Each week I focus on topics directly related to creating great sales copy. But as small business owners, one thing we all do regularly is negotiate. Whether potential customers are negotiating with us on the price of our product or service or we’re the ones looking to make a purchase, chief negotiator is just one of the many hats we wear. So while negotiating doesn’t directly relate to creating great sales copy, it does require knowledge of who you’re dealing with (the ideal customer) and an understanding of the problem they want to solve (internal pain point.) 

 Raise your hand if you LOVE to negotiate??? I’m guessing for most of you, it’s a hard no. Why do so many people loathe negotiating? Because it often feels like a conflict, and that is something people generally want to avoid. And the outcome can feel unbalanced with one person “winning” and the other person “losing.” But successful negotiations can result in a win-win for both sides. I’ve learned lots of negotiating tips throughout my sales career, but the art of anchoring is one of the most intriguing concepts and one I love to share!

 Believe it or not, I’m one of those people that LOVES shopping for a new car. More specifically, I love the entire negotiation process! It’s always an awesome opportunity to sharpen my skills with trained salespeople who do it all day, every day. One of the keys to any successful negotiation is to take emotion out of it, which is easy with cars. There’s always another dealer to visit, and most likely, there’s another car you also like and would consider purchasing.

 A couple of years ago, I was invited to speak to a team of account managers for a large global travel management company. Waiting for my turn, I had the opportunity to listen to one of their leaders present, which is always valuable when you can hear what they’re telling their team members. First, they talked about their new pricing strategy, which led to a discussion about negotiating. Next, the leader presented a fascinating YouTube video discussing the concept of price anchoring. I’ve watched it at least two dozen times since and have played it for countless colleagues and clients.

The premise of price anchoring is simple – the first person who puts a number out there sets the bar for all future offers. Subsequent offers may be higher or lower, but they all revolve around the initial number. So, when given a chance, you always want to make the first offer.

 Some experts disagree and suggest letting the other party make the first offer. This allows you to understand what’s most important to them based on what their offer focuses on and provides insight into what it will take to close the deal. It also allows you to understand the price range they’re willing to consider. All valid points, but when YOU make the first offer, YOU anchor the price, and all subsequent offers are based on where you started. And when price is the primary concern, this is considered significantly more valuable and a strategic advantage.

Learning from the Experts

Dr. John Lowry is a recognized authority on negotiating through his experience as a lawyer, business consultant, negotiation coach, and university administrator. He’s made it is his business and teaches leaders how to become master negotiators. He teaches a negotiation course that emphasizes six points that will help any negotiator sharpen their skills. If you, like so many business owners, dread negotiating, it’s worth your time to listen to some of the many podcasts featuring John Lowry, where he discusses the six pillars of a successful negotiation.  

You don’t need to be a born negotiator. These are skills that can be learned and then honed through practice. Likewise, negotiating doesn’t have to be an area of your business that you dread but instead with a bit of insight, one that you approach strategically. And perhaps, you may even find a little enjoyment the next time you go car shopping.