Become a Member
Guides and Reports
Show All »
Metrics & ROI
Search Engine Marketing
More Marketing Topics »
MarketingProfs Enterprise Solutions
See All »
Schedule of Events
Virtual Conference Series
Products and Services
Post a Question
Quick Start Guide
Find and Post Jobs
Real-World Education for Modern Marketers
Join Over 600,000 Marketing Professionals
Ask your question ... sign up today! It's FREE!
Just for Fun
MProfs PRO Seminar Q&A
Search more Know-How Exchange Q&A from Marketing Experts
This question has been answered, and points have been awarded.
Price Increase Notification Letter
Posted by Anonymous on
8/19/2005 at 3:44 PM ET
I am writing a letter to our customers to announce our price increase. I will give them 45 days notice and the day the new rates will apply. As when I was in collegue, the beginning of a paper (in this case a letter) is always the hardest to write!
Do you have any sample letter? do you any of you know of a website where I could read samples?
Do you have any insights or recommendations?
8/19/2005 at 4:06 PM
I know informing your clients about any pricing changes can be like handling a live grenade. First off, does the price hike have anything to do with industry trends, regulations, taxation or rates that are out of your company's control? When the price change is related to an external force, many clients react better than an arbitrary change. By being straight-forward with your clients, you build a level of credibility. I recommend starting the letter describing the price change, then detailing the reasoning, then concluding with the benefits of your services/product. You almost have to re-pitch the client on the new price.
8/19/2005 at 4:49 PM
What are the real reasons behind your decision to raise prices?Is it due to some mistake or just external reason? Whatever the case be, I would personally recommend first calling your customers to inform them of the situation in a straightforward way and then draw up a letter. Be frank with them and you will find it not so cumbersome.You will also find it much easier to write a letter following a heart-to-heart.The more so as following the phone calls you can have more feedback as to people's reactions and best ways how to put it in writing.
8/19/2005 at 6:46 PM
Could you think of any good news for the customer so that you could add some honey to it? Is there any new value or feature or anything which could balance the price hikes for customers? I do not think you should say that you have not increased prices in the past 3 years.They could wonder why and assume that you must have overcharged them a lot previously.
In a word try to think in terms of some benefits your customers might have with your new price-setting.
8/19/2005 at 7:33 PM
You need to open the letter by telling your customers what you're going to do -- raise prices to cover increasing costs. Then you need to offer any additional rationale that will soften the blow (e.g., first increase in two years, cost increases that outstrip inflation, etc.).
Then you need to reassure them that all the benefits they've come to expect from your company -- quality, service, etc. -- are still at the forefront of your thinking, and that you're committed to being the best supplier in your industry. Etc.
Hope this helps.
8/19/2005 at 7:52 PM
This is not really polished copy, just concepts, but how about something like this after the Dear Customer:
"We’re working hard to remain your #1 source for widgets. We appreciate your business, and will always find ways to continue to provide you with the highest quality products and services.
As part of that effort, we reviewed our pricing structure in relation to a number of changes in the industry. We discovered that a price increase is necessary in order to maintain the same level of quality in our products and services."
Then, if it makes sense, and you can explain it simply and without sounding like you are whining, you could cite some of the industry changes that are impacting your business.
I'd emphasize the fact (assuming it is true) that your prices are still very competitive with companies offering the same level of product/service.
And, hit on the benefits you provide, as mentioned by Kristin. If you have a new feature or benefit that you can focus on, that would be good, too. It just seems that price increases and new stuff just don't seem to happen at the same time, no matter how we wish they would.
I'd also suggest naming someone the customer can contact for more information or to answer questions. I'd make that someone fairly senior in your company who can do a good job of re-pitching your company, handling price objections, etc.
I'm assuming that you must have a customer base that isn't serviced by dedicated sales reps. If you have a salesforce that is assigned to support your customers, I'd recommend getting them to discuss the change with their customers before the letter goes out, and to hand deliver the letter to key customers.
Hope this helps!
8/19/2005 at 9:40 PM
"Dear Friend and Valued Customer;
"You know that we provide quality service and products at a reasonable price. Now, we are faced with a terrible choice, a choice that we have tried to avoid for three years. We must choose now between compromising on quality or raising our prices.
"We don't like either choice, but we understand that you have chosen to do business with us because we fulfill your needs. In order to continue satisfying you, we have decided to raise our prices so we can maintain our high standards and so that we can continue to find new avenues to increase our quality level.
"We thank you for your understanding, and we are sure that you will continue to work with us. Please call me at 555-555-5555 if you have any concerns that we have not addressed with this letter.
Blowlene Widget Sales and Service"
Hope that this helps. Keeps the positive, doesn't try to shift blame and asks for continued business.
8/20/2005 at 7:04 AM
i agree to a large extent with Kathaleen, i feel you should put it straight forward to your customer with the valid reason rather than beating around the bush. one way could be ,
we are thankful to you for your continued business association with us we are sure our product/service is giving a better value addition to your business. as you will agree our prices are stagnant since last 3 years inspite of hike in production cost due to increase in the industry trends, insurance, regulations, taxes, drivers pay increase; all reasons that we cannot control.
because of the afforsaid reasons we are compelled to increase our cost to ____ which will be applicable from ______ date. which as you also know is a reasonable price.
we assure you of our best service and hope to serve you in a better way in the coming times
hope this helps you.
BACK TO TOP
Post a Comment
Four Ways People Think and How to Convince Them to Buy
by Mikita Mikado
Nine Things Every Successful Content Strategist Understands
by Micah Pratt
Seven Common Mistakes Marketers Make
by Subir Kumedan
What Content Types Should You Create? [Infographic]
by Barry Feldman
Four Email Optimizations That Will Increase Your Click-Through ...
by Stephan Hovnanian
See more marketing articles »
MarketingProfs uses single
sign-on with Facebook, Twitter, Google and others to make subscribing and signing in easier for you. That's it, and nothing more! Rest assured that
provide your social data to 3rd parties
contact friends on your network
post messages on your behalf
interact with your social accounts
Your data is secure with