Is the buyer really king? A meta-analysis of the buyer advantage in sales negotiation

Abstract

This meta-analysis investigates the existence of a potential buyer advantage in economic outcomes of sales negotiations, i.e., greater mean buyer profit than seller profit. Role theory predicts such an advantage due to different role characteristics and behavioral prescriptions between buyers and sellers. Related research on heuristic decision-making comes to the same conclusions based on different loss- and gain framing due to role. This main effect, i.e., the buyer advantage, is expected to be context-dependent. Therefore, role context-related and negotiation advantage-related moderators are analyzed, which are expected to amplify or attenuate the main effect. Using a hierarchical linear modeling approach to meta-analysis, this study includes k = 669 effect sizes from 196 primary studies or data sources, amounting to N = 24,757 negotiation dyads. Per our prediction, buyers fare slightly better than sellers in sales negotiations, albeit this buyer advantage qualifies as rather small. The effect is attenuated when male sellers negotiate with female buyers, when negotiators are experienced professionals or MBA students, and when the negotiation setting is B2B. Well-known negotiation advantage variables (information, power, goal, first offer advantage) largely amplify or reverse the effect, depending on which side holds the negotiation advantage.