OFB 61 | How to Raise Prices without Losing Customers: Lessons from Airline and Cable Companies

-Which do you like better ALL INCLUDED pricing, or ALA CARTE pricing?

-What company lost millions in dollars and customers, then gave their CEO a 100% pay increase?

-And How to raise prices for your products or services and not lose business

Guest Host: Lon Seidman - Host of Behind the Video and Lead Writer of CTTechJunkie.com, but also a partner in the Safety Zone, his family’s glove and safety equipment business, SafetyZone.com.

*******HOT POTATO NEWS

1. Is Ala Carte ruining the Airline Industry? Add on fees initially kept the cost of the air ticket down. They have creeped up, along with increased fees. Is air travel a unique industry for pricing? http://www.telegram.com/article/20121230/NEWS/112309994/1002/business

Lon: No fees on Southwest

Everyone else subsidzes elite flyers on major airlines. They pay no fees.

2. Double you’re prices and see the CEO double his pay. NetFlix CEO Reed Hastings gets $4million now. $10-$20 monthly subs or $8/mo. We can complain, but only cable TV providers might listen -- and laugh.

http://www.bloomberg.com/news/2012-12-28/netflix-doubles-ceo-hastings-yearly-compensation-to-4-million.html

Lon: Consumers need to demand more, people complain but don’t change their behavior which is why companies get away with this stuff.

*************FOCUSED DISCUSSION LINKS

At some point, we all have to raise prices for our products or services. This is a lose-lose situation: I hate having to re-explain or re-sell why I’m valuable at a certain price, and certainly my customers our advertisers here don’t JUMP at the opportunity to spend more.

Here are some tips:

Inc Magazine (Ken Cook contributor) http://www.inc.com/tom-searcy/raise-prices-without-losing-customers.html

Entrepreneur Magazine

http://www.entrepreneur.com/article/219752

OpenForum.com

http://www.openforum.com/idea-hub/topics/money/article/5-ways-to-increase-prices-without-losing-your-customer-1/

SBA.gov

http://www.sba.gov/community/blogs/community-blogs/small-business-cents/how-raise-your-prices-or-rates-without-losing-c

Small Business Success Blog | blog.score.org

http://blog.score.org/2012/sba/4-tips-for-raising-your-prices-without-losing-business/

Tell us what you think. Email Tommy or Ken at [email protected].

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