Think you’re a crack negotiator? Think you can wangle a nice deal? How about trading a paperclip for a house? Reckon you can do it?
– The paper-clip for a fish pen
– The fish pen for a doorknob
– A doorknob for a stove
– A stove for a generator
– A generator for an instant party
– An instant party for a snowmobile
– The snowmobile for a trip to Yahk, British Columbia
– A trip to Yahk for a van
– The van for a recording contract
– The recording contract for one year free accommodation in phoenix
– The year in Phoenix for an afternoon with Alice Cooper
– An afternoon with Alice Cooper for a motorised KISS snow globe
– The snow globe for a movie role
– The movie role for a house.
Hmm, how on earth did he do this?
Leverage different relative values
The key principle involved is leveraging different relative values. To one person, the instant party was worth more than their snowmobile; for someone else, the van was worth a lot but the recording contract was an easy give.
This is the basis of trade, it is how 1 plus 1 can equal 3. Look for what you can give easily but is of high value to them; look for what they can give easily but is high value to you; then swap. Everyone is happy.
Take the snow-globe, doesn’t seem very close to the value of a house, does it? But it was quite a unique snow-globe, a motorised KISS one, no less. It just so happens that Corbin Bernsen collects them (he has 7000) and he wanted that globe. He is a famous actor (L.A. Law and many others) and could offer a speaking movie role in return. Someone wanted that movie role so badly, they traded in a house!
Create ‘soft’ value
Of course, you might think that Kyle could only do this because of the publicity around it. I wouldn’t argue. The trading really took off with the snowmobile – it happened to belong to Michel Barrette, who hosts his own tv and radio shows in Quebec. Almost immediately afterwards, the story was picked up by the Canadian Broadcasting Corporation and then CNN. Now everybody wanted to be part of the story.
But this was all part of the value that Kyle was creating. It is a kind of a ‘soft’ value. That paperclip was suddenly worth so much more because it was part of this adventure. People wanted to be part of the experience.
Now, you may not be able to get your trade covered by CNN but you can add soft value in other ways. The most common form is friendliness and graciousness. If you make their negotiating experience a pleasant one, that usually counts for something. It is often said that the deal goes to the greatest charmer
- Lesson 1: look for items that are valued differently by the two parties and swap
- Lesson 2: add value, and ‘soft’ value should not be under-estimated.
Right, off you go, rummage through your stationery cupboard now. I’m sure you’ve got lots of paperclips!
(Update: You can find an interesting infographic about the story at Commodity.com , a specialist site for traders.)