I commented already, but since this popped up in my list, I thought I´d elaborate a bit, since it´s Sunday and the forum has this great search function and this probably is a question many sellers face at one point or other.
I actually had to raise the prices at one point, simply because I was getting too many orders with my low ‘entry-prices’ and I couldn´t work till 2 am every night. but it´s difficult of course especially when you have regular buyers, then again, anyone who can think, knows that prices for everything go up all the time, and sellers do have to live as well.
If the quality of the work matches or exceeds the price, it should not be too big a problem, I did get less orders after I raised my prices from my initial ‘I am new and want to see if this fiverr thing works at all’-prices, but I´m not less busy.
I did ‘split’ my initial gig though, when I adjusted my prices, and didn´t raise them for some kinds of translations as much as for the other kind, which really reflects the situation ‘in real life’ as well, also my preferences.
I think Zeus’ approach makes sense if you have a lot of regular buyers, or high volume buyers though.
If someone books a 5 $ gig 3 times a year though, I don´t think it really warrants to actively contact them, which could be seen as ‘spam’, only to tell them that 5 $ now gets them only 200 words instead of 250, but it all depends a bit I guess.
Some buyers might appreciate that, personally I think I´d prefer to not get a message, but would just check the gig again when I want to book next time, will see the new price and think to myself, 'yeah, they are right, who can work for 2,50$ (or whatever remains after fees, taxes and health insurance) actually, this is still much cheaper than ‘out there’ and hit the order button. Or of course I might think 'yeah they are right, but sadly this is over my budget now, I´ll have to find someone else. Which is okay.
If I’d buy regularly and at least one or several times a month or high volume, then again I’d probably appreciate the seller informing me about the price change, because then I guess I might not check the gig description/how many x I get for y$.
Most of my gigs, especially those with high wordcount, are booked per custom order anyway though, so usually buyers should be aware of the price before they book and I quote them the prices for the exact wordcount too, so they won´t pay for 2x1000 words by booking 2x the 1000 word gig, when they only got 1750 words etc.
It all depends on a few things, and reading all these opinions and approaches should help everyone a bit to figure out the optimal way of dealing with the issue for themselves. And lastly, ‘optimal’ as in ‘as good as it can be’, there are no 100% right or proper or wrong ways to do this, I think.