How to Communicate a Price Increase Without Alienating Subscribers
Apr 26, 2024Episode 9
Monica Badiu
We've all been there, feeling the pinch as costs go up, and realizing our prices need to reflect that.
But the big question is, how do we communicate this to our loyal subscribers without upsetting them?
In this episode, I'm sharing my go-to strategies for justifying a price increase in a way that keeps everyone on board. We explore strategy, communication, and ensuring our audience sees the value, even with a slight price uptick.
Stick around as I walk you through making these tricky conversations a tad easier and a lot more productive. It’s all about finding that sweet spot between staying competitive and staying connected.
Specifically, this episode highlights the following themes:
Effective communication strategies for announcing price increases
How to reinforce the value behind your pricing to maintain subscriber trust
Tips for leveraging price increases to enhance customer relationships
***
Hi. And welcome. My name is Monica Badiu. I am a marketing consultant turned conversion copywriter and coach. I help online course creators and info product businesses sell more through persuasive, non-spammy, no fluff copywriting.
I teach about copywriting, digital marketing, and conversion strategies tested in my businesses and with my clients.
We've all been there, feeling the pinch as costs go up, and realizing our prices need to reflect that.
But the big question is, how do we communicate this to our loyal subscribers without upsetting them?
In this episode, I'm sharing my go-to strategies for justifying a price increase in a way that keeps everyone on board. We explore strategy, communication, and ensuring our audience sees the value, even with a slight price uptick.
Stick around as I walk you through making these tricky conversations a tad easier and a lot more productive. It’s all about finding that sweet spot between staying competitive and staying connected.
Specifically, this episode highlights the following themes:
Effective communication strategies for announcing price increases
How to reinforce the value behind your pricing to maintain subscriber trust
Tips for leveraging price increases to enhance customer relationships
***
Hi. And welcome. My name is Monica Badiu. I am a marketing consultant turned conversion copywriter and coach. I help online course creators and info product businesses sell more through persuasive, non-spammy, no fluff copywriting.
I teach about copywriting, digital marketing, and conversion strategies tested in my businesses and with my clients.
You probably noticed prices have gone up in every category possible. Your marketing platforms are probably costing more. Your living costs are higher. Inflation makes things more expensive, and it's the same for your audience. Now, that creates a problem a lot of course, creators have, which is increasing prices because you simply can't keep up the low prices anymore. So in today's episode, we're gonna talk about my process for justifying a price increase to your audience. It's gonna be a big one. Welcome to Master the inbox, the podcast where course creators, coaches, and consultants come to learn how to sell with email marketing in a non spammy, non aggressive way. I'm Monica Badiu. I'm an entrepreneur, copywriter, and fellow course creators. And today we're tackling a big one. And it's something that a lot, of course, creators have to do, but they are so scared, and they are scared for a good reason. Now, a lot of people, when they start a business, they try to compete in an established market with the lowest price possible, which is a model that can help you in the beginning, that gets some people in the door. You have some clients, you're proving your offer. You can actually improve it while you're at it, but long term, you can't really keep that up. And the recent price increases is a very good reason why you can't be profitable just competing on the lowest price. First of all, prices go up. They just evolve like that. You can't really keep that. And even if you would love to give really low prices for your audience because you know they're struggling with the same thing, you still have a hard choice to make, because the more the cost goes up, the more your costs go up as well, which means you're not going to be able to deliver as good content. You're not going to be able to host as many students. You're not going to be able to send as many emails. So you either cut corners or you finally do the difficult thing, which is increasing prices. But how do you announce the price increase without alienating your audience? It's not easy. I'll give you that. Over the last few years, I had to write price increase promotions, and it hasn't been easy. But if you have a clear justification and you convey it with clarity and enough motivation behind it, your audience, well, majority of your audience, isn't going to get pissed. Now, there should be a disclaimer about the freemium model, and if your business has relied a lot on delivering free content, now you're going to have a bigger challenge to put the price on that and enroll freemium into paid members. I'm going to record a podcast episode about that in another season. But for now, we're going to talk about someone who already has a paid course and they want to increase the price. Now, a lot of people have asked me, but wouldn't it be better to just increase the price without informing my audience? I have two answers to that. One, you could do that if the price increase is minor and you don't have a lot of new people in your. I have two answers to that. One, if you have paying members who pay a monthly subscription or an annual subscription, and your prices will go up, you should inform them and give them enough time to decide if they're going to cancel before the price increase or not. The other one is, you could not communicate the price increase for anyone who's, like, on a free course right now or not even in your system right now, and just increase. The price is on the front end. So if I'm visiting your website and I go to your course page and you've just increased the price from, I know, $30 yesterday to 35 today, then that's perfectly fine. However, it's good to communicate your price increases. First of all, it gives people a chance to decide for themselves, well, I can continue with this guy, or I can say no, and that's honestly a right and a freedom they should have. The other part of this is that communicating price increases is actually tapping into scarcity and fear of missing out, and you can actually get a nice cash flow before you increase the prices. So I'm going to tell you more about it in this podcast episode, so keep listening or watching. If you're watching this on YouTube now, the theory says there are five different justifications for increasing your price. One is you haven't increased the price in the last six months. And this isn't me saying this is a report from a big consulting firm. And this applies to other industries, not just the online classes. However, I know from experience that it's very hard to increase the prices every year. And this takes me to the second justification, which is, have you added any new features, or are you planning to add new features? That's a big one. The third one is you have a lot of demand from customers, so you can't keep up with the demand, which means you need to actually increase the prices, either to filter out some of your customers or to ensure that you can actually deliver on the promise you've made when you started promoting your course. So if you're offering one on one coaching and the demand is so big that you can't actually have that many coaches, then you're going to need to increase the price again, either to make sure that the demand meets supply, or that you can actually afford to hire new coaches to take on the influx in demand. The fourth justification would be about the return on investment. So if the value they get for the price they're paying right now outweighs the actual investment, then you can justify a price increase. Now, you can do that after you've spent some time talking to your students. What were some of the results they've had? And can you quantify that? Because if you can quantify it and you can create a minimum outcome that is common for the majority of your students, then you can present it in a way that justifies the price increase. The fifth one would simply be you just need the extra income. Maybe you want to hire a team, maybe you want to hire a new coach, maybe you want to hire new teachers or to outsource your video editing to someone who does that for a living. All of these are justified if they result in a better student experience. So here you have it. You have the five justifications. Now for the hard part, how do you communicate the price increase? So the best way to do it is obviously through email marketing and through your website and through your social media. Now, social media doesn't guarantee a lot of people will see it, but it's still good. Your website is also a really good opportunity to communicate that price increase. You can do it on the front end. So for people who are not yet in your learning area, but you can also do it in your learning area. And now through emails. Now, again, as I mentioned in the beginning, you should inform your current students who are on a monthly subscription or annual subscription that your prices will go up. Now for the good part, you run an email promotion to everyone who hasn't yet subscribed. And this is a great opportunity to increase your cash flow and enroll a lot of students. And there's also a small detail here. So when they enroll before the price increase, they have a chance to keep the lower price for as long as they are paid members if you have a membership, or they can keep their course for that specific lower price for as long as they want. Now again, this taps into fear of missing out and scarcity. But I also know this is like the scariest part about sending an email, communicating a price increase, right? So again, go back to those five justifications and remember your why? Like why are you in this business? Why do you have a course? What's your mission? And why are you actually increasing the price? And how will that impact your mission? Will it make it better? Will it help you deliver more? Will it help you improve your student experience? It's also very important to communicate the features, communicate the content, the value that you've added in the last few months or even like lifetime, because a lot of people, they haven't really increased their price, like, ever. They would be in business for five years and they would have never increased the price. Now, the very important thing is to understand that increasing the price doesn't make you the bad guy. You're just sometimes actually forced by business conditions, inflation, raising prices, to have to come up with a way to keep your business afloat so you can continue to deliver the value you're after, to continue to deliver your mission. And yes, this will annoy some of your audience, but if you do communicate the new features and how it's going to be a change that will add value to your user experience. You're actually helping them help you. You're onboarding them on your mission. So it's not the grab for cash flow, like, hey, I want to make more money next month and I'm going to increase the prices. No. Hey, Monica, I am so grateful you've been with us for these many years or this many months. This community has managed to create a massive change in our industry simply by being able to prepare for Yelp online without going to in person tutoring, without having to travel, has changed lives of so many people. Just in our learning community, we have 10,000 people who are able to get the band seven plus in Yelts speaking without leaving the comfort of their home, which means that they got closer to achieve their goal. Now we want to open this possibility to even more people, to help even more people just like you achieve their goals. This is why we're planning to add this feature and this feature, and you'll explain how those features are actually going to benefit not just the person reading this, but the community as a whole and you onboard them. You give them a chance to be part of this mission, to change the industry, change the world, change lives, and this is going to shift control and power from you to your reader, but it's also going to do it in a way that's compassionate and powerful. Instead of just saying, hey, get your access before the price goes up, or lose access for life. You can do it in a more elegant way, in a more empowering way, as always. Price increases can be tricky. So make sure you do know your audience, you do know your competition, and you are very, very clear about the value you can provide and communicate that with clarity to your audience. Treat them with respect and they will reward you. This was it for this episode of Master the inbox. If you want to learn more about how you can sell with email marketing in a non spammy, non aggressive way, just hit subscribe for follow, share it, leave a comment, leave me a review and let's spread the news. Email marketing can be fun and can be authentic and can be valuable to your brand and to your audience as well. Until next time, be bold.