Ask what changed, then trade scope, term or payment timing for price, and never offer the cheaper plan first. For an increase, lead with results and existing needs, anchor it and reward early renewal.
The renewal is due, and the customer's first message is that they need to pay less. Or you need them to pay more, and you are dreading the call.
When they ask to pay less, find out what changed before you touch the price: a budget cut, fewer users, a new finance lead, a competitor's quote. Then trade. Less money for less scope, a longer term, or earlier payment, never a discount for nothing. And never offer the cheaper plan first. Suggesting it unprompted invites the customer to reconsider the whole purchase, not just the plan.
When you need them to pay more, do not provoke. Show the results they have had, remind them why they chose you, put the increase in terms of new capabilities that solve problems they already have, and then offer a smaller increase if they renew by a date.
The price-increase message Corporate Visions tested, written up by Tim Riesterer and Nick Lee of Warwick Business School in April 2017. Four steps: document the results so far, reinforce the reasons people stick with what they have, introduce new capabilities that solve existing needs rather than new ones, and anchor the increase high before offering a loyalty discount. In the winning version, the supplier announced an 8% increase and then offered to cut it by half, to 4%, if the customer renewed before the end of the month. Corporate Visions sells the messaging training.
The vendor's price-increase experiment. In the same study, 503 people imagined running a small business whose two-year contract with a health and wellness supplier was coming up for renewal, and read one of six messages about a price increase. The message that opened with a problem they had not considered did worst. Compared with the winning message, it left people 18.8% less favourable towards the message, 15.5% less likely to renew and 16.3% more likely to switch. The results are from the vendor's own online simulation.
The request is getting more common. Gong's trend data, from 33.5 million deals at 3,398 companies since February 2024, shows the share of deals where a buyer mentions cutting a budget they had already disclosed up by 41%, and deals that call out a discount from list price up by 41% too. Gong sells the software that tracks these mentions, and gives only the rise, not how common they are.
Offering the cheaper plan made more customers leave. Eva Ascarza, Raghuram Iyengar and Martin Schleicher ran a large field experiment with a phone company, published in 2016. Some customers were encouraged to switch to the plan that would cost them least. In the three months after, 10% of them left, against 6% of customers who got no recommendation. The authors found two reasons: the nudge broke customers' habit of staying put, and it reminded them how little they had used the service.
The price-increase evidence is one online simulation run by the vendor that sells the training, and the plan-recommendation experiment is about consumers on phone plans, not a business renewal. Nobody has tested trading scope for price against simply discounting in real renewals.
When a customer asks to pay less, ask what changed, then trade scope, term or payment timing for price, and never suggest the cheaper plan first. When you raise prices, lead with results and existing needs, anchor the increase and reward an early renewal. In the one field experiment, volunteering a cheaper option raised the share of customers who left from 6% to 10%.