Negotiation Lessons I Learned From My Dog

My dog Buster is a natural negotiator. He loves lying on my bed, but knows he’s not allowed. When he jumps onto the bed to join me, I firmly tell him to get down. He obeys, makes a u-turn, then comes back and puts only the upper part of his body on the bed. He gives me a wet lick for good measure.

“Fine,” I say, “but stay there.”

Buster is happy. 
 
Unbeknownst to him, Buster is employing two very powerful psychological principles: reciprocity and anchoring.

Reciprocity

The reciprocity principle states that people have a built-in need to reciprocate concessions given to them. In one study psychologist Robert Cialdini had his team disguise as workers from a county juvenile detention center and approached people in the street asking, “Would you be willing to chaperone a group juvenile delinquents on a day trip to the zoo.”

Only 17% agreed.

Next, the researchers tried something counterintuitive. They again randomly stopped people in the street, but instead of reducing their original request, they increased it: “Would you be willing to serve as a counselor at the juvenile detention center? This requires two hours of your time each week for three years.” Not surprisingly, they got 100 percent rejection. But, after each initial request, they quickly followed up with: “Well, if you can’t do that, would you be willing to chaperone a group of juvenile delinquents on a day trip to the zoo?”

This time 50% agreed.

As this experiment showed, when the chaperone request was preceded by an extreme request, three times as many people said yes. What is happening here? By moderating their request, by seemingly making a concession, the researchers were activating the other side’s need to reciprocate. Thus, when buster agrees to put half his body on the bed, I feel like he already made a concession to me. I thereby meet him half way.

Lesson from Buster: Sometimes in order to get a “yes”, you need to start with a “no!” Begin a negotiation by deliberately getting rejected and then modify your claim to seem reasonable.

Anchoring

Anchoring is the second technique employed by Buster. Anchoring is a cognitive bias in which exposure to an initial number scrambles your ability to properly asses the value of what is being negotiated. Think of sticker prices in a car dealership. Dealers know that you are not going to accept their opening offer, but they also know that you are going to be pulled by the presence of the anchor.

Another instance of anchoring is seen with the food delivery service Seamless. The company has recently started defaulting to a 20 percent tip on orders. People can manually change the amount, but the first number they are exposed to is now higher than it used to be. Is Seamless experimenting with anchoring?

Fortunately, we don’t have to wait to find out the results, as many experiments have already demonstrated the impact of anchoring. My favorite example comes from the work of Dan Ariely, George Loewenstein, and Drazen Prelec, who conducted a creative experiment on their MIT students back in 2006. 
 
The professors showed their students six items (bottle of wine, wireless keyboard, box of chocolate, etc.) that they were planning to auction off. They then asked their students to bid on each item. But, before they could do that, they had to jot down the last two digits of their social security number and answer whether they would pay that amount in dollars for each of the items. Once they answered, each could place their actual maximum bid.
 
Ariely and company were trying to asses if the mere exposure to something as arbitrary as a social security number could impact the amount each student was willing to bid. The results were striking. Students with social security numbers in the top 20 percent bid between 216 to 346 percent higher than those with numbers in the lowest 20 percent.

In our own negotiation workshops with LifeLabs Learning, we have replicated this study to find very similar results.

Lesson from Buster: Conventional wisdom be damned: If you have enough information about the issue under negotiation go first and anchor your negotiating partner.

Tips to avoid being “Buster-ed”

But what if you are on the wrong end of this tactic? As negotiators how can we protect ourselves? Here are a few tips to keep in mind:

1. Be Aware: make sure you are mindful of the impact of these psychological principles and techniques. Before a negotiation, remind yourself that you are — by virtue of being human — susceptible to them.

2. Do your homework: Prepare by having knowledge about the market value of whatever it is you are negotiating over. Once you do that, create a bargaining range consisting of your walkaway point, goal, and opening offer. That way you can counter-anchor the first offer by referencing your own range. Knowing the market will also give you useful information with respect to your partner’s alternatives and range.

3. Write it down: Research has shown that you’re much more likely to stick to your goals if you write them down and share them with others who can hold you accountable. Knowing that you shared this information with your team can help you keep from being influenced by a strong anchor.

So next time Buster is going to jump on the bed, I will be ready. But then again, who can resist that face?

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