All the crises in the world, like coronavirus, then the war in Ukraine, made inflation increase in a lot of countries, if not in all. In the USA it increases at almost 8,6% and in Eurozone stands at 8.1%.
All kinds of businesses are affected, not only in this area but in the whole world, from small businesses to big companies. The small business owners are asking themselves about how to price their products in an era where almost everything is getting more expensive: transport, raw materials, energy, and logistic costs. It’s hard to bear the new higher costs, but it’s harder to tell the people about raising prices.
So you have more expensive costs on the one side, and your customers, who should be always satisfied on the other side? Is it possible to make them satisfied in crazy times like this? The answer is yes. Just a reminder, it’s not so easy to do inflation pricing, because you have to pay attention to how much your consumers are ready to pay for products like yours, and also here is your competitor.
You should look at them so you can make better inflation pricing on your products or services.
Let’s see how tricky pricing looks like and keeping your customers satisfied:
Inflation pricing on the right products
So, imagine you sell furniture, and you have both: cheaper and more expensive. You have broadened the audience, people with low and high revenue. The second one is the people willing to pay higher prices even in a crisis. Also, you see that your competitors have already raised the price of products like these. Don’t think twice, but raise the price only of the more expensive products, and there you go. Both you and your customers are happy.
If you increase the price of cheaper products, which are actually for audiences with low revenue, you can just watch them blur out.
Expand your offer
Inflation pricing includes more expensive products or services but is expanded. This means that you have to add new features to the product or add something to the order, so your customer won’t notice, or won’t mind the raising price.
Imagine you have a jewelry business. The golden rings before the crisis were 100$ and now their price should be increased to 150$. To make inflation pricing unnoticed you can give the people a small gift with the ring in order to keep them satisfied and happy.
Or if you sell techniques expand your guarantee, if it was 1 year make it 2 years now (the opportunity of returning the product back).
These are just two examples of the ocean, and you can choose which one is more relatable for your business.
Also, instead of increasing the price of the already existing products, you can create new products instead, so the pricing won’t be that irritating.
With lower costs, I mean reducing packaging, designing, and distribution costs. Maybe this is difficult to be done, but imagine how much you’ll save in the long term.
By the way, you’ll lose more if you raise the price, because that may mean losing customers.
Fair pricing when inflation pricing
As a business owner, you want loyal customers, but also your customers want you to be loyal to them. Why don’t you try to message them directly and tell them personally that your products or services will be more expensive when they come next time? This is an awesome approach because you don’t want them to come into your store and don’t have enough money on their card to pay for what they want.
Or you can tell them personally when they come to your store. Make them feel special by saying that even if the prices are higher they can shop now with the old ones, just because they were not informed.
Say the truth
It’s again about loyalty. You’ve spent so much time building trust and connection with your customers. And it may happen when you say “increasing price” on your Social Media pages, people get angry. It would be very nice of you if you put the effort into making a short explanation of why you raise the price of your products or services.
Also, when telling the story about inflation pricing, tell the people what will you invest in. Tell them that you expand your product’s offer or services and that the benefits they get will be bigger in the future. People love to be a part of companies’ stories so make them a part of yours.
Tell them that they won’t lose anything but instead they will get more from you.
For e.g. if you have a cosmetics salon, and your service is making gel nails, tell your customers that now you will use more high-quality gel than the one you use now.
If you are a pet-shop owner, tell to your customers (dog parents) that you will bring new, healthier food for their pets.
Increasing pricing is a must, except if you want to fail, but that’s not the choice. All you can do is using all the tools you have as discounts, expanding offers, and more products. Use your marketing as a tool so you can tell people in an easier way that your prices are higher now.
All of your staff should know about the new prices because they have to be ready to promote it in new customers’ calls. Have in mind, that people as loyal customers love to be a part of a community so keep them informed. Appreciate them, and they’ll appreciate you back, and love your Brand more.
I know that everything seems overwhelmed, but the UIXlabs team is here to help again. We can do the inflation pricing instead of you. All you can do is send us your email, so you can explain more about your business and products/services.
Let’s talk about your pricing problems, and let’s make inflation pricing fair pricing.