To Seal The Deal

When we negotiate, we do not just make decisions based on how we feel, rather we draw from different sources to help us evaluate the situation we're dealing with. Initially, there is more than one party involved and both parties aim is to maximise the outcome by contributing less input. However, while one party most likely experiences a loss, the other party will win the deal.

This video clip was a short scene from the movie “Jobs”, where Ashton Kutcher who plays Steve Jobs approached Paul Terrell to set up a contract for his computer shop.  What you didn't see before this scene was that Wozniak gave a demonstration of the Apple 1 at a computer lab called Homebrew Computer Club. Paul Terrell saw the demonstration and expressed his interest but didn't say explicitly that he wanted to make a deal.

So how did Steve Jobs or Ashton approach the negotiation situation? The basic idea of sales was that we can be easily tricked into buying items that we do not need and even more into buying items, we can’t have (Cialdini, 2007). Just bringing to view the label "limited edition" is enough to trigger our hunting instinct. One negotiation tactic used by Ashton was to create the sense of scarcity by saying that many retailers looked at his computers. Not only did he say that there are other parties considering to seal a deal with him, he also said that Paul was the chosen one out of all of those retailers and therefore should consider the offer now before the opportunity is gone. This is due to the fact that Jobs hinted out his that his products are close to been gone. In other words, he placed time pressure on Paul ,ultimately leaving Paul with less time to explore his alternatives, almost deliberately commanding him to make an abrupt decision. As a result, he'll be more inclined to create a contract between him and Jobs (Stuhlmacher & Champagne , 2000).

Paul on the other hand was aware that not many retailers wanted to buy Apple 1, as not many people seem to have been interested in their computer. He stated this during the negotiation. Ashton (Jobs) appeared to be very confident and argued that he does actually have alternatives. In other words, Ashton made it appear as if he had a better BATNA (Best Alternative To a Negotiated Agreement). Berscheid (1966) argued that similarity is factor that can convince us to negotiate into things that appeal to us. For example, Ashton Kutcher related to the targets name by saying that his middle name is also Paul. Drawing a simple familiarity between both parties can lead to a sense of trust, considering the fact that people ally themselves with things that they are familiar with, as familiarity is related to trust.

Berscheid , E. (1966) Opinion change and communicator-communicatee similarity and dissimilarity. Journal of Personality and Social Psychology, 4, 670-680.

Cialdini, R. B. (2007). Influence: The psychology of persuasion. S.l.: Collins.

Stuhlmacher, A. F., & Champagne, M. V. (2000). The impact of time pressure and information on process and decisions. Group Decision and Negotiation, 9, 471-491.