How to Communicate Price Increases When There is Record Inflation



Record inflation is more than just a pain point for consumers. It also makes it very difficult for businesses to continue to offer their products and services at a price their customers are used to paying. The last thing people want to hear is that in addition to paying more money at the gas pump, they are having to pay more for your product or service too. Price increases may also cause challenges for your employees as well, who have likely developed relationships with your customers and aren't excited about making them angry.


Here are the keys to communicating about price increases during a time of record inflation.


Inform your internal team about the price increase

When you decide that you're going to increase prices, it's important to let your employees know about the decision as soon as possible. The earlier they know, the more time they have to prepare for any changes and make plans for how they will communicate the price change to their customers.


The best way to inform your internal team is through a company-wide email or meeting that communicates the reasons for increasing prices and what those reasons mean for them personally (and professionally). This should be followed up by an email from their manager with additional details on how this affects their work moving forward.


Speak directly to your customers

It's important to communicate the price increase directly with customers, rather than just putting it on their bill. This will help you earn customer trust and respect, as well as provide an opportunity for you to explain the reasons for the increase and how it impacts them—which can be a powerful selling point in itself.

When communicating directly with customers about your price increases:

  • Put yourself in their shoes. Empathize with them; understand that this is a challenging situation for both of you.

  • Explain how you and your business came to this decision. It helps build credibility when they know why they're paying more money (and what steps have been taken so far).

  • Reiterate your commitment to offering quality products and services at the most competitive price possible.

Give your customers ample lead time before the price increase

If your organization is going to increase prices, you must give your customers ample lead time before the price increase.Plan for how you will communicate the change in prices and ensure that key internal stakeholders have enough time to adjust to it.


Give customers enough time to adjust—at least two weeks—and preempt questions they might ask with clear talking points that provide context around why prices are increasing (e.g., “While we understand this may be difficult for you, this increase is necessary for us to provide the great product/service you expect from us.”). Also let them know your team is available to answer any specific questions they may have on pricing increases so there’s no confusion or frustration around why costs went up when there isn't anything new in terms of product value being offered by your company.


Reiterate your commitment to providing quality products and services at the best price possible

Anytime you speak with customers about your products or services, whether that centers on price, quality or updates, that is an opportunity to reiterate the values and mission that make your organization unique and likely drew your customers to you in the first place. This is a good opportunity to communicate your commitment to providing quality products and services at the best price possible.


If customers understand that a price increase is due to inflation, they will be more likely to accept it. But if they think you're just trying to make more money off of them, they will definitely be upset.


Conclusion

The best way to communicate price increases is by informing your internal team and speaking directly with your customers. It’s important to give them ample lead time before the price increase takes effect, so they can make adjustments accordingly. Reiterate your commitment to providing quality products and services at the best price possible, so that they know you’re not just raising prices because it's the current trend.