“OMG did you hear the news? SomeStartup has dramatically increased their prices and their customers are in active revolt.”


Oh no. I wanted to raise my prices…but my skin is soft and vulnerable to torches and pitchforks so I guess I will just…you know…tootle along at this price. Forever. Ever. Ever. Ever…

Let’s talk about the cycle that stagnates your earnings:

  1. You can’t help but learn from watching other people make mistakes.
  2. So by now you’ve probably learned that your customers are ready, willing, and able to roast you alive. Because the scent of BBQ long pig is in the air.
  3. So naturally you resist raising your prices (even when you need to).
  4. Because raising prices is dangerous (and you taste delicious).


Bzzzt… Wrong!

There’s nothing dangerous about raising prices. In fact, raising prices can be a totally positive experience for all involved!

Unless — UNLESS — you go about it in a way that is assholeish and/or hamfisted.

“Well…wait a second. Are you telling me those guys got smoked by the hot coals of customer rage because…they were idiots?”

Yes, my friend. Yes. They were idiots.

The idiots broke the oldest rule in the book: They tried to change a contract after the emotional ink was dry. Which is not a thing trustworthy people do. And how do we react to people who show themselves to be untrustworthy toward us? Anger. Anger is our defensive mechanism.

So of course their customers reacted with heat.

It doesn’t have to be this way, though.

You can raise prices without flames.

You can walk away unscathed from the Weber grill of customer ire. Better yet, you can refuse to light it at all.

If a broken promise triggers a revolt, then why break it in the first place?

Yes, the one weird trick is to honor your promise. (Honesty? Forthrightness? Whoa, that is so totally weird!)

It’s pretty simple:

  • Do not surprise your customers with a sudden change in terms.
  • Do not violate the agreement you’ve already made with the customers you already have — whether that agreement is written or unwritten.
  • When you raise prices…exempt your existing customers.

Yes, if people agreed to pay a certain price for a certain level of service, honor that agreement. When you raise prices, give them a special pass.

This exemption is called grandfathering, and it’s pure customer service magic.

How to grandfather your customers

The key is to not only not raise their price, but to be absolutely sure they know you’re doing it.

Here’s how:

  1. Design your new plan levels
  2. Email your existing customers: “Hey, heads up, we’re raising prices soon — but for new customers only! Your plan and price are staying exactly the same. Because you are special. We’re so glad you’re with us. Love you guys.”
  3. Update your web site to only offer the new plan levels with the higher price
  4. Charge new customers the new, higher price
  5. For your existing customers, simply keep providing the same great service at the plan level and price they’ve been paying. Aka change nothing.
  6. Drop another note to your (valued!) customers: “Hey, just FYI…we raised prices today, but again! Not for you! Your price is staying exactly the same! We’re so glad you’re with us. Love you guys.”

Everybody’s happy:

Your existing customers: Will feel smart because they got in on the lower price, and glad that you value them enough to give them special treatment. Everybody likes a little special treatment.

Your new customers: Will never know there was a better price to be had, so they won’t get salty. You might get a couple emails begging for the old price, written by eagle-eyed prospects. Give it to them, if you want (but you don’t have to). It’s up to you.

Blammo! More money, no tears.

You can make your entire customer base happy…in some cases, by doing nothing!

This won’t instantly increase your fortunes…

Granted, with grandfathering, any financial improvements will take time. Your revenue won’t skyrocket today, tomorrow, or next week. You will, however, earn priceless good will. And you’ll sleep easy and unscorched.

In my next essay, you’ll learn a technique for charging your existing customers more, right away…because they’ll ask you to.

Read on: How I raised prices… by customer request.

There's more where that came from

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