Wednesday, April 29, 2015

ANALYSIS OF LIVE8 NEGOTIATION

LIVE8 Negotiation  - Janine Olah
            For my preparations for the LIVE8 negotiation, I used the negotiation checklist.  My overall goal was to get the potential audience for my concert to be able to access information about the concert on the WorldWideWeb.  The issues I had in meeting this goal were to obtain a domain name, and at the same time keep as much money as possible in my departmental budget.  The most important issue was to get the domain name.
             I set my Resistance Point at $1,200,000.00, which represented the one million dollars I had left in my department’s budget, plus the $200,000.00 that my boss said he could collect from other departments.  It was difficult to decide on my initial offer, but I eventually chose to anchor the negotiation much lower than my reservation price to see what would happen.  My initial bid was $300,000.00.  My BATNA was that I would have to pay an outrageous sum for one of the other two domain names.
            I didn’t know a whole lot about my opponent, Kameron Morral, other than that he was from Turkey and that his domain name had been “under construction” for a while.  I assumed that his BATNA would be just to keep the domain name and wait until another person wanted the name. As for his resistance point, this was nearly impossible for me to determine.  I knew that of the three other domains I contacted, two wanted 5 million dollars and one of them was willing to let theirs go for free, so there was quite a range.
            As far as the situation, I was more impatient because the concert was going to start in two weeks and the website was going to be shut down on that domain in one week.  Since Kameron site had been idle for some time, I didn’t feel he’d have much urgency to sell.   
            Looking at the fairness norms, I wanted to focus on the charity aspect of the concert so that he might feel a sense of moral obligation to sell. There were a few topics of discussion that I wanted to avoid.  One, was the fact that I was about have my current website shut down and, two, the fact that two other domains were trying to get 5 million dollars for their similar sites. 
            When I first contacted my negotiating partner I wanted to make sure that I didn’t sound too desperate.  I also wanted to focus on interests by stressing the charity aspects of the deal and tried to appeal to his sense of goodwill. I framed my request as an opportunity for him rather than a need of mine.  I never mentioned my other domain name that was being challenged. I led with my initial $300,000 offer, a full 900,000 lower than my resistance point.  
            I was pleasantly surprised when Kameron returned with an offer of $475,000 because his first offer was already lower than my resistance point.  My counteroffer to his counteroffer was to go up just a bit to $325,000.  I tried to appeal to his emotions by adding the slight dig about taking money from starving children and I added a sense of urgency for him by mentioning that the domain name might not be worth much after the concert, so the time to sell was now.
            His next offer was $375,000, and even though this offer was well within my bargaining range, my role explained that I was to save as much as I could.  So at this point I used the norm of reciprocity by sharing some information with Kameron about the other three domain names in hopes of gaining some empathy from him.  I also “expanded the pie” by offering him tickets to the concert and advertising mention, along with my offer of $350,000  which was splitting the difference between the two latest offers.  At the end, I avoided asking a yes or no question to seal the deal.  That offer was accepted. 
            I felt the negotiation went well and that each of us had some of our interests met.  I was pleased that I ended up well below my reservation point.

            

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