3 negotiating tactics to stop using right now

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“Needs some work”

At the end of each newsletter, we always ask to fill out a quick one-click survey to see how we’re doing with the choices of 1) amazing, 2) it was ok, and 3) needs some work.

Over the past 2 newsletters, I’ve received a few more “needs some work” than I’d like, but no one ever provides any insights on what needs to improve or why.

Since most people love tactics, this week, I decided to explore some tactics related to negotiations to see if they make a difference. 

After reading through this, if you think the newsletter still needs work, I’d really appreciate it if you could take the extra two seconds to write back with some ideas on how you think I could improve it moving forward.

Thanks! 

SALES FROM THE STREETS: PRACTICING NEGOTIATIONS, BUT….

TACTICAL TIPS: STOP DISCOUNTING, GET CREATIVE 

SALES RESOURCES: AI HYPE vs REALITY

SALES FROM THE STREETS 

PRACTICING NEGOTIATIONS, BUT…..

Sales is one of the greatest professions in the world for many reasons.  

One of my favorites is that you can literally practice Sales almost everywhere you go, especially when it comes to negotiations.

I read a story one time of a guy who was super introverted and didn’t think he would ever have the confidence to negotiate anything in his favor.  

To prove him wrong, the coach he was working with told him to ask one simple question every time he bought something - “Do you offer a good guy discount?”  

He went on to explain that if the person he asked seemed confused, he should follow up by saying, “Well, I’m a good guy, and I was just wondering if you had any discounts for people like me.”

So, everywhere he went, he asked for the “good guy discount,” and guess what? In many cases, he either got a discount or had something added to his purchase.

I don’t ask for the good guy discount, but I almost always ask for an upgrade at a hotel or if they have any specials or coupons I’ve missed out on. You can’t get what you don’t ask for, right?

For example, here in the US, if you pay full price for anything at Macy’s, you should be ashamed of yourself.  They have a 1-Day sale 365 days a year. All you have to do is ask for it. 

While I was down in Costa Rica for the past few weeks, I loved “negotiating” with street vendors and artists while looking for local items to decorate our new house with.

BUT….

I wasn’t negotiating for a better price.  

Instead, I was negotiating on the experience, stories, introductions and recommendations.

As someone new to the country, I wanted to know as much about it and its people as possible, not from reading about them on TripAdvisor (no offence to TripAdvisor). I wanted to learn about them from the people who lived there. 

That’s why everything I bought came with a story, a recommendation or an introduction to someone else. 

I learned more about the country and its people during my “negotiations” than I could have ever read in a book and it made the experience so much more valuable for both parties.

This is why it’s so important to reframe negotiations and elevate it from a pure pricing conversation which is what the tactical tips in the next section are all about. 

TACTICAL TIPS 

STOP DISCOUNTING, GET CREATIVE 

First and foremost, to reframe negotiations, I recommend we stop using the word “discount” altogether.  

I’m not saying to stop discounting. I understand that’s an important part of the game.

I’m saying to stop using the word discount

Instead, replace that word with either “creativity” or “flexibility.”

I can be flexible in my negotiations and get creative, but that doesn’t always have to come in the form of a discount.  

Ultimately, it’s all about what’s important to the client.

Think about what was important to me when it came to negotiating with the street vendors and artists in Costa Rica. Even though I’m always looking for the best price, the experience and information were worth far more to me. 

It’s the same thing when it comes to B2B sales and negotiations.

I’m not saying the client necessarily values the sales experience over the value of your solutions, but did they talk about the importance of service or implementation?  If so, maybe you can offer additional implementation services or resources to help train their team.

Did they talk about their growth plans over the next 12-24 months? Maybe you can offer fixed pricing for a period of time or include extra licenses in the package.

We can leverage so many other things when negotiating with a client that we fail to even consider or think are valuable from our perspective since we’re so conditioned to negotiate on price.  

By being creative and flexible, you can reframe the conversation sometimes to focus more on other valuable things than price. 

However, since negotiations on price are inevitable, if we are going to discount, then we need to stop doing these things:

1. STOP proactively discounting 

This is when you offer a discount to a client towards the end of the sales process without them asking.  It’s usually driven by the manager who needs to get that extra deal in the quarter for the team to hit their target so they tell their reps to proactively offer a discount to clients if they sign early.  

I’m sorry. This is one of the most pathetic things we do in Sales, and it needs to stop. By doing this, we go from being a trusted advisor that the client sees value into a quintessential sales rep who is just trying to close a deal.

Also, think about it from the client’s perspective. If you gave me a discount without me even asking, what would happen when I asked?  

2. STOP negotiating with yourself 

This one kills me.  It’s when a rep is asked for the price or to send a proposal, including a discount, without the client asking for one yet.

It doesn’t always come in the form of a specific number but in how it’s presented in many cases. 

For instance, if the price of something is $10,000 when the client asks how much, the answer should be “$10,000.” Then we should shut up and wait for the response from the client to see if they object to it and handle it then.  

But when most sales reps are asked the price, it’s almost never $10,000. It’s almost always something like, “Well, it’s $10,000, but it depends on blah blah blah…..”

Maybe the client was talking to your two biggest competitors, and they heard $20k from one and $15k from another, so when they heard $10k from you, they thought it was a great deal.  But, if you deliver your price the way I outlined above, regardless of how reasonable the price may seem to them, they’re not going to pay full price. You just gave them a discount without them even asking. 

A great example is the scene in the movie War Dogs, where they win the government contract because they are way underbid and don’t even know it. 

3. STOP using round numbers when offering a discount

I can always tell an inexperienced negotiator (and so can clients) when I see a 5,10,15, or 20% discount.

Instead, offer a more “precise” discount like 6.35% or something like that.  

Check out this research study by Harvard Business School that “builds on several previous social psychology studies showing that people place more value on precise numbers than on relatively round numbers. 

People tend to assume, true or not, that someone must have crunched lots of data to come up with an amount so specific.  

I posted about this on LinkedIn a few weeks ago and got some feedback that it was deceptive and that we should just be open with the client. I wholeheartedly disagree (and you can see my reasoning in the comments). 

Not only does offering “precise” discounting make the client think there is some reasoning behind the number, but it also gives you room for additional discounting moving forward if you have to.  

(If you want to learn more about negotiations, feel free to join my membership, where I train on the gives and gets of negotiations in my Driving to Close program)

SALES RESOURCES

AI HYPE vs REALITY

I heard you loud and clear a few newsletters ago when more than a few of you commented that you were sick and tired of all the hype around AI.

I’ve definitely come down from my previous view that it was going to impact everything about Sales overnight.

I still believe that sales reps will not be replaced by AI but by other sales reps who learn to use AI.

That’s why I’m doing a tactical breakdown of real-world, practical applications of AI with my partners at Clay and my good friend and colleague Jen (aka DemandJen) Allen-Knuth on August 29th at 2:00 pm EST. 

We’re selecting 12 of Clay's most staunch advocates ("Clay Experts") to compete live to solve real-life business challenges, from pipe gen to qualification. 

Jen and I will evaluate each of them and judge which workflows can move the needle and which ones are duds that did little more than inflate your SaaS budget.

Join us on the 29th as we have some fun determining what's hype and what’s legit about AI.

Let’s make it happen!

ADDITIONAL WAYS YOU CAN LEVEL UP YOUR SALES GAME 

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• The industry-leading Make it Happen Monday Podcast, where you’ll get insights and inspiration from some of the most interesting and influential people in the world of Sales and business. (this is where you’ll hear the Guy Kawasaki episode on May XYZ)

• The JB Sales YouTube channel has practical tips that you can apply immediately to drive results, interviews, and content that is guaranteed to get you to think differently.