Gaming Negotiations are not as hard as you might think!

 You just gotta “Set the Anchor”, know the ZOPA and have a BATNA.  Got it?  lol

I started negotiating contacts and deals in the games business when I joined the ad agency Ayzenberg in 2006. At first I kinda thought agencies just charged as much as they could. While that might be true, the good ones know how to close at a high rate. Later when I ran marketing and publishing teams negotiating on the other side, I used this knowledge to my advantage. So the people I learned from were really good at these things:

Setting the “Anchor”

Significant research including the work of Amos Tversky and Daniel Kahneman prove that being first with a numeric “anchor” psychologically sets the zone of play. Their research shows that the final agreement often gravitates towards the first offer, making it a critical tool in shaping the negotiation in your favor. But the art to this science is knowing what that “anchor” number should be. 

Understanding and Leveraging “ZOPA”

The Zone of Potential Agreement (ZOPA) is a critical concept in negotiations. It represents the range within which an agreement can be reached, considering both parties' interests and limits. A thorough understanding of ZOPA allows you to steer the negotiation towards a mutually acceptable outcome. So that initial “anchor” should probably be at the top end of the “ZOPA”.

Working to create a reasonable but advantageous “ZOPA” is really where the hard work is. You need to research what competitors would offer for the same services or products, know what your acceptable limits are on the bottom end and build a compelling and persuasive justification and pitch.

So what do you do if it all seems to be falling apart?

The Safety Net of “BATNA”

In any negotiation, it’s crucial to have a strong Best Alternative to a Negotiated Agreement “BATNA”. Your “BATNA” is your fallback plan if negotiations fail, providing a safety net that empowers you to walk away from unfavorable terms.

Usually, your BANTNA will be an alternative to the basic framework of the deal. If there is resistance to the price then the BANTNA mostly likely will be designed to reduce scope and thus lower the acceptable “ZOPA” for a new deal.

I have used these techniques to land multi-million dollar ad campaigns as an agency executive, hire a agency at the rate I want as a client and strike mutually beneficial deals with first parties on publishing and co-marketing promotions. By strategically making the first offer to set the anchor, understanding and leveraging ZOPA, and having a robust BATNA, you can navigate negotiations effectively and secure the best possible terms for your game.