How To Negotiate Like An Expert: 7 Secrets From Research

Some say negotiation is an art. But often it feels like spiritual erosion.

What should be a simple matter of mutual agreement instead dissolves into a maddeningly performative exchange where no one says what they mean and everyone suspects they’re being cheated. And the worst part? It’s EVERYWHERE:

• Asking your boss for a raise? You have to justify it like you’re applying for parole.
• Negotiating the purchase of an automobile contains more conflict than most UFC matches.
• Then there’s the domestic front, where logic goes to die screaming. Every human spends 11.3% of their waking life negotiating where to eat dinner. (No, that’s not a real statistic but doesn’t it feel true?)

It starts to seem like negotiating is a scam. And not even a good, sexy “Ocean’s Eleven” kind of scam. Every decision feels haunted. And the kicker? We tend to make the same mistakes every time we negotiate. So what’s going on?

There’s a simple answer: cognitive biases. Those errors our brains consistently make often lead us astray when trying to get a good deal. But here’s the glorious silver lining in this circus of mental misfires: awareness is a cheat code. Once you recognize these biases not as personal failings but as system bugs, you can start patching them.

So who can teach us how to correct these errors?

Max Bazerman is a professor at Harvard Business School. His book is “Negotiating Rationally.”

Let’s get to it…

 

Escalating Commitment

Martin Shubik, economist and possible sadist, invented a game where you auction off a $20 bill. Everyone bids in $1 increments. Highest bidder gets the $20. But — plot twist — the second-highest bidder also pays their bid but gets nothing. That’s right: they lose and pay anyway.

So people start bidding. It’s fine at first. But what eventually happens? Someone bids $19, someone else bids $20. And then someone bids $21. Wait…

That makes no sense. The bill is only worth $20. But they do it because they’re trying to avoid being second and paying for nothing. So the other person goes to $22. And the bidding spirals, resulting, invariably, in someone paying like $47 for $20 but leaving with nothing but a sense of shame and a lesson in game theory.

Welcome to the cognitive catastrophe known as irrational escalation of commitment. It’s the tendency to cling to a doomed plan simply because you’ve already invested time, money, or ego into it. And it’s what you do every time you refuse to adapt your negotiation strategy when reality slaps you in the face.

The real skill in negotiation isn’t bulldozing your way through; it’s becoming a better student of the situation. Ask questions of the other party. Gather intel like a nosy aunt at Thanksgiving. Treat your assumptions like hypotheses, not scripture. Then actively try to disprove them.

The best negotiators treat their first position like a test balloon, not a suicide pact. They’re not locked into their plan. They’re locked into the outcome they want, and they’ll shift however they need to get there.

So when you feel yourself digging in your heels mid-conversation, whether it’s about salaries, relationships, or why you think “Gremlins 2” is the superior film, ask yourself: “Would I take this same stance if I’d gotten all the facts before I walked in?”

(For more on how to be a better negotiator, click here.)

Many people don’t like negotiating because it feels like a winner-takes-all battle. But it doesn’t have to. In fact, if you’re doing it right, it won’t be…

 

The Fixed Pie

The fixed pie mindset assumes that negotiation is always a zero-sum game, like divorce court or middle school dodgeball: someone’s going to cry, and it better not be me. Anything I gain must be extracted, molar by molar, from your reluctant, twitching jaw.

And, yes, some negotiations are zero-sum. The fancy word is “distributive negotiations.” The “Highlander” model: there can be only one. But the majority of negotiations aren’t contests; they’re collaborations in disguise. They can be what the pros call “integrative negotiations”. Both parties can leave the table better off.

“What do you mean we can both get what we want? This isn’t a utopia. This is Earth.”

Um, no. Here are the mistakes you’re making:

• You’re assuming their priorities are the same as yours.
• You’re assuming the only currency in negotiation is money.
• You’re assuming every yes costs them something.

You need to ask the magical, brain-expanding question: “What might they want more than I do? Is there something they care about that I don’t?”

Maybe your boss can’t give you more money, but they can give you a better title. Or you can tell your spouse, “I’ll do the laundry if you deal with your weird cousin at the reunion.”

That’s the beauty of integrative bargaining. It doesn’t have to be a tug-of-war over The One Thing; you just have to find the other things they’re willing to give.

(For more on how to negotiate salary, click here.)

Let’s talk about the aspect of negotiating that feels most like a Jedi mind trick – and how not to get fooled by it…

 

Anchoring

You’re buying a used 2016 Toyota Camry. The salesman says, “This baby’s priced at $36,999.” And instead of replying, “For what? The entire fleet?” your brain unconsciously adjusts its expectations: “Well, if I can get it for $35,000, maybe that’s a win.”

No, it isn’t. That’s not a win. That’s you getting mugged politely. The win was you doing your homework before you showed up and realizing the going rate for that car is $15,800.

There’s a moment in every negotiation when somebody blurts out a number, and instead of laughing in their face like a rational mammal, your brain goes, “Ah yes, an Official Number. This must be reality now.” That’s not reason speaking. That’s anchoring.

The foundational work on anchoring comes from Tversky and Kahneman, the Lennon and McCartney of behavioral economics, whose experiments in the 1970’s showed that people’s numerical estimates could be wildly manipulated just by exposing them to unrelated numbers. Anchors are not real. They are just numbers with good posture.

How do you avoid the mental Trojan horse of anchoring? Do. Your. Homework. Look at market rates. Talk to people. Walk into a negotiation with your own number.

Then, when the hiring manager says, “This role pays $55,000.” You can nod thoughtfully and say, “That’s weird. Glassdoor says the average is $72,000.”

(To learn how to use hostage negotiation techniques to lower your bills, click here.)

Okay, we’ve covered slippery numbers. Let’s talk about slippery words…

 

Framing

You hear “You’d be joining a small, nimble team” and you think “collaboration” instead of “we don’t have any resources and expect you to do five jobs.”

Framing is being overly affected by the way information is presented to you.

You probably think you’re immune to this. “I’m not one of those people. I weigh the pros and cons.” No, you don’t. You’re tragically human. Let’s proceed.

Most of this happens below the radar. You think you’re making rational decisions, but really you’re being emotionally blackmailed by phrasing.

And it gets worse. Your internal frames can cause you to say no to good deals you should accept. The numbers work but it didn’t “feel” like a gain. You don’t just want a good outcome. You want an outcome that feels like a win from your current reference point.

Your boss says, “We can offer $65K,” and your first thought is, “But Becky got $70K.”

To which I’d say, “Who the heck Becky? Why does she matter? What does her job have to do with yours?”

Doesn’t matter. You feel like you’re losing, so you walk. Your arbitrary reference point activated a little indignation gland you didn’t even know you had.

So what should you do? Pause in the middle of a negotiation and ask yourself: “What’s the frame here? What’s the reference point I’m using, and does it make sense?”

(To learn how to negotiate with kids, click here.)

Everybody talks about information when it comes to negotiating. And they’re right. You need good info. Problem is, your brain often prefers the bad kind…

 

Availability Bias

You buy a blender, and the salesperson launches into a monologue about how you need the extended warranty. Because what if it explodes? What if it becomes sentient? Sounds terrifying, right?

Except — and here’s the bit where logic commits seppuku — if you play the odds, you’re going to spend far more on that warranty than you’ll ever recoup from it. But we don’t do the math; we react to the scary story and buy the warranty.

It’s called the availability bias. Instead of figuring out what’s most relevant, your brain says “Hey, remember that one time that one thing happened to someone you barely know? Let’s base all our decisions on THAT.” To the brain, one emotionally charged anecdote beats rigorous data.

You need to stop and ask: “Am I making decisions based on what’s readily available in my brain, or am I actually doing the work to find out what’s true?”

Look up the stats. What’s the real rate of failure for that car transmission you’re worried about? How often do people use the travel insurance they buy with that credit card? These aren’t things you feel your way through; they’re things you look up.

(To learn the negotiation methods they teach in MBA school, click here.)

Another critical part of negotiation is the person you’re dealing with. Problem is, we often forget about them completely…

 

The Other Side’s Perspective

The “winner’s curse” is a concept that means if you won the auction, you probably overpaid. Sellers usually know more than buyers. The seller knew the car needed a new transmission, the landlord knew the plumbing was older than disco, the employer knew the culture was toxic.

There’s an important lesson here: the simple, mortifying, universally human tendency to get so absorbed in our own position during a negotiation that we fail to consider what the other person is thinking. Their motives. Their incentives. Their knowledge.

Research shows that negotiators who take the other party’s perspective do better. They get better deals, more value, less resentment, and are less likely to cry in the car afterward.

Ask yourself: “Why are they selling this? What might they know that I don’t? What do they care about?”

Beneath every bargaining position — “I want $20,000” or “No, Karen, I won’t watch another episode of The Bachelor” — there’s a deeper interest. Maybe the car dealer is desperate to hit a sales quota. Maybe your partner doesn’t care about the price of the hotel; they just want to feel like you listened. That’s the stuff you should be trying to uncover. Because that’s where the real leverage lives.

(To learn how to be more persuasive, click here.)

A lot of people feel nervous in a negotiation. That’s no fun. But the opposite can be far, far worse…

 

Overconfidence

Research shows people are routinely overconfident about attaining outcomes that favor them. Overconfidence reduces your willingness to listen, can kill any chance at compromise, and makes you believe the only acceptable outcome is your outcome. You think you’re being assertive. You’re actually being deaf.

What makes overconfidence so insidious is that it feels like clarity. You’re not rejecting compromise; you’re holding out for what you deserve. It’s the bias that masquerades as backbone. But the research tells another story: people who can’t recognize overconfidence tank more potential deals.

How do we overcome it? With rational humility, a phrase I just made up but that you should tattoo on your face. The people who do better in negotiations are the ones willing to say, “I might be wrong.” And then they ask someone else for their perspective.

Ask your rational friend. Not your ride-or-die bestie who hypes you up no matter what. You need the friend who tells you when your outfit is weird and your ex was a mistake. The one who frequently reintroduces you to the reality-based community. That friend.

(To learn the methods of NYPD hostage negotiators, click here.)

Okay, we’ve made it through the Seven Deadly Biases of Negotiation, which — like the Seven Deadly Sins — are just common human behaviors wearing name tags that say, “Don’t do this.” Let’s round it all up and learn the two essential things you need to know before any negotiation…

 

Sum Up

Here are the seven mistakes to avoid when negotiating…

• Escalating Commitment: You don’t look strong when you refuse to adapt. You look like someone ordering a second glass of milk after discovering they’re lactose intolerant.
• The Fixed Pie: Don’t go into negotiations with the attitude of “I’m being taken advantage of unless I can see the other person bleeding.” Figure out how you can both get more.
• Anchoring: It’s like someone declaring, “You owe me $500 for air,” and you reply, “How about $400?” Don’t work from their numbers. Get your own.
• Framing: A proposed cut to your team’s budget is presented as “streamlining.” The results are the same, but people respond as if one is champagne and the other is radioactive sewage. Don’t be fooled.
• Availability Bias: We trust our memories as though they were curated libraries instead of chaotic junk drawers. Do your homework.
• The Other Side’s Perspective: Ask questions and get in their head. Otherwise, you’re playing chess without looking at the other side of the board.
• Overconfidence: This is a problem frequently associated with watching “Glengarry Glen Ross” too many times and not understanding that it’s actually a cautionary tale. Get a third-party perspective.

So what do you need to know before any negotiation?

Know each party’s BATNA and your own reservation price.

What’s BATNA? “Best Alternative to a Negotiated Agreement.” It’s your fallback option, what you’ll do if the deal doesn’t happen. The point of negotiation is not to get a deal. The point is to get a deal that is better than what you’d get if you walked away.

And you need to know the others side’s BATNA. If the other person has no better option than working with you, you’re in a good spot.

Your reservation price is the worst offer you’ll accept before you walk. This is your line in the sand, your red button, your personal hell no.

Becoming a better negotiator isn’t about turning into some Wall Street Terminator who dreams in leverage and wakes up quoting Sun Tzu. Frequently, negotiation is an excruciating test of whether or not you can outwit your own ridiculous brain.

Once you start noticing the above biases, once you see the rigged game for what it is, you can start rewriting the script.

It’s not about winning every time. It’s about not losing yourself in the process.