The Audible-Ready Sales Podcast
The Audible-Ready Sales Podcast

Episode · 2 years ago

15. How to Prepare for Buyer Negotiation Tactics w/ Tim Caito

ABOUT THIS EPISODE

Why do buyers use tricky tactics in negotiations? 

 

Because they work! 

 

In this podcast, Tim Caito shares how to best prepare yourself (and your teams) for those popular buyer tactics.

 

He’ll cover:

 

- The 4 main reasons buyer tactics work and when they originate during the process

 

- The key 5 tips for managing the negotiation process and preparing for success (to the best of your ability!)

 

- How to expand the conversation and avoid pain points that narrow the negotiation too early

 

Check out this and other episodes of The Audible-Ready Podcast at Apple Podcasts, Spotify, or our website.

 

Additional Resources:

Sales negotiation training resources

Sale negotiation balancing act webinar

 

What the Science and negotiation tells us is that whatever gets anchored into the discussion will actually be the things we end up negotiating. You're listening to the audible ready podcast, the show that helps you and your team's sell more faster. will feature sales leader sharing their best insights on how to create a sales engine that helps you fuel repeatable revenue growth, presented by the team at force management, a leader in BTB sales effectiveness. Let's get started. Hello and welcome to the audible ready podcast. I'm Rachel Clap Miller with force management and joined today by our own Tim Cato. Tim, welcome. Hello Rachel, and everybody excited to have you on the podcast today. Tim, I think this might be your inaugural appearance. Yes, absolutely, I'm excited, and today, what better topic to talk about then negotiation? Tom I know that we have spent a lot of time educating our clients on the importance of treating negotiation...

...as a process, not as an event, and the point that we try to do in educating them on that idea of it as a process is to minimize our vulnerability to late stage tactics by our buyers. So today we're going to talk about that very issue and talk through when those negotiation tactics work the best. That is a great introduction, Rachel, and the first place to start is to recognize that when we talk about when those buyer negotiation tactics work best, we're also simultaneously saying why they work best. So so let's set this topic up a little bit. When we talk about negotiation tactics, they're most commonly referred to as anchors. Now, formally, the definition of anchors are things that are set or done with the intent to change the frame of reference for the negotiation. So, for example, when a customer says our prices too high or their budgets just got cut, those are common examples of...

...anchors. The idea is they're trying to anchor the negotiation around a framework reference that they're trying to create and they're counting on US reacting to that. Now, what the Science and negotiation tells us is that whatever gets anchored into the discussion will actually be the things we end up negotiating. You know, for a minute metaphor here, think about what happens to a boat when we drop the anchor. It basically stays in that place and the same is true for anchors, are customer use in negotiations. If we allow that to happen. Now, Rachel, I suspect most of the people listen to this know what anchors are, but might not availabled them with that word. So, with that in mind, you know the definition of anchoring, those tactics. Let's talk about how they get executed. First, buy our customers. Now, most, most customer anchors are leveraged unconsciously. You know, there's the things they've just always said almost instinctively, like your price is much higher than your...

...competitor's price, and that's how most of them get executed. However, we got to keep in mind there are many professional buyers that leverage anchors in a very conscious and purposeful way with the intent of weakening the seller's position or, at a minimum, to get a reaction that throws the seller off bounce. So, Rachel, whether it's unconsciously mentioned or purposefully executed, to be less vulnerable to anchors, those customer tactics, knowing how to effectively manage them starts with knowing when they work best. And, by the way, they get thrown at us at every stage of our sales process. Early, middle and late stages. Yes, so, whether they're being unconsciously said or purposely said, that's some great background. So let's walk through some examples of when these anchors work best to weaken our position as salespeople. Like, when are we...

...most vulnerable to them? Yeah, I'm sure, rich. Also, I found that customer tactics or anchors work best for for reasons and ironically, Rachel, these are reasons that we can actually control. So the first reason I'll call lack of preparation. Now, when we talk the sellers, what they tell is is they frequently know most of the customer tactics in advance. They could be anticipated, either because they're used all the time by that particular customer, because of that particular customers current situation, or when we know that anchors are competitors always feed our customers to weaken our value proposition, are potentially in play now for years, we refer to those as flood fear, uncertainty and doubt. So lack of preparation is one of the first big reasons, Rachel. All right, so preparing it's your ten. Being prepared for those anticipated anchors is something that we can control, at least for most the anchors that...

...we're going to run into. So what's the next reason? Well, the second rate reason is readiness to respond. You know, sellers are most often vulnerable to customer anchors or tactics because they lack information in the moment to counter the anchors and are not really fought through their response to managing them in advance, which includes who's going to actually provide that response. Now, simply anticipating the anchors in advance is not enough. We need to know what to do and say when they surface in the conversation. But, by the way, Rachel, not just to survive the moment, but to actually use the customers attempt to anchor us into a vulnerable position as our opportunity to expand the discussion to multi items that create value for both sides. The readiness to respond is most critical when you think about the third reason for when customer tactics work best early stage anchors. That are also known as premature single item negotiations. Okay,...

...so premature single item negotiations. It dig a little deeper on that one for us. So a premature single item negotiation occurs when a customer brings up an anchor or an objection early on and establishes it almost like a gate. In other words, they suggest or or maybe even actually tell us they won't engage in any further discussions with us unless we resolved this single issue first, and might have been service issue they've experienced with us, it might be some you know, legacy terms and conditions they want to change, but in other words they're just saying, if we don't deal with this first, there is no negotiation. Now, these can occur Rachel, at any time in the sales process, but they frequently occur early because they work extremely well now the again. Once again, the science and negotiation tells us that early stage anchoring has a profound impact on what gets negotiated late. So if we get anchored...

...on their budget cuts that they're having or other limiting considerations they're trying to throw it US early, will likely find ourselves in a very narrowly defined negotiation all the way through to the final agree men, with very little room to negotiate. And that's where that preparation comes in handy as well. I'm sure, YEP, and I'm heard already say many times that the best negotiators know that these premature single item negotiations are to be avoided, you're not going to get away from them if they anchor on them early, and they, these best in class negotiators, do so by knowing how to get the conversation focus back onto those multiple items they were talking about that also matter to both the customer and the seller. Yep, you know, and it's like that old school saying don't allow yourself to get painted to a corner. That's kind of this is the negotiation version of that. So that brings us to the fourth and final reason for when customer tactics work best, Rachel, and it's when we...

...react emotionally to their anchors. So here's the thing for all of our listeners to understand. Anchors only work when we react to them, in other words, when we get sucked into blindly reacting to the customers anchors, accepting them as reality. That limits the situation on our ability to deal with it. When that happens, we get anchored and honestly, we taught the customers to expect that from us, maybe not US individually, but the community of sellers over the decades. You know, the customers have learned that they can use our own emotions, especially fear against us, you know, the fear of losing the deal or the fear of negatively impacting the relationship or the fear of losing market share and and I even talk about a whole slew of personal negative impacts, like fear of losing income, fear of losing internal credibility, fear of limiting career advancements. Now, one last time, the science and negotiation...

...tells us that emotions have the biggest single impact on negotiated agreements and, as such, anchoring that throws us off balance, creates fear of loss and causes our emotions to come into play are very proven and impactful tactics, especially for old school tactical negotiators. Yeah, they people use them because they work. Go figure, go fight here grace. Well, things are diving into all that Tim really really helpful to break those down for us, and I know you mentioned earlier in this podcast that we we are in control. We actually control how well these customer tactics work, based on knowing when they work and how to manage them. And as you're talking in my head I'm thinking, you know, confidence really plays a role here. You should be confident in knowing that you can spot them and manage them. So let's rob up the conversation by looking at how to best manage each one of these so we can...

...be less vulnerable to them. Yeah, we really good. So, in summary, if I was going to take, you know, an overarching umbrella comment, come swear, tactics work best when we're not prepared for so to not be a victim the customer tactics are anchors, here are five tips on how to best manage yourself in those moments. So first number one, anticipate customer anchors in advance. Now, we can't anticipate every single one. Some will surprise us, but when you think about it, you'd be actually surprised how many of these tactics are anchors. We can anticipate and if we can, then we can deal with those three through our precall planning communications with our internal team, with our champions, to best figure out which ones are coming at it. And then the second tip is to be prepared. You know, if you can anticipate some of those anchors, have key information at hand...

...for those anchors when you run into them in the moment. But, more importantly, determine in advance how you're going to respond to the anchors, including who on your team is going to say what some things. The sellers are best in position to be able to manage those anchors. Sometimes it might be a solution engineer or other support folks on the team. It could be a senior manager, it could actually be one of your own champions. So be prepared now, of course, you do those two things, then what you have to do is number three, the third tip. Recognize when it's happening. You know, to understand you're an attack to a moment right now. It keeps you from reacting and especially helps you manage your emotions. You know, I hope after this podcast summon says up. I think I'm in one of those moments that I talked about and usually we know when it's happening. Okay, so recognize it. The fourth best tip, and this is the...

...big one, is to pivot the conversation, pivoted away from a single issue to multiple issues, you know, avoiding that premature single item negotiation. Now this is interesting, Rachel, because this right here, pivoting the conversation, is an example how sellers can use anchoring. And yes, we can do it too, all right, but I would suggest as long as we're using anchoring to drive the conversation towards achieving more value for both sides. That's almost like pivoting the conversation or using anchoring for purposes of good has coupposed the purposes of evil, like trying to get the you know, make the customer more vulnerable. That's not the approach when you're trying to also manage an ongoing relationship. So you know. But the idea here is pivot away from a single item to multiple items gives us a lot more flexibility and keeps us from getting painted in that in that negotiation corner. Now the last to it, and...

...this one actually comes into play if you stay mindful of the first four tips that are just mentioned, and that is to stay calm and, you know, avoid emotional, fear based reactions that make us vulnerable and victims to the the customers tactics. So anticipate customer anchors in advance, be prepared, recognize when it's happening, pivot the conversation from the single item to multiple items and stay calm. That's great. Thank you for wrapping those up for us. Again to him. That was on my list. If you didn't do it. I was going to do it for you, so I appreciate you. Get ahead of me out that all, except on your lines, right Sol sorry, no, no, I like it. I like it. So that leads me to just say thank you to him. Thank you to all of you for listening to the audible ready podcast. At force management, we're focused on transforming sales organizations into elite teams. Are Proven methodologies deliver programs that...

...build company alignment and fuel repeatable revenue growth. Give your teams the ability to execute the growth strategy at the point of sale. Our strength is our experience. The proof is in our results. Let's get started. Visit US at force MANAGEMENTCOM. You've been listening to the audible ready podcast. To not miss an episode, subscribe to the show in your favorite podcast player. Until next time,.

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