Negotiation Simulations

Overview Approximately forty-six 12-18-year-olds were assigned in pairs of two to negotiate over the sale of a website: floss.com (and possibly a companion site and company, flossapp.com and Floss App, respectively). The negotiators had five days to engage in purely email negotiations with strangers to come to agreement on the sale. Notes: The sellers wanted $100,000+ to invest in a new, toaster-related business idea of theirs The buyers were selling for their company--so they were spending someone else's money--with a budget of $1 million. But buyers would get a kickback of 10% of whatever under $1 million they didn't  spend. So if sellers got $100,000, then the buyer personally would get $90,000 in bonus. But a seller could earn up to $1,000,000, while the most a buyer could get is $100,000 (if she had gotten the website for free). Results  (full results available here ) 18 of 23 pairs reached an agreement Agreed prices ranged from $28 to $765,000 ...

The Buyer  The Negotiation Scenario Buyer—floss.com You You are the marketing manager for a Mouth Enformatics, LLC, a major multinational dental supply company. Your company has decided to create a new, cool website designed to sell more toothbrushes, denture cleaners, and floss to consumers. Situation Your bosses have decided that floss.com is their number one choice for the domain name (website URL) of the new website. Your company could buy other URLs, such as (teeth.com, toothbrush.com, cavityzapper.com, floss.biz, diamondchompers.net), but your company wants to take advantage of the dance trend called “flossing.” Plus your consumers prefer .com sites to other sites. Budget You have a budget of $1 million to spend on this domain name. But your bosses want you to buy floss.com for as low a price as possible. In fact, they’ve decided that you personally will get a bonus equivalent to 10% of the difference between $1 million and the amount you spend to pu...

The Seller The Negotiation Scenario Seller—floss.com You You own a company that makes an app called Floss. (It helps remind you to brush and floss your teeth.) To promote your app, you own the domain name flossapp.com, which is your main site. You also own floss.com. (Your dentist uncle bought floss.com for you as a present when you started the Floss app. He was so proud of you for promoting dental hygiene!) Situation Floss App is bringing in no money right now. Flossapp.com gets 1000 visitors per month, which provides approximately $9/year in advertising revenue. You haven’t built a site on floss.com yet, so it’s not bringing in any traffic or advertising revenue. Money You started in dental hygiene to make your uncle happy, but your true love is toast! What you want to do is create a new app/tech for toast lovers that allows people to take videos inside their toaster and then share those toasting videos online with other toast lovers. You need $100,000 to really do ...