Why Lawyers Need To Understand The Art of Price Conditioning

Jeff Berman
July 27, 2010

DollarsI would venture to guess that the majority of attorneys out there aren't trying to sell their services based on price.  Your goal shouldn't be to offer the cheapest services in town for a number of good reasons.  However, an issue lawyers face is that most people don't have a good sense of what quality legal services cost.  This can lead to sticker shock and lost clients when you discuss your fees with prospects.  For this reason, lawyers need to understand the art of price conditioning.

So what exactly is price conditioning?

Price Conditioning: A Study In Psychology

Dan Ariely at the Irrationally Yours Blog shares with us an interesting psychology experiment:

To get some insight into this process, consider the following experiment:  We asked a large number of people to write the last two digits of their Social Security number at the top of a page, and then asked them to translate their number into dollars (79 became $79), and to indicate if in general they’d buy various bottles of wine and computer accessories for that much money. Then we moved to the main part of the experiment and we let them actually bid on the products in an auction.  After we found the highest bidders, took their money and gave them the products we calculated the relationship between their two digits and how much they were willing to pay for these products.

Lo and behold, what we found is that people who had lower ending Social Security numbers (for example 32), ended up paying much less than people who had higher ending Social Security numbers (for example 79).  This is basically the power of our first decisions: if people first consider a low price decision (would I pay $32 for this bottle of 1998 Cote du Rhone?) they end up only willing to pay a low amount for it, but if they first consider a high price decision (would I pay $79 for this bottle of 1998 Cote du Rhone?) they end up willing to pay a lot more.

Price conditioning is the art of changing the perception of your service pricing.  When you first talk to many of your prospective clients, they have a certain price expectation in mind.  What  price conditioning can do is to raise the expectations of your service pricing to the point where, when you reveal your price, it’s not as much as they expected or at the very least, it’s less of a shock.

How You Might Implement Price Conditioning

Price conditioning involves forshadowing what the potential client might expect a legal service like yours to cost without addressing your pricing specifically.  For instance, in a conversation with a prospective client you might mention

"Experienced firms can charge upwards of (fill in the blank with a top end price that is more than you charge) for what you need."

You should also discuss the advantages of hiring your firm while making sure to mention you aren't the cheapest out there nor are you trying to be.  Use your service pricing to your advantage to build value.  Quality work and expertise takes time and effort.  If you sacrifice price, you do so at the cost of the quality of the service you receive.  Of course these points need to be addressed in the conversation prior to a discussion of your fees.

The point is to lay the groundwork that legal services aren't cheap and your legal services certainly aren't on the low end.  Elegantly working this into conversation, while building the value of your service at the same time, helps to reset the expectations of what your legal services will cost.  More importantly, it will help to avoid sticker shock, and might even provide relief, when you do discuss pricing.

Photo by Surat Lozowick

Jeff Berman
Jeff Berman, is co-founder of AttorneySync. "Properly marketing a law firm online is about producing relevant content that helps a prospective client understand your expertise and how you are able to help them. Finally, it’s about getting that content found by the people you are trying to help."
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Steve Williams
13 years ago

This is really good advice, let the client see the value before revealing the price.
I also ask clients how much income they will lose if they are banned from driving for 6 months, this sets a benchmark as to the value.
Thanks again for this.

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