Closing Your Early Sales: The Power of Secret Pricing

November 24, 2014

12:30 pm

When you’re looking for early sales, you’ll notice that each customer wants to wait until someone else bites. They give you positive feedback, and appear as if they’re going to go through with the deal. Then, as you start getting close, they ask to wait until you have other customers on board. This can be tough and also devastating because of the time and resources that are wasted going through this. As an entrepreneur, you need to be able to get your product out quick so you can start refining. You also need initial traction for investors, revenue, and to help buy yourself more time.

While there are a couple of ways to get your prospect to be your first customer, one of the most effective is the secret pricing technique. When you’re talking to the client, tell them you’d like to give them a special offer because they are an early adopter. The only catch is that you’d appreciate if they could keep the price a secret, because you don’t want other customers to know. Here’s the advantage of using a move like this to create early sales and also why it’s so effective.

1. Secrets Create Friends

You know the saying, “Secrets don’t make friends.” Well, that’s not true if you are the one who gets in on the secret. Giving your customer an initial price point that you ask him to keep quiet builds a bond. You trust the buyer with important information that could hurt your business. The fact that you would give that power to the purchaser will automatically improve the relationship. This is important, because the real value you’ll get from customers is their lifetime value rather than just a single buy.

Also, it makes the client feel special when he’s around others in his market. Knowing that he’s working with a company that gave him a deal so exclusive that he can’t share goes a long way in making him feel special. This will give him a better feeling about working with you, even if he’s your first customer.

2. You Create Bargaining Power To Get The Deal Done

When I started using this with initial customers, I still had a few who kept trying to delay the deal. Eventually, I started using the secret price I gave them as a way to move the sale along. After all, the reason the customer was getting a better offer is because they were an early adopter. By taking too much time they no run the risk of someone else jumping in instead.

Note that the deal you give should not be a drastic drop in the price you want to charge. Breaking into the market is tough at first, and chances are your price will increase after a few satisfied customers. You should not use this in a negotiation either. You should never negotiate your price. Instead, open the conversation with this one price and present it to them. Once they are impressed and feel special, use it to your advantage to get the signature quick. If you let the customer drag you along, you’ll waste the revenue you gave up for getting an early customer.

3. There’s Always A Way Out

The greatest objection to this tactic is that customers talk to each other. It’s way too risky to tell a secret to a customer and hope that they don’t share it. While I acknowledge that point, there is always a way out if other customers get a hold of the secret price: simply tell them the truth.

Clients will understand that they need to pay more because there is less risk for them than there was for the first customers. When our prospects ask me what others have paid, I tell them the truth and that our first customers got cheaper prices. Never once have I had a purchaser get upset about this; if anything, they become more willing to test out new features. Early adopters are what serve as a catalyst for startups; they have every right to get better deals than the rest of the pack.

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AJ Agrawal is an entrepreneur, speaker, and writer. He is the CEO and Co-Founder at Alumnify Inc.

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