At auction, I made an impulsive vehicle purchase that I soon regretted. The sweet pickup truck was intended for my 16-​year-​old son. Patiently, my wife explained that her son would never be safe in that truck, and that I was a fool.

“I got caught up in the heat of the auction,” was my poor excuse. Swallowing my pride and admitting idiocy was far less painful than paying to rectify the deal. I learned that auctions are not the same as sales negotiations AND auction rules are quite firm.

Use Auction Strategies in Your Sales Negotiations

Auctioneers have superpowers. Not only do they chase an elusive price point, but they make (mostly) everyone feel like a winner. The law of auctions involves binding contracts, minimum bid increments and risk assumptions not commonly associated with B2B sales negotiations.

Lydia Fenet is an auctioneer and author at FastCompany​.com and she shares her considerable experience with readers here. Many of her strategies you should adopt if you want to be a stronger dealmaker. Here are just three:

• Build rapport and trust. Auctioneers focus on positivity as they engage with the crowd, making eye contact and reading body language. Keep in mind they do this in a public forum where tensions sometimes run high. You can replicate this in sales negotiations by being friendly, professional and respectful while you maintain control.
• Anchoring techniques. Psychology plays a vital role in initiating a price. In B2B negotiations, an aggressive first offer will anchor the discussion to your advantage. At auction, this price influences subsequent bids. In B2B sales, the first offer shapes expectations and counteroffers.
• Create value. Prior to banging the gavel, auctioneers have shared features and the virtues of the item at bid. Quickly, they’ve assessed the crowd for attentiveness and identified their prime bidders. Like culling a herd, they focus on the action and, as Fenet says, “always befriend your underbidder.”

Befriending the Underbidder is a Smart Tactic

Like an auctioneer, a smart negotiator knows it’s crucial to make every person in the room feel important. In auctioneering, if there is no underbidder there is no bidding war. The point of the exercise is to encourage competition and inspire the underbidder.

In sales negotiations, you create value, weigh intent and balance competition with thorough research and knowledge of your prospect’s needs. Sometimes you win; sometimes you learn.

Occasionally, your product is not the right fit or the timing is off. In these circumstances it’s best to focus on the relationship and creating rapport. Eventually, conditions will change and, as Fenet writes, “a ‘NO’ today does not mean a ‘NO’ in six months.”

Learning From Mistakes

Life is for living; mistakes are for learning. Lydia Fenet shares “5 mistakes you might be making in a negotiation” and it is well worth investigating. Again, as an auctioneer, she has a perspective that transcends a B2B seller’s viewpoint.

One mistake that stands out is entering sales negotiations with the wrong mindset. The author reminds us that negotiation is a conversation, not a battle. Here is a link to find more things you can do better.

Auctions vs. Negotiations

Auctions are straightforward, competitive transactions designed to tease out the highest price of an item in a defined environment. Buyers may be subject to the “winners curse” where bidders exceed the item’s worth due to competitive pressure. Tell me about it!

Negotiations are preferred for complex projects where experience, reputation and knowledge are required for more customized deal structures. Also, sales negotiations offer the flexibility to explore interests, generate options and create value over a longer period.

Photo by Antoni Shkraba on Pexels