Ilustration: Oscar Ramos Orozco

How To Get Paid What You're Worth & Other Negotiation Tips

For most us, the thought of bargaining over money is an awkward and painful affair, something we try to get over with as quickly as possible like a root canal or watching a slideshow of our in-laws’ vacation. But if we skip a few minutes of haggling, we can leave some serious cash on the table and, more importantly, short-change our true value as creatives. One study found that negotiating a raise of $5,000 for your first salary can result in more than $600,000 in additional lifetime earnings.

A Cautionary Tale

In 1912, Teddy Roosevelt’s campaign printed three million pamphlets with his picture featured prominently. It was only after the pamphlets were printed that his staff noticed a small line of text that read “Moffett Studios – Chicago” under the picture. The campaign did not own the rights to the photo and licensing a photo for reprinting usually cost $1 per reprint.

A campaign manager was tasked with calling the photo studio and negotiating a fair rate for the use of the image. Shrewdly, the campaign manager contacted the studio and simply asked how much it would cost use the picture, never revealing that the campaign had already printed millions of fliers using the photo. Without further inquiry, the studio quoted a price of $250, which the campaign promptly accepted.

Had Moffett Studios been savvy negotiators they would have taken the time to gather all of the information before offering $250 and proposed a much higher rate instead.

How To Become A Better Negotiator

While the Moffetts of the world might appear a little naive, oversights of this sort are extremely common: we often fail to consider the full impact of a deal in the long run.

To make sure you get a better deal, here are a few tips on mastering the dark art of negotiation:

1. Separate the person from their position.

This is one of the primary points of the popular negotiation book Getting to Yes. When we argue over positions, our egos are attached to what we are proposing. Instead, focus on the other party’s underlying interests. Find where interests overlap and work to develop solutions with the other party as a partner not as a combatant. An example from the book:

Consider the story of two men quarreling in a library. One wants the window open and the other wants it closed. They bicker back and forth about how much to leave it open: a crack, halfway, three quarters of the way. No solution satisfies them both.

Enter the librarian. She asks one why he wants the window open: “To get some fresh air.” She asks the other why he wants it closed: “To avoid the draft.” After thinking a minute, she opens wide a window in the next room, bringing in fresh air without a draft.

The librarian could not have invented the solution she did if she had focused only on the two men’s stated positions of wanting the window open or closed. Instead she looked to their underlying interests of fresh air and no draft. This difference between positions and interests is crucial.

2. Money isn’t the only factor in a negotiation.

If we make it all about money, the negotiation only has one measure of success. In a 2001 Harvard Business Review article, Harvard professor James Sebenius advises us to recognize the other factors that may be less black-or-white.

For example, when negotiating a project with a client, price isn’t the only thing on the table. You can discuss deadlines, delivery methods, communication preferences and a host of other options. Give a little on deadlines, but propose a higher rate. The more variables you can negotiate, the higher the likelihood that both parties will feel like winners.

3. Practice your negotiating skills with a friend.

Think back to the first time you drove a car. It was likely pulse-pounding affair that caused quite a bit of stress and maybe even embarrassment. But, as an adult, you can now hop in your car and drive to the store with barely any stress. So what happened? Practice made the difficult into the routine, and negotiation is no different.

The more variables you can negotiate, the higher the likelihood that both parties will feel like winners.

Do you know that friend you have that can poke holes in any idea? Enlist him or her to enact all of the possible scenarios for a negotiation to help you prepare proper responses. If you’ve already made your mistakes in the (forgiving) company of friends, you can remain calm, cool and collected when it’s game time. Personal finance author Ramit Sethi drops a ton of knowledge about negotiation on his site I Will Teach You To Be Rich, including this tip: “The people around you matter. Practice matters,” writes Sethi. “If we just become marginally better negotiators than we currently are, we can reap disproportionate rewards.”

4. Never name the first number.

It’s accepted wisdom that naming the first number is bad negotiation form, but rarely do we see an exact script and reasoning for a stingy negotiation partner. Short story: the other party often has much more information than you do, so have phrases like “You are in a much better position to know how much I’m worth to you than I am” ready for use.

The other party often has much more information than you do.

5. The first number named has a profound impact on the rest of the conversation.

The blog “You Are Not So Smart” tackles the psychology behind the phenomenon of naming the first number, or “anchoring.” When we have to guess a number or price for which we have no previous information, we crave a “foundation” to base our guess on. Think of your perception of value when you discover a pair of shoes were “originally” $200 but are now “on sale” for $50.

It’s one of the many reasons it pays to make the other party name the first number whenever possible: if you were to name a less favorable number it could “anchor” the conversation to your disadvantage.

What do you think?

What are your negotiation battle stories? What are the things you’ve succesfully negotiated for?

More insights on: Career Development, Clients, Money

Sean Blanda

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Sean is the Editor-in-Chief and Director of 99U. Find him on Twitter: @SeanBlanda.
load comments (30)
  • Brandon Wu

    Thanks for the nice list of negotiation tips! On the other hand, there is an article “Should You Make the First Offer?” from Harvard Business Review (… that offers a different point of view to No.4 – that often times, you should name the first price because of the anchor price effect (No.5). Interesting study and worth a read. :)

  • Steve H-B

    For me item 2 is the key one in the article. There is a big issue for professional speakers (which I am) when negotiating a rate for an event. If you give a rate to one organisation then others expect the same rate (often regardless of circumstance). The best way that I have found to deal with this is to have a ‘full package’ price which includes all of my value adds. If this is too rich for the event organiser, we then discuss which bits of the package they wish to drop in order to get to the rate they wish to pay for the event. That way when somebody comes to me telling me that “I know Fred paid you this” I can go back to them and deal with the specifics of what Fred wanted and got which was not my ‘full package’.

    If they don’t want to budge on rate and still want the ‘full package’ I then have to move to comparison to try and reset their thinking. A good example is asking how many delegates they are expecting and asking them what they are expecting to pay per-head for coffee. I then compare my rate on a ‘per-head’ basis and ask if they value the ‘Keynote address’ above or below the value of the coffee? If they say below then I’m clearly working with the wrong organisation so it’s best we end the conversation there. If they rank it above then it becomes a discussion of value and what they want their delegates to leave with.

  • Jacob Curtis

    “You are in a much better position to know how much I’m worth to you than I am”

    I wish I had known that going into my last pay raise meeting. I was more focused on leading the conversation and had no idea that in most cases you shouldn’t be the first to name the number.

    But it makes absolute sense, the employer IS in a much better position to know, and as the post states:

    “if you were to name a less favorable number it could “anchor” the conversation to your disadvantage.”

    …powerful Sean!

  • Mark

    Your employer could himself throw a bad anchor, and you empowered him to do so when you said he was in a better position to judge. Not to say it’s necessarily a problem, but there are pros and cons for both ways (opening or letting the counterparty open).

  • ciaran

    I guess this is more related to Steve HBs post about his full package price, but this article from Win Without Pitching is gold for anybody whether they work freelance, on a contract or full-time role – http://www.winwithoutpitching….

  • Sean Blanda

    Even if your employer throws you a bad anchor, it puts you in the driver’s seat to negotiate your worth up (with quantifiable proof of your value, research of similar salaries etc) instead of you giving a number and having them inevitably argue you down. In other words: when they throw our the first number its the floor. When you do, it’s the ceiling. Additionally if the employer significantly undercuts your perceived value, maybe it’s not a good fit after all.

  • Mark

    So either they throw a low floor, or you throw a high ceiling. You may give them the chance to blunder with a high-floor by letting them open, but most counterparties know better. In the same vein, you run the risk of shooting too low if you open, but with some research you can generally find an appropriate figure that you know will be very high–and might well work as an anchor.

  • Ton
  • Daniel Kleinfeld

    I just really liked the story for point 1 :) but all in all an excellent post on how to become a better negotiator. (minor niggle – the name of the blog is ‘I will teAch you to be rich’).

  • Sean Blanda

    Good catch. It’s been fixed.

  • naat

    Never name the first number – for me this tip was also most insightful. I just recalled all the interviews for new jobs I’ve went through and the most difficult question the employer asks: “So, how much would you like to earn?”. It’s so… unfair ;P

  • Jenn

    I was is a very similar situation during my pay raise meeting and was denied my raise altogether. :( This article was a really great lesson to learn!

  • The Film Beast

    Awesome comment Steve. I love comparison to reset their thinking. It an honest tactic too, which makes me love it more.

  • royhasson

    What to do when for a job interview HR asks you to provide your W2 which “anchors” the first number without giving you a chance to say anything. This is becoming a frequent practice which I hate because it leaves very little room for negotiation.

    How would you deal with this tactic ?

  • Sean Blanda

    It’s hard to say without knowing specifics. I’ve spoken with people that suggest leaving all salary forms blank until you’ve been able to properly negotiate.

  • Lisa Gates

    State of the art negotiation practices and research reveal that you DO want to put the first number on the table for the very reasons you describe. It influences the conversation in your favor. The missing ingredient in anchoring wisely is asking open ended questions that allow you to uncover as much information as possible; to get at your bargaining partner’s interests and preferences, goals, fears, constraints, etc. Stay at the table long enough asking such questions, and balance that with the advance prep research you’ve done, and you will be well poised to find your way to agreement. And this is where “The more variables you can negotiate, the higher the likelihood that both parties will feel like winners.”

  • gertial

    What would your advice be if you only receive the offer as a letter/contract and you never meet with an HR person? Who do you negotiate with then? Your direct supervisor or make an appointment with HR?

    • Sean Blanda

      Whoever sent you the offer letter is usually a good place to start, I think.

  • akanoodles

    This is a great article, but how do you negotiate a pay rise? If you’ve accepted the job at a lower rate, at which point would it best to get a better salary?

  • Liam

    I admire the precious information you offer in your articles. I am going to bookmark your site and have absolutely my children visit here often

  • PaulS

    Don’t forget the use of silence to get the other party talking. I’ve used the tactic of asking for a raise between zero and some impossible number like 30 percent; then the conversation goes one by one through each item for which I’m responsible: cost control, safety, quality, productivity and intangibles. Break it down, agree on a percent for each item then add them up on a weighted basis and you have it! Generally better than negotiating over just one number.

  • Isabella

    Good work! Thanks for post.

  • kwameadjaye

    Practise Vs Practice.

  • SK Jain

    An alternative negotiation tactic could also be to ask for nothing at all! It may seem weird at first, but just imagine you and a friend are fighting over who will pick up the tab for lunch. However, you are going to have to teach the other side how to give in the context of negotiation.

    1) Think about what you would want if you were on the other side, and ask the other side to think likewise.
    2) Write down the most you are willing to give a perfect counterparty and the least YOU would accept to work for.
    3) Ask them to do the same.
    4) Say something like, “If later you decide to improve your offer, then I will not
    work with you because you lied on the first go-around, and I do not work with
    liars. Likewise you should hold me to the same standard of honesty.” Of course,
    you can find less harsh words than these.
    5) Reveal what you wrote to each other simultaneously.
    6) If upon exchanging the offers, their number isn’t higher than your lowest number, then you could call off the negotiations and save time. In case you each offer more than the other party would accept, and you honestly admit your imperfections, then chances are you will come to an agreement.

    – Attributed to and borrowed from an interesting article by Brooke Allen.

  • a visual artist

    Here is the thing. In the new environment where I live now, art is not as much valued money wise as where I used to live before. People won’t spend much on art, unless it’s decorative art, save and pleasing to the eye. Conceptional art is something people need to get into. It’s hard for me to negotiate here, often I end up not selling or being underpaid. Especially the ‘don’t name the first number’ I need to just try out, but I’m shocked how low people rate conceptual art.
    It’s true, it’s about just doing, trying, making mistakes and getting better. Thank you for your article!

    • Jonbon

      I think you touch on a very interesting physiological event. How much people value art. But before that I wanted to mention that you’ve got yourself on the wrong end of this equation. Since you are the seller you need to use the seller tactic of anchoring (setting an initial number and setting it high.) The buyer is the one that is not naming the price here because you are selling a unique product and not a well defined service. But back to art…
      Conceptual art is not well understood in many areas and even the term itself is quite modern and ambiguous to many.
      People pay for things solely because of perceived value. I believe the things that affect value most in the Conceptual art arena are: education about the art process and artist, and the relative fame of their work. Conceptual art appeals to the consumer because of interest in the work or process itself or the prestige of ownership. The problem is that since the process itself is quite enjoyable and doesn’t require easily recognizable skills. You might find your art educating others on how to become artists or intriguing others on the process or particular piece. However, the art product itself may not be of interest and therefor will not be valued highly. Conceptual art has found a foothold in public spaces but won’t make much progress until there is more general education about it. You mention that “Conceptional art is something people need to get into.” As a person who is not an artist I can say that many if not most people view this art as a waste of space and worth less than nothing. That may be hard to hear but think about how most people process the encounter with your art. They look at the piece and ask two or three traditional questions. 1. “Is it visually pleasing?” If the answer is “no” or “maybe but I don’t know what it is” then the mind jumps to the second question of “is it useful or practical?” typically this would also be “no” then they ask the final question “does this have a hidden meaning or significance?” The answer is typically “if it does I can’t figure it out and I’m not going to trouble myself about it” the person will immaturely assume his intelligence has been called into question by looking at a “strange thing” and not being able to puzzle it out. There follows a subconscious resentment to the art and artist. Hence the artistic prejudice you likely experience from others on a regular basis. I would focus on making your sales experience an educational one that opens dark and mysterious doors and ushers your customer into the artistic sanctum beyond. Give them the special insights that make this art special to you and you’ll have them hooked on the art form. Then explain the piece to them so that they will have an appreciation for the meanings. If you feel it’s important to let them interpret the meaning for themselves you will have a much harder time selling your art. I’m not trying to tell you how to be an artist but there are some physiological realities you have to overcome to sell it.

  • Jonbon

    I love the article and the links you posted. You’ve got a great intro piece that whets the appetite for more.

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