A Negotiation Tip All Salespeople Must Know
To understand it, you must understand the anchoring cognitive bias (see image below).
Negotiation is all about anchoring. It’s the starting point from which a negotiation works up or down.
When buying something, anchor low. When selling something, anchor high.
I was in Morocco a few months ago and negotiating at the local market. My tactic was to start the negotiation by pulling a small amount of Dirhams (local currency) from my pocket. I would say “this is all I have left”, knowing it was a small amount. This gave me an extremely firm anchor of which was ultimately take it or leave it. I ended up buying the same products my friends bought, but for less.
Combine this tactic with expressing you don’t really need the product, there are other similar products available for less. I’d prefer your product, but if I can’t afford it I understand.
It works the same in reverse. I’d love your business, but if you can’t afford our premium product, I understand.
Google it, you’ll learn a lot and become a better negotiator.
Retailers pull this tactic on you all the time. Labeling items $20 for 1, but buy 2 for $10. You think you got a great deal but really you just bought 2 of a $5 product when you only needed 1.