Negotiation is a critical skill in the world of sponsorship. Whether you're haggling over a new partnership, hashing out asset or contract terms, or persuading a brand to buy your proposal, the ability to negotiate effectively can make or break your success in the industry.
The sponsorship industry can be full of ambiguous value, perceived value, and those levers can cause negotiations to be unfair or unsuccessful. Sponsorship marketers need to be persuasive and win negotiations in order to flourish in the industry.
To become a master negotiator in sponsorship, we turn to the wisdom of Chris Voss, a former FBI hostage negotiator, and his book "Never Split the Difference." In this article, we'll delve into key principles from Voss's book and explore how you can apply them to improve your negotiation skills in the dynamic world of sponsorship.
1. Embrace Tactical Empathy
Tactical empathy, as introduced by Chris Voss, is the practice of understanding your counterpart's perspective on a deep emotional level. In sponsorship, this means putting yourself in your client's shoes, grasping their goals, fears, and desires. When you truly understand what motivates your client, you can tailor your proposals and negotiations to align with their needs. This emotional connection can foster trust, which is vital in negotiations.
Sponsorship Take: Buying and selling and having empathy can go a long way. Properties need to hit revenue goals and brands need to hit objectives. Understanding what motivates and how motivated people and organizations are can provide leverage.
2. Master the Art of Mirroring
Mirroring is a simple yet powerful technique discussed in "Never Split the Difference." It involves repeating the last few words your counterpart says, which encourages them to continue talking and revealing more information. In sponsorship negotiations, mirroring can help you extract valuable insights about the client's preferences, budget constraints, and pain points. By actively listening and mirroring effectively, you can gather essential information to tailor your proposals more precisely.
Sponsorship Take: Pretty tactical one here, but get a sense for the other person's motives by keeping them talking. Good for all negotiations, not just sponsorship.
3. Silence as a Negotiation Tool
Silence can be a potent tool in sponsorship negotiations. According to Voss, people are often uncomfortable with silence and tend to fill it with more information or concessions. In negotiations, this can work to your advantage. When faced with a client's counteroffer or resistance, embrace silence rather than rushing to respond. Allow your counterpart to process and possibly reveal more about their position, which can provide you with an edge in the negotiation.
Sponsorship Take: "Let the price sit in silence". That might be the one thing I remember from my Learfield training 15 years ago. :)
4. Use the "No" to Your Advantage
In "Never Split the Difference," Voss highlights the importance of not fearing the word "no." In sponsorship, hearing a "no" can be discouraging, but it doesn't necessarily signal the end of the discussion. Instead, view "no" as the beginning of a deeper conversation. It's an opportunity to understand your counterpart's concerns and address them effectively. By exploring the reasons behind their refusal, you can work together to find common ground and move closer to a mutually beneficial agreement.
Sponsorship Take: Don't be afraid of no. Especially when you're selling. Understand that when you're selling a maybe is worse than a no. When I was brought up in the Learfield training we had a "take them to no" tactic. Where you would say something like "Well, even though we both thought this was a good idea, it sounds like we can't make it happen this year" ...... [silence]. Swing the no pendulum toward the buyer to see if they do 1 of 2 things. 1. accept the no, validate it and feel a sense of relief (usually) or 2. They push back and fight to not let it be a "no" and give you the reasons or motivations that might reveal that there's still a chance.
5. Leverage the "That's Right" Technique
The "That's Right" technique involves summarizing your counterpart's key points and validating their feelings and concerns. In sponsorship negotiations, this technique can be a game-changer. When your client feels heard and understood, they are more likely to trust your judgment and be open to your proposals. By repeating back their perspective and saying "That's right," you can create a positive rapport that paves the way for successful negotiations.
Sponsorship Take: Everyone's opinions and feelings matter in a sponsorship negotiation. Being heard is a great starter for a great business relationship
6. Employ the "Accusation Audit"
The "Accusation Audit" is a strategic tool discussed in the book that allows you to address your counterpart's potential concerns before they even bring them up. In sponsorship, this technique can preemptively deal with objections and hesitations. By acknowledging possible challenges or drawbacks in your proposal, you show that you've considered their perspective and are committed to finding solutions. This can build trust and make your counterpart more receptive to your ideas.
Sponsorship Take: Always come prepared. What might they say if we say this? What if they go here? Voss' recommends bringing it up early instead of waiting for them to cause the objection. This can be category competitive situations like "Are you done spending in baseball (or whatever sport)? Are you done spending in Baltimore (or whatever market) ?
7. Create Value and Collaborate
In sponsorship, successful negotiations should not be a zero-sum game. Instead, aim to create value for both parties involved. Collaborative negotiation strategies often yield better results. By identifying win-win opportunities, you can strengthen long-term relationships with clients, leading to more fruitful partnerships and referrals.
Sponsorship Take: Bu This is where Voss' strategies shine in sponsorship. How can you create more value for the other side? Can you adjust the asset mix? Can you add something of value for your side of the table that doesn't cost you anything? Can you tap into your brand audience to benefit the properties? Can the mutual audience both benefit from the parties coming together? Finding out how to increase the size of the pie, vs YOUR cut of the pie is really where creativity and innovation can provide substantial value in a negotiation. Sponsorship prices based on supply and demand. Make sure it's tilted in your favor.
8. Be Prepared to Walk Away
One of the most powerful principles from "Never Split the Difference" is the idea of being prepared to walk away. In sponsorship negotiations, this means knowing your bottom line and having the courage to say no when necessary. A willingness to walk away can signal to your counterpart that you're serious and can encourage them to make concessions or reconsider their position.
Sponsorship Take: I highly recommend creating your BATNA (Best Alternative to Negotiated Agreement). This is the option you will choose if your negotiation doesn't work out. By increasing your BATNA, you have the courage to walk a way. This might be a plan "B" partner that you've been working with in parallel or a different plan for the category. If you're in sales or if you're buying sponsorship, this can equate to a full pipeline and "more fish in the sea".
Mastering negotiation skills is a crucial asset in the world of sponsorship. By applying the principles outlined in Chris Voss's "Never Split the Difference," such as tactical empathy, mirroring, silence, and the "No" technique, you can navigate the intricate landscape of negotiations with confidence and success. Remember to focus on building trust, using strategic questions, and fostering collaboration to create value for both parties. Finally, always be prepared to walk away when it aligns with your goals. With these strategies in your toolkit, you can become a formidable negotiator in the sponsorship industry, forging mutually beneficial agreements and securing your professional success.