Now that seemed like a reasonable question to him, but it produced a reaction from his mother that he didn’t understand. Each time she explained to him that it’s not polite to ask for a present. But as soon as someone else showed up, he got excited and asked again. He could not help himself.

In the process of growing up most of us were taught that it is not polite to ask for some of the things we want. Later in life, we are told that we have to ask or we won’t receive. The problem really grows when we try to decide how much we should ask for. How do we know what to do?

Many sales people started with the “Foot in the Door” lesson. They were told that it is easier to open a new account with a small order and then try to grow the business. Those who also started with a very low price found out how difficult it was to significantly increase their price. Where should we start?

There are three fundamentals to guide us in deciding how much to ask for.

The Law of Reciprocity

This law says that most people will feel obliged to you if you do something for them. The gift doesn’t have to be large to produce an obligation. It is also a part of this law that people don’t want to refuse your gift because this might offend you. So, they accept your gift and then courtesy requires them to pay you back. This unconscious behaviour comes from our early training and we may not even be aware of its influence. But marketers know that offers accompanied by a gift produce better results. Charities are regular users of this approach and corporate entertainment does create loyalty.

Rejection-then-Retreat Tactic

The RTR approach is based on asking for more that we want and then settling for less. It can be as simple as asking for a higher price when selling our home and then appearing to reduce our expectations when a buyer offers us less. Children will ask for things they know they cannot have to increase the chance of getting what they do want. And sales people have routinely asked people who refused to buy for referrals to their friends. In effect, they are giving them their friends’ names in exchange for letting them off the hook. The surprise here for most people is that after using the
RTR tactic purchasers display more loyalty than the buyers who actually accepted the first offer. It is as if adjusting your initial offer creates a sense of reciprocity, an obligation, for the other party.

Contrast Principle

This principle simply says that if we mention another number early in our conversation, it will serve to make our subsequent number more attractive when we say it. For instance after buying a suit, the price of a shirt or tie seems less than if we had looked at them first.

A homebuyer will mention a lower number first to make their offer look bigger, by comparison. Of course, the home seller will use a larger number first to make their
asking price look more attractive to the buyer. Many negotiators better know this approach as using an ‘anchor’.

A University professor demonstrates the power of this principle by asking his class to start a negotiation exercise with the last three digits of their phone number. All the students understood that this number is random but it does change their perception of the numbers used in the rest of the exercise. Students starting with high phone numbers behaved differently to those with lower ones and produce a much higher result. Their phone number served as a contrast to later numbers, changed their perception, and their results followed.

Where should we start; do we ask for a lot or a little?
If we want to use the power of these principals, we should ask for more than we expect. Our starting point should be at the upper limits of what is reasonable. When we are willing to concede a bit, we will earn the good will of reciprocity by accepting rejection and retreating from our initial request. Our initial expectations will also act as a contrast (or anchor) to our adjusted figures. But if we ask for less in the first place, we not only guarantee less for ourselves, we also miss the opportunity to earn their goodwill and loyalty by letting the other side feel good. In short, everyone loses.

So how does this tieback to my godson? What mothers sometimes forget is that godparents, grandparents, friends and neighbours do enjoy being asked.

MICHAEL SCHOETTLER

Michael Schoettler is a professional speaker and educator who helps people to use negotiation and sales skills to build profitable relationships. With a MBA in International Management and over 25 years in Sales, he has the power to
move audiences to action.

For program details or more articles, contact Mike on:

Phone: 02 9529 7051 / fax: 02 9529 7525
Email: mike@salessense.com.au
Website: www.salessense.com.au