Value Added Ep.15 – When and How to Raise Your Prices

It doesn’t matter whether you’re running a digital marketing agency, an ecommerce store, a productized services business or a SaaS — one of the hardest things to do is raise your prices.

Many business owners struggle with the notion of increasing their rates because they’re convinced it will lead to customers abandoning them and an overall decrease in revenue.

It’s no wonder the decision to raise prices is so fraught with fear and uncertainty — everyone is sensitive to how much something costs.

But, as the expenses associated with delivering your products or services grow — and the value you provide increases — you’re likely doing yourself a great disservice by failing to raise your prices accordingly.

In this episode of The Value Added Podcast, Jonathan and Jarod dissect when the time is right to raise your prices — and how to do it without losing clients…

KEY TAKEAWAYS

• Identify the key reasons for raising your prices. These typically include:
  • Increased overheads that don’t directly translate into billables
  • Providing higher quality products or services
  • A substantial upgrade in your offerings — such as a product or service redesign and improvement

“When you have an existing service or consulting client, and you need to ask for more money — it comes down to the why.

The only times that we’ve done it is with clients who’ve been with us for a really long time. And the type of work we do for them has simply changed.

Link building has become more expensive. Content creation has become more expensive. The amount of work we need to put into the website has become more expensive, and it’s just grown.

And so 99% of the time, we’re able to articulate that and just say, look, client, you joined us two years ago. Look at the growth that you’ve had. You can see that over time, the amount of work that we’ve had to put in has grown.”Jonathan Kiekbusch

• When trying to close higher-end deals, don’t underestimate the importance of branding and presentation — both can significantly increase your perceived value.

“I hate giving prospects, pricing options. As a consultant or somebody that provides a service where you’re the expert, giving people pricing options, to me, limits your expertise.

And look, I can see both sides, don’t get me wrong. But to me, the idea is I’m the expert, and I’m telling the prospect what it’s going to take for me to get them results.

There is no, you can do it for $500. You can do it for a thousand dollars. You can do it for $1,500.”Jonathan Kiekbusch

• There’s a big distinction between raising prices for existing clients and proposing pricing for prospects.

“The most essential takeaway from this episode is that pricing is almost exclusively based on perception. You need persuasion, emotion, and trust.
If you have those three things down, you can charge almost whatever price you want.”Jonathan Kiekbusch

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