Netflix is raising the price of renting DVDs through the mail by 60% – and customers are none too happy about it. The announcement of the price increase has the web all a-twitter with thousands of complaints on Facebook and other websites.
What used to be a $10 monthly fee to rent physical DVDs in addition to online streaming will now cost customers $16 a month. Customers can still subscribe to the streaming service only for $8 a month. This change in price structure will undoubtedly push consumers toward online streaming options, following trends in the entertainment market. Netflix is confident that people who rely on DVDs will continue to shell out the cash, and while it is a move to increase revenue, it is also a move to phase out physicial DVDs and set up Netflix as a top contender in streaming video.
As the economy stabilizes, should recruiters begin raising their fees as well? It may have been a while since you raised your fees, or you may have even cut your fees to stay afloat in a floundering job market. But is now the time to consider hiking up your fees?
Do you have a niche in the market? Like Netflix, when you have a great service, you can afford to raise your fees, no matter what the economic climate is. Identify the services you offer that your clients cannot live without, and raise your fees accordingly.
Are you looking to phase out a service you offer? Perhaps there is a service your firm offers that presents more problems that the revenue is worth. Charging premium fees for an out-dated service can help phase it out. Then, you can focus on the real revenue generators, as well as the services you see being in demand in the future. Plus, clients who really need a service that is falling by the way-side will be willing to pay for it.
What factors do you consider in raising your fees? Will potential backlash from clients prevent you from making a strategic pricing move like Netflix did?