Negotiating the holidays: Five common negotiations in a magical time of year

With the holidays fully upon us, I thought it might be useful to recap some negotiations you’re likely to face amidst the festivities—along with some research-based suggestions for making them negotiable. I’m pretty sure you’ll face at least one of the following negotiations over the next few weeks:

  1. Deciding where to spend the holidays. Many of us will have a robust discussion with our better halves as to where to spend the holidays—and for how long. For some suggestions on avoiding a less-than-festive meltdown in the process, you might want to review this post.
  2. Dealing with annoying seatmates. Many of us will encounter fellow holiday fliers who…how shall we put this…have a slightly different take on in-flight decorum. For some suggestions on keeping the skies friendly, check out this post.
  3. Finding time for family. Many of us will need to physically pry ourselves away from our desks to spend the desired time with family and friends. For some tips on negotiating a reasonable work-life balance when it’s needed most, you might want to review this post.
  4. Counteracting predatory retailers. When purchasing our presents, many of us will encounter amazing deals. Others will encounter “amazing” deals—deals that retailers would love for you to misinterpret as such. To recognize and counteract a particularly pernicious version of this trap, consider the following post and paper.
  5. Giving appropriate and reacting appropriately to gifts. It’s the season of giving and receiving, but many people struggle to devise the appropriate gift or react appropriately when they receive the annual fruitcake. So consider reviewing the following posts on giving and receiving for some insights from the negotiations literature.

And now, here’s ho-ho-hoping your holiday becomes a bit more negotiable.

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False anchors: Don’t get sunk this holiday season

This holiday season, retailers seem particularly eager to make their lives more negotiable by selling you on their wares. So now is probably an appropriate time to alert you to one of the oldest negotiation tactics in the book and—in so doing—help to make your own life more negotiable.

Several of my early posts discussed the power of the first offer: in brief, they described negotiation research revealing that the party who makes the initial offer in a negotiation often performs better, particularly when that offer reflects a realistic but aggressive goal. So if you’re selling a used car and consider 12K both possible and hopeful, then making the first offer and making it 12 or even 13 is probably a worthwhile idea. And the underlying reason is anchoring: whoever issues a number anchors both parties’ attention on that number rather than letting it stray elsewhere.

This tactic is known all-too-well to retailers, who would like nothing more than to interest you in their products and then anchor you on their desired price shortly thereafter. But most retailers are far too sophisticated to think they can just quote you an exceptionally high price. They know that your many possible alternatives are just a few clicks away. Instead, they realize they have to be much more subtle in their anchoring. Any guess on their preferred tactic for doing so?

Well, it would take about 20 posts to list all of their tactics, but a particularly common and pernicious one is this: they mention a very high number and label it something like the “retail price” or even the “competitor’s price.” Whether it is, is not the issue. The issue is the fact that you’re now anchored on a very high number. And you’re still anchored on that number when, moments later, they state a much lower price and label in their amazing sales price. “This 65” HD 2160p curved TV normally retails for $3000. But today only, you can nab it for an amazing sales price of $1800!”

Now, all of us, seeing the sales price, are tempted to think “Wow! Fantastic! What a deal!” In fact, the sales price is all-too-often nothing more than the price the retailer really wants you to pay. But by anchoring you on the exceptionally high number and immediately drawing a contrast to their much lower (albeit still aspirational) number, they make you and I and everyone else think we’re getting a fantastic deal.

Now, I don’t mean to imply that all retailers are pernicious or unscrupulous, nor that all of us always fall for this tactic. But I do think that most of us, reflecting on this tactic, would admit to ourselves that we’ve fallen for it more often than we realized at the time or would like to tell the rest of the world now.

So what can you do to combat this tactic? Your best hope is to spend a bit more time perusing at least a few more websites in search of comparative data. Is this really such an amazing deal or is it just the going rate? In addition to competitors’ websites, I’d also include the manufacturer’s website, Amazon, and a few independent websites like Consumer Reports as applicable. If that sounds like a bunch of holiday time spent surfing, well, it is. But at least for a consequential and costly purchase, I’d argue that avoiding the allure of the anchor is well worth the time.

Have you ever fallen for this tactic and then realized after the fact?

Giving gifts as an analogy for mastering negotiations

The holiday season seems like an appropriate time to tackle the topic of gift-giving. A little reflection suggests that there are two types of gift-givers:

  1. “Recipient-focused” gift-givers think about what their recipients really like and try to give them that, even if they themselves find it boring. For example: the guy who gives his girlfriend a spa trip even though there is no place on planet earth that he would rather avoid more.
  2. “Self-focused” gift-givers think about what they themselves really like and make that their present, under the assumption that the recipient will like it too. For example: the guy who gives his girlfriend some NASCAR tickets on the assumption she couldn’t possibly find the race anything less than exhilarating.

Which approach is better?

Well, the first is probably more thoughtful, in that it actively takes the recipient’s preferences into account. But it’s also a lot harder, in that the gift-giver has to truly understand those preferences and might just get them wrong. In contrast, the second approach is easy, requiring only that the gift-giver understand themself. Still, it’s always possible that this someone else will be less than enthralled with the wave of the checkered flag. On balance, I’d say the first is the safer route to holiday happiness.

And to negotiation prowess. Beyond their holiday relevance, I raise these examples because they offer a useful analogy for negotiations.

Negotiators, like gift-givers, can seek to understand their counterparts’ preferences, making no assumption that those preferences resemble their own. “The most important thing for me is a low price on this sofa,” a negotiator might think, “But let me try to understand the salesperson’s priorities on their own terms.” Or they can start from their own preferences, assuming that their counterparts definitely see the world the same way. “Low price is the key for me, so high price must be the key for the salesperson.”

As in the case of gift-giving, the first approach is harder: the conversation with the salesperson is going to be a lot longer and more complicated than a simple exchange of prices. But it’s also much more likely to produce an ideal outcome. Why? Because differences and diversity abound in this world, so our negotiation counterparts often value things that we consider relatively unimportant if not trivial—and vice-versa. Yes, the salesperson would probably prefer a high price, but isn’t at least conceivable that she might be more concerned about your willingness to buy an entire living room set (with each piece discounted)? Or your willingness to accept the store’s financing plan? I’d say it’s at least conceivable.

So here’s the point: If we apply the second gift-giving approach to negotiations, assuming our counterparts think about the world the exact same way that we do, we stand to miss out on the major reason for negotiating in the first place: capitalizing on different value systems to make ourselves and our counterparts reasonably happy at the same time.

In sum, when you spot one gift-giving approach or the other this holiday season, please don’t think about negotiations. Please savor the moment. But if your brain needs something to do after said savoring, consider asking yourself which mode of gift-giving describes your own negotiation style—and whether that’s the style you want to carry into 2017.

Gratitude: Or when not to negotiate

My posts often talk about getting more of what you want. That is by design, as some basic negotiation skills can often help you get more and give more at the same time. Who wouldn’t do that if they could?

Yet, the holidays—and especially their gift-giving traditions—offer an opportunity to make the opposite point: that getting more is not always the goal. Indeed, life’s only negotiable when we can at least sometimes suspend our desire for more and be thankful for the people around us.

But when should we do that? This post will offer five questions that—answered in the affirmative—suggest it’s time to at least momentarily supplant desire with gratitude. Beyond the holidays, they offer some clues about other situations in which negotiation’s not your best option:

  • Are they obviously trying to benefit you? It’s true: those 48 Snoopy socks were not atop your Christmas list. But did your sister buy them thinking you’d love them? Or did she just have an expiring Kohl’s coupon? If the former, it’s probably a good time to be thankful.
  • Is it about the process or the outcome? Gift-giving is one of many life situations when the outcome is less important than the process—or at least should be. As another such situation, I’d venture that few of us throw our toddler a birthday party in hopes of excellent hospice care. If you’re in a situation when everyone’s focus is the activity or human interaction itself, it’s probably a good time to be thankful.
  • Have you already achieved your primary objective? What’s your primary objective for the holiday season? For many people, it’s to be surrounded by a happy and healthy family. The temptation, having read posts like mine, is to negotiate everything just because. In fact, when you’ve already achieved your most important objectives, it’s probably a good time to be thankful.
  • Would the costs of initiating a negotiation outweigh the benefits? Go back to the Snoopy socks. True, you could probably get a better present next year by, for example, laughing and demanding an Xbox next time. But would the Xbox outweigh the strained relationship? If not, it’s probably a good time to be thankful.
  • Are you the only one dissatisfied? Suppose the whole family got the Snoopy socks. Is everyone else trying them on and enjoying the (awkward) moment while you’re brooding over the expected Xbox? If so, it’s probably a good time to be thankful.

So the point is this: If you can find an opportunity to get more and give more this holiday season, by all means do it. But if you find that the effort to get more is actually giving you and everyone else less, gratitude is probably the better option.

I’m outta here! Five questions to ask before walking away from a negotiation

In September, I tackled the thorny problem of where to spend the holidays. Briefly, I suggested that fighting with your spouse about which family to visit (a distributive strategy) is less productive than figuring out a way to satisfy both of you (an integrative strategy).

Well, suppose you gave my suggestion a try—you offered to spend Christmas with your spouse’s family in San Francisco if she’d spend Easter in Chicago with yours—but she wasn’t too interested. If only she’d read these incredibly useful posts! Regardless, you’re now thinking of defaulting to what I originally called a “50/50 person split”: you spend Christmas in Chicago, while she heads to San Francisco. In effect, you’re considering walking away from this particular bargaining table. And the tenor surrounding your dinner table is starting to reflect it.

The impending holiday impasse is unpleasant, but still negotiable! In this post, I’ll discuss five simple questions to ask yourself before giving up on this or any negotiation. Though they won’t necessarily prevent you from giving up, they’ll at least help to ensure that impasse is the best option. So here go the questions:

  1. Have I asked why? In other words, have you explored the reasons behind her preferences? Why did she flat-out decline your offer to split the holidays? If you asked, she might tell you that her brother will visit San Francisco for Easter but not Christmas, which opens up the possibility of making her happy by reversing the order of the cities in your offer.
  2. Have I said why? In other words, have you communicated the reasons behind your preferences? Perhaps your mother is having an operation around Easter, and you really need to be in Chicago to help her. If you said so, perhaps your spouse would realize that your collective Easter plans are much more important to you than her, especially since her brother’s visiting both of you later this year.
  3. Am I angry? In other words, is emotion propelling you toward an impasse? Few decisions are best made angry, and negotiation decisions are no exception. If you’re angry, I’d suggest ratification as a means of justifying a short break.
  4. Do we have to decide now? Even better than a short break is an extended break in which both parties ponder their options. No, you can’t wait too long in the face of rising airfares, nor is procrastination generally a great strategy. But in the face of an impending impasse, it’s usually worth the wait in order to collect your thoughts.
  5. Is the alternative really better? In other words, is the 50/50 person split (your BATNA) really preferable to the worst deal you could reach with your spouse? Suppose she’s still insisting on both of you spending both holidays in San Francisco. While that makes you angry, is it worse than spending Christmas (and probably Easter too) apart? Perhaps so, and then an impasse is justified. But the point is to ask the question, as we often impasse out of anger even though the alternative is actually worse (previously called hubris).

So the bottom line is this: Before walking away from this or any other negotiation table, make sure you’ve asked and said why, taken the time to diffuse your anger and weigh your options, and verified that the alternative is preferable. If you’ve skipped any of those steps, it’s worth spending a little more time at table, if only to make the holidays that much merrier.

How do you decide whether to walk away from a negotiation?

My family or yours? Using integrative negotiation to allocate holiday time

With the holidays fast-approaching, many of us face a decision: my family or yours? As anyone who has made this decision can attest, its consequences often stretch far beyond December.

Dividing up family time can be contentious. But it’s negotiable!

For this post, imagine you’re married or in a serious-enough relationship to worry about the division of family time. Imagine, further, that both you and your partner have already insisted that, “It’s my family this year!” Having one family in Chicago and another in San Francisco, having one week of vacation, and having both refused to back down, you’re now on the brink of crisis. Specifically, you can only see three options:

  1. 50/50 time split: You both spend two days in Chicago, two days in San Francisco, and about 3 days flying Reunited Airlines. Obviously a bad option, and not just because you have to deal with Reunited. Two days with each family is not nearly enough: both will feel slighted, and you’re likely to feel unfulfilled if not exhausted.
  2. 50/50 person split: You spend the week with your family in Chicago, and your partner spends the week with his/her family in San Francisco. But that doesn’t sound so great either – who wants to remember 2015 as the year they spent the holidays apart?
  3. 50/50 relationship split: You could actually see this discussion getting so heated that—in combination with other various and sundry disputes over the years—it strains the relationship itself. Though that might facilitate the second option, it’s obviously not preferred.

In short, you’re stuck in a holiday pickle. But why? Because you’ve assumed that the pie is fixed—engaging in what negotiation researchers call distributive or win-lose negotiation. In other words, you’re trying to slice one fixed resource—the week of holiday vacation—rather than entertaining the possibility that you and your partner could discuss multiple resources. The latter would imply that the pie can grow, which researchers call integrative or win-win negotiation.

Integrative negotiation is a HUGE topic that many researchers have studied for many decades, and that I will write about for a long time to come. The current point is not to describe integrative negotiation in all of its glory, as that would be a 1,589,230-word posting. The point is to highlight the difference between distributive and integrative negotiation and mention some of the many solutions to the holiday pickle that become possible when we assume that the pie can grow:

  1. Trade the holidays: We spend Christmas (for example) in San Francisco and Easter (for example) in Chicago. Come to think of it, that sounds better, as only a masochist would try to fly Reunited into O’Hare in December.
  2. Trade this holiday: We spend this Christmas in San Francisco and explicitly agree to spend next Christmas in Chicago. In other words, we recognize that this is a repeated decision, bringing time into the equation to develop a schedule. Come to think of it, that sounds better, as your brother will probably be able to make it next year.
  3. Introduce a new issue: Suppose that you love extreme downhill skiing but rarely get to do it, tethered as you are to the rolling hills of the East Coast. The sounds utterly irrelevant to the holiday pickle until your partner suggests five days in San Francisco and two in the Sierras. Come to think of it, that sounds awesome.

These are not earth-shaking ideas, nor do they come close to exhausting the possibilities. The point is only to emphasize the power of integrative negotiations. By assuming that there are many possible resources to discuss—multiple holidays, multiple iterations of this holiday, an extreme skiing trip—the holiday season looks a lot rosier.

How have you resolved your own holiday pickles?