One advertiser has been paying me $*** for six months of advertising on my home page.
I was contacted by another advertiser the other day and sent him the rates. However he asked if I would accept $60.00 less for the same type of ad and time-frame.
What is the best approach?
I know these are tough economic times for many but if I lower the price of the ad is that fair to the first advertiser? Will I be morally obligated to give the lower rate to the first advertiser if they renew?
Of course it's unfair. Offer a quarterly discount if you don't already . . . if someone can't afford the rates, they don't play. I know this, I've gotten back on the porch many times and never asked for special favors. :-)
Or . . . consider, maybe, the "tough economic times" are only making you consider it because you want that sixty bucks. In which case it's back in your court, your call.
Will I be morally obligated to give the lower rate to the first advertiser if they renew?
Morals are about as individual as people, so that's only something you can answer for yourself. In terms of ethics, prices change all the time. The original advertiser paid your going rate way back when he started. Today's market price is apparently different.
I look at it this way- if he renews, he's apparently happy with the ROI he's getting even though he's (unknowingly) paying $60 more than his competitor. If you feel so inclined, you could build some goodwill and give him a slight discount when he renews.