Sales Negotiation Styles Explained

Promoted content from IRD Prospector

Like it or not, negotiation is part of our daily routine. Whether with our partner, colleagues, friends, bosses or prospects, we find ourselves having to constantly draw upon our techniques and powers of persuasion in an attempt to get our own way.
This is even more so in the world of B2B sales. Much of our success (or lack thereof) can be traced back to how effective we’ve been in the negotiation phase. However, few of us give enough consideration to the most appropriate negotiation style for the situation and consequently fail to achieve our desired outcomes.
As the US psychologist Abraham Maslow is renowned for stating “if the only tool you have is a hammer, you tend to see each problem as a nail.” A one size fits all approach is limited at best when it comes to successful sales negotiation. To be effective as a sales negotiator, we need to control our character dominated natural tendencies and often employ non-default strategies that lie beyond our comfort zone. The key is to take an approach best suited to the person and situation at hand.
With this in mind, here’s an overview of some common negotiation styles and suggestions, to nail your desired outcome:

Let’s face it, when the pressure of negotiation is on and the customer is pushing back on you, the easiest (and laziest) course of action is to pull your head in and play turtle. This may avoid conflict but should be avoided at all costs, as the only thing being nailed will be you. In price negotiation scenarios the turtle approach represents a psychological withdrawal by the seller that makes it nigh impossible to position your value proposition, and gives your buyer carte blanche to dictate terms.

On the flip side, many sales people, especially those with domineering character traits, believe the best way to negotiate success is to hammer their customer into submission. For these sales people (aka sharks) there is no shying away from conflict and negotiation is really a matter of winning at all costs. Intimidating or overpowering may well be a way to achieve a sales result if you’re on the other side of the table from a turtle, but it won’t get you far if you’re facing off against a more resilient personality. Competitive negotiation is a win/lose scenario. Whatever character type you are trying to do a deal with, this is a sure fire way to kill any chance of a long-term, trust-based relationship.

Under the accommodating style of sales negotiation, the seller typically deems the strength of the relationship they have with the buyer as paramount. Like the avoiding turtle, the accommodating negotiator is conflict averse and has a tendency to accord the buyer everything they want. Often too concerned about being liked, the accommodator runs the risk of being steamrolled when negotiating with a highly competitive character type, so give careful consideration as to who you are working with. Conversely, the accommodating approach can be just the ticket when the relationship with a buyer is damaged or weakened. Giving the buyer a win could be what’s required in an account management scenario when fences need to be mended and provide a platform for stronger, more assertive future dealings.

Sales people could do worse than considering the words of former German Chancellor Ludwig Erhard who once said that a compromise is the art of dividing a cake in such a way that everyone believes he has the biggest piece. Without doubt, compromising is an effective negotiation strategy that can give both buyer and seller a sense of satisfaction on securing a win when in fact they have actually achieved less than their original objective. Compromising is a great way to reduce conflict and get a deal done, especially when negotiating with someone that you have already established trust and rapport with. It goes without saying that for compromise to be an effective part of the negotiation strategy it is again essential that you have a solid read of your customer and their needs. Also be mindful that any shrewd negotiator that you may find yourself working with will know that the party with the most ambitious opening position tends to be the “winner” in a compromise deal.

For many B2B situations, the collaboration approach is the best way to go. Sales Experts who take the collaborative approach are prepared to actively seek and get points of conflict and contention out in the open. The collaborative negotiator frankly discusses and addresses customer concerns. The collaborator recognises both party’s particular goals and needs and are genuinely driven to deliver a mutually beneficial solution. For the collaborative negotiator compromise is a fall back, never the opening gambit. The result is often an open and honest true win/win scenario. Ultimately collaboration builds trust and puts both parties on the same page. Of course, collaboration can be tough when working with a competitive negotiator, so ensure you go the extra mile to demonstrate your value proposition and show the customer why doing business with you will be such a clear a win for them that your terms do not need stretching.
So, next time you enter negotiations with a new prospect or customer, take time to consider their personality and to fully assess their goals and needs. Whatever you do, don’t see them as just another nail to be hammered.
Got a big deal coming up?

Download IRD’s simple-to-use Negotiation Planner Template. It will help you prioritise your points and predict possible scenarios from your client or prospect, helping you close more deals on YOUR terms.