Negotiating Tip #18:
Make the Other Side Satisfied
Classical economics tells us that satisfaction comes from getting as good a price as possible. But that is not what modern research shows. In fact, satisfaction comes from the feeling that one got a good deal.
One of our seminar participants and announced, Boy do I need this course – I am the world’s worst negotiator. When asked why she said that, she described how she had made an offer for $400,000 on a house she was looking at that had been listed at $500,000, and the broker immediately accepted it – which made her convinced she could have gotten a better price. She was dissatisfied, even though the house is now worth $600,000.
The broker made a serious mistake by giving in so quickly; he would have made the buyer happier with the deal if he had gone into a back room and doodled for 15 minutes before coming out to say, you drive a hard bargain but the seller reluctantly agreed to accept your offer.
The point of these stories is that satisfaction can be quite different from what an outside observer would expect if only looking at the outcome. The objective outcome is only part of the factors which determine if the other party in a negotiation is going to be satisfied. At least as important is if they think they got a good deal.
We have warned that giving in too quickly can lead the other side to add on extra demands. But even if they don’t, they may still leave the negotiating table thinking that they could have done better. The better advice is to flinch, to hesitate, to object before accepting an offer that is entirely acceptable.