According to crikey.com.au, Australia’s peer nations are all grappling with higher-than-expected inflation. It recently hit a 40-year high in the US (7.5%), and 30-year highs in New Zealand (5.9%), the UK (5.5%) and Canada (5.1%).
“Australia’s uptick has been comparably smaller (3.5%). Yet some are understandably asking whether we’re simply a few steps behind, and if greater price rises are in store for us too. The Morrison government seems to think so, with MPs expressing concerns that extending low- and middle-income tax cuts could fuel more inflation”
It’s difficult these days. I see many business owners apologising for raising prices, but it can’t be helped. You need to make a profit to remain in business, yet your customers are likely struggling too. That’s why now, more than ever, you need to communicate the value behind your products and services.
Here’s how:
Communicating Value to Your Customers: 6 Solid Ways
Add Extras
Customers are far more likely to accept higher prices if they’re getting something extra in the bargain. Consider what you could throw in with your current product or service that would cost you little or nothing but would have higher perceived value to the customer. For instance, you could offer free gift wrapping or a free ebook about a relevant topic.
Focus on FOMO (the Fear of Missing Out)
Using the words “for a limited time” conveys value, even when it doesn’t mean cost savings. When you use that phrase, customers immediately think of a price reduction or offer that will only be around until it vanishes without warning.
You can use this language when you know a price increase is inevitable. Market your current offerings with the language “for a limited time” and then increase your price or run a special under that same language and then increase your pricing. You’re giving your customers one last opportunity to buy from you at a lower price.
Mention How They Can Save
This advice is specific to your business, services, and products but is there something additional that buying from you saves customers from purchasing? For instance, does your ready made meal service save them money at supermarket or keep them from spending money dining out? If so, try to estimate what that looks like. Put some numbers around it. Ask current customers what they save. What can your customers eliminate in their expenses by buying from you? Market those ideas.
Host Secret Sales
While it may be cost prohibitive to offer sales and discounts to everyone, why not offer flash sales to your newsletter subscribers or social media followers? You’ll drive more business in the short time you hold the sales, and you’ll make your loyal customers feel appreciated by offering them more for less.
Speaking of…
Let Them Know When to Buy
If you have loyal repeat customers, train your employees to offer savings tips to them. Give them a reason to return. For instance, if you run a products business where you get new selection of rotating stock in on Tuesday, for example, share that. People who love a good bargain will return again and again if they think they can get to the items first.
Use Pairings
If you need to increase prices, look for bundles you can create in your business to provide more value. What items or services can you combine to provide your customers with more? Most people don’t mind paying more if they feel like they’re getting more.
The good news is that most of your competition is doing the opposite. They’re raising prices and offering less such as smaller boxes, reduced quantity, etc.
If you’re like most business owners these days, you’re faced with the fact that increasing prices is inevitable. Even if it pains you to do so, your costs are increasing, and you likely must pass those along to your customers if you want to remain in business. If that’s the case, these ways to increase perceived value should help you both feel better about the necessity of doing so.
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