Ever wish you could win every single negotiation you entered? Whether it is a job interview, appointment with a new client or winning over a big business contract, you can…if you are ridiculously prepared.
The strategy I’m talking about has won me a lot of business. And you don’t have to be a natural-born negotiator to use it. In fact, I’ve known some very timid and soft-spoken people who’ve landed great deals using this strategy…which means anybody can use it.
Let me show you how it works and why.
How to win a negotiation
It doesn’t matter what kind of business you are in or what you are selling, the overall steps in winning a negotiation is the same. Here are the 4 steps I take to close big deals:
Step #1: Identify business problems
Negotiations are all about preparation, and the side with the most preparation wins. That’s because the side with the most information gets to frame the discussion. They get to control the direction of the proposal and position the other side to accept their terms.
So, let’s imagine you are an Internet marketer, and you are trying to convince a division of Intuit to hire you for a huge contract. You’re jumping through hoops during the meeting, and then they ask what you charge. That’s when you hand them a proposal that identifies the critical problems with their site. Let’s say, there are three:
- You’ve outlined their ecommerce transaction path and spotted critical areas where users are abandoning the checkout process.
- You’ve spotted a lack of fundamental elements of trust on their landing page that could be costing them subscriptions.
- You’ve documented strategic flaws in their email newsletter that deals with how they are making their emotional appeal.
And next to each of these problems, you’ve also included the number of leads or sales they are probably losing. You then ask them for specifics about traffic that travels down these paths. Whatever they quote you—exact percentages, a range or just shrug their shoulders—you share with them the benchmarks from a case study you pulled. This case study indicates to them the amount of money and business they are losing if they continue to leave these processes alone.
At this point in the discussion, you’ve got them sitting up in their chairs. They are listening to you. That’s when you move to the next phase.
Key takeaway: Make sure you are identifying realistic problems that can be fixed. Don’t bring up problems that may drastically change a business and cause you to get a lot of push back. On the flip side, make sure you are identifying big enough problems that will have a decent revenue impact. If you identify small problems that will only make a company an extra $10,000, there won’t be much money in it for you.
Step #2: Create solutions
Once you’ve identified their crucial problems, you now present them with the solutions. In our current scenario, you roll out a plan to fix these problems.
- You suggest that the transaction path is too long and recommend testing a shorter one with an optimization strategy, using multivariate testing tools.
- You slide a screenshot of their landing page that is professionally marked up with the trust elements that are missing on their page…and then another screenshot of your modified version.
- You present three or four emails in their sequence with your recommended changes to improve their emotional appeal.
At this point the person is leaning out of his or her chair, hovering over what you’ve just presented. But your job still isn’t done.
Key takeaway: Similarly to the problems you identified, your solutions must be realistic. Not only do the company’s reps have to like your solutions, but they also have to feel the solutions are somewhat easy to implement. And, ideally, these need to be solutions that don’t require too many, if any, resources from the company you are pitching.
Step #3: Suggested Timeline
Next, you need to indicate how long you think it will take to fix these problems.
- “We could knock out the landing page in a day or two.”
- “The transaction path will take a little longer as we test and tweak, but we could grow ROI, I believe, by 10 to 15% percent in 30 days.”
- “The email sequence will probably take the longest due to all of the content creation that is needed. We’ll do that last, and it can take anywhere from 2 to 3 months to complete.”
Then, you roll out your recommended priority list:
“It’s obvious the transaction path should be fixed first since it is directly tied to sales and revenue. Then, we will focus on the landing page since it’s low hanging fruit. And, finally, we will work on the email series.”
Key takeaway: The timeline you give has to be realistic, yet aggressive. If it takes you longer to implement the solution than it would the company, they won’t hire you. And when giving them a timeline, you have to include the revenue impact it will have as businesses tend to make decisions based on revenue and not emotions.
Step #4: Go for the throat
At this point, you have them exactly where you want them. But you can still mess up the negotiation and lose the deal if you don’t handle the next part correctly.
What you need to do now is ask for the sale. But what’s important is how you ask. You must frame the question as a “Yes” or a “Yes” question.
For example, you might say, “So, do you want to wait until the end of the month to get started…or should we get started on this immediately? Your choice.”
“Do you think we should start on the transaction path first? Or should it be the landing page? What do you think?”
You’ve just framed the discussion so that it’s really easy for them to say, “Yes,” no matter how you ask for the business.
Key takeaway: Strong negotiators are aggressive. If you showed a company why it financially makes sense for them to work with you, why wouldn’t they hire you? So, don’t ask if they want to hire you; instead, force them to hire you.
Why studying pays off
When it comes to negotiating, the busier the person is and the more preparation you’ve done, the easier it is going to be for you to win the deal.
See, the person, let’s say it’s a he, you are meeting with probably knows that these problems exist. He just has never been able to get around to figuring out what was wrong. His boss has probably been complaining about sagging ecommerce sales. He’s just too damn busy to do anything about it…let alone analyze the issue to the level you have.
Busy people suffer from the “blank page syndrome.” They simply don’t have the mental capital to invest in figuring out how to solve these new problems as they are already overloaded. You, however, are their solution.
And don’t feel bad if they make suggestions. Busy people love to make suggestions. They love to change and improve upon an idea because that’s what busy people do…they play with existing proposals because coming up with a solution from scratch is simply too time-consuming.
You are their savoir.
Key takeaway: The reason I am able to close million dollar deals isn’t because I am a better sales person or negotiator than you. It’s because I do my homework. I come into a company, tell them exactly what I am going to do and lay out the whole process. Yes, they can steal it and not hire me, and it’s actually happened, but in most cases companies are too lazy to do that. You can’t be worried about that. You just need to make sure you laid everything out so they won’t have any major objections.
Why acting like a punk pays off
Listen, you don’t have to wait for a big client to call you to use this strategy. You can approach the big client yourself.
Find a client or company that you really want to work with, study what they do, identify their problems, create solutions and map out timelines. Then give them a call and work your way to the right person by climbing through the food chain. You’ll be shocked to find out how many times I’ve been able to cold call a company and, after asking to speak with the “director of marketing,” have been transferred to him or her.
Once you get to the right person, tell her that you have something you’d like to discuss with her.
This is exactly how I got to work with big names like Amazon and Viacom. I didn’t wait for them to call me. I figured out how to connect with the decision-makers…and I acted like a punk.
That might sound disrespectful, but the higher up the person is in the organization, the more she appreciates someone who talks straight with her without fluffing things up. Plus, a little cockiness goes a long way.
The last thing they want to do is hire somebody whose hand they have to hold. They want someone who can walk in, tell them what needs to happen…and then get it done.
That is how you win every negotiation. And make a lot of money.
Key takeaway: People want to hire people who are smarter than they are. People who aren’t as smart tend to be a bit more insecure, so if you want to show that you know what you are talking about, act a bit cocky. Just make sure you don’t get carried away.
What to do if they say “no”
Just like everything else in life, however, this strategy isn’t fool proof. Some people will still say “no.”
Maybe it’s because they don’t have the budget. They would love to give you the money to do the work, but it’s just not there. No matter what reasons they are giving you, you need to figure out why.
And when you figure out why, circle back around and ask for the sale again in light of this new information. Just because they say “no” once, it doesn’t mean they won’t say “yes” later.
If you figure out why they said no, you can figure out how to tailor your pitch around it. For example, if it was related to the budget, you can charge a lower upfront fee and ask for the rest of the money towards the end of the project or when you hit specific milestones. Or if you want to make things simple, you can just reduce the scope of your work and fit it within their budget.
If they beat around the bush, then just be blunt: “Do you want me to help you make more money? If so, what is it going to take to start an engagement?” The key is not to take “no” for an answer.
Key takeaway: No just means “not right now”. There is always a way to make a deal work out. Sometimes you have to be flexible with your pricing or offer a performance-based deal with your costs covered upfront. Just don’t give up when people say no.
Common mistakes people make when using this strategy
Experienced negotiators know how to deal with other experienced negotiators. They also know how to pull one over on inexperienced negotiators. If that’s you, then here are a few common mistakes you need to avoid when negotiating.
- Talking to the wrong person – I don’t care how prepared you are…if you are not talking to the decision-maker, then you will not win. Ask for the decision-maker as soon as you possibly can, and make sure they are involved at every level of the negotiation. And by the way, whether there are two people or ten in the room, know who the decision-maker is…and talk to that person.
- Giving in – Negotiate enough, and you will run into a really good negotiator, who picks up on what you are doing. They may say, “I know what you are doing. You want me to say ‘yes.’ I will only say yes if you do X.” The question you have to ask yourself is this: “Is X reasonable?” If it’s not, then don’t give in. Ask for more time.
- Being rushed – Whether they do it on purpose or not, giving you only “X minutes” to speak will not do the trick. It’s very difficult to negotiate under pressure. Experienced negotiators know this, so they may try to create that pressure by limiting your meeting time. Don’t fall for it. Dig in your heels and say, “When can you give me Y minutes?” where Y is however much time you need to share your presentation.
Key takeaway: You always need to have the upper hand. Once you lose the upper hand, you’ve lost the negotiation. To make sure you have the upper hand, don’t be afraid to push back a little. If you keep on saying “yes” to all of their demands, sooner or later, they’ll squeeze you, and the deal just won’t be worth it to you.
How to handle common objections to your proposal
You are probably mature enough to realize that negotiations do not occur in a vacuum. They are never as seamless as I make them appear to be on paper. Things will go wrong during the presentation, e.g., objections might be raised. Here’s how to be prepared:
- “Why should I trust you?” If you’ve done your homework, then this will be easy. You will have the proof of what you are saying in the statistics and case studies that you’ve dug up. If you have testimonials, you’ll show those too. If you have endorsements from major media, you’ll share those too.
- “I’m not sure you are the right person.” Ask them these four questions: “Why not? Do you have an ideal candidate in mind? Are you speaking to other candidates? Who?” If based on the information they give, you discover you actually do fall short of their expectations, then say, “If I do X, can we work together?” If they still say “no,” then there is something deeper. Get to the bottom of it.
- “I’m not sure this is as important as you say it is.” Now, granted, if you don’t have access to their raw analytics, you cannot say for sure whether the problems you’ve identified are the problems they are facing. However, what you can do is suggest that you’ll work with them on gathering this information. And if you find a problem during this phase, you can propose working with them again.
Key takeaway: Closing deals always takes time. They rarely are easy, and you’ll typically run into roadblocks. Be prepared to fight and put pressure on the potential customer. If you show that you are busy and have tons of companies hitting you up, it will make them want to work with you, and you’ll run into fewer objections. So, make sure you show that you are successful by starting off the first meeting by introducing yourself and breaking down what you have done for other companies.
Let me end by saying this: I love to negotiate. I love to sit across from someone and try to influence him or her to think the same way I do. You, however, may hate it and think that it’s manipulative. Unless you are lying, it’s not manipulative. It’s called influence. Learning how to use it can change your life.
That’s one of the reasons I fell in love with negotiating. I learned that by influencing people I could get things done, accomplish my goals, and help other people along the way.
It wasn’t always easy. I’ve lost plenty of negotiations. For instance, when my partner and I were trying to get funding for Crazy Egg, we presented to dozens of VCs. Not one single one of them gave us money. But that didn’t discourage me. When they said “no” to me, I just interpreted it as “not right now”. I kept trying, and eventually I got better at convincing people to give me money.
So, what other negotiation strategies have worked really well for you?