Understanding How to Negotiate with Anchoring

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Join us on February 16th, 2020 for the PointsNerd Reader Meetup with special guest, Ricky Zhang from Prince of Travel and Ian Davis from US Tax Resources. Learn more about this unique opportunity at https://www.pointsnerd.ca/pointsnerds-reader-networking-meetup-february-16th-2020/

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Let’s try an experiment.

I want you to guess whether the population of Nigeria is greater than or less than 25MM.

Now I want you to guess what the actual population of Nigeria is.

What did you guess?

The actual population of Nigeria is ~191MM people and it is the 7th most populous country in the world but I’m going to guess that you assumed the population was between 20-40MM or somewhere in that range.

This is what is known as anchoring.

By planting the number of 25MM in you mind, your natural inclination is to assume that the true population must be close to that number.

How Does This Help Me?

I love learning about how people think and behave so that I can leverage that information to help me achieve my goals. Using anchoring can greatly assist you to social engineer your way to a better outcome

If you’ve traveled a lot, you are bound to have run into a situation or two that wasn’t ideal. Perhaps the in-flight entertainment (IFE) was malfunctioning on your transatlantic flight or you found a used bandaid under the bed of your hotel room. Whatever the case may be, you are often left feeling jaded.

This is most likely because when you complained to the manager of the hotel or the airline itself (if you complained at all), you left the resolution open-ended. Here’s an example of what someone that doesn’t use anchoring might say in a complaint email:

Dear Hotel Manager,

When we arrived at the hotel last night, we were given a room that clearly had not been cleaned. When we complained to the check-in clerk, our concerns were met with a shrug and we were hastily given a key to another hotel room. When we got to that room, the key didn’t work and we had to walk back to the front desk to get a functioning key. I feel that this stay is off to a bad start. I would appreciate a response to the situation.

Sincerely,
Mr. Fife

The most likely outcome of this situation is that the hotel manager may call you to offer their apology and, if you’re lucky, give you a credit towards a pay-per-view movie or something else fairly inconsequential to the hotel.

The reason for this is that you didn’t give a specific desired outcome and left the hotel manager with too much discretion to try and make you happy.

Think about it.

How many times do folks in the service industry go beyond your expectations to resolve a complaint? Not very often. At best, they meet your expectations but rarely do they exceed it. When brands exceed your expectations, you remember and you tell all your friends about it because it is so out of the ordinary. Brands like Ritz Carlton and Disney come to minds as brands that really understand how to go above and beyond but most others just don’t get it.

So why not take control of the situation yourself?

How to Anchor

Much like my Nigeria example above, you need to anchor the hotel manager to a lofty expectation for a resolution. The theory here is to ask for the stars and settle for the moon. Sometimes you may even be pleasantly surprised when they give you the stars.

It should be noted that this is more of an art than a science. If your proposed resolution is outlandish, there’s a chance that the hotel manager feels so offended that they don’t offer you anything more than an apology so tread carefully.

Remember, there are no guaranteed outcomes here – this is meant to provide guidance to help you achieve your goals.

Here’s an example of how Mr. Fife might want to write his email:

Dear Hotel Manager,

When we arrived at the hotel last night, we were given a room that clearly had not been cleaned. When we complained to the check-in clerk, our concerns were met with a shrug and we were hastily given a key to another hotel room. When we got to that room, the key didn’t work and we had to walk back to the front desk to get a functioning key.

I feel that what we experienced at check-in was not up to standards that your hotel has demonstrated time and time again. I have read very positive reviews across many review sites and I must say that I felt rather disappointed in the service that we were provided.

I would respectfully ask that as a gesture of goodwill, the hotel provides compensation of 40,000 points as well as breakfast in the hotel restaurant for tomorrow morning. This gesture of goodwill would certainly go a long way in resolving the poor start to our stay.

Sincerely,
Mr. Fife

Tips and Tricks

There are a few things you can do to better your likelihood of success:

• Know the standard resolution – if you know what the airline/hotel/car rental agency offers as a resolution to a complaint, you will have a better understanding if what you should ask for. Check things like TripAdvisor or Flyertalk and search for keywords like “complaints” and see what other people have received in compensation.
• Have a story – the more detail you have in your complaint, the more likely it is to be taken seriously. If you demonstrate how you were negatively affected and communicate that well, the person deciding your fate is more likely to be responsive because they can empathize with your situation.
• Loyalty matters – if you have status or have stayed/flown/rented many times with the same company, let them know that. Companies are more likely to try to fix issues with returning customers.
• Be courteous – don’t be a jerk – plain and simple. Nobody wants to deal with the obnoxious guy. Make it easy for people to connect with you and want to help you.

Conclusion

Learning how to write effective complaint letters when things don’t turn out as you expect is a valuable lesson but a huge part of that is understanding how to anchor your request. If done correctly, you stand a much better chance at being satisfied than if you left it to chance.

Your mileage may vary depending on who you deal with and the brand that they represent but remember, if the issue isn’t resolved to your satisfaction, you can always escalate it if you feel it is necessary.

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