Latest / Closing the Deal with Fexingo: Sales, Negotiation, and Revenue Conversations for Operators / How One Sales Rep Closed a Deal by Sending a Price Increase
Transcript
- Lucas: You send a prospect a price increase — and that's how you close the deal. Luna: I've heard of this tactic, but I have to admit, my first reaction is: isn't that just daring them to walk? Lucas: Right, that's the instinct. But let me give you a specific case. A cybersecurity SaaS company — mid-market, annual contract value around $80,000. Rep named Dana had a deal stuck at the proposal stage for six weeks. The prospect kept saying they were 'circling back internally', which we all know means no one's fighting for it. Luna: Classic procurement stall. So what did Dana do? Lucas: She sent an email. Not a discount offer, not another calendar invite. She wrote: 'Per our pricing review, our rates will increase 12% effective July first. Since your proposal is still under review, I wanted to make sure you had the current pricing before the adjustment takes effect. The current quote is good through June 20th.' That's it. Luna: So she created a deadline. A legitimate one, I assume — the company actually had a price increase coming? Lucas: They did. That's critical. It wasn't a bluff. The company had a scheduled price increase on that date. She just chose to proactively surface it with a prospect who was dragging their feet. The result: the prospect's internal champion forwarded that email to the decision-makers, and within three days they had approvals to sign at the original price. Luna: Three days, after six weeks of nothing. That's a powerful nudge. Lucas: It's loss aversion in action. The prospect wasn't motivated by a potential gain — a discount — because that would still require them to act. They were motivated by a potential loss: paying 12% more for the exact same thing. Behavioral economists call this the endowment effect. You frame the current price as something they already have access to, and taking it away feels worse than the effort of getting approval. Luna: But doesn't this only work if the price increase is real? If a rep fakes it, they destroy trust. Lucas: Absolutely. Dana's company actually raised prices that quarter. The rep didn't fabricate the date or the percentage. She just accelerated the prospect's awareness of it. The company later tracked that this tactic — surfacing an impending price increase to stalled deals — closed at a 30% rate within two weeks. Compare that to their normal proposal follow-up, which converted around 12% over the same window. Luna: So it tripled the close rate. But I wonder about the deals that still didn't close. Did some prospects take offense? Lucas: Some did. The internal data showed that about 15% of prospects who got the price increase email responded negatively — they felt pressured or accused the rep of using a gimmick. But here's the interesting part: most of those were deals that were already unlikely to close. The prospects who had a real intention to buy but were stuck in internal inertia — those were the ones who moved. Luna: So it acts as a sort of filter. It separates the serious buyers from the time-wasters. Lucas: Exactly. And this is where the psychology gets even more interesting. Dana told me after that deal that the prospect's champion later confided: 'We needed something to force the issue internally. Your email gave us that.' The rep wasn't just closing a deal — she was giving the champion ammunition to use with procurement. Luna: That's a great point. The price increase email becomes a shared urgency. The champion can say, 'Look, we need to decide now or it costs us 12% more.' That's a lot easier than saying, 'I just want to buy this thing.' Lucas: Right. It depersonalizes the deadline. It's not the rep being pushy. It's a policy change. The company is raising prices. That's an external event, not a sales tactic — even though the rep is the one who chose to surface it. Luna: Let's talk about the risks though. I imagine this works best in certain scenarios. What about long enterprise sales cycles? If you're selling to a Fortune 500 with a 9-month procurement process, a 10-day deadline probably won't fly. Lucas: You're right. This tactic works best in the mid-market, where the decision-maker and the buyer are closer together. For enterprise deals, you'd need to align the price increase with the customer's fiscal calendar or an upcoming renewal. But the principle still holds: create a real, time-bound consequence for inaction. Luna: And the size of the increase matters too. 12% is significant but not absurd. If you said 50%, that would feel like a penalty. Lucas: Exactly. Dana's company did 8% to 15% annually, depending on the product tier. The key is that it's within a believable range. Too high and it feels punitive. Too low and it's not a strong enough motivator. Luna: What about the timing? She gave them 10 days before the increase. Is that the sweet spot? Lucas: The company's data suggested 7 to 14 days worked best. Under a week felt like a fire drill to buyers; over two weeks, the urgency dissipated. Ten days was the most common successful window. And importantly, the rep followed up once, three days before the deadline, with a simple: 'Just a reminder that the current pricing is available through Friday.' No pressure, just a factual note. Luna: That follow-up is key. One email, one reminder. If the rep had called five times, it would have felt desperate. Lucas: Yeah, the tone has to stay neutral. You're not negotiating. You're informing. If the prospect asks for an exception — 'Can you extend the old pricing for us?' — the rep has to hold the line. Dana's company allowed reps to extend the deadline once, but only by a week, and only if the prospect had a genuine blocker like a legal review still pending. Luna: That's smart. It gives a little flexibility without undermining the urgency. Now, I'm thinking about the flip side: has this tactic ever backfired spectacularly? Lucas: There's a story from a different company, a marketing analytics firm. A rep tried this with a prospect who was a personal friend of the CEO. The prospect called the CEO directly, said, 'Your rep is threatening me with a price increase.' The CEO was furious. The rep got written up. Why? Because the price increase wasn't real — the company had no plans to raise prices. The rep fabricated it to create urgency. Luna: Yeah, that's the cardinal sin. Never lie. If the increase isn't real, you're not selling — you're scamming. Lucas: Exactly. And that's why the word 'legitimate' is so important. If your company doesn't have a scheduled increase, don't pretend it does. But there are other legitimate deadlines: contract expirations, promotional pricing ending, product version sunsets. Any real, time-limited event can serve the same psychological function. Luna: I've also seen reps use 'end of quarter' as a deadline, but that feels less legitimate because it's about the rep's quota, not the buyer's interest. Lucas: That's a common mistake. Buyers know when a deadline is about the rep's pipeline versus their own business. A price increase is about the buyer's cost. An end of quarter push is about the rep's commission. They feel different. Luna: Speaking of the buyer's perspective, let's zoom out. What does this tactic say about human nature in B2B sales? That we're more motivated by avoiding loss than by achieving gain. Lucas: It's textbook prospect theory. Daniel Kahneman and Amos Tversky showed that losses hurt about twice as much as equivalent gains feel good. A 12% price increase feels like a loss. A 12% discount? That's a gain, but it's not as motivating. In fact, many buyers interpret a discount as a sign that the vendor was overpricing in the first place. Luna: Right. A discount can actually reduce trust. 'Why are you cutting the price? Is your product not worth what you said?' Lucas: Exactly. With a price increase, you're reinforcing value. You're saying, 'Our product is becoming more valuable, and if you want it at today's price, act now.' That's a more confident signal than a discount. Luna: I want to ask about the champion's role again. In Dana's deal, the champion used the email to push internally. Do you think the tactic works differently depending on whether there's a strong champion? Lucas: Absolutely. If there's no champion, a price increase email might just get ignored or forwarded to procurement with a note saying 'push back on this.' The tactic works best when you already have an internal ally who wants the deal to happen. The price increase gives them a reason to escalate. Luna: So it's not a first-contact tactic. It's a mid-to-late stage lever. Lucas: Right. And it's one of many. There are other legitimate deadlines you can use: product discontinuation, feature sunset, onboarding slot availability. The principle is always: create a real, time-bound consequence for inaction that is about the buyer's interests, not yours. Luna: I think this episode is a good example of how sales isn't about tricks — it's about understanding human psychology and using information honestly. Lucas: And if today's conversation helped you think about a stalled deal in a new way, honestly, if it was worth a coffee to you, that's the link — buy me a coffee dot com slash fexingo. Luna: Yeah, that's a nice way to put it. Listener support is what keeps this show ad-free and focused on stuff that actually works in the field. Lucas: So back to the tactic: the key takeaway is that a price increase isn't a closing technique you deploy arbitrarily. It's a communication strategy that surfaces a real business event in a way that helps the buyer make a decision. Dana didn't trick anyone. She informed them. And that information changed the timeline. Luna: I think a lot of reps are afraid to have that conversation. They worry about upsetting the prospect. But the data suggests that the risk is worth it for deals that are already stalled. Lucas: Exactly. And you can mitigate the risk by being transparent. When the prospect asks, 'Is this a real increase or a sales tactic?', you can honestly say, 'Our company is raising prices on July first. I wanted to make sure you had the chance to lock in the current rate.' If that's true, it's a win-win. Luna: What about the procurement reaction? Often procurement will demand the old pricing anyway, even after the deadline. Lucas: That happens. Dana's company had a policy: they would extend the old pricing for up to 30 days if the prospect signed a non-binding letter of intent. That gave procurement a paper trail and the rep a commitment. If the prospect wasn't willing to do even that, the deal probably wasn't going to close anyway. Luna: So it's not about being rigid. It's about having a framework. Lucas: Right. The framework is: here's a real deadline. Here's what happens if you miss it. If you need a small concession to make it work internally, I can offer this specific bridge. But I can't just extend pricing indefinitely. Luna: I want to close with a question for our listeners: what legitimate deadlines are you not surfacing? Are you sitting on a price increase, a feature retirement, or a capacity limit that could help your stalled deals move? Lucas: That's the right question. Because the tactic isn't about inventing urgency. It's about using the urgency that already exists. Thanks for listening, and if you have a story about a price increase that closed a deal — or backfired — we'd love to hear it. You can find us at buy me a coffee dot com slash fexingo.