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Pandemic, technology force salespeople to adjust negotiation tactics

MU researchers find sticking to specific online sales strategy can improve success rate

May 28, 2020
Contact: Pate McCuien, 573-882-4870, McCuienP@missouri.edu

Due to the rise of COVID-19, people have become hesitant to meet face-to-face. Many rely on online meetings to get their work done.

Business transactions are facing the same challenges, putting salespeople in uncharted territory. According to the International Association for Contract and Commercial Management, 85% of all negotiations between businesses take place over email instead of in person. That was before the implementation of social distancing. Now as many are working remotely, it is becoming increasingly difficult to negotiate in person.

With these changes to the sales industry, many salespeople are having trouble reaching the goals they set for themselves before the pandemic.

This is an image of Detelina Marinova.

Detelina Marinova is a Frances Ridge Gay MBA Professor of Marketing at the Robert J. Trulaske College of Business.

However, in a study recently published in the Journal of Marketing, Detelina Marinova, Trulaske College of Business professor, found that certain sales tactics can improve the chances of a successful e-negotiation.

“Salespeople are simply anxious because many of them are paid by commission,” Marinova said. “They are struggling to figure out how tactics that were so successful for them in face-to-face sales scenarios will translate to success in email negotiations.”

The study looked at two years of emails and data from a private firm to discover the words and phrases that resulted in the most attention from the buyer. These words and phrases were then categorized as negotiation tactics and grouped into one of two commonly used categories, “compliance” and “internalization-based” tactics.

“Compliance” tactics are tactics in which the seller of the product accepts some of the risk of the transaction. If a salesperson intends to use these types of tactics, they will need to use information that does not pertain to the product itself to convince the potential buyer. For example, if a seller is confident enough in their product, they may offer a warranty, taking on some of the buyer’s potential risk. To track this tactic, the research sought words like “perform,” “review,” and “send.”

“Internalization-based” tactics, however, put the onus on the product and the buyer. These tactics utilize information about the product to convince the potential buyer. The seller could, for instance, present the buyer with a broad scope of information about the product, allowing the buyer to internalize the information and truly ponder if the product is the best fit. With these tactics, it is important that the salesperson presents the most important and relevant information to the buyer. If successful, the buyer will realize the product speaks for itself. To track this tactic, the researchers looked for words like “attach,” “forward,” “recommend,” and “advice.”

When sellers used tactics from both categories through online negotiations, buyer attention decreased. The use of different tactics implemented remotely is overwhelming to the buyer, who has a shorter attention span online. Thus, the researchers suggest that salespeople should use multiple tactics from the same category to maintain the attention of the buyer when negotiating online. The findings show that increasing buyers’ attention by a factor of one standard deviation increases the likelihood of a contract award seven-fold.

“In the past, researchers weren’t able to study buyer attention as well as we are now, given all of the tools and other techniques that we’ve used in this study.” Marinova said. “Most of the prior research has only studied compliance and internalization tactics individually. We traced the entire negotiation process over two years.”

Marinova’s research helps provide insights to salespeople about how to adjust to a changing medium. Here are some tips for any salespeople struggling to adjust to technological changes:

  • Keep your tactics simple. The potential buyer’s attention span is much shorter in online negotiations. They are often in negotiations with many other businesses as well, so try to optimize your sales pitch. Only use similar sales tactics from one category to keep them engaged.
  • Use your sales tactics at strategic times. Sales tactics from the same category can help reinforce each other. So, use similar sales tactics within close proximity to increase buyer attention. If used correctly, each tactic will amplify the other.
  • Be patient. Online conversations often take longer than those in person to reach resolution, so closing the deal can take some time. Be patient with the buyer and don’t bombard them with unwanted sales tactics if you don’t hear back immediately.

“Business-to-Business E-Negotiations and Influence Tactics” was recently published in Journal of Marketing. This research was funded by the Marketing Science Institute.

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