Persuasion as it Relates to Negotiations
Definition
The term persuasion refers to the ability to change people’s or a person’s attitude or mindset towards something by utilizing various resources such as spoken or written words among other things. Negotiation refers to the process of reaching a mutually beneficial agreement in efforts to overcome a conflict which might exist. Persuasion plays a massive role in the negotiation process.
Summary
The authors of the article, Yvette Holmes, Brayan Hochstein, Lauren Beitelspacher, and Willy Bolander, are all affiliates of the University of Alabama. Dr Yvette Holmes graduated from Florida A&M University with her degree and MBA and Florida State University with her PhD. She is a distinguished member of the business community and a Marketing Professional. In her article, she states that customers have ways of getting a vast array of information which they use in persuading salespeople when negotiating for prices. Customers can make use of the internet to obtain information on the different products and compare prices and use that information as leverage. They are then able to extract value through negotiation. Due to the availability of information, power has shifted over to the consumers. Salespeople and businesses have to concede to the demands of the customers to build the brand’s loyalty and retain their customers. According to Holmes at al. (2017), consumers make use of persuasion, during a sales interaction, to potentially maximize the value of the negotiation in their favour. Persuasion knowledge, in this case, refers to a consumer’s perceived understanding of the persuasion tactics, strategies and motives of the salesperson or business. During the negotiation process, salespeople also aim to improve the value of the bargain they get from the customers.
Analysis
The article acknowledges the importance of persuasion in the negotiation process that exists between buyers and sellers. Both parties want to derive as much value in their favour as possible, and this might lead to conflict. The availability of information has given consumers some power in that they can persuade the sellers since they have the option of going to another seller. Sellers usually have little say in the matter as they stand to lose more than the customers. One can see persuasion at work in B2C interactions. For instance, one can observe how customers bid for products on sites like eBay. Customers can place a bid based on the price that they feel is right, and many usually bid around the same price, so a seller has little input in the matter of price. To curb this and avoid any conflict, sellers employ several strategies to try and lessen the power that customers possess.
One strategy is avoiding negotiation. In this strategy, the salesperson uses evasive language or other tactics to physically or psychologically remove himself from the process in efforts to prevent conflicts. Several different strategies are salespeople can employ other than avoiding negotiation. I think that persuasion stands to benefit customers more since the salespeople and businesses have a lot to lose. For instance, they stand to lose the customer, their reputation, and the customer’s loyalty if they overcharge a customer for a product. If they concede to the customer’s prices, they will also have to forgo some value to evade conflict with the customers. I once had to negotiate with a salesperson, and it did not go my way because, at the time, I did not have customer persuasion knowledge as I had not gathered enough information on the product. It was a relatively new product, and I wanted to get my hands on it as soon as possible. We had disagreed on the price of the item several times, but I ended up buying it anyway, only to find out that I had paid five dollars more.
Reference
Holmes, Y. M., Beitelspacher, L. S., Hochstein, B., & Bolander, W. (2017). “Let’s make a deal:” Price outcomes and the interaction of customer persuasion knowledge and salesperson negotiation strategies. Journal of Business Research, 78, 81-92.