daylife
Training your customers for regular price increases. Pricing part 12. If you want to be one of the successful companies who are able to regularly raise prices, through value selling plus other methods you have to start now. Start when they first become a new customer. i.e. start Day1 by reinforcing how to prevent late fees, change of terms costs, change order costs, decision delay charges, partial ordering charges and so on.
Use psychology 101.
- Stepwise small price increases are more palatable than one large one.
- The power of 9 still reigns in setting price (sets a reference price).
- Large cuts are seen as better than a series of small ones (increase the perception of saving).
- Humans love to see that they have avoided a cost versus having one forced on them ( The sense of something gained vs something lost).
- Take an offer away when you say you will. ( Increase sense of loss)
- Communicate your price increases many months ahead – see what the competition does
Use the power of stories
- The need for vendors to remain viable
- A mutual need for survival
- All competitors will be treated equally
Be prepared for those who went to buyers school (e.g. Lowes, WalMart, IKEA, Safeway)
- Run lots of “what ifs” prior to any large bids/contracts
- Never volunteer you give price exceptions
- Resist being bulled – cause they will try to
- Maintain price integrity
- Be ready to walk – they are talking to you because they want something from you.
- Be prepared to let someone else go broke selling to them
Related articles
- Home Insurance – price increases (politics.ie)
- What Happened to Wal-Mart’s Low Prices? (fool.com)
- Five Pricing Tips For Small Companies (blogs.forbes.com)
- Safeway Deflates Its Way to a Profit (fool.com)
- Every Day Low Prices: The Real Story of Wal-mart (socyberty.com)
- When does the customer first ask about price? Pricing part 2. (regnordman.com)
- Osaka Titanium to Increase Prices on Aviation Demand (businessweek.com)
- Bloxx knocks rivals’ price hikes (channelweb.co.uk)
- Pricing survey indicates you are dropping prices, but for the right reasons? Part 1. (regnordman.com)
- What generates the highest profit margin, product or service? Pricing part 3 (regnordman.com)
- Make Customers Pay Extra With a Great Customer Experience (customerthink.com)
- The Competitive Edge: Differentiating Your Product or Service (pamil-visions.net)
- Customer history, is it helpful in raising prices? Pricing part 5. (regnordman.com)
- Examples of Companies That Use Cost Leadership Strategies (thinkup.waldenu.edu)
- Wal-Mart Is Offering Free Online Shipping To Increase Sales (lockergnome.com)
- Top Five Ways to Waste Your Time and Money When Selling Your Business (prweb.com)
Similar Posts:
- Does finance still set your prices? Pricing panel part 7.
- The Wal-Mart Effect. Charles Fishman
- Your Company culture often works to resist raising prices. Pricing part 4
- What generates the highest profit margin, product or service? Pricing part 3
- Pricing survey indicates you are dropping prices, but for the right reasons? Part 1.
Category: Communication, Finance, Leadership, Management, Marketing, Pricing, Sales
