Wednesday, March 19, 2014

Haggling For Dummies


This scene is taken from the classic comedy Monty Python’s The Life of Brian. We join Brian as he is desperate to escape arrest by the Roman guards following a Latin lesson scrawled on the walls of the palace (https://www.youtube.com/watch?v=XbI-fDzUJXI) and so Brian decides to quickly buy a false beard from a market stall to use as a disguise…



Despite being rather unorthodox exchange, the scene provides several lessons in the art of negotiation.

The first mistake Brian makes is impulse buying under time pressure, which is likely to lead to poor decision making (Zakay, 1993) even worse, he tells the merchant he is under time pressure, allowing the merchant to make a high offer and causing Brian to accept it straight away. However, luckily for Brian the merchant seems to be completely barking mad and decides to refuse to accept Brian’s acceptance of his first offer, begging him to haggle with him! The merchant also cleverly gets his large, intimidating friend Bert to express surprise at Brian’s refusal to haggle, leading to social proof, further pressing Brian to haggle.

The merchant did well to set an initial high price of 20 shekels; Brian –still in a rush – falls for the anchoring effect and makes a first offer of 19 shekels, yet again the mad merchant refuses this offer and suggests Brian should make an even lower offer. Brian takes the advice and offers a more door-in-the-face price of 10 shekels, this is likely to improve the merchant’s acceptance of a slightly more reasonable price as Cialdini et al., (1975) found that people were more likely to accept an offer if it is preceded by an extreme offer.

Unfortunately for poor Brian the merchant then justifies a higher price because he has a poor old dying grandmother. Langer et al., (1978) showed how giving a justification for pushing in line to use a photocopier, even if extremely weak such as “Can I go before you because I need to photocopy this”, increases acceptance of the request. Brian does well to then only increase his offer to only 11 shekels, however the merchant then continues to justify a higher price stating that the beard cost him 12 shekels, to which Brian rapidly increases his offer to 17 shekels (luckily the merchant tells him off for raising his offer too soon). The merchant continues to use social proof by yelling Brian’s offers to passers-by, pressuring Brian to raise his price.

Eventually the merchant states his final price of 17 shekels and after all the hard work, Brian finally learns his lesson that the merchant really just wants to haggle so makes him an offer of 16 shekels which he accepts, this could be seen as Brian making a concession by adhering to the merchants desire to haggle, consequently ending in the merchant reciprocating and throwing in a gourd for free. Stupidly Brian insults the merchant by rejecting the gourd leading to further haggling over a gourd, but luckily Brian walks (runs) away from the situation with his beard in hand just in time. 

References

Cialdini, R. B., Vincent, J. E., Lewis, S. K., Catalan, J., Wheeler, D., & Darby, B. L. (1975). Reciprocal concessions procedure for inducing compliance: The door-in-the-face technique. Journal of personality and Social Psychology, 31(2), 206.

Langer, E. J., Blank, A., & Chanowitz, B. (1978). The mindlessness of ostensibly thoughtful action: The role of" placebic" information in interpersonal interaction. Journal of personality and social psychology, 36(6), 635.

Zakay, D. (1993). The impact of time perception processes on decision making under time stress. In Time pressure and stress in human judgment and decision making (pp. 59-72). Springer US.

Fiona Angell

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.