# Raising a price: whom, when, how much > Notice, the message and existing customers, as Dana raises her rate. - Course: [Pricing: Set, Package and Raise Your Prices](https://productovi.com/courses/pricing.md) - Module: How do we change a price? - Lesson 26/32, ~23 min - Source: https://productovi.com/courses/pricing/raising-a-price ## How much **Alex Tutor:** Back to Dana's practice, now at the end of April. Since mid-March she has quoted 750 UAH to everyone new who asked, and four of six said yes. We'll look at that small test properly in the last module. **Dana:** My hour at Klasna is worth 470 after tax. To match that, my private lesson would need to cost about 960. Should I just jump there? **Alex Tutor:** That's your target, not your next step. A 60% jump at once is a lot to ask from people who chose you at 600. Go up in steps you can explain, and see how buyers respond at each one. **Alex Tutor:** Before the arithmetic: what's the difference between a target and a next step? > **Exercise:** Dana's target is about 960 UAH a lesson; she charges 600, and in spring four of six new enquiries accepted 750. What is the soundest next step? **Alex Tutor:** First, what does 750 change for you? You keep 94% after the single tax and the military levy: 564 UAH a lesson at 600, 705 at 750. Your tools, 7,200 a year, don't change with the number of lessons. **Sofia:** This year's plan is 348 paid lessons and 189,072 UAH net. How many lessons at 750 bring the same? **Alex Tutor:** Work it out. The general version of this question, how much volume a price change can lose, is in the course Finance for Product People; for Dana the arithmetic fits in one line. > **Exercise:** At 750 UAH Dana keeps 705 a lesson after the 6%, and her tools cost 7,200 a year whatever she teaches. How many paid lessons at 750 bring the same **189,072 UAH net** as 348 lessons at 600? Round up to a whole lesson. **Alex Tutor:** So she could lose 69 lessons a year, almost one in five, and still earn the same, with about a hundred hours freed. With a waitlist, she's unlikely to lose that many. **Alex Tutor:** Put those 69 lessons as a share of her plan. > **Exercise:** Dana plans 348 paid lessons at 600 UAH; 279 lessons at 750 bring the same net income. What share of her planned lessons could she lose and still earn the same? In %, to two decimals. ## For whom and when **Dana:** What about my eight learners? And the four people on my waitlist: I promised them 600 when they wrote. **Alex Tutor:** A promise is part of the price. New learners pay 750 from 1 May, which is what you already quote. Everyone who started at 600, the waitlist included, keeps it until September. **Dana:** And then 750 for them too? **Alex Tutor:** You could. Or a smaller step for people who've been with you all year: 700 from 1 September. You tell them on 1 June, three months ahead, when the summer pause gives them time to decide. **Nazar:** Or skip the awkward talk: make lessons 50 minutes and keep 600. Most won't notice. **Alex Tutor:** That's a price rise in disguise, and the learners who notice stop trusting everything else you say. Raise the price openly and keep the lesson as it is. > **Exercise:** Which plan for Dana's **existing** learners is the fairest and the easiest to defend? > **Exercise:** By what percentage does the price rise for an existing learner who moves from 600 to 700 UAH? To two decimals. ## The message **Dana:** What do I actually write? I hate talking about money with people I like. **Alex Tutor:** Keep it short and personal, sent to each learner, not posted in your channel first. Say what changes, from when and by how much. Give the real reason in one sentence: what goes into each lesson and what the time is worth. **Alex Tutor:** Then what stays the same, what they can do (keep going, switch to fewer lessons a month, or stop with no penalty), and a thank-you. Don't blame inflation if it isn't the reason. **Alex Tutor:** And how should the message reach them? > **Exercise:** How should Dana deliver the news of the September price to her existing learners? **Sofia:** Should she offer a discount to soften it? **Alex Tutor:** The smaller step for existing learners already is the thank-you. A discount on top would blur the new price before it starts. The founder's quick version of this is in From Idea to Profitable Product: Building Without Investors; here we go one level deeper. > **Exercise:** Which belong in Dana's price-increase notice to existing learners? Select all that apply. > **Exercise:** **True or false:** shortening lessons from 60 to 50 minutes at the same 600 UAH is a gentler, fair alternative to raising the price. ## Your turn: Dana's message **Dana:** Draft it for me, please. I'll send it on 1 June. > **Exercise:** Write the message Dana sends each existing learner on 1 June (4–7 sentences). Include what changes, when, by how much, the real reason, what stays the same, their options and thanks. Her decision: from 1 September existing learners pay 700 UAH instead of 600 for the same 60-minute lesson (new learners already pay 750); until then the price they were promised stays; they can continue, switch to fewer lessons a month, or stop with no penalty. Her costs barely changed, so the reason is what goes into each lesson and what her time is worth. > **Key ideas** > > - **How much:** step towards your target in amounts you can explain. Dana: 600 → 750 for new learners (+25%), her target near 960. > - **What a rise can afford to lose:** at 750 Dana keeps 705 a lesson; 279 lessons give this year's 189,072 net, so she could lose 69 of 348 (19.83%). > - **For whom:** new buyers first; existing ones later and, if you choose, with a smaller step (700, +16.67%). Keep promises already made. > - **When:** with notice (here three months, told on 1 June for 1 September), at a natural break. > - **The message:** what changes, when, by how much, the real reason, what stays, their options, thanks. > - Never shrink the product instead of raising the price openly. **Alex Tutor:** Dana's rise is about her own time. Next, Klasna: what to do when costs move with inflation and the hryvnia, or when a rival cuts its price. - Previous lesson: [Signs a price is too low](https://productovi.com/courses/pricing/signs-a-price-is-too-low.md) - Next lesson: [Inflation, the hryvnia and a competitor's cut](https://productovi.com/courses/pricing/inflation-hryvnia-competitors.md) --- Productovi Learning. Free, no sign-up needed to read.