I thought I would share one of my favorite, but rarely discussed topics in the news, media and with other senior Advertising and Marketing leaders today.
In fact, I thought I would outline some of the key findings that have been responsible for hundreds of millions of dollars in advertising and marketing accounts for over the past two decades.
‘Negotiations are present everywhere in life and work.’
You’ll negotiate little things, like who takes the kids to school or even taking the trash out, and big things, like how much money you’ll be making at a new company or how much a national TV campaign will cost to run for this Christmas!
The first thing I would like to flag is that I have been amazed how poorly trained, educated and skilled at ‘negotiation skills’ most of the Multinational Advertising Agency, Digital and PR Chiefs and General Managers are – both within the US and globally. (Especially when negotiating with brand and client Procurement Directors and team.)
Over the past 25 years, I have been involved with many successful commercial negotiations of all sizes, ranging up to mega deals of great complexity and risk that spans many countries, cultures and industries. So it’s about time to standup and share some of my insights gained from negotiating global media contracts for a massive computer/hardware company, many ‘dot-com’ start ups as well as established: FMCGs, Financial Service Brands, Telco’s, Automotive, Travel, Airlines, Sporting Teams, Fashion, Utilities, Music/Events and other categories.
I have often been appalled over the years at how poorly most Advertising Agencies really are when negotiating with Multinational Clients and brands.
I have even had many lengthy conversations with leading CMO’s and Procurement Officers in recent years – and they often described the annual compensation or remuneration meeting as ‘bringing lambs to the slaughter’.
Unfortunately, in most cases, today’s Agencies don’t have well trained or skilled procurement or negotiation folks sitting at the Boardroom table like the Big Brand Multinational Clients.
In fact, I have personally witnessed many of the leading global agencies getting ‘slaughtered’ once they meet a season Procurement Director. They simply lack expertise in negotiation strategies, processes, behavior and ROI expectations.
My best advise for Advertising Agencies, PR Agencies, Digital Agencies and 1:1 Agencies in 2018 is to focus 150% on winning the Procurement Executive over. Just don’t complain anymore about them. Procurement is here to stay in 2018 and beyond!
My mission, especially over the past decade has always been focused on building a competitive advantage, through instilling a ‘value creating’ negotiation capability, which ultimately leads to greater profitability and increasing shareholder value.
In the Agency space, it’s critical to methodically plan for all internal and external capabilities too and not just in marketing decisions!
Here are just five things I would like to highlight that will improve your success ratio at your next negotiation:
1.PRACTICE SAYING NO
I have learned that, everyone has to practice saying “no” to become more comfortable with this process and ‘feeling’.
This doesn’t mean you should start saying “no” to everything, but it’s far easier if you start becoming comfortable with lower-stakes situations than if you try to hold your ground in a high-stakes situation like a job interview or negotiating a global media and/or advertising contract.
2. LISTEN TO WHAT PEOPLE ARE REALLY SAYING
I have found throughout my career, Listening is one of the most important skills you can have. END OF STORY.
- Listen to obtain information.
- Listen for nuances.
- Listen to understand.
- Listen for enjoyment.
- Listen to learn.
Importantly, recent research suggests that we remember between 25 percent – 50 percent of what we hear. That means that when you talk to your boss, colleagues, customers or spouse for 10 minutes, they pay attention to less than half of the conversation.
This is dismal! In this digital and mobile age and it is even getting worse!
Listening is the biggest and most important part of communication; it’s what allows you to understand what’s going on in the other person’s mind/head.
Moreover, saying less and listening more puts you in a position of power during a negotiation. It means the other person is giving you more information than you’re giving them.
In fact, quiet people are often seen as better, more respectful communicators. Suffice it to say, being a better active listener will make you a better all-around negotiator.
I truly believe that every Agency New Business/Growth Director, CFO or CEO who negotiates with fortune 500 Brands/Clients – can significantly benefit from improving their listening skills!
By becoming a better listener, you will also improve your productivity, as well as your ability to influence, persuade and negotiate. What’s more, you’ll avoid conflict and misunderstandings. All of these are necessary for workplace and partnership success!
3. LEARN BODY LANGUAGE CUES AND MASTER THEM.
As I have written about in the past – The percentage of communication that’s nonverbal is critical. It can account up to 90% of the success in a successful negotiation, presentation or performance. To illustrate this, consider the study that Dr. Albert Mehrabian, of UCLA did on the ways we communicate when there is an incongruence/mismatch in communication.
Source: Albert Mehrabian, source www.kaaj.com/psych, retrieved 29 May 2009
- Words: 7% of message pertaining to feelings and attitudes is in the words that are spoken.
- Tone of Voice: 38% of message pertaining to feelings and attitudes is paralinguistic (the way that the words are said).
- Body Language: 55% of message pertaining to feelings and attitudes is in facial expression.
Subtle cues, like the excessive blinking of the eyes or an uncomfortable shift in a chair, can give you major insight into what’s going on in the other person’s mind.
But you need to be attuned to this body language. The only way to do that is through study and practice. Get in the habit of observing the body language of people you already know, and strangers when you get the chance (since it’s harder to notice in strangers).
Communication is approximately 93% non-verbal.
It is no wonder that so much gets lost between the speaker’s lips and our ears. Non-verbal communication is also important in determining the speaker’s style. So, learn to observe, learn and negotiate better!
Picture: The Famous Tree Swing Picture
The famous tree swing picture (also known as tire swing, tire swing, rope swing) depicting tire (or tire) and rope swing in various states of dysfunctionality, illustrates the pitfalls of poor product design, or poor customer service, and the dangers of failing to properly listen to customers, clients or brand and interpret their needs.
The tree swing also demonstrates the dangers of departmental barriers, and failures of departments to talk to each other, and to talk to customers. This is common between Ad Agencies and Clients too!
As such, the tree swing is the perfect analogy for training these areas of quality, communications, client/agency partnerships, customer care and inter-departmental relations.
If you are using the tree swing to highlight a training subject most people very readily interpret the pictures into their own organizational situations.
4. ALWAYS SEEK CLARITY IN EVERY NEGOTIATION
The best negotiators I have seen, worked with or negotiated over the last 25 years – all were expert at establishing ‘clarity’ before, during and after every major discussion or negotiation.
By that I mean e.g. envisioning the future, determining the feeling that both parties are after and defining the ‘exact’ meaning for what’s needed.
Importantly, know what you want to achieve. The clearer you are on your interests and goals, the better your chance of negotiation success will be.
I have found, in order to be effective at asking questions and having immense clarity, three things must take place:
- Understand where your questions are going. Most people find randomly asked questions to be unnerving and it makes them distrust you.
- Ask the other party if it is okay with them if you ask questions.
- Then tell them what information you want to know.
The best thing I have read recently was by former Accenture executive and New York Times best selling author, Brendon Burchard when he said,
“Define what’s meaningful. Not everything that is achievable is important, and so achievable is not the issue – alignment is.”
Additionally, use all of the four levels of listening to obtain information:
- Selective: We hear things that we believe are relevant.
- Responsive: Allow the other party to know that you are, indeed, paying attention and involved. This involves verbal and physical feedback, nodding, or asking questions like: ‘Tell me more about that.’
- Playback: Always ‘restate’ what you think you heard and ask for confirmation. It is also beneficial to follow up with a confirming question. An example would be, ‘Have I gotten everything, or might there be something I missed?’
- Raise Necessity: When you verbalize facts and information it becomes more real and important to you. The partnership with your client or brand can’t be extraordinary without an absolute necessity to make it excel and be extraordinary.
Picture: Turkey’s President Erdogan and US President Donald Trump negotiating ‘Peace Deals’ for the Middle East
5. Prepare options for mutual gain: Be creative. Find unique ways for both sides to get their interests met. E.g. ‘What if we tried this?’
6. Negotiate everything. If you want to be a better negotiator and you want your Advertising Agency to get a better deal, you have to negotiate!
The more you do it, the more comfortable you’re going to be, which will lead to more natural confidence and better overall results.
You’ll become a better speaker, a better listener, better partner and you’ll learn the rhythm of negotiation better.
The key here is to start with small situations and scale your way up to bigger and more important ones.
I recommend, start negotiating small responsibilities with friends and family members, and then work toward innocuous social situations, and then start commanding more authority in your workplace by negotiating your responsibilities and needs.
Then, after tireless practicing and improving, I think you need to initially find a great role model in the New Business and Agency Growth space and let him/her become your role model.
7. SHARE INFORMATION & BUILD TRUST
I have consistently found in my travels that people ‘follow the norm‘ of reciprocity by responding in kind to how we treat them.’ If we want to be trusted, we must first offer it.’
By this I mean, you don’t have to put all of your cards on the table at the outset. By simply putting something of yourself out there – your vision, hobbies, personal concerns, or dreams – you can set a positive tone that’s conducive to gaining agreement. Be the role model and serve with integrity, heart and excellence.
Having worked in many multinational advertising, direct and digital agencies during my career – I have especially noticed over the past decade, that at least 50% plus of clients/brands today are now bringing a ‘procurement’ executive into Agency/Client negotiations.
Importantly, as Agencies are generally not skilled negotiators or want more accountability, or more contingency planning, tighter evaluation methods or better strategic plans across all disciplines – ‘procurement’ executives scare the ’crap’ out of most unseasoned Advertising Management teams today.
Agencies need to always understand that their key role today is ‘adding value’ and ‘procurement executives’ aren’t just focused on cutting Agency costs!
In today’s ‘always on’ digital/mobile world, the smartest marketers are now demanding clear deliverables, accountability, efficiencies and procedures. In fact, I only see the rise of more clients and brands involving ‘procurement’ earlier and more often in all future strategic planning and execution sessions.
Ad Agency CEO’s, CFO’s and Boards must now plan for this ‘recent’ movement. It isn’t going to go away and you can’t put your head in the sand and ignore it anymore!
In fact, today’s best agencies must understand and prepare for adding more ‘value’ to their clients, saving them more money year-to-year, by applying and using the best metrics for the industry/client and ensuring that costs/investments are closely adhered to.
Importantly, incremental profits ensure increased sales, more successful launches and campaigns, increased sales, improved EBITDA and better relationships.
CONCLUSION: Changing the way you think about negotiating – joint problem solving versus a series of compromises where one party may win and one may lose – is the first step towards leveraging your negotiating skills and enjoying better results.
Finally, to increase your batting average and become a better negotiator. Always develop a strategic plan in advance of the actual negotiation.
This will give the ‘negotiator’ far more confidence, and lead to better and more consistent results. I wish you much success in your next Agency compensation or remuneration meeting.
Remember: being an effective communicator and negotiator starts with being an outstanding listener and always teaching people to think and grow.
If you recognize you need to upgrade or revise your existing strategies or plans for 2018, please reach out and call me today. Isn’t it time you had an established ‘rainmaker’ and ‘negotiator’ helping you become even more successful and have a full business pipeline and success with your compensation agreements in 2018?
More About Geoff De Weaver:
Since 1985, Geoff has helped pioneer the use of inbound/outbound marketing, content marketing strategies, leadership, digital, PR, innovation and social media marketing specifically for agency new business.
Geoff is one of the Advertising & Digital industry’s leading agency New Business Thought Leaders. His extensive cross-cultural expertise spans five continents, multiple languages and hundreds of companies. Over the course of his career, Geoff has won more than 90% plus of the brands/ businesses he has pitched. (Rare in an industry that averages 20%-25% success rate is considered good.)
Geoff can also access hard to reach brands and clients, fully examine and target your exact needs and requirements in all channels. I can even pitch on your behalf and happily be the extension to your company’s new business team.
Proven, in-depth expertise in Internet Marketing, leadership development, organization design, performance management, training, ideation process and communications. Areas of focus are leadership, innovation, agency profit and loss, global business development and executive coaching.
Importantly, I develop Ad Agencies, PR Agencies or Digital Agencies to discover power, accuracy and efficiency through properly sequenced and correctly timed mechanics. Geoff is a strong globally experienced strategic thinker, active practitioner, and perennial entrepreneur.
Give me a call and let me show you a better way and prepare for the future, +61 411 224 961 or send me an email: email@example.com
Global Brand Management & Operations, Digital Marketing, Marketing, Advertising, Sales, Training, New Business, Consulting, Management, Strategic Planning, Leadership Coaching, High Performance, Negotiating, Team Building, Operations, Developing Strategic Business Development & Marketing Plans and Ad Agency Growth.