Salary Negotiating Technique: When They Go Low, You Go High

women who ask

During her speech at the Democratic National Convention back in July, First Lady Michelle Obama, speaking of how the Obamas addressed cruelty and bullying with their daughters, said the now iconic phrase: “When they go low, we go high.” It’s a great rule to live by: don’t let the negativity of others cause you to pursue negativity yourself. It also happens to be an excellent motto to apply to your salary negotiations: when other job applicants are aiming lower than they should with their salary expectations, you should aim high.

Aiming to make the first, high offer in a salary negotiation has proven to be beneficial to the prospective employee. However, in my experience working with smart, successful women, they tend to price themselves at the mid-range of their potential pay scale when asked to name their proposed salary. There are a few reasons for this:

  • They worry that starting the negotiation too high will sour the discussion from the beginning
  • Many women undervalue their skills in relation to their asking salary and will be more likely to accept a first, lower offer from an employer
  • A lot of women think they are supposed to accept the first number an employer offers without question

The truth is that the women I work with who aim high are more likely to get the salary and benefits package they know they deserve. And the research backs me up.

During Salary Negotiations, Aim High

There are a few ways a salary negotiation typically shakes out:

The employer makes the first offer. This is a pretty typical scenario and women are more likely than men to accept this number. However, there is usually more money available and employers are expecting a negotiation.

You're asked to disclose previous salary history. This usually sets a lower bar than intended and I generally recommend not disclosing your salary history. (If you’re interviewing in Massachusetts, it will soon be illegal to even ask this of potential employees!)

You make the first offer, but aim too low. By lowballing your salary expectation you usually end up leaving money on the table because the bar was set low from the beginning. It could even hurt you because of the perceived lack of quality in lower numbers. If you value you, the employer will too.

You make the first offer and you aim high. Even though it sounds counterintuitive, making the first, high offer will leave you at the best possible advantage because of a psychological principle called anchoring.

Why A High Salary Anchor Will Benefit You

The concept of anchoring has a lot to do with first impressions. Essentially, we tend to rely on the first piece of information we’re given during a decision-making process. What this means for a salary negotiation is that the first number your potential employer hears from you is the number that will have the greatest  influence on the salary and benefits package they eventually offer you.

If you start with a low number, they’re going to come back with a lower number than they would have given had you started higher. And research shows that those who start out with a high number, anchor this number in their employers’ minds and receive better offers.

There’s also something to being perceived as a confident negotiator. While it’s true that women can be judged more harshly for the same negotiating tactics a man can successfully employ, proving yourself a confident sales person for yourself during your salary negotiation can give you a leg up over other candidates who are not negotiating confidently.

One of my clients, Alexus, was negotiating for a marketing position at a small, 25 person startup. She understood her value and knew that the company was excited to hire her and in need of filling a position that had been vacant for awhile. Alexus used this knowledge to her advantage to name the first numbers on the things most important to her: salary, equity, bonus, and health care, in that order.

She anchored herself high for salary and equity, knowing that she would be negotiated down and knowing she would need to make concessions on points less important to her. Her employers did negotiate, but because of this tactic, she says, “I ended up with a salary that I felt was on par for my experience, and an equity plan that I was very happy with. I made concessions that still worked for me on bonus and health care. This combination was exactly what I wanted.”

How To Figure Our Your Salary Anchor & Negotiate Your Best Possible Offer

From the start, it’s important to remember that it’s OK to discuss your compensation package with your employer and that you will not be penalized for negotiating. During the Women Negotiate Forum at Northwestern University, Victoria Medvec made an important distinction: “‘Offer of employment’ and ‘terms of employment’ are confounded”. What she meant was that we tend to confuse an offer of employment—”we want to hire you,”—with the terms of employment—”let’s talk about what it would take to come to an agreement.” A job offer is always negotiable until you sign an agreement and you shouldn’t hesitate to ask for what you deserve.

If you’re able to make the first offer, you’re at a huge advantage. When I tell women to make the first offer - and name the highest number they can possibly justify, they look at me like I’m crazy. But it’s the smartest you can make if you’ve done your homework.

The first step is to do your research: find out what the salary range is for that position in that specific job market. There are a lot of great resources you can use to find salary information, including Payscale.com, Comparably.com, and Glassdoor.com. Get introductions to current and former employees at the company you want to work for. Talk to HR people there too and ask about salary ranges. Talking to real people is an important step to help you confirm that the salary ranges you’re finding online make sense in the real world.

Once you have an idea of the market value of the position you’re applying for, write down the highest number in that range that you can justify. Here’s what I mean by justify: come up with with 3 concrete examples that show why you’re awesome at what you do -- why you’re more valuable to the company than the average Jane/Joe doing the same kind of job.

The best examples are quantifiable accomplishments. For example, you drove 13% increase in leads, produced 9% savings in costs, or increased efficiency by 23%. Other excellent examples highlight your unique skills such as fluency in another language, exceptional presentation skills, or your ability to motivate others. Think about what you do that makes your boss’s life easier and this is where you’ll come up with ideas of examples to back-up your anchor.

The anchor should of course be higher than what you expect to get. That gives you the wiggle room you need to land at the number that would make you thrilled to be working for the company.

Holly, who works in software development, shared her story with me about negotiating her salary for a job that was similar to the job she held at the time she applied, but in a much better location. A recruiter initially contacted her after she applied to the position. They were excited about her, but when they disclosed the salary range it was much lower than what she was currently making.

She let the recruiter know the range was too low for her. Without disclosing her current salary, she also told the recruiter the number she was looking for, which was 12% more than her current salary, and the conversation ended.

However, because she had set the expectation that she deserved to make more than the salary on the table, they reached out to her again. Holly says the the recruiter called her back to let her know there was flexibility with the salary range for the right candidate. “I ended up accepting an offer for 9% above what I had been making, which was significant considering I was also moving from a job in downtown Boston where salaries are higher to a more suburban location.”

It may be scary to name the first number in a salary negotiation, but if you’re the employee they want to hire, an employer is willing to negotiate and you’ll be better off anchoring high.

It literally pays to know your worth, know how to sell your assets in relation to your worth, and ask for the highest salary you can justify as your anchor during a salary negotiation.