Classic Sales Negotiation Tactic: I’ve Got To Talk To My Boss…

by drjim on February 17, 2009

The Escalating Authority Sales Tactic Is Crude But Often Works

The Escalating Authority Sales Tactic Is Crude But Often Works

Picture this scene: it was about 20 years ago (ouch!) and I was still dating my wife when she suddenly had to replace her car. She knew exactly what she wanted: a Honda Civic with a manual transmission. There was a local Honda dealer near where she lived so one evening we went there to have a talk about buying a car.

The salesman that we talked with was the “older guy who reminds you of your uncle” variety. I had an opportunity to sit back and watch my soon-to-be-my-wife bargain with him over the price. She started low, he started high, and after a bit of back-and-forth, they were still fairly far apart. Now my bride-to-be had done her homework and had called a bank to find out how much this car was really worth (20 years ago = no real Internet). So she knew what the correct outcome of this sales negotiation needed to be.

The salesman that we were dealing with looked at the gap in offered / accepted prices and said, of course, “are you sure that you can’t do any better than this”. When my girlfriend said “No”. He then said “I’m going to have to go talk with my boss about this…” And off he went.

Returning about 10 minutes later, he had a slightly lower price, but still the gulf between what my girlfriend was willing to pay and his new lower price was great. TWO MORE TIMES HE WENT BACK TO TALK WITH HIS BOSS. I couldn’t believe this – I was watching a classic Greek play being staged before my very eyes. At any rate, my girlfriend got the price that she was asking for in the end after about 90 minutes of haggling. What was going on here?

I didn’t know the name of this sales negotiation tactic at the time, but I do now. It’s called the “Escalating Authority” tactic. This tactic uses the need to have a deal approved by a reluctant higher authority in order to gain more concessions from the other side of the table.

This tactic is used by salespeople all the time. The reason that they use it is because it often works. Here’s what a salesperson can expect to get out of using the “Escalating Authority” tactic:

  • Helps to lower the other side’s expectations.
  • Causes the other side’s arguments to come out early instead of later.
  • May cause conflict within the other side’s negotiating team.
  • Causes the other side to state their negotiating demands earlier.
  • Just physically wears the other side down.
  • May end up lowering the self-confidence of the other side.
  • Uses up the other side’s valuable time.

The party that this tactic is being used on is not without defenses. There are several counter measures that can be put in place in order to diminish or eliminate the effectiveness of this sales negotiation tactic:

  • Match the other side: bring your higher level people to the table when they say that they need to go to their higher level people.
  • Walk out.
  • Bypass the other side of the table and go directly to their senior management.
  • Manage the expectations of a quick resolution on your side of the table.
  • Communicate to your side of the table what tactic is being used against you and let them know that one of its goals is to lower their expectations for the outcome of this sales negotiation.
  • Don’t repeat yourself. Force the other side of the table to relay all that you have said to each higher level of their management.

In the end, the Escalating Authority tactic is a fairly crude negotiating tool that is used most often by amateur negotiators. It can be countered easily and effectively. Keep your eyes open and make sure that you spot it when someone starts to use it on you – the best Escalating Authority tacic defense is a good offense!

Have you ever had the Escalating Authority tactic used on you during a negotiation? How did you respond to it? In the end was it successful? Have you ever had a chance to use it during a negotiation? Leave me a comment and let me know what you are thinking.

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{ 4 comments… read them below or add one }

Zan February 24, 2009 at 11:35 am

I have used this tactic during a negotiation as a way to buy time to think about how best to respond.

Also, I have use this tactic even when I have the authority to meet the demands of the customer. Because if I could sell something at a cheaper price why didn’t I offer that price to start with? This tactic can help you maintain credibility.

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Michael August 10, 2009 at 9:12 pm

I prefer not to enter negotiations in a “sum zero” or “fight for survival” state of mind… and only start using tricks/techniques after the other party starts using them or i have a burden that forces me (i.e. to buy time)

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Dr. Jim Anderson August 17, 2009 at 1:21 pm

Michael: You would think that the day of such “old school” tactics would have passed us by, but no, they sure seem to still be here. I guess the most important point is to make sure that you recognize it when someone starts to use them on you…

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Robb January 15, 2011 at 2:20 pm

I typically respond to this with “Evidently I am dealing with the wrong person on these issues, I should be speaking directly with the person that has the authority to make these decisions.”

This typically results in a change in tactic and more cooperativeness from the opposing negotiator.

I don’t agree with the poster that says that this helps maintain credibility….I think it lessens credibility because if you dont have the authority to make decisions then you shouldn’t be making offers to begin with as far as I am concerned.

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