Case study: Raising prices

The following is a case study derived from working with a client. To preserve confidentiality, I am only describing the problem and not the client.

PROBLEM: A client came to me with their need to raise prices. They’ve had prices set for a while now and it was time to raise them to keep up with inflation and the cost of hiring qualified staff. I had been hired to simply write an email to announce it, and the email was going to be a quick statement (like pulling a bandaid off as quickly as possible). However, I proposed an alternate idea that they used which involved some strategic changes in their offering followed by a more detailed marketing effort.

SOLUTION: We created tiers of service designed to express their value in different ways. We upped the ante on each tier so that the new levels of service offered additional compelling value to each customer (thus softening the impact of the increased price). While there will always be some backlash when raising prices, the message can be configured in a more positive tone by adding value at the same time.

RELEVANCE TO THE BUSINESS DIAMOND FRAMEWORK™: This was very much a Value Chain Axis effort because it meant an across-the-axis shift in thinking. However, it did require some Leadership Diamond work (in communicating the  overall positioning) and it involved some work in the Support Diamond (in delivering on some of the value-added changes).

Leave a Reply