In the late 1990s Procter & Gamble tested Olay Total Effects at three prices, $12.99, $15.99 and $18.99. The cheap one did fine. The middle one did worst of the three. At $18.99 more people said they would buy it than at $12.99, and department-store shoppers most of all. Joe Listro, who ran Olay, told the story to A.G. Lafley and Roger Martin for their book Playing to Win, and it is worth sitting with for a minute before you knock 10% off to close a sale. The buyers were not objecting to a number. They were comparing it with something, and the comparison was doing the deciding.
I sold for a living for more than fifteen years, door to door first, then in London, Amsterdam, New Zealand, Australia and at trade shows across the US, and the price objection sounds the same in every one of those places. "It's too expensive" is never the end of a conversation. It is a request for a different comparison, and the research below tells you where the comparison comes from and how to change it without touching the price.
Expensive compared with what
Your buyer cannot judge a number on its own. The brain grabs the nearest reference point and measures from there, and it will use a number it knows is meaningless if that is the one that arrived first. Tversky and Kahneman showed it in 1974 with a wheel of fortune rigged to stop on 10 or 65, followed by a question about the share of African nations in the UN. People who spun 65 guessed 45% on average and people who spun 10 guessed 25%. A carnival number moved the answers twenty points, and when the Many Labs project re-ran the effect across 36 samples in 2014, it held.
So ask yourself what number your buyer heard first. If the first number was your quote, your quote is the anchor and everything you say afterwards is measured against it, which is a fight you lose. If the first number they heard was the top of your range, your quote is the sensible one. The dear option does not have to sell. It has to be seen before the real one, and it has to be something you would honestly deliver at that price. More on the mechanism on the anchoring effect page.
Let them say no to the big one first
In 1975 Cialdini and his colleagues at Arizona State asked students to sign up for a demanding two-year volunteer commitment. Nearly all of them refused, which was the point. Then came the smaller ask, chaperoning one trip to the zoo. Half of the students who had just refused the two-year ask said yes to the zoo. Among students who were only asked about the zoo, 17% did. Getting refused first nearly tripled the yes.
Two things happen in that sequence. The refused first ask makes the second look small, and the drop reads as a concession, which people feel a pull to match. The only thing they have to give back is a yes. In 2012 Feeley, Anker and Aloe pooled 35 years of door-in-the-face studies and found the effect reliable, if modest, which puts it ahead of most of what gets quoted at sales conferences.
In a quote that means offering the full version first, the one you would genuinely recommend, and letting them turn it down before you offer the one you expected to sell. A hairdresser does it at the basin with the full treatment and then the ten-minute mask; the salon page has that script written out in full. A plumber does it with the full re-pipe and then the repair. The first offer has to be refusable rather than ridiculous. A price they laugh at ends the conversation instead of anchoring it.
Talk about what they already hold
Losing something tends to hurt more than gaining the same thing feels good. Kahneman and Tversky showed it in 1979 by giving people the same outcome in two costumes. A sure $500 or a coin flip for $1,000: most took the sure thing. A sure loss of $500 or a coin flip to lose $1,000: most of them gambled. People take risks to dodge a loss that they will not take to chase a gain. How much more a loss weighs is still argued over by researchers, but the pattern itself is one of the best known in the field.
When the Bose Wave system struggled in magazine ads, Bose changed the headline from "New" to "Hear what you've been missing". Robert Cialdini, who says he worked with Bose on it, puts the result at a 45% rise in sales. Bose has never published a figure, so the number is his and travels with his name. The headline change is on the record, and the shape of it is the lesson. The first version offered a gain. The second named a loss the reader was already living with.
With a price objection, the thing to put in front of the buyer is what they already hold and are about to give up. The slot you held for them. The rate they were quoted. The time they have already put in with you. It only works on something that feels like theirs, so do not invent a loss they never had. People can smell that from across the room. The loss aversion page has the study and the status in one place.
The price is part of the product
In 2008 Plassmann and colleagues gave people the same wine and told some of them it cost more. The dearer wine tasted better, and the brain scans agreed with the tasters, because the region that registers pleasantness responded harder to the dear label. The Olay result sits in the same family: $18.99 told department-store shoppers something that $12.99 could not.
The caveat matters here. The study shows that price can change how good a thing feels. It does not show that raising your price on its own fixes push-back, and the study was a tasting experiment, not a test of service quotes. Raise a price and you have to pair it with a visible reason, the better finish, the longer guarantee, the person who turns up on time, or the buyer fills the gap with suspicion instead.
Try this week
Next time you quote, start at the top of your range with a version you would honestly deliver, and let them say no to it before you say the number you expected to win. Then, if they still baulk, name the one thing they already hold that they would be giving up by walking. Count how many quotes you win in the two weeks after you start against the two weeks before. The scripts for this, and the versions written for 54 different industries, are in the $37 book.