I've thought a lot about how far to bend to customers demands the past few weeks as I've been working on a fairly large project geared toward companies that are used to influencing product design and direction. In enterprise sales, when the Vice President of Marketing at a company ready to pay a few million dollars says, "Can I check my data from your website while I'm on my jet?" what are you supposed to say? Sure, we could rig some complex system to download the data for him, but that's a terrible use of our time.
On the other end of the spectrum is Apple's dealings with consumers. Apple very rarely does things people ask for-- I wish I had a card reader on my MacBook Pro, for example, but I don't. They're geniuses at distilling the most useful things that most people will use and then developing them to absurd levels of perfection beyond what the rest of the industry is used to.
I'd much rather build a product with a few amazingly awesome features that help a wide number of people than one with tons of OK features (including the ability for one person to view reports on their private airplane!).
Both of these ends of the spectrum can be argued for putting the customer's interest first.
(sorry for the digression)
I have to agree on the interpretation problem here. But, I think an important thing to learn in business is that sometimes lowering your price is bad for your customers. You may have more of them because of a price drop...but you'll almost certainly serve them less effectively. It took me way too many years to learn this simple fact (and Joel Spolsky hadn't yet written his very good article on the subject when I was learning it).
No, but how about... "No, we are not a major corporation with millions of customers. This has many effects on how we'll do business with you. For one, it allows us to provide you with the kind of attention and customer service unmatched by our competitors. As one of our first customers, you have a strong influence on how our product lines evolve, what features we implement, and what bugs we fix first. We can also offer you {special service program}, something we will only offer our first {100} customers, to help us evolve our software to address all of your needs. Being a fresh competitor in {this market} also holds our product to a significantly higher standard - the purchases you make from us can't be justified as the 'market default', and so we have to compete on features and quality, such as {specific features and examples of better quality}."
But I'm just a programmer, not a good business person; I'm sure a good business person can make it sound much better.
The opposite of "telling lies" is not "emphasizing your weaknesses" (besides they might not even be weaknesses).
Corollary: Careful with the shades of brown.
A good personal moral compass in such situations is whatever helps you sleep soundly at night. Life is rarely black or white, more shades of grey (can't remember where I read that).
Curious to know, what would you have said in the same situation, would you have said we have 2 customers, one office, couple of customers, you would be third if we are lucky and hey guess what you are going to beta test our product.
Also, think about the second order effects of this deal not going through. Can you company make payroll without it? Is this deal the break your company has been looking for?
I did technical sales for 3 years, first real job right after school, the 2 things that really helped me sell were:
1. Tell the truth and
2. Put your customers interest before your company's
Good luck!