Basic Negotiation and Persuasion Strategies
What are negotiation and persuasion?
Negotiation is a discussion between two or more parties with different needs and goals to seek a mutually acceptable solution. In the business context, negotiations may occur during informal day-to-day interactions, such as face-to-face conversations or via instant messaging apps and phone calls, or formal transactions where conditions of sale, lease, service delivery, and other legal contracts are being discussed.
Persuasion is influencing or convincing people to change their point of view or to agree to commit or purchase a product or service.
Why are they important?
Developing good negotiation strategies may help build better relationships with external parties, deliver lasting and quality solutions that satisfy the needs of all parties involved, and help to avoid future problems and conflicts.
Good persuasion strategies are essential as many facets of business involve persuading others, swaying their opinions and changing preconceived notions, particularly in sales and marketing. Effective persuasion strategies can convince customers that your products and services are better than your competitors’ and motivate them to buy from you instead.
Strategies for negotiating
Here are five effective negotiation tactics to achieve an equitable outcome.
1. Set concrete goals
Successful negotiation requires a clear set of goals. Define the specific and realistic goals and desired business outcomes clearly. Share them with the team to ensure everyone is on the same page.
2. Identify the Best Alternative to a Negotiated Agreement (BATNA)
BATNA refers to the best option and best possible outcome if the negotiation falls through. Identify the benchmark to compare the other party’s offer with the best you could get if you walked away.
3. Work toward a win-win situation
The best negotiation is about structuring a win-win scenario for both parties. Be prepared to make concessions on negotiable items to gain trust while protecting your non-negotiable terms.
4. Listen attentively
Listen actively and attentively to what the other party wants and respond using the mirroring technique – repeating keywords they have used to show that you are paying attention and treating their views with close consideration.
5. Build rapport and learn more about the other person
Learning about the other parties is key to negotiating effectively. Developing a rapport opens the door for open dialogue and effective communication and fosters mutual trust. You can establish rapport through shared interests and experiences. Do your research and find out who they are and their strengths and weaknesses.
Strategies for persuasion
Here are three persuasion tactics that you can use.
1. Focus on problem-solving
Listen to the other party and learn more about their needs and challenges. Give priority to their concerns and demonstrate how you can provide viable solutions to their problems and fulfil their needs.
2. Provide social proof
Leveraging social proof can be an effective persuasion tactic. Social proof is evidence that customers have found value in the product or service they have purchased. Provide testimonies and share success stories of previous customers.
3. Do not rush the process
While creating a slight sense of urgency can be an effective tactic, do not rush the process and avoid pressurising your client or customer to close the deal. Effective persuasion should feel natural for the other person.
Business Queensland. “Negotiating Successfully.” Last updated 27 May 2020, https://www.business.qld.gov.au/running-business/marketing-sales/managing-relationships/negotiating
Forbes. “How To Be More Persuasive In Business: Seven Unique Approaches.” Published 5 May 2021, https://www.forbes.com/sites/yec/2021/05/05/how-to-be-more-persuasive-in-business-seven-unique-approaches/
Forbes. “14 Expert Tips for Business Negotiations.” Published 13 October 2020, https://www.forbes.com/sites/forbesbusinesscouncil/2020/10/13/14-expert-tips-for-business-negotiations/