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The Risks of Crowbar Pricing

The foot-in-the-door psychological effect occurs when a smaller request is made in order to enable a bigger request to be made later. It works because people tend to perceive the subsequent requests as part of the initial one they already said yes to. Everyone likes to see themselves as behaving consistently, after all.

When you struggle to communicate value, it’s tempting to try “crowbarring” the client’s interest by getting them to pay a very modest sum to try the service, and then use the experience to leverage a better price point next time.

And people

Here are 3 reasons people do it, and why I think it’s risky to think that way.

1) It demonstrates value: Value is subjective, and the client’s perception of value often depends on the initial price tag. Once you buy a beer for $1,50 you hate to buy it for $3,50.

2) It builds trust: Luring them in and then charging them more once you have more leverage may not be seen as a trustworthy move but as a bait-and-switch “scam”.

3) It helps market penetration: That works for commoditized goods, where everybody understands the differences between options. Market share is an entirely unhelpful thing to measure for solo experts or small firms.

A lower initial price can be a good idea when you have built sufficient relationship “scaffolding” around it to ensure it will indeed build trust. If you are unsure about that, leave the crowbar alone.

A well executed trust building example

Claus Raasted, the rockstar consultant, external McKinsey advisor, and co-author of my book “Pricing Expertise” has his own way of building trust: you trust first. You can hear about the pluses and minuses of his approach in the latest Fearless Pricing Podcast episode.

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