Netflix is a well-known streaming service that offers award-winning content to its customers across the globe. The wide-ranging shows, movies, and documentaries it streams on a regular basis make it an industry leader and keep its audience happy.
However, in 2011, it had to face widespread customer complaints about a sudden price increase and change to its plans. The complaints happened due to the company’s decision to separate its streaming and DVD-by-mail services as it came with a huge backlash from customers.
Since most customers were happy with Netflix’s bundled service, they found it weird when forced to subscribe to two different plans which would increase the overall cost for them.
Many subscribers felt that Netflix was increasing the cost, so they took to social media and online forums to vent their ire and flood those sites with complaints. In fact, the company witnessed a big surge in cancellations of subscriptions.
Thankfully, Netflix knew how to respond to a customer’s complaint about the price.
The company issued an apology and accepted that it had not communicated the price increase effectively. The then-CEO posted a detailed blog, explaining the reason behind the changes, and gave clarification on the pricing and plans.
While the immediate reaction to the price increase was substantial, over time, customers adapted to the changes, showed faith in Netflix’s vision of producing high-quality content, and made the company a leading force in the streaming category.
The above example shows how a company should face customer complaints about a price increase and act strategically. It also underlines the value of effective communication and the importance of understanding the anger and sentiment of customers with care.
In this blog, we will discuss in detail the scenarios of customers complaining about high prices and how to handle them with due professionalism.
So, let’s first get started with understanding what to do when customers complain about price…
What to Do When Customers Complaint About Price?
Customers complaining about price is something no business can wish away. The right strategy is to take each complaint as an opportunity to bolster your relationship with them and win their trust and loyalty. The key is to handle price-related complaints professionally and empathetically. Here are some suggestions on what to do when customers complain about the price rise –
Listen actively – Customers have every right to complain. If they feel the price is unfairly increased, they have reason to feel angry. As a business, your responsibility is to allow them the opportunity to share their views without interruption. You have to listen to them actively and show you value their opinion ( complain ).
Empathize – Customers who complain will obviously be upset and angry, so it’s important to stay calm and professional throughout the conversation. Your composure will play a key role in assuaging their anger and diffusing the situation. The key is to be empathetic to their cause as it gives reasons to feel heard.
Give explanation and highlight value – Any price increase is justified when it has a rationale behind it. Although customers are less likely to buy all your arguments, you should always provide a clear and honest explanation for the price hike. It’s equally important to highlight the factors that caused the decision, and also emphasize the value available despite the price increase.
Show appreciation – Customers should be encouraged to bring their price rise concern to your attention. This should serve as an opportunity to get their valuable feedback and consider pricing decisions. When you’re receptive to their thoughts and suggestions, it gives them the impression that you’re really interested in what they have to say.
Apologize for lack of communication – Customers deserve an apology if the price increase happens without proper or prior communication. In that case, you should tender an apology for any confusion or misunderstanding arising out of the situation.
What Not to Do When Customers Complaint About Price?
Customers are right when they complain about price increases or any other thing. However, many companies don’t take such complaints seriously and hardly entertain such customers. This kind of customer strategy is bad for the health of any business that aspires to achieve big success and retain most of its customers.
Here are some of the important things a business should never do when customers complain about price –
Ignoring their concerns – A customer who complains about price deserves to be heard. He/she should be valued and respected for the concerns they have. Sadly, some businesses either ignore or dismiss the concerns of customers complaining about prices. This kind of approach is not good in the long run as you might lose the trust of the customer.
Defending the price – Even though your price increase is justified in the wake of rising costs and competition in the market, this does not mean you argue about or defend it when customers come up with a complaint. The right strategy is to adopt a professional approach and help customers see the value and points that led to the price rise.
Using negative language – Customers are the pillar on which the foundation of your business rests. If they are not happy about the price, it means they have genuine concerns and you should understand their pain points. It would be a great mistake if you confronted them or used foul language with them. Such behavior might cause you to lose customers.
Dismissing competitor’s comparison – If customers are complaining about price, it means they are aware of how your competitors are offering the same product at a lower cost. They may bring this point to your attention, so you should be ready to accept the fact without ignoring the truth. Rather, you can highlight the USP of your product and justify the value with the price rise.
Overlooking feedback – Your customers provide the best feedback on your product and service. As a responsible organization, you should see their complaints about price as an opportunity to get feedback and implement the changes. The last thing you should be doing is to overlook the feedback from your customers.
How to Respond When Customers Complain About High Price?
A price revision is sure to bring complaining customers to your door. The key is to be ready to handle a lot of anger, ire, suggestions, and opinions. The best strategy to deal with such situations is to stay calm and wear a professional look. It will help you win new customers and retain existing ones.
Here is the strategy to respond when customers complain about the high price of your product or service –
1. Thank the Customer for Bringing the Issue to Your Attention
Saying a polite thank you is a key step when responding to customers who complain about high prices. It’s also a vital aspect of a customer-centric culture that your organization espouses. More importantly, greeting customers with a thank you will set a positive tone for the conversation, showcasing your commitment to fixing their issues.
- Acknowledge the customer’s concern about the high price
- Show them how you respect their opinions and feelings
- Express gratitude for the feedback
- Take steps to address their concerns
2. Provide the Context For the High Price
A sudden price increase can irk and disappoint customers. When the increase happens without context, it can add to the anger of paying customers. However, customers are less likely to feel aggrieved when the high price has happened after effective communication. So, it’s important to offer a valid context for the pricing and clearly communicate what led to the high price.
- Explain the things that have necessitated a price increase
- Provide information that helps customers understand why your product is priced as it is
- Give a peek into various cost components but keep the information concise and clear
- Make your customers understand that your pricing is not random and is rather based on other factors
- Empathize the quality and the cost associated with maintaining unique features
3. Explain Why Your Product and Service is Worth the Price
Customers don’t mind paying high prices when they get value. They may feel a little less disappointed when the price increase is accompanied by unique value or benefits. So, your foremost priority should be on helping them understand the unique benefits and value they get for the price they pay. The key is to effectively communicate why your price is worth what it is. The best way to make customers comfortable with pricing is to show them the value proposition.
- Emphasize the benefits that your product or service offers
- Explain how your offers are high-quality with value for money in the long run
- Share social proof, customer reviews, or case studies that demonstrate the satisfaction of other customers
- Make customers understand how your product or service is better than competitors
4. Make Customers Feel Confident in Their Purchase Decision
Customers feel confident when there is a clear and honest explanation of the price rise. This level of transparency not only builds trust but also helps customers realize why the high price is justified. More so, customers are more likely to see value in the product when they know the factors that led to the price increase. Such customers often feel informed and confident in their purchase decisions.
- Explain the various components that contributed to the high price
- Discuss how the price is a reflection of your commitment to providing quality
- Compare your pricing to competitors and let customers understand the value they are getting for the money they spend
- Mention how the price changes have been reached after customer feedback
5. Encourage Customers to Share Further Feedback on Price
Understanding customer perspectives is important when it comes to refining your pricing strategy. This will help you better understand what customers expect and what you should deliver. That’s why you should encourage them to share their feedback on price and then show them how you value their feedback.
- Ask open-ended questions so that customers feel like sharing their thoughts on the matter
- Use feedback surveys during interactions with customers
- Use live chat support to engage with customers and encourage them to share their concerns about pricing
Your Price is Too High Responses
Customers expect you to respond professionally and tactfully when they voice their concerns about high prices. It’s equally important to maintain a polite tone in your response and be empathetic to their problem. The goal is to provide information that satisfies their concerns and assuages their problem with the price rise.
Here are some of the common “your price is too high” responses –
“I understand our prices may seem high, but be rest assured to get the value you deserve in this price tag.”
“Our offer is more than competitive. It gives you the kind of benefits and features you look for in this price range.”
“Our prices are obviously higher than competitors, but let me explain why and you’d definitely agree with that.”
“We agree that our prices are higher and your concerns are valid, but let me tell you how some of our best customers also initially thought the same before they realized how the prices are fair and competitive.”
“Your concerns are genuine, but we can assure you that this price increase was inevitable. In fact, he had held off the rise for a year before it became too difficult to maintain that price point due to various external factors.”
“It may seem high, but trust me, you are getting a great deal that even our competitors can’t afford to offer you.”
“Our pricing may seem high but this is something which had to happen sooner rather than later. The earlier prices were not feasible and they could not keep up with the market dynamics. But we assure you that you get a product or service that meets the highest standards.”
“I concur with your objections to the high price but let me assure you that when you compare our prices to similar offers in the market, you’ll realize that we give a competitive value for the quality you receive.”
“Your feedback on pricing is much appreciated. We would like to know, is there any suggestion on a specific price point?”
“While our prices may seem higher, we are confident our product or service is a great value addition for you.”
“Many of our customers did initially feel the same about the high price, but they have realized how the increase is justified as the product performance and quality has been improved than earlier.”
A price revision is sure to bring unhappy and complaining customers to your door. If such customers and their concerns are not handled properly, they might feel disappointed and may consider leaving you.
The best strategy to respond to a customer complaining about a price rise is to be tactful, understand their concern, respond with a sense of empathy, and make them understand the benefits of your product.
With REVE Chat, you can sign up and get quality engagement tools and reach out to your customers for feedback and queries about prices.