Our thanks to those of you who voted in our latest poll, “Which of the following is a Principled Concession™?” For those who need some reading on the definition, see our article here or the full list of our articles about this topic here. Without further delay, our answers:
“Why don’t we split the difference?” As of the date of this posting, no one chose this answer. That’s good, because this is not principled. “Split the difference” can be characterized as a way to make both parties equally unhappy. Since neither has a good reason for the split, each is likely to go away thinking they could have (or should have) gotten more. The technique often works because it appeals to our sense of fairness.
“You can have 5% off if you buy today.” 5% of our voters picked this one. This is most commonly heard in the technology business near the end of a quarter or year. It is not principled. In fact, instead of encouraging a sale today, it encourages waiting until the deadline (e.g. end-of-quarter), to see if the deal gets better. If there is no compelling reason to buy now, savvy buyers will wait until the next quarter – for an even better deal!
“You can have 5% off if you buy today for delivery next week.” This one is closer, but it is not a principled concession. It got 35% of the votes. Why? Most people recognize that there is a trade here – you pay less, but delivery is later. Presumably, if you wait until next week, you pay full price. Why isn’t it a Principled Concession™? Because it makes no direct connection to the buyer’s business value. There is no stated loss of benefit that comes with waiting. So in this case, a buyer who acts should accept both the discount and the delivery delay. It would be Principled if it were in this form: “You can have 5% off if you buy today for delivery next week. However, you will not be able to get the (benefit which is obtained through use) until next week, and that will mean (loss of benefit). Sample benefit/loss pairs might include such things as public visibility for an advertisement and the loss of sales, or use of your new car and the need to pay for public transportation in the meantime. Note that benefit/loss pairs can also be put positively as benefit/gain pairs. For example, if you pay the full price today, your advertising will run now, and you can expect 12 additional sales before next week.
“You can have 5% off if you buy 10.” Only 2% of our voters went for this one. There is no trade, and there is no explicit value to the buyer. For the seller, it is nice to reduce the cost per sale, but that is value to the seller. If we said, “You can have 5% off if you buy 10, which saves me marketing expense which I can use to reduce your price, and you get the benefit of 10 deployments instead of 1, which means that you will accrue (benefit)…”, it would be Principled.
“We give 5% off on days that end in “y” – like today!” Not Principled, and fortunately no one thinks that it is.
“None of them.” Well, 60% of our voters understood that none of the choices follow the Principled Concession™ format described in the article. We hope that they also recognize that unprincipled concessions not only accomplish nothing, but often delay decisions. The real test is not how you voted, but what you will do in your negotiations. Our hope is that you will only make Principled Concessions™. (td)