Win-win negotiation is the way to go…except in one situation: when the buyer has their hand in your pocket. Whether they're doing it intentionally or just out of habit, sometimes buyers try to push down seller prices just to see if they can.
When they do, you should counter with value, but you also have to signal as you respond, "That won't work. I know what I'm doing." (Without, by the way, saying it like that.) You need to respond in a way that gets this message across and gets the discussion back on track.
We studied 449 business and procurement buyers. Among the areas we analyzed, we homed in on:
- The negotiation tactics buyers use
- The effectiveness of these tactics
Ninety-three percent of buyers admit to using at least one of the 16 negotiation tactics we studied. In fact, the average number of tactics buyers use in each negotiation is three.
If you’re in sales, that means your buyers are throwing, on average, three tactics at you in each negotiation, most of which are designed to get you to lower your price.
Read: 6 Essential Rules of Sales Negotiation
Following are the five tactics buyers told us were most effective. These are also the basis for our report, The 5 Most Effective Negotiation Tactics Buyers Use on Sellers. Here, we share are the tactics, what they sound like when buyers use them, and why they work.
The 5 Most Effective Buyer Negotiation Tactics
- "I just need you to change this one thing and then I will sign it."
- Tactic name: One Last Thing
- Effectiveness: 85% of buyers find it effective
- Description: At the very end of a negotiation, the buyer asks for one final concession to get the job done.
- Why it works: Sellers are eager to close the deal. They've come this far and are willing to give a final concession in exchange for the signature.
- "Your price is too high. Is that the best you can do?"
- Tactic name: Whack Back
- Effectiveness: 83% of buyers find it effective
- Description: Some buyers are programmed to always say "we need a better price." Regardless of the circumstance, they ask for a price concession.
- Why it works: Because it works! Many sellers give in to pure price concessions. You never know if you don’t ask. Plenty of buyers ask, and when they do, 83% find it effective.
- "Let's meet in the middle."
- Tactic name: Split the Difference
- Effectiveness: 79% of buyers find it effective
- Description: When countering offers, buyers will often suggest "just meeting in the middle." However, the middle isn't inherently fair—it may be bad for you and good for them.
- Why it works: Sellers want to be seen as reasonable. They want to create a partnership. When buyers say, "Why don’t we meet in the middle?” there's an emotional appeal of showing good faith by splitting the difference.
- “Our budget for this is…”
- Tactic name: Anchoring
- Effectiveness: 76% of buyers find it effective
- Description: When a buyer shares a low budget up front to set the stage for bargaining to start at a low price.
- Why it works: Academic and other research supports that whomever makes the first offer is usually more effective in the negotiation. It's called a cognitive bias. When making a decision, people strongly favor the first piece of information they receive. In this case, if a low anchor is set by the buyer, sellers come in with lower estimates. The opposite is true as well: when sellers set a higher price anchor, agreements tend to be higher.
Read: Who Should Make the First Offer in a Negotiation
- "I'm speaking to your competitor this afternoon and I'm confident they'll go for this."
- Tactic name: Closing Window and Going, Going, Gone
- Effectiveness: 75% of buyers find it effective
- Description: These are time pressure tactics.
- Why they work: Urgency and scarcity are the drivers here. Buyers know if they limit your time for negotiating, you're rushing and possibly willing to make bigger concessions. There's also fear of loss when buyers present an offer within a tight timeframe because you don’t want to miss out.
While there are a host of other tactics buyers use, these are the most effective according to buyers themselves. If you're a seller, don't fall victim to these tactics. Be aware and ready to respond. We provide many sales negotiation tips, including how to respond to these specific tactics, here on our blog.