There’s a tactic you might like to try the next time you are negotiating price with a customer. It won’t cost you anything. It will increase the likelihood of purchase. And it may even mean you get a referral out of it too.
All you have to do is … ask your customer for a favour.
Let me explain.
Researchers at Georgetown’s McDonough School of Business in the US were interested in whether asking a favour of a customer changes the dynamic of the negotiation. To test this they had salespeople, after offering a discounted price, say something like: “In fact, at this price, I hope that next time you hear about somebody looking for art you consider recommending my gallery”.
Customers hearing the request for a favour went through with the purchase 65% of the time. In contrast, customers who were given the same discounted price but were not asked a favour purchased only 41% of the time.
Why did it make a difference? The request evened the playing field, shifting the dynamic from combative to cooperative. Further, the offer went from being seen by the customer as a standard tactic to one that was personalised to their specific negotiation.
This is all about reciprocity. Reciprocity works on the basis that we operate in a world full of social nuance: I do something for you, you do something for me. Asking a favour of your customer – like for a referral or social media recommendation – makes them feel part of a fair social exchange.
It increases the credibility of both you and your offer because you could only risk asking them a favour if you have done one for them first. In effect, they believe the offer is being specially offered only to them, not everyone. So next time you are pushed on price, push back by asking a favour to increase your odds of success.
Watch a short YouTube clip of the researchers explaining their findings below.
Bri Williams runs People Patterns, a consultancy specialising in the application of behavioural economics to everyday business issues.