Communicating Price Increases to Your Clients

Emily Thompson 0:02
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Kathleen Shannon 1:21
Welcome to being boss. Today's minisode comes live from Toronto when we hung out with over 100 bosses in person at freshbooks headquarters.

Kathleen Shannon 1:37
Hi, what's your name? Megan.

Megan 1:41
Hi, I'm Megan. So I'm a I'm a new media storyteller. And thus far, some of my clients have been nonprofits or arts organizations that are working with grant based funding. And so, you know, like not the big moneymakers, basically. And so I was wondering when you were talking about when you realize you looked at your numbers, and you saw that you needed to raise your prices? How did you communicate that to your ongoing clients? Or did you just shift client basis? or How did you move into that level up?

Emily Thompson 2:18
Sure. So I the way I restructured everything was the new pricing model was for how people would engage with me to begin. So every everyone who was already my client did not have that big of a shift in pricing. I did up my hourly rate, because like hourly maintenance of clients that I already had was absolutely something that I was doing. And I was able to up that a little bit. And just an email, like, my business is growing, my team is growing for us to better serve you like here's the price and just being very open with that. And no one had an issue, not a single person came back with an issue. But the really big change was with the new clients who came in. So if you're afraid that like, well, what if you're afraid that your current clients are going to have beef with raising your prices, those are your thoughts, not the thoughts of your clients, you should still like communicate that if they are going to go they're not your dream clients anyway, they can go, but the biggest change is with new people. Because if I were to have jacked up my prices, like three times for clients that already had like, there probably would have been a mutiny, which would not have been fantastic. But because it was with that initial engagement with my clients, it didn't hugely affect the people who had already been working with, but even then just an email. And that's something that like you should all do once a year or so anyhow, is raise your ongoing prices for clients who are already on your bugs. Or even like if your products like raising your product prices occasionally is absolutely a thing. You don't have to email all your past customers for products, but for clients, just send them an email, let them know, like thank you sending them some some thanks, letting the know that you're growing, that they are a part of that growth and that you appreciate them. But it's time for your annual price. price change. And like if you make it an annual or semi annual thing, like they'll know, it's always coming. And hopefully, like they're growing in their business or their projects, or whatever it is, and they'll be able to hack it until they can't if that's ever the case, but probably won't be

Kathleen Shannon 4:30
I have a different thought,

Emily Thompson 4:32
go for it.

Kathleen Shannon 4:33
So I don't have a lot of retainer clients. So maybe this is where it might be a little bit different for me, but the retainer clients I do have, including Brene Brown, and including like a restaurant group locally that I love working with, they're actually kind of rent controlled. So they get the same prices with me basically for as long as they're staying with me and I think it's because I don't again, I don't have that many retainer clients. But what I will do is now Instead of working one on one with me every single time, they're working with one of my designers or junior designers. So it might also be a good opportunity to start hiring help, that can serve those clients at that price point. And then you continue to be more of the new business person that is continuing to raise your rates. And it really does continue to position you more as an expert. And they're kind of then lucky to get you on the project versus your junior team. But then that's a whole other transition whenever you're telling someone, okay, now you're going from me to my trusted team member. That's a whole other conversation. But it's also really important for growth. And I think it's a really good way to get around. Maybe not raising your prices on existing clients that you love.

Emily Thompson 5:48
I second that retainers, I don't up like just one off like maintenance things afterwards, like they're gonna come to me for like, Hey, I just need this updated thing, or just need this like piece of whatever, like, those are the prices that I do raise, because it's not an ongoing thing. But retainers don't change, except for I do do annual, like looks at what we're doing. And if the retainer needs to shift based on you're using me less or using me more, because that is a thing that needs to be looked

Kathleen Shannon 6:15
and like I hire Emily. And now you may be in some raising your rates a lot on me, it'll be your developer working on my projects.

Emily Thompson 6:24
Yes. And handing off to them.

Kathleen Shannon 6:25
Maybe that's just us,

Emily Thompson 6:26
we'll talk about it.

Kathleen Shannon 6:28
Like, Don't raise your prices on me. Know, you should actually you have before and I didn't bat an eye I didn't. I was like, fine.

Emily Thompson 6:38
Whatever it takes.

Kathleen Shannon 6:40
It's worth it.

Emily Thompson 6:43
Any other questions?

Kathleen Shannon 6:45
Yeah, Barbara,

Barbara 6:46
I actually just want to follow up on that, because I am literally right now in the process of tripling my prices, like and that's actually the exact amount that I'm going to be doing that. And I'm curious about like, so with my retainer clients, I'm at this point. So I do coaching services, one on one. So like, they're still playing, like paying a pretty low price per the hour. But I'm about to switch to packages, where like, if you break down the price point of the hour, like that price has tripled. So I'm like in a space where I'm like, debating whether to put the new coaching price, right on my website, when the packages like on the landing page of the package. But then I'm like, at the same time, I'm also seeing clients for like, 1/3 of that ongoing because I still need to pay my bills. So like, have you ever had to navigate those ethics? Or is that just like where you pull the price from the website and and just be like, nope, you have to talk to me to get the pricing. So

Kathleen Shannon 7:42
I've actually experimented with both. And one thing that I do is if I'm working with clients who are getting the lower price, I actually let them know, hey, you're getting a lower price. But I've tried it both ways with putting my pricing on my website, because I thought that it would be another barrier of entry that would mean less emails to respond to less proposals to send out. But it turned out that our conversion rate, at least at braid creative was exactly the same. Whether or not our prices were on our website, I've experimented with this with multiple clients. And same thing like I have not seen a huge difference between having your prices on your website and not having them on the press on the website. And part of that is that no one's reading your website, which is just a thing. And so whenever it comes to the ethics of then this is why I only charge one price, it doesn't matter what kind of Rockstar I'm working with, or solopreneur. Right, it can be all ends of the spectrum. But I've priced myself at a place where I feel like the work that I'm doing is worth that much no matter who you are. So I don't do sliding scale pricing, because it just feels too icky to price something based on how much I perceive someone else is making. But I can see both sides of the argument truly like if Nike if Nike hires you for a logo or a project, and then they're making bajillions of dollars off of it, it does feel a little funny.

Emily Thompson 9:05
Well, and that's your dream customer so defined, exactly, that's not going to happen that Nike is going to be a great fit for what it is that you do. So whenever I did my price change, like the people who had already purchased it or purchased websites at that price got them like it didn't go in mid project was like hey, actually, but I did quit cold turkey. Like I never booked another project at that price point again, like at that point, if you wanted to hire me, you were hiring me of this new rate and that was scary as hell. Like I had never never sold a project at that price point. But I did and again and again and again. And I would not have if I had had another option of like, Oh, you can actually maybe go ahead and buy me at this rate. So quitting cold turkey with the old price point to go with a new one was huge. And I think that people I think that have When people talk to you about prices, especially if you're doing something like tripling your prices, having that high price point, you can get a lot further with the right clients if you are having a conversation with them in order to tell them the price, because they're going to actually really want to work with you if they're going to bother getting on the phone with you. So I think that can be a really good tactic for selling that higher priced offering, you're able to really show them that you're a human express the value that you offer, and really make that connection that's going to make it a lot easier for them to say yes to working with you.

Kathleen Shannon 10:33
Ruth has something to share.

Ruth 10:36
Yes.

Kathleen Shannon 10:37
We have some like awesome bosses in here. Stylish

Emily Thompson 10:39
folks are all beautiful. Thank you. Anyway, sorry.

Kathleen Shannon 10:45
I seem to like talk about how you look. But you look.

Ruth 10:50
First of all my English is not my pants. So I try my best. I want to explain a story I had about that. That was a turning point for myself. I am a Spanish. I came here four years ago with no English. So that's why my English is not so good. But

Kathleen Shannon 11:13
it's great.

Ruth 11:14
I am

Emily Thompson 11:15
better Kathleen's

Ruth 11:16
but you are not in Spain. So in Spain, and here, I used to be a conservator restorer of artworks. my speciality is contemporary art. What these days are your restorer, that means you make food. No. So are you conservator that means you are in a political team? No. So first of all, you have to explain that performance, that it's a kind of expression, you can conserve, because it's about the idea. So in Spain, you know, a real pizza bullshit now about money. So I used to work for free or for almost free. And when I came here, I decided I'm not going up work for free ever. I am more than 40. So it's not my time to be free person. So I I was hired by a company that they built a collection of young artists that they were bought and paid. But the point was, I was the only conservator for more than 300 pieces that they were traveling around the world for three years. So I was my own team for everything going everywhere with my short English talking with everybody. And I was a bit the bossiest person ever, like no, don't touch this. But the point was when I was selling my prices, the people who was hiring me, they knew that I was Spanish and I was coming from Spain, and I was like in university prices. And they told me Okay, what your salary, what you are telling me that you are going to be paid. It's too much because in Spain, you will be having like, What? Nothing. And now I am not about paying you that amount because I can hire another person for that price in Spain, because they are an international company so they can hire everybody and every well. So my first reaction was that true? Bad because I had that boss in my mind that was reminding me No, ever. So I told him, okay, that's true. But you can pay that amount to a person who is not a professional, who is not gonna do what you need. And who's not me. Yes, but in my intern person was like, Oh my God. He's not gonna hire me, for sure. And I'm gonna lose my first ever amazing opportunity to be my dream in my living my dream. So he told me, okay, I'm gonna think about that. I don't want to spend that much money. I don't have that budget. I was one week waiting like that. But in mind 10 I said, Okay, I had nothing. So if he hasn't hired me, I had the same and that was the point. And when he called me, I was like in the other silo. But he said me, okay, I buy it. Because you are going to be the master and I told him Yes.

Ruth 15:00
For three years, I have been doing that for only them. And it has been my best experience ever. Now I'm doing nothing because other things, but not because I was not the best because during that three years, I had a lot of connection connections, everybody who was telling me Wow, you're amazing. And I was. So yes, the point is, you don't have another client. It's okay. You had nothing. So you are not doing an nothing bad. I'm sorry. But for the English. Oh my God.

Kathleen Shannon 15:40
That was the best story to end on. I think now, instead of saying we're all gonna die, I'm just gonna say, well, you started with nothing. So it's fine. I love that. Thank you for sure. All. Right, so are you telling me to take off my clothes?

Emily Thompson 15:56
Not this time. Hey, there bosses around these parts, we preach the necessity of email marketing for your creative business. Sometimes we joke about not being podcasters, but that we make our money writing emails. But the truth is, that's not really a joke. Email Marketing is the engine that runs our businesses. We share a lot of content around here from our own brands and digital photography and bring creative to all that being bald is going to become and we rely on a single system to make sure that we're making the most of our email list and the messages that we share with our tribe there. That system is ConvertKit I spent months testing every system I could get my hands on to ensure that the switch we were about to make was the right one. And we've been really pleased with our choice. We immediately found ourselves diving into using the system to more automate our email marketing content, and to better segment and target our growing list of cool creators looking for the right content for them. If you're in the business of sharing content, we recommend you check out ConvertKit try ConvertKit for free for 30 days go to beingboss.club/ConvertKit to learn more. Did you like this minisode Be sure to check us out on our website at beingboss.club. There you can find more from being boss including our full episodes minisodes and blog posts. And while you're there, be sure to sign up for our mailing list so that you can get access to behind the scenes and exclusive content from Kathleen and myself to help you be more boss in your work and life. Do the work be boss