Selling the Price Increase. Jeb Blount

6 Relationships Matter

      Here is a blinding flash of the obvious: The effort you put into selling price increases doesn't matter if you lose your customers or their future orders in the process.

      Chasing your good customers and high-value accounts into the arms of your competitors is bad business. But, so is allowing profits to suffer because you are afraid to get the prices you deserve, for the value you are delivering, because you worry you'll lose your customers.

Price Increase Initiatives Are Dual Focused

No matter if you are involved in a broad price increase campaign or selling a price increase to a targeted account, your mission is to get the highest prices you can, AND retain your customer and orders. To accomplish your mission, both of these things must be true at the same time. It is a dual focus. This can be a delicate balance, which is exactly why your company needs YOU to sell these price increases.

      You are the one person with the most intimate knowledge of and deepest relationships with your customers. You are a professional who can sell the price increase and get customers to accept it while protecting the long-term relationship.

      But, you already know this. Therefore, my objective in this section is to help you gain awareness of the various pitfalls you'll face when approaching customers with price increases that can cause them to:

Navigating Imperfection

      Let's get this straight from the get-go. You do not work for a perfect company. Your product, software, or service is flawed. There have been quality issues, delivery issues, service disruptions, and shutdowns.

      Your customer success team, service delivery team, warehouse, billing department, help desk, technicians, engineers, programmers, and installers, have made mistakes, shown up late, and said stupid things to your customers. From time to time, your team has managed to piss off your customers, leaving you to clean up their mess.

      You have more customers and more on your plate than you can manage. Because of this, you've missed calls and haven't been able to get to some of your customers as quickly as they'd like. Some of them are not happy with you.

Your customers make unreasonable demands even though sometimes they don't see it that way. Some of your customers demand more of you than you can deliver. Many of these same customers consistently point out product imperfections, call about service deficiencies, and inform you that your competitors have better quality at lower prices.

      This is reality. The real world. Yet, in spite of it you will still be required to navigate these imperfections and sell the price increases. That's also the truth.

      There are few unicorn situations in which all the stars are aligned and customers are so satisfied and happy that they willingly agree to every price increase with zero pushback. Of course, if everything was perfect and it was this easy, you would be unemployed because your company wouldn't need you.

      There is nothing easy about approaching customers with price increases. You don't want to sell it and they don't want to buy it. Therefore, you must get past your own fears and influence your customers to accept price increases that they don't want in spite of these imperfections.

We Feel, Then We Think

      Price increases don't happen in a vacuum. Instead, they are woven into the fabric of an imperfect and flawed business environment AND human emotions. No matter the situation, emotions – yours and those of your customer – play a deciding role in the outcomes of your price increase conversations.

Science is stacking up one study after another demonstrating how emotions exert power over the choices we make. Human decision-making is driven by our emotions. Although we might be certain that we're making choices based on rational logic, our own best interests, or organized facts, science says that we usually don't.¹

For this reason, your customer's emotional experience while working with you is a more consistent predictor of price increase outcomes than any other variable. There is an oft-expressed maxim: They'll forget what you said, they'll forget what you did, but they will never forget how you made them feel.

      As humans, we feel first, then we think. This is why relationships matter, interpersonal connections matter, and approaching price increases through the lens of human emotions matters.

      This is why you matter. Emotion is the glue that connects customers to you and those emotional connections are the ultimate key to maximizing price increases while retaining your customers.

Customers Are People

      Business-to-business (B2B) relationships are different and more complex than consumer-based relationships. B2B relationships may involve large sums of money, contractual agreements, strategic relationships, and layers of influencers and end users. Relationships tend to be long-term rather than transactional.

      On the outside looking in, these business relationships appear to be, as they say, “nothing personal, just business.” However, on the inside, at the core, in B2B relationships, customers are still people. They are irrational humans who are driven by emotion just like you. Not companies, not departments, not org charts, not job titles. People.

      Emotional people with their own agendas. Sometimes complaining, belligerent people who seem to lack any semblance of logic or reason. They will almost always default to their own self-interest, despite a price increase that may be fair and deserved.

Perhaps, then, this is the most important lesson: Selling price increases is human. You aren't selling price increases to a company; you are selling them to other people. At the granular level, it is just one person (you) influencing another person (your customer) to accept the price increase without resenting you for it.

      What's important to understand, though, is that your leaders are sending you in personally to have a conversation with your customer because they are counting on you to mitigate potential negative outcomes. With price increases, you cannot lose sight of the lifetime value of the relationships you've developed and nurtured.

      This is our focus in Part Two, “Protect Customer Relationships.” In this section we're going to do a deep dive into: