How do you go about informing your client you are raising your pricing?
Currently my strategy is to text them to schedule a call about payment terms, with "I've sent you an email about my pricing changes, my value, and industry standards". I have a good relationship with them so this isn't out of the ordinary to text to schedule a call, but not sure if I should give them a heads up, or include an email pricing breakdown, or just tell them outright the changes that will happen going forward when we talk. Any insights appreciated. Thanks!
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It depends 😉 In this specific, a lot depends on why the price is rising.
If this is simply a price rise in line with inflation, and it has been a couple of years since your last price change, just explain that and that's it. By all means compare the increase to other things that have changed in price to illustrate that your own raise is only in line with that, or even a touch below the average inflation for the time period. This happens to thousands of products we buy, every day, and so there's usually no need to make much of a fuss about it, just notify people and explain. (Unlike grocery shopping when we usually don't hear a word until we get to the aisles and see the price hike).
If the rise in prices are more than that, representing additional service levels, or investments in more expensive staff, software, etc, and so can be called an upgrade, then that's when you want to schedule a call, and also to give a lengthier, fuller explanation of where the extra money is going, and why this is actually better value dollar for dollar than before.
One to the head instead of two to the gut – you don't need a reason to raise prices, just say it's happening and prepare an answer for when they ask what they get in return.
Steven Kang 👑
Most agencies struggle with pricing, and there is a good reason. It's all about how you frame pricing from the beginning of a sales conversation, during audits, and deliverables.
My sales conversation is different from probably 99% of the agencies out there. The way I frame pricing is built into each sales conversation. It has worked for small businesses to multi-billion dollar operations. I usually close a sale within 5 to 10 minutes because of how the conversation and value prop is structured. With multi-billion dollar organizations, I close within 30 minutes of a meeting. Once clients accept your thought process, clients expect the price to go up, and they will pay for what you ask for, provided they can afford the budget.
I can't share in detail since my mastermind members are paying for my knowledge, but I can provide a small hint. The cost to operate differs in each market regardless of the vertical.
What do you consider a market – geographic/ country or service provided eg Search Engine Optimization (SEO) or design?
Steven Kang 👑 » Gail
I was speaking from the context of selling SEO. I guess selling design can work provided there is competition involved, not just creating a functional website. The market can be local or global. It's about who your client is fighting against in order to get a slice of the market share.
Kelly » Steven Kang
Would love to know more about your mastermind
When u had ur first discovery call with them, what was their budget? If youve done SEO for them for a while, and u did a proper onboard to understand their business – Return of Investment (RoI) should speak for itself… To justify u raising prices if they are growing.
Just blame it on Biden if that doesnt work. Seriously though, always have a buffer in ur price, and if u have shitty results thus far, do not ask for more money unless u actually need spend on high Domain Authority (DA) links
If you show growth and convey the potential if you do xyz other things (more. content, broader reach, new assets etc.) I find that a lot. of times the clients straight out ask themselves "If we spend more will this get even bigger, faster?". But that in itself. can be a nice angle to take aka we can do other things and more. of then or jusr continue the nice growth we are experiencing atm.
The same goes for when anyone is trying to cut the price on the onboarding… "Woooah 3k for this.. but blahblahblah"… "Ok, we can go SLOWER and DO LESS for xyz $…". 0% of the times someone says "Yeah go slower… do less.. take it easy" 😂🤣💪
Give enough notice if you can. 2-3 months at least. And try to do incremental updates. Nobody likes surprises and steep price raises.
You can do it by email no need to for a call unless they're not happy with the price change and need more info. Or do a quick Loom with more details.
I'd say something along this line:
Subject: SEO Investment update
Hey 👋 Chris,
I just wanted to let you know that we plan on updating the pricing of our retainer engagement so it better reflects our current experience and expertise. That way, we can continue helping you grow using the full extent of our updated skills and knowledge.
The new investment will be $3300/month (only a tiny 10% change) starting with June 2022.
I love working together, so if you have any concerns with this price increase, please let me know!