What is it?A low ball is a negotiation strategy that targets a quick agreement based on an irresistible offer. Additional conditions are placed on the offer after agreement has been confirmed.
Why Does it Work?Make an offer that your customer can't refuse.
Make it clear that the customer has agreed (e.g. by shaking hands). Then change the agreement to what you want. The customer may complain but it often works nonetheless.
Example: Low Ball
A shoe salesperson offers a customer brand name shoes for $50. The customer jumps at the offer because the shoes are regularly $400. The customer and salesperson shake hands to seal the deal. Then the salesperson adds — you just need to buy two pairs at regular price.
The customer complains but feels bound by the agreement and buys 3 pairs of shoes.
Is it Ethical?When you have to ask if something is ethical ... the answer is often no.
A low ball is a little shady at the best of times. It involves an initial misrepresentation of an agreement. However, it's important to keep in mind that negotiations can be adversarial in nature.
In some cases a low ball is relatively harmless.
Example: Relatively Harmless Low Ball
A university asked students to volunteer for a study. They tried two approaches:
1. Making it clear up front that the study was the next morning at 7 AM (24% agreed to volunteer).
2. Getting agreement first, then telling the students the time was 7 AM (56% agreed to volunteer and 95% keep the agreement after discovering the time).
In this example, a low ball is really just the natural sales tendency not to highlight negative information.