Elements of Negotiation

             The word negotiation is heard often in the world of entertainment. On a daily basis we watch television shows like “Entourage” where the star’s manager and agent are in constant negotiations with each other about what movie role the star should take.  What about in real life? We see people at the local Starbucks drinking coffee or at Panera Bread having lunch, all while negotiating a deal. Negotiating is a daily part of our lives.  We negotiate more with ourselves than we do with anyone else. In the entertainment industry negotiation is a key skill that is necessary to be successful.  I had the pleasure of interviewing a successful individual in the entertainment industry who has mastered the art of negotiation. For reasons of confidentiality we will name the individual Mr. Lee. During the interview with Mr. Lee, he talked about certain elements of negotiating process. These elements are objective criteria, leverage and power, and status.

            Mr. Lee stated that he negotiated a tour for a well-known R&B star. While negotiating with one of the tour venues, a pricing issue arose concerning the percentage that the venue should receive per ticket sold. Mr. Lee never goes into negotiating a deal without using objective criteria. He has a goal in mind that needs to be accomplished by the end of the negotiation process.  The venue manager wanted 35% of the ticket sales as opposed to the 25% that was agreed upon. The venue manager advertised underpriced tickets by mistake and had sold a number of seats. To avoid having to refund the money for the underpriced tickets the venue manager wanted a larger percentage. Mr. Lee knew that 35% percent was not fair for the artist nor the future of the tour. If the other venues on tour heard about this incident then every venue would want to re-negotiate and the tour would lose major money. Anything over 30% would not work for Mr. Lee. So Mr. Lee negotiated for 28% and guaranteed that the artist would perform an extra 30 minutes on both nights of the show. The venue manager would redeem his mistake without having to pay refunds to customers and the artist would get rave reviews before performing at the next venue on tour.

            I asked Mr. Lee what was the key to effectively winning while negotiating. He smiled and simply said “leverage is the key.”  Mr. Lee said that negotiating and research are siblings and you cannot have one without the other. Mr. Lee expressed that he knows everything about the person he is negotiating with as well as the deal he is negotiating on.  Then Mr. Lee researches other deals the person has negotiated and the outcome of those deals. Mr. Lee looks for things that the person does not expect to come up in negotiating.  This technique was used while negotiating a marketing deal for the movie “The Express” the story about Ernie Davis who was the first African American college football player to win the Heisman trophy.  During the negotiation process Mr. Lee was viewed as smaller marketing firm who the film producers had never heard of.  The larger firm who was also in negotiations with the film producers was well known and had a record of marketing a number of films. Mr. Lee researched the other firm and discovered that the maliciously overcharged clients while only marketing to a limited market.  Mr. Lee asked the film producers to identified their target audience and asks that both his firm and the larger firm to present data from marketing campaigns performed within the last year. Mr. Lee and his team produces the data while the other firm did not.

            Ego is also known in the negotiation arena as status. Status could be described as a person in a position of power who expects to be treated in a certain way or how you compare yourself in relation to someone else.  Mr. Lee’s philosophy on addressing status while negotiating is to be confident but humble.  Being comfortable in his abilities allow Mr. Lee to negotiate with famous actors and R&B singers on a daily basis.  Mr. Lee is always respectful but stern when negotiating. He recently negotiated a role in a stage play for a certain actor. This particular actor demanded a certain salary while touring with the play. Mr. Lee expressed to the actor that the salary expectation was unrealistic. The actor became belligerent even to the point of using profanity. Mr. Lee smiled and said,  “You are a great actor. No one doubts that but your personality has caused you to not get roles.” After a long pause the actor apologized and agreed to star in the play. Mr. Lee has become a master at knowing when to cater to a person’s status and when to challenge it.  

            These are but a few of the elements used in the art of negotiation. The interview with Mr. Lee was very insightful. He taught me that when negotiating to always be confident, humble, and do your research. Look for some form of leverage to gain power. Use the power to create a fair deal. If you practice these techniques daily you will become a master negotiator.