A real conversation that just happened:
☼ What do you think you’ll charge for this project?
► Between 80K and 60K
[Silence…]
☼ Humm… and why not between 60K and 80K?
► You’re right. Maybe I’m going too little. Should I go 100K…?
☼ No, no, no. 80K is fine. Let’s talk about 80K.
In a negotiation about price, you can use several levers to make your case (it also requires you to be ready to let go. Not everything will follow, and that’s OK).
One of these levers is price anchoring.
You leave a piece of information first, so that they’ll be hooked on this one and remember, so when trying to negotiate, the subject revolves around the anchor.
To “overweight the first piece of information we receive on a subject“.
Here’s a deep dive into the convo ↓
☼ What do you think you’ll charge for this project?
Asking for what the price would be. (There was a previous conversation about the value, but that’s a story for another time).
► Between 80K and 60K
80K becomes the (high) anchor. The thing to remember.
[Silence…]
The one who speaks first, loses.
☼ Humm… and why not between 60K and 80K?
They just dropped their own anchor. IGNORE IT.
It’s an attempt to shift the price to a lower range. If you go there, it will keep going down.
► You’re right. Maybe I’m going too little. Should I go 100K…?
Embrace and pivot. Agree with them on that the price might be wrong (too low) and go with a higher number.
☼ No, no, no. 80K is fine. Let’s talk about 80K.
You get to keep the conversation around that price.
You’ll leave less money on the table.
Remember, though:
This is like a game.
You have to be willing to walk away.
And you’re there to serve.
If you’re not there to serve —well, that’s sleazy.