Do you feel nervous about raising your rates? Are you worried that your clients will all leave you, or that new clients will stop coming to train with you? Here are some tips to help you raise your rates without losing clients.
First step in all cases below is to plan to send an email to your clients announcing that you will have a new rate effective on a set date.
Subject line: Thank you!
You have been a loyal client of Custom Strength and I thank you very much for allowing us to be part of your life. Because of your loyalty and referrals, the gym has grown. Wow has it grown! In fact, we have grown so much that we had to stop taking new clients in May and now have a waiting list with 32 people on it! I'll be honest - I'm a bit overwhelmed at how popular Custom Strength has become. Of course I'm also quite thrilled.
Given how much demand there is for training with us, and the cost of having staff and our own gym, I felt there was no alternative but to make a change to how we approach payment for sessions.
Tip #2: Grandfather-in your existing clients, but tell them you are doing this so that they feel a sense of loyalty from you
Here is an example I have used with my clients:
Subject line: Price changes... but not for you
It's that time again. We increased our rates for new clients last week. But because we value our loyal clients, we are not increasing your rates. So really this is nothing new for you. It's not that we keep the same rates forever, but we do try to provide a better deal for clients who have been with us a while than for new folks. Just a little way we have of saying thanks for training with us.
Now here is the cool thing about this approach: you can make your clients feel appreciated for their loyalty while also introducing the idea of increasing their rates in the future. As you can see in the next excerpt, that is exactly what I did. Note this is the second section of the email; the first introduced our new scheduling system. It still follows Tip #1 in that it does not jump right into discussion of price, although I did not use that first paragraph to grease the wheels on the new prices this time but instead refer back to how they have paid less for the past six months as the reason for the increase.
Subject line: Price changes
It's that time again. We will be increasing our rates effective November 1st. Because we value our loyal clients, we did not increase your rate the last time we increased our rates. But we've just increased our rates again for our new clients, and so it's unfortunately time to bring your rates up a bit. You'll still pay less than new clients...
There are two downsides to this approach that should be noted. The first is that your current revenue increase will be limited because only new clients are affected, so if your schedule is almost full then work that into your email about the need for an increase, and avoid the grandfathering. The second is that logistically you will now be carrying multiple rates which can add to your administrative load.
If you opt for the grandfathered approach, revisit your rates in another six months and consider bringing everyone up to par at that point, but as you do, remind them that they've been receiving a loyalty discount for six months. And of course, remember to thank them again for that loyalty.
Tip #3: Offer a friends and family deal in conjunction with the new rate
This offer works well when tied to a grandfathered rate, and is ideal if you want to increase your rates but you do not have a full (or nearing full) schedule yet. People love it when they have earned a discount they can offer to their friends. Make sure you make it a limited time offer, with a set date by which the potential new clients must start. You may also want to make it a limited duration offer, such that the new clients will get the discounted rate for some number of months. I would recommend six months so that you can time the end of the deal with the date you will be increasing the rate for your grandfathered clients.
Raising your rates can feel like an overwhelming task; but is often necessary for the lifeblood of your business. With these tried-and-proven strategies, have the confidence to implement your price increase and continue to serve your clients at the value you deserve.
Elsbeth Vaino is the owner and head trainer at Custom Strength in Ottawa Canada, where she works primarily with masters-aged athletes wishing to return to sports post-injury. Prior to becoming a trainer, Elsbeth enjoyed a successful career as an engineer, which significantly influences her approach. She holds a CSCS, is FMS certified and has a wealth of experience coaching and teaching hockey, ultimate, and skiing. She writes about exercise and nutrition at www.elsbethvaino.com
First step in all cases below is to plan to send an email to your clients announcing that you will have a new rate effective on a set date.
Tip #1: Spend time crafting the email
How you present potentially sensitive information is at least as important, if not more important than the actual information you present. Ideally, you want to lead into the price change rather than just blurt it out. Have you purchased new equipment over the past year? Attended conferences and increased your knowledge? Have you had an influx of new clients such that your schedule is now quite full? These are all great reasons for increasing your rates. Make your introductory paragraph about one of these improvements you have made to your space or your ability. Then start the second paragraph as a transition from that. The third and any subsequent paragraphs of the email can then provide the details of the increase and how it will be applied. Here is an example:Subject line: Thank you!
You have been a loyal client of Custom Strength and I thank you very much for allowing us to be part of your life. Because of your loyalty and referrals, the gym has grown. Wow has it grown! In fact, we have grown so much that we had to stop taking new clients in May and now have a waiting list with 32 people on it! I'll be honest - I'm a bit overwhelmed at how popular Custom Strength has become. Of course I'm also quite thrilled.
Given how much demand there is for training with us, and the cost of having staff and our own gym, I felt there was no alternative but to make a change to how we approach payment for sessions.
Tip #2: Grandfather-in your existing clients, but tell them you are doing this so that they feel a sense of loyalty from you
Here is an example I have used with my clients:
Subject line: Price changes... but not for you
It's that time again. We increased our rates for new clients last week. But because we value our loyal clients, we are not increasing your rates. So really this is nothing new for you. It's not that we keep the same rates forever, but we do try to provide a better deal for clients who have been with us a while than for new folks. Just a little way we have of saying thanks for training with us.
Now here is the cool thing about this approach: you can make your clients feel appreciated for their loyalty while also introducing the idea of increasing their rates in the future. As you can see in the next excerpt, that is exactly what I did. Note this is the second section of the email; the first introduced our new scheduling system. It still follows Tip #1 in that it does not jump right into discussion of price, although I did not use that first paragraph to grease the wheels on the new prices this time but instead refer back to how they have paid less for the past six months as the reason for the increase.
Subject line: Price changes
It's that time again. We will be increasing our rates effective November 1st. Because we value our loyal clients, we did not increase your rate the last time we increased our rates. But we've just increased our rates again for our new clients, and so it's unfortunately time to bring your rates up a bit. You'll still pay less than new clients...
There are two downsides to this approach that should be noted. The first is that your current revenue increase will be limited because only new clients are affected, so if your schedule is almost full then work that into your email about the need for an increase, and avoid the grandfathering. The second is that logistically you will now be carrying multiple rates which can add to your administrative load.
If you opt for the grandfathered approach, revisit your rates in another six months and consider bringing everyone up to par at that point, but as you do, remind them that they've been receiving a loyalty discount for six months. And of course, remember to thank them again for that loyalty.
Tip #3: Offer a friends and family deal in conjunction with the new rate
This offer works well when tied to a grandfathered rate, and is ideal if you want to increase your rates but you do not have a full (or nearing full) schedule yet. People love it when they have earned a discount they can offer to their friends. Make sure you make it a limited time offer, with a set date by which the potential new clients must start. You may also want to make it a limited duration offer, such that the new clients will get the discounted rate for some number of months. I would recommend six months so that you can time the end of the deal with the date you will be increasing the rate for your grandfathered clients.
Raising your rates can feel like an overwhelming task; but is often necessary for the lifeblood of your business. With these tried-and-proven strategies, have the confidence to implement your price increase and continue to serve your clients at the value you deserve.
Elsbeth Vaino is the owner and head trainer at Custom Strength in Ottawa Canada, where she works primarily with masters-aged athletes wishing to return to sports post-injury. Prior to becoming a trainer, Elsbeth enjoyed a successful career as an engineer, which significantly influences her approach. She holds a CSCS, is FMS certified and has a wealth of experience coaching and teaching hockey, ultimate, and skiing. She writes about exercise and nutrition at www.elsbethvaino.com
