Top 7 Questions About Negotiating with Customers

Here are 7 Questions (and answers) About Negotiating with Customers with Myra Golden.

1. Is it wise to make concessions when negotiating with customers?
   
   Every negotiator, even savvy executives, concedes from time to time and as long as the concession makes good business sense, it’s okay. BUT – and this is a BIG but – you need to be aware of what your concessions are saying to customers. A large concession on your part tells the customer he can get a lot more, so he may press you for more. Rapid concessions undermined your company’s creditability. Only make concessions if you have considered all of the alternatives, you feel it will maintain the customer’s loyalty, and when it balances the interests of both your customer and your company.
   
   
2. How do you respond in a negotiation with a customer when the customer’s demand is unreasonable?
   
   I use 5 little magic words: “That sounds a little high.” And then you pause. No matter what dollar amount the customer puts out, just state the 5 magic words and then sit back and wait for their response. Most people become increasingly uncomfortable with silence and will feel compelled to respond. Most likely, your customer will either make a more reasonable request, or they will try to justify their request.
   
   
3. What do you do when you find yourself in a deadlock with the customer in negotiation situation? That is, what do you do when the customer isn’t accepting your offer and you are not willing to concede?
   
   Don’t allow the customer to push you into a corner. Here’s a phrase that will help you set and enforce your limits, while at the same time moving the conversation forward: “We see this differently, and I am going to have to put more thought into the perspective you have shared with me. It’s helpful to me to understand how you see things. In the meantime, here is what I can do to solve the immediate problem.”
   
   
4. Is it appropriate to negotiate with a difficult customer who is actually responsible for the problem they are complaining about?
   
   I am not for compensating customers when the problem is clearly their fault. Never forget, today’s exception becomes tomorrow’s expectation. Customers have eternal memory, and they’ll expect you to give in again if they encounter the same “human” error. Here’s how I’d respond to the customer when the problem is clearly their fault:

   
   
   “We appreciate hearing about your experience, but we cannot compensate you in this matter because you failed to follow instructions (or misused the product, etc.)”
   
   

5. Should frontline customer service employees be involved in negotiations with customers or should this always be the responsibility of supervisory or management employees?
   
   As long as employees are trained, empowered, confident, and known to make good judgment, they can negotiate with customers. Having said that, it’s often a good move for frontline customer service representatives to admit early on that they don’t have the final say in a negotiation. (Even when they do have the final word, this is a good move.)Admitting this gives the representative a graceful exit, should negotiations become deadlocked.
   
   
6. What are some of the most common tactics customers use to paint companies into a corner in a negotiation situation?
   
   There are many tricky tactics customers will use when negotiating. When it comes to negotiating a settlement in a product liability complaint, a common tactic is the use of hypothetical questions. An example hypothetical question is “If my 3 year old son had bitten into the hamburger that had the piece of glass in it, don’t you agree that he could have been in serious condition?” This is clearly a setup and you cannot answer the question. Get the customer focused on solving the actual problem that did occur and nothing more.
   
   
7. Is it appropriate to negotiate with customers via email?
   
   Yes, it is. Ten years ago I would have answered differently, but today email is the preferred communication medium of many of your customers. You need to know that email negotiations tend to take longer than phone and face to face negotiations and email negotiations are less likely to end in agreement. If things become tricky via email, pick up the phone and call your customer.

Myra Golden is author of the best-seller, Beyond WOW. She is nationally recognized for delivering paradigm-shifting programs that position employees to build, restore, and strengthen customer relationships. Her clients include McDonald's, Coca-Cola, Frito-Lay, Michelin Tires, Estee-Lauder, and many more.