Bruce D. Sanders, consulting psychologist with Vacaville, California-based RIMtailing, offered retailers advice on how to raise prices without alienating customers in a recent Bloomberg BusinessWeek article.
“These days, most customers are especially sensitive to any increase in price for the items they regularly buy,” Sanders wrote. “Sometimes customers accept a price hike and move on, but in other cases they get upset. According to researchers at the University of Arizona, Arizona State University, and University of Pennsylvania, the root cause of their anger is a desire-”conscious or subconscious-”to punish the business owner. How else to explain a shopper leaving behind a full cart and walking out the door?”
Sanders has three scenarios for retailers to consider when planning to increase prices.
First, does your customer consider the item a necessity?
Second, is the price increase a surprise to your customer?
Finally, does the price increase seem unjustified to the customer?
Examining these questions from the customer’s point of view whenever you’re planning to raise prices can help you salvage a customer relationship and keep a sale.
Read the complete Bloomberg BusinessWeek article here .