From the course: Strategic Negotiation
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Anchoring a deal in negotiation
- There's an interesting dynamic that can happen in negotiations. It's called anchoring. Anchors are initial points from which you're going to negotiate. They can lock you into a position, and unfair anchors can kill a deal. If you get one, consider walking away. Also understand, if you give the other party an unfair anchor, they may walk away. When you go to set an anchor, base it in reality with data or assumptions. Many times, the final offer in a deal, will end up within a reasonable distance from that initial anchor. For example, if you anchor your deal at $100 upfront, and that's your first offer, more often than not, you'll end up between 80 and $100. If instead, that first anchor was $500, you'll end up between 400 and 500. That anchor can drive the final deal price a great deal. Now understand, that anchor also has to be based in reality. You can't just throw a huge number out there, without some basis…
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